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Unlimited? Introducing the New Generic Top Level Domains

Intellectual Property Law Update Nikia L. Gray, Lars E. Gulbrandsen

When and What?

Beginning in the second half of 2009, the governing body for Internet domain names, Internet Corporation for Assigned Names and Numbers (ICANN), will receive the first applications to sell an unlimited number of new generic Top Level Domain names, or gTLDs. gTLDs are those letters that come after the dot in a Web address, like .com, .org or .net.

Currently, there are only 21 gTLDs available, but after the new proposal is implemented, anyone who wants to register will be able to have an individual or corporate gTLD, including brand names (.coke), business categories (.hospital) and geographic locations (.Arizona). Compared to the current system, this new proposal truly opens a new world of possibilities for expansion of names, including Internationalized Domain Names (IDNs), which are used to designate any character other than the 26 Latin letters (a-z), ten digits (0-9) or the hyphen symbol (-).
 


What do I need to do?

The path to obtain a new gTLD could be as simple as a three-step application-and-approval process or as complicated as a lengthy evaluation that includes objections, string contentions,1 additional proof of standing and legal endorsement, and dispute resolution proceedings.

Generally, the process of applying is as follows:

  1. Submit application and pay fee.

  2. Await initial evaluation by ICANN.
  3. Resolve the filing of any objections to the Arbitration and Mediation Center of the World Intellectual Property Organization, except for objections based on morality, which are administered by the International Chamber of Commerce.

    There are only four grounds for objections:

         a) String confusion: The gTLD string is confusingly similar to existing gTLD.

         b) Legal rights: The applied-for gTLD infringes upon existing legal rights of the objector.

         c) Morality and public order: ICANN has yet to define the applicable morality standard.

         d) Community: There is opposition by a particular community.

  4. ICANN will resolve cases of string confusion where there is more than one qualified applicant for the same gTLD or for similar gTLDs.
  5. Technical tests and delegation of the new gTLD into the root zone.

Initially the application is open solely to established organizations. ICANN will not consider applications by individuals or sole proprietors. Applying organizations must provide proof of good standing and legal establishment, financial records and other supporting documentation, depending on the type of industry.

How much is this going to cost me?

The fee for a general evaluation process is $185,000. However, this amount could increase exponentially if there are contentions and the applicant for the gTLD needs to pay additional fees for dispute resolution filing and adjudication, re-reviews and evaluations.

Why is this important and how would this affect my company or me?

Although many may consider the idea of an unlimited well of creative ideas an exciting opportunity to develop brands and individualized Web sites, many others are already concerned with the costs and consequences of such an ambitious expansion.

Pros: 

  • gTLDs can provide a new way for people to express themselves on the Internet.

  • This option can accelerate the shift to an expanded IP addressing scheme.
  • gTLDs will reduce domain tasting, the practice of market testing a new domain name during a five-day grace period allowed by ICANN, after which the registration fee will no longer be refunded.

Cons:

  • This development could force companies to spend millions in defense against cybersquatters and fraud.

  • There is a high cost of application and a need to apply for TLDs for all trademarks a company uses.
  • gTLDs could increase disputes between companies with similar names, even if they are in different fields.
  • A gTLD that is a company's registered trademark will not be automatically reserved.
  • New gTLDs increase chances for trademark dilution.
  • There will be a greater challenge to Web-filtering applications for suppliers whose products depend upon keeping a URL database up to date.

If you have questions about the new generic Top Level Domain process, objections, dispute resolution or the impact the proposed changes may have on your business, please contact Nikia Fico 520-770-8721 / nikia.fico@quarles.com in Tucson, Lars Gulbrandsen 414-277-5137 / lars.gulbrandsen@quarles.com in Milwaukee or your Quarles & Brady LLP attorney.

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1
String contentions occur when a string so nearly resembles another that it is likely to deceive or cause confusion. For a likelihood of confusion to exist, however, it must be probable, not merely possible, that confusion will arise in the mind of the average reasonable internet user.