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Punishment of reverse domain name hijacking – a fair reprimand or far too lenient?

Jul 2, 2021, 12:26 PM

The accessibility and affordability of the UDRP process have been key factors in its success. While the policy allows for brand owners to recover infringing domain names without the need for litigation, it has unfortunately also been misused. Spurious or severely misguided complaints are often deemed by panels to be an attempt of reverse domain name hijacking (RDNH).

RDNH is an abuse of the UDRP process; the complainant tries its luck at wresting a domain name from a legitimate owner. The respondent in such cases often bears the costs of hiring counsel to defend its position. It also wastes the panel’s time. RDNH is not simply losing a UDRP case, it applies where the complaint should never have been filed.

Nevertheless, there are no damages following an RDNH decision, nor any bar to filing further complaints. Instead, the pronouncement of RDNH is the punishment.

Reputational damage a non-factor for some

Recently, there has been an alarming pattern of abusive complaints, including three RDNH findings on a single day in June 2021. Other recent examples of RDNH demonstrate why there have been calls within the domain name industry for tougher sanctions.

In WIPO Case D2021-0048, the complainant filed a complaint, which lacked evidence with regard to its rights in the term ‘IDTC’. In addition, according to the panel, the complainant withheld material facts and made unsupported assertions of bad faith. Filing such a case was clearly going to result in a finding of RDNH.

However, more egregious was the explanation from the complainant’s counsel for their filing of the complaint. It revealed that the case had been filed with no intention of fulfilling the UDRP requirements. Instead, the purpose of filing was to “force early discovery” and “obtain an optimal jurisdiction after the decision”. Further, the complainant’s counsel saw no reason to be concerned by the RDNH decision against their client.

The case highlights a particularly abusive manipulation of the UDRP process. If such filings became the norm, it would severely harm the trust and legitimacy of the UDRP. As an alternative dispute resolution drafted and applied extra-judicially, use of the UDRP for ulterior or abusive motives presents a real threat to its existence.

Calls for a tougher stance against RDNH are not confined to members of the domain name industry. In WIPO Case D2020-3416, the UDRP panel implied that it wished for more punitive weight behind its RDNH finding. The final paragraph succinctly describes the three-member panel’s frustration with the complainant’s counsel:

In sum, the Complainant’s professional representative betrays an alarming unfamiliarity with the UDRP and the two decades of precedent under it, to the point of including the Registrar as a respondent merely for performing its non-discretionary function of registering an available domain name. Such conduct in any court would result in a swift dismissal and appropriate sanctions for wasting the parties' and the court's time. This Panel is limited to a find of abuse, which it readily imposes.

Thus, the two examples above encapsulate both malicious and misinformed complaint filings. Safenames’ previous article outlines the various types of RDNH and shows that there is a scale of abusiveness. The question, therefore, is should the cases of RDNH on the most abusive end of the scale attract a more severe punishment?

Issues with implementing a more stringent punishment

Complainants have two remedies available under the UDRP: transfer or cancellation of the domain name. Complainants do not receive damages or any other recompense for the harm caused by the domain name infringement. Such remedies are confined to litigation.

Therefore, where the respondent has been abusive, there are no further repercussions for it beyond remedying its ownership of an infringing domain. Why should an abusive complainant, meanwhile, face paying damages?

One argument against this mode of thinking lies in the policy issue outlined above. The credibility of the UDRP process is paramount to its existence. RDNH harms this credibility and, therefore, must be strongly deterred.

On the other hand, aggrieved respondents can already receive damages for RDNH under the US Anti-cybersquatting Consumer Protection Act. Further, the UDRP is inherently meant to be a streamlined dispute resolution mechanism; thus, an application of damages is potentially beyond its remit.

Rather than paying damages, abusive complainants could be barred from filing. The ‘.uk’ domain name dispute resolution procedure has such a provision: three RDNH findings in a two-year period will prevent the complainant from filing for a further two years. This provision could be easily replicated in the UDRP; but should it be the complainant or the complainant’s representatives that are barred?

There is also the issue of defining RDNH. Respondents have set criteria laid out before them on how to avoid losing their domain via the UDRP process (ie, the substantive requirements laid out in Paragraph 4). There is no such certainty for complainants in regard to avoiding RDNH. Thus, if a more stringent punishment is to be handed out to complainants, RDNH must be defined and included within the policy, rather than left to the discretion of panellists.

What the future holds

Other domain name dispute resolution policies incorporate punishments for RDNH (under ‘.ca’, for example, RDNH can cost a complainant up to C$5,000). There are also examples of ccTLD policies where complainants recoup costs from the cybersquatter (in particular ‘.be’). Could either of these mechanisms be introduced into the UDRP?

The UDRP will be the focus of Phase 2 of ICANN’s review of its rights protection mechanisms. We will see whether this review will incorporate a discussion on RDNH.

Understandably, calls for tougher RDNH sanctions are unlikely to come from the IP stakeholder community. However, the UDRP contributes towards making the domain name system safer, helping brand owners to combat cybersquatting attacks. The UDRP as a whole deserves to be protected, and this includes protection against abusive complainants.

Nevertheless, the doctrine of RDNH, as it stands, is not sufficiently predictable. The circumstances in which a panel will find RDNH must first be solidified. Only then should changes be made to the punishment for such findings.

James Taylor
Legal Advisor

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