As the Internet Corporation for Assigned Names and Numbers (“ICANN”) continues to roll out their gTLD program, a better understanding has developed as to how trade-mark disputes will be handled in the application process.  On September 25, 2013 ICANN made public 63 decisions under their Existing Legal Rights Objection procedure, which was established to provide a framework for challenging gTLD applications based on the complainant’s existing trade-mark rights.  The scales are weighted heavily in favour of the applicants, while complainants clearly have their work cut out for them.  Of the 63 decisions, the complainant prevailed in only 4.  This article will highlight some of the takeaways from relevant decisions.

An applicant will not prevail where they intend to disrupt the business of a competitor, which should bring comfort to brand owners.  The DirecTV Group Inc. v. Dish DBS Corporation was a clear case of competitors vying for market share through internet brand presence.  Although the applicant had no rights in the trade-mark DIRECT, they still chose to register with ICANN for <.direct>, which happened to be the root word of the complainant’s family of trade-marks.  The two parties were also competitors in the television market.  Panelists concluded that the applicant’s stated reason for their application was contrived, and their intention was actually to disrupt their competitor and create confusion in the hopes of bettering their own market position.

A licensee applying for a gTLD corresponding to the licensed trade-mark will not succeed against the licensor. Del Monte Corporation v. Del Monte International GmbH dealt with a licensee-licensor dispute over the DELMONTE trade-mark.  Incorporating trade-mark law concepts, panelists found that absent an express agreement to the contrary, use of a mark by the licensee inures to the licensor’s benefit.  Allowing the applicant to register the gTLD for their exclusive use would cause harm to the complainant and their other licensees.  Their strategy created the impermissible likelihood of confusion with the complainant’s mark and resulted in a successful challenge.

Generic words cannot be monopolized for the exclusive use of one trade-mark holder.  The gTLD program has created a business opportunity for certain large corporations to apply for a multitude of generic terms for the purpose of allowing second-level domain name registration by the public within those gTLDs.  Treatment of these applications, in the face of existing legal rights, came to the fore in Express, LLC v. Sea Sunset, LLC.  The complainant filed an objection on the basis that they held trade-mark rights in the <.express> gTLD.  The panelists concluded that the term “express” can be used in connection with a range of second-level domains and was capable of registration as a trade-mark for a variety of wares and services.  By choosing a generic trade-mark with a number of different meanings, the complainant voluntarily undertook the risk of legal difficulties in protecting the mark outside their specific channel of trade (in this case, fashion).  Importantly, trade-marking generic words will not result in control over the entire English language lexicon for that particular word.

With every new decision released by panelists the decision-making framework will continue to be fleshed out.  At this point, it seems clear that registration of generic terms is generally permissible, particularly where second-level registrations will be open to the public.  There is also no appetite for allowing applicants to undermine their competitor’s brand or that of their trade-mark licensor.  Panelists appear committed to maintain a balance of minimizing trade-mark confusion while keeping generic gTLDs accessible for public use.

Matthew Doak