[gnso-rpm-wg] TMCH Blog

Thu Feb 2 17:23:49 UTC 2017

I think I might have posted a link to this article before, but it
makes sense to post it again:

http://www.fr.com/news/dont-be-confused-about-whether-your-trademark-is-used/

regarding bona fide use vs. "de minimis" uses. As the article
correctly states "Plainly, mere token use made solely to reserve a
right in a mark can no longer meet the statutory definition."

If one thinks about the economics, suppose a TM has a value of $X, and
the value of a sunrise registration of a domain name has a value of
$Y. The "gaming" we are seeing, in this framework, happens when very
marginal trademarks (i.e. X is close to zero) are used to obtain
domain names in sunrise periods, where Y is (much) greater than X.

Indeed, the trademark registrations exist not for protection of
commerce in an ordinary trade, but instead solely for the purpose of
obtaining the more valuable domain names.

The only way to remove these incentives to game the system is to set
the bar high enough so that only marks with "high" values of X are
allowed to participate in the sunrise periods (low values of X could
still participate in other aspects of the TMCH, e.g. getting
notification of domains that match those marks, etc.).

How do we know which marks have "high" values of X? We can see
"obvious" ones like Apple, Google, Microsoft, Lego, Verizon, Yahoo,
Adobe, Disney, etc., but where does one draw the line between them and
the marginal marks, etc.? Economics tells us there is one way --- set
a price, or have the market set that price.

If one sets the price high enough (say $50,000+), that wouldn't deter
the "superbrands" like those mentioned above, but it would price out
the marginal ones. Of course, every owner of a "marginal" brand likes
to think of their own mark as a "superbrand" in their eyes (i.e. some
in the IP community cling to the mantra of "a trademark is a trademark
is a trademark", as if their marks are as strong or as valuable as the
superbrands above).

The other option is to have the market set a price, via some auction
mechanism. In order to protect the brands most subject to
cybersquatting, sunrise "privileges" were granted by ICANN (although
these privileges do NOT exist in trademark law, requiring first dibs,
etc.; TM law provides curative measures, not prior restraint). A quota
can be set, perhaps 500 or 1000 marks in total that are protected with
sunrise privileges (in line with the typical number of sunrise
registrations we've observed). The TMCH (or ICANN) could then auction
off those slots. Companies that experience a lot of cybersquatting
(and would want sunrise protection, to reduce future UDRP/URS or other
legal costs) and that have a high value of X would bid high enough to
obtain that privilege. Companies that don't experience a lot of
cybersquatting wouldn't value that sunrise privilege, and thus
wouldn't bid (or would bid a lower amount).

Importantly, marginal TM holders (low values of X) that game the
existing system would be priced out under either of the options above
--- the economics of their behaviour have been ruined.

In conclusion, one really needs to think about the economics, and
using the market mechanism to drive out the unwanted behaviour. Bad
actors are usually rational, and are driven by economics. It's time
that policy designers (us!) take these economics explicitly into
account.

