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ICANN - Dispenser of Internet Justice

The following is a paper presented as a keynote speech at Studienkreis 2013 in Pisa, Italy last week.

ICANN is beginning to look more and more like a government. It assesses taxes, it has amassed an enormous treasury, it passes laws with international effect, and it has developed an ad hoc judiciary system to enforce its laws. This paper will take a look at that judiciary system and ICANN as dispenser of Internet justice.

ICANN has a well founded aversion to being involved in litigation. It has managed to fend off attacks from the operators of alternative roots and attacks based on the United States antitrust laws. By its very nature, however, it could find itself making judgments about violations of its rules or resolving conflicting claims to domain names. Any or all of these judgments are invitations, especially in the United States, to litigation. As a result, ICANN has developed an extensive system of referring them to outside parties.

The first example, and best known, is the Uniform Dispute Resolution Policy, the UDRP. ICANN began as the United States government's chosen instrument for performing functions related to coordination of the domain name system. From the beginning, U.S. authorities concluded that these functions must include some way to protect the rights of trademark owners against cybersquatters.

In the series of conferences that led up to the creation of ICANN, a system was developed to enable resolution of trademark-cybersquatter disputes based on contracts among the various participants. Since the generic top level registries and the registrars would each have contracts with ICANN, and the registrants would have contracts with their registrars, a system was developed to impose a dispute resolution procedure binding by contract on all parties. An aggrieved trademark owner may not be subject to an ICANN contract, but it can still be the complainant under the UDRP rules, allowing it to attack a registration that is alleged to be an infringement. The UDRP has been controversial since its inception, not least because it is based on underlying assumptions about the desirability of strong protection for trademarks. By one measure it is clearly a success; the UDRP has resolved over 40,000 disputes, involving over 80,000 domain names, since 1999. It is almost inconceivable that litigation in any national court or group of courts could have achieved the same results.

The World Intellectual Property Organization, WIPO, was instrumental in establishing the procedures of the UDRP, refining a proposal originated by an Internet Society group. WIPO is a United Nations body with a mission to help develop intellectual property law, but not to make law. Making law is still the responsibility of nations, whether by domestic legislation or by entering into treaties. WIPO's mission includes arbitration and mediation functions, but it is not an international court. WIPO's arbitration function provides decisions that are binding on arbitration parties; they can be enforced in national courts. For the most part, they cannot be appealed or overturned. WIPO's mediation function attempts to bring parties to a resolution, but, in general, does not bind the parties.

When WIPO developed the UDRP rules and procedures, one of the significant questions was whether the UDRP should be an arbitration or mediation process. The answer was the provision in the policy that allows either party to go to court at any time if reluctant to submit to UDRP procedures or, after a decision is rendered, if a party is dissatisfied with the result. The rationale for this provision was two-fold. First, the complainant in a UDRP matter is often not bound by any contract with ICANN before filing the complaint. Second, trademark law is still a matter of national law along with certain treaties among nations, but there is no international governing law with respect to trademark infringement by cybersquatters. WIPO correctly concluded that its credibility would be enhanced by a procedure that renders decisions that are acted on by ICANN, but subject to the possibility of further action by a national court, in other words, without the finality of arbitration. As use of the UDRP has developed, only a tiny percentage of UDRP decisions are taken to court. In the United States, the courts have uniformly taken the position that UDRP decisions are not binding in subsequent court proceedings; the courts make their decisions de novo.

The question of what law applies in deciding UDRP cases, and in other dispute resolution procedures discussed below, is a subject beyond the scope of this paper. In general, the ICANN procedures either spell out principles as a basis for decision (as in the UDRP) or appeal to "generally accepted and internationally recognized principles of law."

In recognition of the effectiveness of the UDRP, three new top level domains, .info, .biz and .mobi adopted variations of its procedures to deal with conflicting claims for registrations in connection with their start-up and sunrise periods. The UDRP was an obvious choice as a model.

Facing similar problems, four other new domains, .aero, .coop, .museum and .travel adopted a procedure for dealing with questions of eligibility to register in their sponsored domains. The Charter Eligibility Dispute Resolution Policy (the CEDRP), like the UDRP, recognizes the possibility of a court challenge to its decisions, but the wording of the policy does not unambiguously enable a second bite at the apple. The UDRP does not prevent either party "from submitting the dispute to a court of competent jurisdiction" at any time. The CEDRP takes a different tack. The complainant must designate a court, either where the complainant or the registrar resides, as an agreed jurisdiction for "purposes of any challenges to a decision..." This appears to leave the question of finality to the chosen court. A national court dealing with a challenge to a CEDRP decision might well treat the CEDRP as an arbitration procedure and its decisions entitled to the finality of arbitration rulings.

