[GNSO-RPM-WG] [gnso-rpm-wg] "Lack of cause of action" followup (URS proposals #18, #19, #20)

[Nat Cohen]

Georges,

Thank you for your thoughtful and considered response.

I would like to respond to your comments on-

1.  the relevance of settled court challenges to UDRP transfer orders
2.  the nature of the URS sanction
3.  the likelihood that respondents will go to court to challenge a URS
decision
4.  how much weight to give to the 'clear and convincing' standard

You are right that most of the UDRP transfers challenged in court are
settled, for as you mention due to the high costs involved that is usually
the sensible thing to do for both parties.  While these settled cases may
not have precedential value in a court of law, those cases do offer us
useful information for our considerations.  When I review with my attorney
whether to go to court, we carefully weigh the merits of our position and
our likelihood of success should the case go all the way to judgment.  The
UDRP complainant/defendant engages in a similar evaluation in deciding
whether to settle and for how much.  While other considerations may come
into play besides only the merits of the case, that a domain owner is
willing to risk tens of thousands of dollars in legal fees to have a judge
weigh the merits of the case, and that the complainant/defendant is willing
to pay tens of thousands of dollars in a settlement rather than proceed to
a decision by the court, is not divorced entirely from the underlying
merits of the case.

In short, some domains owners so strongly believe that the UDRP transfer
order was wrongly issued that they are willing to go to court to overturn
the panel decision.  Whether the domain owner is correct on the merits is
not even that important.  Rather it points to the strong desire of
respondents to be able to avail of a court for determination of the issues
raised in the UDRP dispute.

The consequences of losing a URS are currently in flux as numerous
proposals have been raised in this WG including the transfer of rights from
respondent to complainant.  As I understand how the URS is current written,
the domain owner loses the right to use the disputed domain, to transfer
the domain, and eventually to renew the domain name.  This is equivalent to
a loss of ownership rights to the domain, even in the absence of a
transfer.  Unless I misunderstand, the consequence is much greater than a
temporary suspension after which the domain owner gains back full rights to
the domain.  Since the domain owner is being deprived of rights to his or
her asset, it is appropriate to allow the domain owner to bring the matter
to court to ensure that the URS decision is consistent with national laws.

That the loser of a URS decision would challenge the decision in court
strikes me as an exceedingly rare possibility.  As you point out, nearly
all cases are defaults as the domain owner's position is indefensible.
These are also mostly throwaway domains - registered for $10 and worth
little more than that to either party.  Why would a domain owner spend
substantial sums to engage in a court proceeding over a domain that has so
little value to the domain owner?  I also recognized that the URS is less
vulnerable to hijacking attempts because transfer of the domain is not
available and because of the higher standard of proof.

To address your concern that domain owners would go to court as a way to
defeat the URS, as unlikely as that seems, perhaps a way to address that is
to leave the domain suspended pending the outcome of the court case.  The
court case would be about the domain owner's ultimate rights to remain the
lawful owner of the domain, and as to whether the domain owner can show it
has a lawful use for the domain.

In the view of many domain owners, and at times neutral observers, UDRP
transfer decisions are sometimes made where the evidence falls far below a
preponderance of the evidence standard.  The URS is still new.  The ability
of any panelist to unilaterally decide how much weight to give to any
evidence, or any inference from evidence, means that "clear and convincing"
is ultimately a subjective standard that differs from panelist to
panelist.  So whether, in the absence of clear and binding community
guidelines, "clear and convincing" degrades over time to "preponderance" or
worse, remains to be seen.

Like the children's game of "telephone" (
https://en.wikipedia.org/wiki/Chinese_whispers), the nuance of precedential
decisions is often lost when cited by future panelists.  Telstra held that
under certain circumstances, including that the mark is famous, passive
holding can be evidence of bad faith.  Over time that holding degraded to
some panelists citing Telstra for the view that "passive holding is
evidence of bad faith".  Similarly, the retroactive bad faith theory,
illegitimate as it was, started with rulings limited to intentional
repurposing of a domain to target late arriving trademark rights.  Over
time that degraded to panelists finding that an unintended appearance of a
Google ad on landing page converted a good faith registration into a bad
faith registration.

