URS Individual Proposal #22 The URS should incorporate a “loser pays” model. |
Context:
Rationale provided by the Proponent: No enforcement action is without cost to the rights owner, while both the infringement and attempts at enforcement frequently cost very little to the infringer. While realizing that an infringer may be difficult to locate in many instances, we should not perpetuate a system where any potential infringer knows that it will suffer little, if any, sanction or financial burden.
The current cost allocation model is sufficient for most cases but it is not equitable for situations involving serial cybersquatters whose activities do not seem to be deterred by multiple adverse URS or UDRP decisions.
In line with the above question regarding repeat offenders (see URS Individual Proposal #15), a provision requiring registrants who have met a set threshold for habitual cybersquatting could be required to deposit funds into an escrow account with each new domain registration or the Registrar should be authorized under its terms of service to charge the credit card on file in connection with the registration in order to satisfy the “loser pays” requirement. Such funds could be dispersed to prevailing Complainants in future domain name disputes against that registrant.
The loser pays model could be adopted in all cases regardless of whether the respondent meets the “repeat offender” or “high-volume cybersquatting” thresholds, or it could be limited only to those cases involving a “repeat offender” or “high-volume cybersquatting.”
Working Group Deliberation: There was an almost equal amount of support and opposition in the Working Group for publishing this proposal in the Initial Report to seek public comment[1]. Several Working Group members expressed significant concerns about the substance of the proposal.
Working Group Question for Public Comment: The Working Group seeks public comment on: 1) the appropriateness of a “loser pays” model; 2) the definition of specific criteria (e.g., “repeat offender” over a defined time period, “high-volume cybersquatting”); 3) the specific item(s) that should be paid in a “loser pays” model (e.g., administrative fees, attorneys’ fees), and 4) the enforcement mechanism of the proposed model.
[1] The Working Group confirmed that URS Individual Proposal #22 incorporated and superseded URS Individual Proposal #21, of which its rationale applied to URS Individual Proposal #22. The Working Group decided not to publish URS Individual Proposal #21 in this Initial Report for public comment, but the link to all submitted URS Individual Proposals can be found in the “Annex C - Working Group Documents” section.