Sincerely,

George Kirikos
416-588-0269
http://www.leap.com/

On Thu, Feb 2, 2017 at 11:21 AM, Scott Austin <SAustin at vlplawgroup.com> wrote:
> +1. As if recent events involving Pakistan based filings were not enough to
> signal a need for reform.
> Scott
>
>
> -------- Original Message --------
> From: "J. Scott Evans via gnso-rpm-wg" <gnso-rpm-wg at icann.org>
> Date: Thu, Feb 2, 2017, 11:10 AM
> To: Jonathan Frost <jonathan at get.club>
> CC: gnso-rpm-wg <gnso-rpm-wg at icann.org>
> Subject: Re: [gnso-rpm-wg] TMCH Blog
>
> In most jurisdictions in the world you can obtain a valid and enforceable
> trademark registration with no demonstration of use. If the system is being
> abused, then we need to put the n fail safes. We could have a challenge
> mechanism. In the US, which requires "use", token (fake use) is not deemed
> sufficient.
>
> Sent from my iPhone
>
> On Feb 2, 2017, at 8:03 AM, Jonathan Frost <jonathan at get.club> wrote:
>
> These TMCH gaming issues have been well documented all the way back to 2014
> .http://domainnamewire.com/2014/02/10/how-common-words-like-pizza-money-and-shopping-ended-up-in-the-trademark-clearinghouse-for-new-tlds/
>
>
>
> Gaming the TMCH is as easy as starting an ecommerce store on a template and
> selling various products like t-shirts and pens with the arbitrary use of a
> common/valuable term (e.g.. pizza pen shop). This allows registration of the
> trademark for the term in any number of jurisdictions and subsequent
> registration in the TMCH.
>
>
>
> Jonathan Frost
>
> General Counsel
>
> Telephone: (+1)877-707-5752
>
> 100 SE 3rd Avenue, #1310
>
> Fort Lauderdale, FL 33394
>
> E-Mail: jonathan at get.club
>
> Website: www.get.club
>
> <image002.jpg>
>
>
>
> Please be advised that this communication is confidential. The information
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>
> From: gnso-rpm-wg-bounces at icann.org [mailto:gnso-rpm-wg-bounces at icann.org]
> On Behalf Of Phil Corwin
> Sent: Thursday, February 2, 2017 9:13 AM
> To: Jon Nevett <jon at donuts.email>; gnso-rpm-wg <gnso-rpm-wg at icann.org>
> Subject: Re: [gnso-rpm-wg] TMCH Blog
>
>
>
> I’m tempted to say that is one of *** craziest things I’ve ever seen, but if
> I use *** word *** I might be cited for infringement or have to pay a
> licensing fee ;-)
>
>
>
>
>
>
>
> Seriously, it would be interesting to know in what jurisdiction the
> trademark was granted in and whether they professed to demonstrate use in
> commerce.
>
>
>
> Also seems to be an example of a situation where everyone in general but no
> one in particular has an incentive to challenge the acceptance of the mark
> by the TMCH.
>
>
>
> Philip S. Corwin, Founding Principal
>
> Virtualaw LLC
>
> 1155 F Street, NW
>
> Suite 1050
>
> Washington, DC 20004
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> 202-559-8597/Direct
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> Twitter: @VlawDC
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>
>
> "Luck is the residue of design" -- Branch Rickey
>
>
>
> From: gnso-rpm-wg-bounces at icann.org [mailto:gnso-rpm-wg-bounces at icann.org]
> On Behalf Of Jon Nevett
> Sent: Thursday, February 02, 2017 8:55 AM
> To: gnso-rpm-wg
> Subject: [gnso-rpm-wg] TMCH Blog
>
>
>
> FYI -- for those who haven't seen this blog:
>
>
>
> https://www.thedomains.com/2017/02/01/the-trademark-clearinghouse-worked-so-well-one-company-got-24-new-gtld-using-the-famous-trademark-the/
>
>
>
> The Trademark ClearingHouse Worked So Well One Company Got 24 new gTLD using
> The Famous Trademark “The”
>
> February 1, 2017 by Michael Berkens 5 Comments
>
> The Trademark ClearingHouse (TMCH) which was set up/ contracted by ICANN to
> protect those famous worldwide brand names from abuse by those nasty domain
> name squatters resulted in a whole new industry.
>
> Those playing the TMCH for their own benefit to get first jump at new gTLD
> domain names to get registered in Sunrise ahead of all other under common
> words like “the”
>
> Actually there maybe no better example than those domain names obtained on
> the world-famous trademarks as of the word”the”,  which is the most used
> word in the English language.
>
> The world-famous trademark for the word “the” was obtained by Goallover
> Limited of London who according to DomainTools.com owns an amazing amount of
> domain names approaching nearly 100, but was able to get all of the
> following new gTLD’s using their globally well-known trademark on the word
> “the” under the ICANN trademark clearinghouse rules which  allows them to
> obtain the domain names ahead of all other applicants.
>
> Of course the company could have had obtained even more “the” new gTLD
> domain names in Sunrise but apparently did not apply for more.
>
> Somehow the company doesn’t appear to own the domain name The.Com
>
> For all Trademark Holders its nice to know the world is a safer place:
>
> the.car
> the.career
> the.cars
> the.casino
> the.doctor
> the.earth
> the.foundation
> the.furniture
> the.game
> the.group
> the.ltd
> the.mba
> the.pub
> the.report
> the.run
> the.school
> the.services
> the.storage
> the.tools
> the.university
> the.watch
> the.wine
>
>
>
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