Starting tomorrow, organizations may start submitting applications for new gTLDs (generic Top Level Domains). The application window will close on April 12, 2012.

The new gTLDs move well beyond the core group of generic top level domains of .com, .net, .org, .biz, .info, and .edu. Specifically, they can consist of any combination of three or more letters that an applicant chooses. As a result, the new gTLDs have created concerns among brand owners that their brands may be hijacked or held for ransom by cyber-buccaneers. Independently, many brand owners are reticent to pay the $185,000 application fee for the “.MYBRAND” domain of each of their brands - and are not ready to commit to the additional requirement that they own and operate a domain name registry - but at the same time, are concerned about the possibility of losing the opportunity to own the “.MYBRAND” TLD forever. For those who fall in this camp, this alert outlines what brand owners need to know to protect their brands against third parties through this first round of the new gTLD application process.

Timing for objecting to gTLD applications: No defensive action is required by brand owners until the application window closes on April 12, 2012. Approximately two weeks after the application window closes, ICANN (the organization that oversees all domain registry processes) will post the public portions of all applications received, including applied-for strings, applicant names, application types, missions/purposes of proposed gTLDs, and other public application data on its website www.ICANN.org. Currently, the onus is on brand owners to check the ICANN website and review and object to the published applications for any proposed gTLD that may infringe their trademark rights. However, ICANN is considering a notification service to notify brand owners if someone has applied for a letter string that is or contains the brand owner’s brand. Haynes and Boone will continue to monitor the development of this process. In addition, third party vendors are planning to offer watch services for brand owners. Corsearch, Thomson Compumark, and other brand-monitoring services have indicated that they plan to offer such services.

Formal objection process: When the objection window opens in late April, the formal objection period will begin and will last for approximately seven months. The Applicant Guidebook found at http://newgtlds.icann.org/en/applicants/agb sets forth the procedures for each of these objection processes. Formal objections using pre-established Dispute Resolution Procedures (DRPs) may be filed on several grounds, including a Legal Rights Objection on the basis of trademark infringement.

A Legal Rights Objection may be made where the potential use of the applied-for gTLD allegedly takes unfair advantage of the distinctive character or reputation of the objector’s registered or unregistered trademark or service mark. If the objection is based on trademark rights, the panel will consider the following eight non-exclusive factors:

• Whether the applied-for gTLD is identical or similar, including in appearance, phonetic sound, or meaning, to the objector’s existing mark.
• Whether the objector’s acquisition and use of rights in the mark has been bona fide.
• Whether and to what extent there is recognition in the relevant sector of the public of the sign corresponding to the gTLD, as the mark of the objector, of the applicant or of a third party.
• Applicant’s intent in applying for the gTLD, including whether the applicant at the time of application for the gTLD had knowledge of the objector’s mark, or could not have reasonably been unaware of the mark, and including whether the applicant has engaged in a pattern of conduct whereby it applied for or operates TLDs or registrations in TLDs which are identical or confusingly similar to the marks of others.
• Whether and to what extent the applicant has used, or had made demonstrable preparations for use, the sign corresponding to the gTLD in connection with a bona fide offering of goods or services or a bona fide provision of information in a way that does not interfere with the legitimate exercise by the objector of its mark rights.
• Whether the applicant has marks or other intellectual property rights in the sign corresponding to the gTLD; and, if so, whether any acquisition of such a right in the sign, and use of the sign, had been bona fide, and whether the purported or likely use of the gTLD by the applicant is consistent with such acquisition or use.
• Whether and to what extent the applicant has been commonly known by the sign corresponding to the gTLD; and if so, whether any purported or likely use of the gTLD by the applicant is consistent therewith and bona fide.
• Whether the applicant’s intended use of the gTLD would create a likelihood of confusion with the objector’s mark as to the source, sponsorship, affiliation, or endorsement of the gTLD.

All Legal Rights Objections will be adjudicated by the Intellectual Property Organization. The official fees for lodging a Legal Rights Objection will be approximately $10,000 or $25,000, depending upon whether a single member panel hears the objection or whether a three-member panel is agreed upon by the parties to hear the objection.

Recommendations:

1. Arrange for a watch on the ICANN website for newly filed gTLD applications. This can be done internally, through Haynes and Boone, or through a third-party vendor.

2. Review your trademark portfolio:

• Be sure ownership of your registrations is correctly recorded at the appropriate trademark offices;
• Check to see that your trademark registrations are valid and in force;
• Consider filing trademark applications in jurisdictions where registrations can issue in a few weeks;
• Be sure that you have proof of use for relevant registrations; and
• Be prepared to show the strength of your brand through secondary evidence such as advertising, awards, sales figures, and customer declarations.

3. Don’t wait until the last minute to file an objection. Remember that others will be rushing to meet the same deadline!

For more information on the Trademark Practice Group and its members, you may visit the Trademarks, Advertising and Brand Management page of the Haynes and Boone, LLP website. If you would like assistance with your gTLD watch or an objection to a newly filed gTLD application, please contact one of the following lawyers.