The recent approval by the Internet Corporation for Assigned Names and Numbers (ICANN ) of a new .xxx sponsored top-level domain (TLD) for the online adult entertainment industry or those supplying products to such industry (the sponsored community) creates a risk that names, service marks and/or trademarks of financial services companies may be used as part of a .xxx web site address for sexually explicit material. According to ICM Registry LLC, the registry for the .xxx sponsored TLD:

  • beginning on September 7, 2011, owners of national trademark or service mark registrations who are not members of the sponsored community, will have a period of 30 days within which to make an optout application to reserve .xxx domain names, in order to block their nationally registered marks from being used by others as .xxx domain names (Sunrise B),
  • during the same 30-day period, qualifying members of the sponsored community may make an opt-in application for corresponding .xxx domain names (Sunrise A), and
  • once the Sunrise period ends, the .xxx domain names will be available on a first come first served basis; therefore, many trademark owners “will take a prevention is better than cure approach” by making applications during the Sunrise period.  

The cost for an opted out .xxx domain name registration is reportedly expected to be in the range of $200 to $300 for a period of ten (10) years. On the other hand, the filing fee for seeking a transfer of a single domain name registration under the ICANN Uniform Domain Name Dispute Resolution Policy (UDRP) is approximately $1,300 for a single arbitration panelist. Thus, it apparently will be more cost effective to acquire the opt-out .xxx domain name registration in the first instance, and financial services companies interested in protecting their registered marks against potential unauthorized uses in the .xxx TLD, would be wise to consider filing applications within the aforesaid Sunrise period.