Featured Domains

TrueName by donuts. Make a name for yourself

UDRP Arbitration: A Case of Laziness?

Filta.com case calls into question (lack of) incentives of UDRP arbitrators.

I recently read through documents related to Filta.com, a domain name awarded to the complainant in a National Arbitration Forum case on April 23.

The case is disturbing on a number of fronts. If you just read the decision, you’d think this was a fairly simple case (although you’d probably wonder how a trademark to the term “Filtafry” gives you rights to the name “Filta”).

But what really happened is disturbing.

The respondent Donnacha Mac Gloinn submitted a detailed response to the complaint. Apparently it was received 44 minutes past the deadline for consideration. Rules are rules, and it was late. But an arbitrator can choose to consider a late filing, and they usually do if it includes information vital to the case. In this case, arbitrator Louis E. Condon ignored the filing, even though he postponed providing a ruling on the case for a week due to “extraordinary circumstances”. (Condon was also the arbitrator for the controversial Versa.com case. He has found his last 50 plus cases in favor of the complainant. Two phone numbers found online for Condon were disconnected.)

It would seem that if you were to delay a case for a week because of your own circumstances, you would cut someone slack on being 44 minutes late. But the incentive for a UDRP panelist is to just take the payment and issue a simple ruling, usually in favor of the complainant. The evidence in the response was substantial and would have made the case very complicated.

It’s a frustrating case for Mac Gloinn, especially since the complainant made several claims in its filing that are either questionable or clearly incorrect.

-Mac Gloinn alleged in his response that the complainant (The Filta Group, Inc.) didn’t have the trademark for Filtafry and provides detailed reasoning; Filta claimed the trademark holder was a predecessor. Regardless of the merit of this issue, it’s something the arbitrator would have normally considered.

-Filta provided a print out of a DomainTools whois record for Filta.com. It said DomainTools was an online marketplace for selling domains, so it claimed this was proof that Mac Gloinn wanted to sell the domain. (In Filta’s additional submission, it said it misunderstood DomainTools, but that since DomainTools showed that the domain was registered at ResellOne.net, it was proof that the domain was for sale.)

-The complainant said Mac Gloinn had Sedo contact it to offer to sell the domain. Documents provided by Mac Gloinn prove that the complainant used Sedo to contact the owner previously.

-Filta’s complaint included this line:

In an email response to a communication from Complainant before the Complaint was filed, Respondent said on November 13, 2008 that “the domain name was currently not being used and had not been since it was purchased in 2002” (See a copy of the Respondent’s e-mail attached hereto as Exhibit “E”)

This quote does now exist in the exhibit.

When Mac Gloinn pointed this out in his response, Filta wrote “Filta acknowledges misusing quotation marks in paraphrasing Respondent’s words”. Condon didn’t consider the additional submission by Filta, citing lack of payment with the submission. But the payment was actually received by National Arbitration Forum. Filta declined to comment for this story.

I’m not sure which way the case would have gone had all of the facts been considered. But domain names are important, and it seems that UDRP arbitrators don’t always treat them that way. To be sure, UDRP arbitrators are underpaid when they work on complicated cases. Perhaps that’s what needs to be fixed.

The most in-depth analysis of the global domain market

Get Our Newsletter

Stay up-to-date with the latest analysis and news about the domain name industry by joining our mailing list.


No spam, unsubscribe anytime.

Reader Interactions

Comments

    Leave a Comment

  1. George Kirikos says

    The greater danger is that the IRT team has proposed an even more streamlined system called the “URS” for faster takedowns, and panelists might only get paid on the order of $40 and be expected to take less than 15 minutes on average to render a decision. In my comments to the IRT draft paper I called them “McPanelists” working “McJobs.” See more in the comments at:

    http://forum.icann.org/lists/irtp-draft-report/

  2. donnacha says

    I was the Respondent in this case. I missed the deadline by 44 minutes because I thought I was working to Pacific Time but the arbitration company are based in Minnesota, which is in the Central timezone. No-one at the arbitration company indicated that there was any problem at any time over the next 3 weeks and they let me waste another week on my Additional Submission without letting me know. The Complainant received my Response at the same time as the arbitration company and had no problem with the missed deadline.

