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Chances of Winning and Losing Domain Name Disputes

Panels are typically faced with a cascade of options in resolving UDRP disputes. Complainants do not necessarily prevail for proving trademark rights and respondents do not lose for failing to appear and defend themselves. First for some perspective. WIPO prepared an informative overview of the UDRP and its role in a paper dated August 2011 “for the purpose of informing discussion at the September 2011 INTA Conference on Trademarks and the Internet on the issue of whether it would be wise to review and make changes to the UDRP, at least at this time.” We learn that over 35,000 cases have been processed by ICANN Providers since 1999 of which the two most productive are WIPO and National Arbitration Forum. The “transfer rate” is slightly lower for WIPO (86.1%) and higher for Nat. Arb. Forum (87.8%).

Respondents either appear and state their cases or they do not. Reflecting only WIPO’s experience in resolving disputes (it decides approximately 52% of cases and Nat. Arb. Forum approximately 45%), appearing respondents prevail in about 30% of the cases with single member panels and 56.7% with 3 member panels. Defaulting respondents (approximately 80% in 2011) lose 93% of the time decided by single member panels and 83.8% decided by 3 member panels. That 16% of defaulting respondents before 3 member Panels retain their disputed domain names is a tribute to panelists’ careful assessment of the record, but is also the result of the conjunctive model of the UDRP.

Not incorporated into the statistics are situations describing circumstances under which complainants lose. Unscientifically, a small percentage of complainants fail in proving trademark rights (the first element of UDRP). Larger but not significant percentages fail on the prima facie case (second element) and a larger and significant percentage fail in proving conjunctive bad faith (third element).

Proving conjunctive bad faith is increasingly difficult the longer the temporal distance between domain name registration and trademark acquisition and less so as the distance narrows. The conjunctive bad faith model is peculiar to UDRP. a number of country code policies and the Anticybersquatting Consumer Protection Act (ACPA) opted for a disjunctive model. An interesting decision from India has just been reported that draws attention to distinctions between UDRP and INDRP in which the respondent (petitioner in the civil proceeding) was a bulk registrant, Koenig v. Arbitrator, O.M.P 132 of 2007 (Delhi High Court, December 14, 2011), but then bulk registrants are treated differently than single registrants. The INDRP follows the disjunctive model.

On the debate over conjunctive vs. disjunctive bad faith WIPO indicates in the Paper that it is not opposed to a change from “and” to “or.” The Paper states that

it is a proposal likely to be attractive to brand owners. There are clear and workable precedents in the ccTLD space (including the Nominet DRP and the .auDRP models). Changing the “and” to an “or” in the UDRP would require a Policy and Rules change (with the above-mentioned risks if pursued through a minority IP ICANN process at this time). WIPO believes this could be a good change for the UDRP in principle, but the timing and process would have to be right.

Interestingly, WIPO introduces this conclusion with the statement that it “bears reflecting that this issue in practice in fact only concerns a very small number of decided UDRP cases overall (findings of clear bad use absent findings of actual or inferred bad faith registration are rare). Whether this assessment is correct, which I think not, the reason why the proposal would “likely … be attractive to brand owners” is that it removes an impediment in the proceedings, namely situations in which domain names registered prior to trademark acquisitions are subsequently used to take advantage of the emerging reputations of trademark owners. One result would be clear by a change in policy and that is that the transfer rate will surely increase.

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