The lack of predictability in both the UDRP and the URS is a challenge for
both the IP side and domain registrant side in trying to find common
ground.  We each have our own set of outlier cases that cause us concern.
My view is that the domain registrants have more cause for concern as the
IP side controls all aspects of the process while it is the domain
registrants' assets that are at risk.   Addressing the underlying sources
of unpredictability would allow us all to collaborate more productively on
improvements to the policies.

Regards,

Nat




On Fri, Oct 12, 2018 at 11:22 AM Nahitchevansky, Georges <
ghn at kilpatricktownsend.com> wrote:

> Nat:
>
>
>
> Just a few comments.  The case you refer to was not a fully litigated
> case, but was a settlement.  As you likely know, people and companies often
> settle because they do not want the extensive cost of a US litigation ,
> which can be in the hundreds of thousands of dollars (and even in the
> millions depending on the matter).  So absent a litigated court decision,
> what you have are parties transacting a resolution – albeit in this case
> apparently favorable to the Respondent.  It is not a decided case and has
> no precedential value.
>
>
>
> The court review proposal for the URS is actually something that is
> frought with issues.  You have to begin that the URS is a
> streamlined/expedited procedure that is meant to address a very specific
> group of domain names being abused.  The URS has a higher burden proof than
> the UDRP (clear and convincing versus preponderance of the evidence
> standard) and only results in suspension of the domain name for a short
> period as opposed to a full transfer of the domain name to the complainant,
> as is the case in the UDRP.  That means there needs to be fairly compelling
> proof of abuse just to get a temporary suspension.  Second the URS has
> already built in procedural measures that allow a Respondent to challenge a
> decision – namely, a defaulting Respondent has a time period after a
> decision is rendered to challenge the decision and there is an appeal
> mechanism in place.  Third, the statistics prove that very few Respondents
> actually challenge the decisions rendered through the existing mechanisms.
> Now some argue with no evidence that the default rate is somehow based on a
> lack of notice, but quite frankly that is absurd.  Domain name registrants
> at the very least have a provided a valid address to the registrars for
> their domain names (they have an obligation to do so).  So they get an
> email that there is an action involving their domain name.  There is no
> evidence that respondents are not receiving emails from providers.
> Moreover, perhaps the reason Respondents default in so many instances is
> the fact that their cases are indefensible and they know it.  I would
> venture that a number of Respondents simply do not bother defending cases
> that they are likely going to lose.  Simply look at the list of domains
> subject of the URS and it is fairly clear that the vast majority involve
> known brands either alone or with terms that relate to the businesses under
> the marks.  Lastly, adding on a court review over a short term suspension
> (the relief currently in place) is likely to create a windfall to
> Respondents that will allow bad actors to easily defeat the entire URS
> process.  I am not sure if you have ever litigated cases in countries
> around the world, but in some countries court proceedings can last for
> years (up to ten years in some instances).  If a court proceeding can
> simply prevent the suspension, then I can see a situation where a
> Respondent falsely uses an address in a country where proceedings take
> forever and where they can be filed cheaply and essentially defeat the
> entire suspension period.
>
>
>
> So in all, if you want to pursue court proceedings post URS, then I think
> there needs to be procedural safeguards put in place for Complainants, such
> as (1) a shorter time frame for a Respondent to challenge a decision on a
> default, or the removal of such a procedure, (2) a shortened appeal period
> (20 to 30 days), (3) a transfer of the domain name post URS as opposed to a
> suspension and/or a lock preventing use of the domain name during
> proceedings, and (4) some form of bond being posted by a challenging
> respondent or complainant that wants to ultimately proceed in court.  On
> the last point, the challenging party would need to file the appeal first
> and if the party lost the appeal it could then proceed to court, but would
> have to post a bond with the provider to cover costs if the appeal is
> deemed frivolous by a court.
>
>
>
>
>
> *From:* gnso-rpm-wg <gnso-rpm-wg-bounces at icann.org> *On Behalf Of *Nat
> Cohen
> *Sent:* Thursday, October 11, 2018 10:28 AM
> *To:* George Kirikos <icann at leap.com>
> *Cc:* gnso-rpm-wg at icann.org
> *Subject:* Re: [gnso-rpm-wg] "Lack of cause of action" followup (URS
> proposals #18, #19, #20)
>
>
>
> George,
>
>
>
> Thanks for providing this background.
>
>
>
> Speaking for myself, and I believe many other domain registrants, the
> ability to have judicial review of any URS/UDRP decision is an important
> safeguard.  Even unanimous 3-member panel UDRP transfer orders have been
> overturned in court, as with the austinpain.com dispute (
> http://kellywarnerlaw.com/udrp-law-ruling-overturned/).
>
>
>
> The IGO/INGO WG just spent years wrestling with the issue of whether a
> variant of the UDRP could be devised specifically for IGOs that would
> indeed be the "final word".  The strongly held view of many participants in
> that WG was that access to the courts for a final determination of any
> issues in dispute was a fundamental right, and could not be conceded.
>
>
>
> I support the effort to ensure that a respondent, wherever they may be in
> the world, has access to judicial review of a URS decision.
>
>
>
> Regards,
>
>
>
> Nat Cohen
>
>
>
>
>
>
>
> On Thu, Oct 11, 2018 at 12:02 AM George Kirikos <icann at leap.com> wrote:
>
> Hi Claudio,
>
> David Maher gave a history in the context of the UDRP, when discussing
> this various issue of access to the courts, see:
>
> http://www.circleid.com/posts/20180103_the_udrp_and_judicial_review/
>
> which goes back to the very early WIPO Recommendations:
>
> ""140. It is recommended that any dispute-resolution system, which is
> alternative to litigation and to which domain name applicants are
> required to submit, should not deny the parties to the dispute access
> to court litigation."
>
> One can also look to section 4(k) of the UDRP policy, and sections
> 3(b)(xii) and 18 of the UDRP Rules to see that UDRP was never intended
> to be the final word.
>
> https://www.icann.org/en/help/dndr/udrp/policy
> https://www.icann.org/resources/pages/udrp-rules-2015-03-11-en
>
> For the history of the URS, you can go back to the reports that
> preceded its adoption, such as the STI:
>
>
> https://gnso.icann.org/sites/default/files/filefield_8000/sti-wt-recommendations-11dec09-en.pdf
>
> Section 8.3 at the bottom of page 21 (and continuing to page 22),
> unanimous consensus, stated:
>
> "A URS decision should not preclude any other remedies available to
> the appellant, such as UDRP (if appellant is the complainant), or
> other remedies as may be available in a court of competent
> jurisdiction. A finding in URS for or against a party should not
> prejudice the party in UDRP."
>
> or look to the text of the URS Policy (e.g. section 13) and section
> 3(b)(ix) of the URS Rules to see that the URS was never intended to be
> the final word.
>
> http://newgtlds.icann.org/en/applicants/urs/procedure-01mar13-en.pdf
> http://newgtlds.icann.org/en/applicants/urs/rules-28jun13-en.pdf
>
> I hope that answers your question sufficiently. Some of the people who
> were on the teams that developed the UDRP and URS are members of this
> PDP, so you can simply ask them (or consult the archived documents on
> ICANN's website that led to the policies).
>
> If you're asserting that the UDRP/URS *were* intended to be the "final
> word", that's a very bold claim to make (unlike mine, which was
> non-controversial), and I think the onus is on you to back that claim.
> And, even if that claim could be backed (which I doubt), I think that
> would be a scary thought, and reinforce the need to properly review
> the policies to eliminate such errors in policymaking.
>
> In other words, I've been trying to correct what I (and many others)
> feel are *unintended consequences* of poor drafting of the UDRP/URS.
> If you're asserting that those are the *intended outcomes* (i.e.
> inability to have one's day in court, to challenge the outcome of a
> UDRP/URS), that's a bold claim.
>
> Sincerely,
>
> George Kirikos
> 416-588-0269
> http://www.leap.com/
>
>
>
>
>
> On Wed, Oct 10, 2018 at 9:47 PM, claudio di gangi <ipcdigangi at gmail.com>
> wrote:
> > George,
> >
> > I’m getting the sense that we are going to start talking past each other
> > soon, if not already.
> >
> > Since this concerns your proposal, my recommendation is that you supply
> > reference materials, e.g. a link, a citation, quoted language, etc. to
> the
> > following clause:
> >
> > “That means the URS violating the principles upon which these policies
> were
> > adopted, namely that they *wouldn't* be the final word, that both side
> would
> > have recourse to the courts to challenge the outcome, if they disagreed
> with
> > it.”
> >
> > This language does not appear in the UDRP or URS policy, rules and/or
> > implementation documents.
> >
> > Once we have this language to review, we can examine and analyze the
> > material to see if we can obtain a shared understanding of the relevant
> > issues and facts to help steer the discussion in a positive manner.
> >
> > Thank you.
> >
> > Best regards,
> > Claudio
> >
> >
> > On Wednesday, October 10, 2018, George Kirikos <icann at leap.com> wrote:
> >>
> >> Hi Kristine,
> >>
> >> On Wed, Oct 10, 2018 at 7:11 PM, Dorrain, Kristine <dorraink at amazon.com
> >
> >> wrote:
> >> > I am still trying to understand what specific language you could
> insert
> >> > into the URS (or UDRP) that would obligate a UK national court to
> decide to
> >> > take jurisdiction or accept a cause of action.  Those are issues of
> >> > sovereignty for individual countries.  The URS has no authority over
> >> > national courts.  They alone decide what they will and won't hear.
> >>
> >> Thanks for your post. In reviewing the call again this evening, the
> >> proposals seem to be misunderstood, I'm hopeful I can provider greater
> >> clarity in this email.
> >>
> >> When you said " The URS has no authority over national courts.  They
> >> alone decide what they will and won't hear." I agree! that's the
> >> proper identification of the underlying *problem*. i.e. in some
> >> jurisdictions, they won't permit a registrant (who loses a URS/UDRP
> >> and wants to challenge the outcome in court) to bring a case in the
> >> court. That means the URS outcome would be the "final word", violating
> >> the principles upon which these policies were adopted, namely that
> >> they *wouldn't* be the final word, that both side would have recourse
> >> to the courts to challenge the outcome, if they disagreed with it.
> >>
> >> So, I agree with you 100%, we *cannot* tell the courts what to do. We
> >> cannot force them to permit a registrant to have a cause of action.
> >> But, what we can do is make the URS (and UDRP later) policy not get
> >> into that situation in the first place. We know the underlying problem
> >> is caused by the role reversal (i.e. the registrant, as things stands
> >> now, would be forced to become the complainant in court, if they want
> >> to challenge an adverse URS/UDRP; but the natural role of the
> >> registrant, had these procedures never existed, is to be the
> >> *defendant*, and have the TM holder be the plaintiff in court.
> >>
> >> How do we accomplish this? Proposal #18 does this by allowing the
> >> losing registrant to simply file a "Notice of Objection" after losing
> >> and paying the fee (and accepting that if a court action happens and
> >> they don't do any better, they'll be on the hook for additional legal
> >> costs at the discretion of the courts) -- just like in that British
> >> Columbia Civil Resolution Tribunal system. So, under Proposal #18, the
> >> registrant is *not* the complainant in court anymore. It's the TM
> >> holder who would file a TM infringement case/cybersquatting claim in
> >> court. The registrant makes a defense to that cybersquatting claim,
> >> and the case proceeds in court de novo without the interference of the
> >> prior URS/UDRP outcome. This is what we **wanted** all along, the
> >> underlying dispute in the courts, with a fresh slate, and both sides
> >> in their "natural" roles (TM holder as complainant, registrant as
> >> defendant).
> >>
> >> Proposal #19 also fixes the role reversal problem, albeit in a more
> >> circuitous and inelegant manner. In proposal #19, the losing
> >> registrant who wants to challenge the outcome of the URS/UDRP
> >> initially files a court case, like today. If there's a cause of
> >> action, it proceeds as normal, just like today. But, if this "lack of
> >> cause of action" issue is encountered (e.g in the UK), denying the
> >> registrant a de novo hearing of the dispute on the merits but instead
> >> dismissing the action on a "technicality", then that would trigger
> >> something "new", namely that the URS/UDRP outcome would be completely
> >> set aside (vitiated). i.e. it's saying that the right to access the
> >> courts is so important that we're going to fix the problem (lack of
> >> court access in this scenario) by undoing the URS/UDRP, and letting
> >> the parties go back to court with the TM holder as the plaintiff in
> >> court (assuming they still want to pursue the matter), and with the
> >> domain registrant as the defendant.
> >>
> >> Proposal #20 doesn't address the problem in the same manner, but
> >> instead says "Registrant can file a court case in the USA, where we
> >> know a cause of action exists.
> >>
> >> So, let me make it clear, since the proposals seem to be misunderstood
> >> --- I am not proposing any language at all to obligate any courts to