    As Andrew says, it was a pretty complicated case but one of the core issues is that I was also entitled to submit an Additional Submission to response to the Additional Submission that the Complainant submitted to respond to my highlighting of all his “mistakes”. I managed to submit that on time and it should have been considered by the Condon but not one single point raised in that submission was addressed in the decision.

    It is also worth noting that the Complainant had a Design Trademark for a design containing the word Filtafry, not an actual trademark on the word. This Design Trademark was granted AFTER my registration of filta.com in 2002.

    This means that:

    A) Pretty much any existing domain is vulnerable to anyone who files for a Design Trademark because, as shown by this and other recent decisions, panelists are (deliberately?) ignoring the fact that a Design Trademarks give no rights over the words contained within the design.

    and

    B) The domain merely has to contain a constituent part of the trademark: Filtafry gets you filta.com.

    and

    C) The fact that the domain registration predated the Design Trademark makes no difference.

    I think all domain owners need to sit up and see where all this is going.

  3. jp says

    Definitely sketchy and concearning. It seems that the UDRP process is turning into a coinflip now on whether or not you will have to go to real court to protect your assets which aint cheap. Seems sometimes the best you can do is hope you win the coin flip, although the coin seems to be weighted against the domainer.

  4. Jeffery Cockburn says

    Here is an Idea-

    A plan needs to be developed to put all of the domain sellers on notice that the arbitration system as it exists is outside of the contract between the domain buyer and the seller. Do not fight with the domain sellers but give them a reason not to force participation. This process is unreasonable, unfair, shocking etc. No one should participate in any of these arbitrations.

    There is a push to plant the idea that domain rights are only based in contract, but this is not true. Many courts view domains otherwise and there are opinions to that effect, from real judges.

    IMHO if you are served with arbitration, write a response and go down to your local courthouse and file it there. People need to seek justice. If you respond in arbitration that is the only way that these guys get paid. If did not register cocacola.com for example then I personally would not even involve any of these attorneys. Keep your money.

    Additionally, not referring to this case or anyone involved here but as a general statement, RICO may very well be the answer to this entire injustice. Too many innocent people have been gamed too long, IMO.

    Shut it down.

  5. Domain Investor says

    Donnacha, you definitely got railroaded.
    Thanks to Andrew for bringing this udrp to light.

    And, the IP lawyers want a faster track?

  6. George Kirikos says

    I almost didn’t believe it when I read it, but a very candid remark was made in today’s IRT comments archive by someone from NAF (one of the UDRP providers):

    http://forum.icann.org/lists/irtp-draft-report/msg00033.html

    “Complainants have pushed, and Panelists have taken the opportunity, over time, to broaden the scope of the UDRP, but it started out as a mechanism only for clear cut cases of cybersquatting.”

    That’s some nifty language to file away, in case one ever wants to challenge a UDRP decision.

  7. donnacha says

    Thanks for the comments everyone.

    @jp – these arbitrations have always been, as you say, “weighted against the domainer” but, in filta.com and several other recent decisions, the few protections we thought we had are simply being ignored and we have no mechanism to object. There is a lot more to this case than Andrew could include in one article but would it surprise you to learn that bad faith use was found with absolutely no proof of bad faith being presented, merely alleged? And despite extensive evidence of actual, legitimate use being provided?

    @Jeffrey Cockburn – unfortunately, we don’t have much option other than to participate; most Respondents don’t respond and that generally results in the domain being transferred. In registering a domain, we have already given our consent to the arbitration process, participating theoretically gives us some chance to defend our rights (although, in this case, even my second submission, submitted on time and supposedly meant to be considered, was completely ignored).

    What we should really be doing is rallying around and clubbing together to take clearly ridiculous decisions like this to the federal level. It is obvious that the arbitration companies are deploying panelists with a track record, such as Condon, to single-panelist cases such as this, knowing that if the domain owner was unwilling to pay for three panelists, they are highly unlikely to take the case to a federal court. The arbitration companies have figured out a way to create ever-higher percentages of Complainant wins, without triggering any sort of attention or investigation.

    The arbitration companies are stoking a gold rush, in which ever more ridiculous Complaints will be seen to succeed, encouraging the number of new cases to rocket and even supposedly “safe” domain owners will be forced to pay $1,300 for a 3-member panel if they want to have any chance of holding onto what is theirs. The clever arbitration have worked out how to get money from everyone.