Eligibility for registration in a sponsored domain is also of interest to .asia, .cat, .name and .pro, and each of them has adopted a dispute resolution policy to determine the eligibility of a would-be registrant. In addition, .pro has an Intellectual Property Defensive Registration Challenge Policy (the IDDRCP); both of the .pro policies track the UDRP in allowing court challenges before or after a panel decision.

All of these start-up and eligibility policies have proven to be useful as an expeditious and relatively inexpensive approach to dispute resolution, compared to the lengthy and expensive alternative of litigation in court. With this record of success, it should come as no surprise that ICANN has enthusiastically expanded the jurisdiction of its quasi-courts. The Transfer Dispute Resolution Policy (the TDRP) is available to resolve problems among registrars arising from transfers of domain names. It also has an escape valve to the courts, A panel decision under the TDRP is "final, except as it may be appealed to a court of competent jurisdiction."

The new gTLD program has provided a whole new set of opportunities for ICANN's venture into dispute resolution. The Applicant Guidebook includes the New gTLD Dispute Resolution Procedure covering String Confusion Objections, Existing Legal Rights Objections, Limited Public Interest Objections and Community Objections. After the new gTLDs enter the domain name system, a Uniform Rapid Suspension System (the URS) is available as a supplement to the UDRP. There is a Post Delegation Dispute Resolution Procedure (the PDDRP) to rule on disputes over a registry operator's manner of operation that involves multiple trademark infringements, a Sunrise Dispute Resolution Policy (the SDRP) to deal with multiple claims to a single name by trademark owners, and there is a Registry Restrictions Dispute Resolution Procedure (the RRDRP) to rule on alleged failures by community based registry operators to comply with registration restrictions, as well as a Public Interest Commitment Dispute Resolution Procedure (the PICDRP) to rule on alleged failures to live up to commitments in the application process. In addition to all these, many new operators of sponsored registries have adopted procedures, similar to those of existing sponsored registries, for deciding eligibility issues.

As explained at the beginning of this paper, the rationale for ICANN's creation of so many dispute resolution procedures is, in large part, the practical impossibility of finding national courts that could resolve the disputes in a timely and cost-effective manner. Another, and probably equally significant rationale, is ICANN's very strong desire to stay out of court itself. ICANN could, in theory, assign its staff to make the judgments in each of the disputes, but this would certainly expose it to litigation from disgruntled complainants.

ICANN's fears of exposure to litigation have led it to create a risk reserve fund of over one hundred million dollars to cover risks arising from the new gTLD program. At least some large portion of these risks are those that ICANN has off-loaded to the dispute resolution providers. The General Counsel of Verisign, in a letter to the General Counsel of ICANN, recently commented on this. He pointed out that ICANN is in the best position to identify and manage the risks even while simultaneously creating a huge reserve fund and obtaining "broad indemnities, limitations of liability and releases from applicants, registrars and registries".

There is a matrix of inter-related concerns about ICANN's assumption of the role of dispenser of Internet justice:

  1. Fundamentally, does ICANN have the legitimacy to establish a global judicial system?
  2. Has ICANN adequately assessed the liabilities that it faces in taking on ever-increasing responsibilities in connection with the growth of the domain name system?
  3. Are contract based dispute resolution procedures the best system for minimizing ICANN's risks?
  4. Are contract based dispute resolution procedures cost effective?
  5. Are there globally accepted legal norms that can form the basis of ICANN's dispute resolution procedures?
  6. If there are such norms, are they incorporated in the dispute resolution procedures?
  7. Are the users of the Internet adequately protected against arbitrary or irrational decisions?

A number of legal scholars have raised these questions from time to time. ICANN, to its credit, has recognized the existence of at least some of them. ICANN has an ombudsman, and there is a web site devoted to standards of practice that are offered as guidelines for the participants in dispute resolution procedures. Whether or not these guidelines answer the questions raised above is itself subject to question. There are no easy answers, but sooner or later the questions need answers if ICANN is to continue its role as dispenser of Internet Justice.

By David Maher, Attorney

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