LEGAL GUIDE
Written by attorney Bruce E. Burdick | Dec 2, 2011

.xxx domain sure to create new trademark disputes

With the expansion of the generic top level domains gTLD comes a new problem for trademark owners. No longer will having .com, .net, and .org be enough. yourbrand.xxx may give IP counsel a new item of concern.

The .xxx domain is being administered by ICM Registry LLC. Their website announces that there will be a Sunrise A and Sunrise B period for established brands to claim domains. Sunrise A will be for established porn brands to claim .xxx domains. Sunrise B, which will run simultaneously with Sunrise A, will be for non-porn brands to block registration of their brands as .xxx domains. ICM Registry will charge a one time fee for Sunrise B applicants to block a domain. Since this domain caters to the porn industry, all cases of conflicting Sunrise A and Sunrise B will be resolved in favor of registrability and the fees will not be refunded, which incidentally maximizes the money ICM makes. As ICM states it, "If both Sunrise A and Sunrise B applicants want the same domain name, priority will be given to the qualified Sunrise A applicant to register the domain name. The Sunrise A applicant will have received notice of Sunrise B applicant's interest in the domain name and cannot claim lack of notice in any subsequent dispute between Sunrise A and Sunrise B applicants." Of course, in the meantime, ICM will get fees from both sides in order to maximize the money ICM makes. Likewise, if there are multiple Sunrise B applicants (say WILSON sporting goods and WILSON meats). ICM will keep the fee from both even though only one blockage will occur. If there are competing Sunrise A applicants, ICM will auction off the domain name in order to maximize the money ICM makes.

So, let's take a fictional example where there are 10 applicants for 6 APPLE variants, as follows apple.xxx (2 A applicants-Applesex LLC and Pornapple LLC, 2 B applicants-Apple Inc & Business Software Alliance), xxxapple.xxx(1-Pornapple LLC), GayApple.xxx (1-GayApple LLC), iphone.xxx(1 A - iPadSex LLC), ipad.xxx (1A - iPadSex LLC), SexAppStore.xxx (2 A - Applesex LLC & SexApp LLC). This will produce 10 fees for ICM plus ICM will auction off apple.xxx and auction off SexAppStore.xxx and make lots more money for that. Apple Inc and BSA will both pay Sunrise B fees but get nothing except a notification to the other applicants for apple.xxx. There will be 6 new registrations: apple.xxx (to highest bidder), SexAppStore.xxx (to highest bidder), xxxapple.xxx, GayApple.xxx, iphone.xxx, and ipad.xxx. So, let's say Applesex LLC wins auction for apple.xxx and SexApp LLC wins SexAppStore.xxx. Apple Inc would have to sue 5 separate parties to get these taken down, with uncertain prospects for success.

I think ICM is taking a legal risk in not blocking domains that it knows or should know are infringements in case of conflicting Sunrise A & B applications.

Winners in this: ICM and trademark litigation lawyers.

See the link below for more information.

Lesson to be Learned: Protecting a trademark requires constant vigilance and significant expense.

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