    Traditionally, domainers are loners but we have to wake up. If you own domains of any value at all, you are probably going to find yourself at the wrong end of a UDRP sometime in the next year of so, as the system becomes a free-for-all. Quite apart from the expense, the waste of time and the disruption to your life and business as you struggle to meet ridiculous submission deadlines, what really hurts is the unfairness of it – you will feel as if you have been kicked in the stomach. If the arbitration companies succeed in stoking this gold rush, you are ALL going to experience this over the next couple of years, probably repeatedly.

    And this could get expensive: there is absolutely no limit on the amount of UDRP actions that can be taken against you, you could be hit dozens of times for the same domain, forced to shell out $1,300 for a 3-member panel each and every time.

    That is why we need to pull together now. It is too late for my domain, the deadline for filing a federal case is coming up this week, but we need to establish some sort of fund that takes advantage of these ridiculous decisions as they occur, takes them to the federal level and shines a light on this whole rotten mess. The arbitration companies have allowed greed, competition and lack of supervision to make them vulnerable. We can show statistically that they are, clearly, gaming the system for financial gain, they have not been subtle about it. How much would it cost to take a collective case against them, especially when the evidence is so clear, so incontrovertible? $50,000? How hard could it be to raise that sort of fund when so many of us stand to lose so much if the system continues to operate with no oversight and an ever-increasing Wild West sensibility?

    As @George Kirikos and @Domain Investor say above, there are moves afoot to even further streamline this unfair system, to even further marginalize us, and all because we have failed to organize, we have failed to state our case. If we cannot muster the resources to pull down this clearly corrupt system, even when gifted with such clear violations of the supposed rules, perhaps we deserve the coming whirlwind.

  8. jp says

    @donnacha. Well there is always the option to take it to real court, but yea that won’t be cheap, but you can then sue for your costs at least right?

    I couldn’t agree more with what you are saying, but I think that if I remember hearing correctly that the ICA was working on a solution just like you are describing, where there will be a fund put together to help denfend member domainers in situations such as these? Am I making this up or does anyone else remember hearing the same thing. Furthermore if I’m not making it up, when do we get to start taking advantage of this fund at the ICA?

  9. donnacha says

    @jp – I’m sure the vast majority of domain owners are in a similar situation to me, faced with yet another impossible deadline of ten days in which a federal case can be filed. In Texas. I am in the UK, I wouldn’t even know where to begin.

    I have heard of the ICA but have not had time to find out much about them. There is nothing to stop anyone setting up a mailing address and claiming to represent an otherwise unrepresented group, whether they are actually any good at it is another matter.

    What we need is a proactive organization, that contacts the domain owner in every single UDRP case as soon as it is announced, to offer set advice and to ask for copies of the Complaint, the Response and all other submissions by both sides. That would enable them to identify bad decisions as soon as they are announced and to file federal cases within the necessary ten days.

    If such cases focused upon obvious misrulings, such as those based upon Design Trademarks, they would not have to be all that expensive, you would very quickly set precedents that panelists would be wary of coming up against, and the balance within decisions would be restored to the previous, less blatant levels of bias – these greasy panelists know that they are corrupt but they presume that no-one will ever notice because domain owners have not been organized enough to call them on it.

  10. Johnny says

    I think these panelists run the game like an ecosystem…….if they make too many decisions for complainants they back off and give some to the respondents, then they swing back the other way again.

    It all about protecting their gravy train of UDRP fees I believe. They care less about these decisions.

  11. donnacha says

    @Johnny

    It is natural to direct our anger at the panelists but you have to remember that the real power is in the hands of the arbitration companies – they can claim to have no influence upon individual cases but they are the ones who decide which panelists to assign to which cases and they have clearly engineered a general shift in the UDRP environment, a shift that will generate immense amounts of money for them.

    Of course, just as with any form of freelancing, the panelists are aware of the interests of their employer and most will do there best not to cross those interests unless it is absolutely unavoidable. Panelists who don’t understand this, or who are too ethical to allow their own interests to overrule their sense of justice, will simply be sidelined. That was always going to happen in a privatized system with no oversight and no appeal mechanism.

    Good old boys like Condon, who has proved his reliability by deciding 100% of his recent cases in favor of Complainants, will always have a seat at the table.

    The real fault here, the systematic abuse, is by the arbitration companies, not the panelists – the panelists are just the monkeys, not the organ grinders.

Domain Name Wire | Domain Name News
%d bloggers like this: