Here is How to Fix the UDRP

by Revision Legal
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Revision Legal

Recently at Namescon I had the pleasure of watching three of my esteemed colleagues, Nat Cohen of Telepathy, Inc., Jason Schaeffer of Esqwire.com, and Zak Muscovitch of DNAttorney.com, examine three of the most shocking UDRP decisions of 2016. These decisions involved overreaching trademark owners, extraterritorial trademark rights, and panelist conflict of interests. In listening to the panel’s explanation of these cases, however, it dawned on me that there is a simple way to fix the UDRP. These are my brief thoughts on how to provide a long-term solution to the problems that those within the domain industry see in the UDRP in advance of revisiting the Policy next year.

Most lawyers are, by their nature, pragmatists. That means that, if we can secure a win for our clients without subjecting them to additional legal or financial risk, we will. We aren’t paid to provide a coherent legal philosophy—we are paid to win. And, contrary to federal and state court, where fee-shifting statutes and sanctions protect against abuse, the UDRP provides no disincentive to overreaching, or even simply creative, attorneys.

Obviously, fee-shifting or sanctions under the UDRP would be ideal. If there was a financial risk to overreaching, those risks would be analyzed at the outset and both attorneys and their clients would be less likely to file suspect claims. And fee-shifting would provide attorneys with an incentive to represent clients who cannot typically pay for a UDRP defense. But fee shifting becomes more complex when it needs to be applied across the world.

The New York Convention

Enter the Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Better known as the New York Convention, the Convention is a treaty that requires courts of signatory states to recognize and enforce arbitration awards made in other signatory states as if they were made in their own. This means that, if a UDRP panel were to find that a complainant located in the United States is responsible for reverse domain hijacking against an Indian registrant, and if that panel awarded fees in favor of the Indian registrant, the Indian registrant could take that award and enforce it in court in the United States by filing a petition for confirmation of the foreign arbitration award. This award can only be challenged on very limited grounds and can be enforced quickly and without substantial cost. If the amount of the award is high enough, the Indian registrant could either afford to pay an attorney in the United States to file the petition, or he or she could find one that would take the issue on a contingent fee basis.

If complainants were at risk of monetary damages for filing frivolous UDRP complaints, they would be less likely to file them. And where they do, the incentives line up and provide registrants’ attorneys with an incentive to do what is right. It is win-win, except for abusive complainants. That is a good thing.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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