> >> decide to take jurisdiction of a case, or accept a cause of action.
> >> That's entirely up to them.
> >>
> >> But, we do know that trademark holders will have a cause of action as
> >> plaintiff in the courts (for cybersquatting, TM infringement, etc.),
> >> and courts will always allow registrants to put up a defense!
> >>
> >> Now, if someone wants to raise the issue of "Well, what if courts
> >> don't allow a Trademark holder to bring an action as plaintiff?" My
> >> response would be "Too bad for you!" The URS/UDRP wasn't designed to
> >> give TM holders *greater* rights or superior outcomes than those that
> >> exist in the courts. If it turns out that TM holders don't have a
> >> cause of action in a court for their dispute, then that's the PROPER
> >> OUTCOME.
> >>
> >> If it turns out that registrants don't have a cause of action, because
> >> of this role reversal created by the URS/UDRP, then the solution is to
> >> eliminate that role reversal in the current policies themselves (which
> >> proposals #18 and #19 accomplish, albeit in different manners; #18 is
> >> more elegant, and matches how it's actually done by an existing
> >> tribunal in BC).
> >>
> >> > If you allow a losing respondent (who has lost a case because the use
> of
> >> > the domain name was so transparently infringing to a jurist that they
> found
> >> > against the respondent in their absence or despite their
> participation) to
> >> > strip a complainant of their URS win in order to force them to court,
> it has
> >> > the effect of nullifying the URS...why bother?  I realize that you
> have a
> >> > proposal in to remove the URS entirely, so perhaps this is just
> another way
> >> > to achieve the same goal, but I'm merely trying to address
> practicality
> >> > here.
> >>
> >> Frankly, I'm shocked by the above statement. This is suggesting that
> >> the URS/UDRP outcome is always correct, and should never be appealed.
> >> But, we know that's not the case. We've seen reversals in the courts,
> >> the various cases brought up on this mailing list repeatedly (the ones
> >> that WIPO won't post to their website, for example!). Why bother to
> >> have courts of appeal? Why bother to have a Supreme Court? It's
> >> because lower courts can get it wrong! In the URS/UDRP especially,
> >> there's no cross examination, no discovery, nor all the other due
> >> process protections of a court. The URS/UDRP can and do get it wrong
> >> from time to time. Even judges make mistakes.
> >>
> >> This isn't attempting to deprive the TM holder of anything. The
> >> expectation of all sides has been that the matter can go to the
> >> courts. If it requires, procedurally, that the only way to get to that
> >> proper state is to undo the URS/UDRP outcome, then that's how it has
> >> to be done. The domain name registrant wants the matter decided by a
> >> court. They have that right (unless the TM side wants to eliminate
> >> that right --- be transparent about that if that's the case; i.e. not
> >> fixing the problem achieves that outcome). If the domain name
> >> registrant can't have their day in court as plaintiff, then make them
> >> be the defendant instead, and force the TM holder to return to their
> >> natural role as Plaintiff. The domain name owner isn't trying to "pull
> >> a fast one" --- under Proposal #18, the domain name registrant would
> >> make a good faith payment to file that Notice of Objection, and also
> >> suffer cost consequences if they do no better in the courts. Under
> >> proposal #19, the domain name registrant *already* went to court, but
> >> the case got tossed on a technicality, and wasn't able to be heard on
> >> the merits.
> >>
> >> So, I'm not trying to "remove the URS" via these two proposals (#18
> >> and #19). I'm instead trying to ensure that the URS/UDRP are not the
> >> final word, and that there's real recourse (on the merits, de novo) to
> >> the courts. If either side *insists* that the courts be the final
> >> arbiter, then that is a *right*. They shouldn't lose that right to
> >> have the court be the final arbiter, just because the URS/UDRP weren't
> >> drafted properly, or made assumptions that are incorrect. Losing that
> >> right to court access means that ICANN has implicitly created NEW LAW,
> >> eliminating rights for registrants that they had prior to the adoption
> >> of the policies, namely the right to have their disputes decided in
> >> court.
> >>
> >> Sincerely,
> >>
> >> George Kirikos
> >> 416-588-0269
> >> http://www.leap.com/
> >> _______________________________________________
> >> gnso-rpm-wg mailing list
> >> gnso-rpm-wg at icann.org
> >> https://mm.icann.org/mailman/listinfo/gnso-rpm-wg
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