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02|22|2012 11:12 am EDT

UDRP: Abusive Supplemental Filings in the case of AutoOwnersInsurance.com

by Paul Keating in Categories: Legal Issues

The following is a guest post by Paul Raynor Keating (paul@law.es). He is a domain industry attorney with offices in Barcelona and London.

The recent decision in autoownersinsurance.com is a perfect example of things going from worse to horrible. While the decision itself contains many substantive flaws, my overwhelming issue is with the lack of due-process rights evidenced by this UDRP.

The complaint was limited to a 3-paragraph argument which asserted a USPTO registration for “Auto-Owners”. The complaint asserted lack of legitimate interest because the domain was used in PPC and included links to insurance (surprise). The complaint did not allege bad faith registration and allegations of bad faith use were limited to the same PPC argument.

Read more after the jump.

The timely response explained that the mark was a “design” mark obtained under 2(f). For those unfamiliar, a 2(f) application is required when a mark is not “distinctive”. The registration is granted based on the ex-parte submissions of the applicant. “Ex-parte” means that no one is allowed to challenge the application. We argued the domain was not identical or confusingly similar given the additional descriptive term which substantially expanded upon the mark. We noted that while the complainant alleged common law trademark rights in “auto owners insurance”, there was not one scintilla of evidence (not even a hair) supporting the claim.

Complainant’s legitimate interest and bad faith claims were limited to the fact insurance links appeared on the PPC page. The PPC results for insurance were hardly surprising since the domain was inherently descriptive. Insurance is after all required in most places and of obvious interest to “auto owners”.

On the February 14th respondent received Complainant’s supplemental filing (“CSF”) which my email records showed to have been filed late.The CSF included 13 pages of argument and 9 new exhibits covering 191 pages, representing over 7.3 MEGABYTES of data. The CSF substantially amended the original complaint and for the first time included evidence supporting a common law trademark claim. Respondent started preparing a reply which was set for filing on the night of the 21st. Just prior to filing, Respondents received a decision dated February 21st! The decision makes it clear that the entirety of the CSF was considered by the panel. The decision does not even discuss the propriety of the CSF.

It is shocking that a UDRP panel would issue a decision 4 working days after receipt of a CSF, particularly one that was of such length and magnitude. There was no communication from the panel and four (4) days to respond to what amounted to an entirely new complaint with substantially more allegations and evidence is blatantly unfair. The timing of the decision implies that it was written on Friday for submission on Monday and immediately issued on Tuesday. Given the length of the decision (13 pages), it is unlikely to have been written on Monday and I have my doubts that a 3-member panel would have worked over the weekend on a UDRP.

Aside from the lack of opportunity to respond, I was personally shocked that the panel would have the CSF considered at all. The UDRP provides for supplemental filings only upon panel request.

12. Further Statements

In addition to the complaint and the response, the Panel may request, in its sole discretion, further statements or documents from either of the Parties.

Although NAF has its notorious Supplemental Rule 7, NAF panels have held that SR 7 is controlled by Policy Paragraph 12 (“[T]he controlling provision is Paragraph 12 of ICANN’s Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), under which discretion to request such supplementation rests with the Panel.” (Deep Foods, Inc. v. Jamruke, LLC. c/o Manish Patel, FA0648190 (NAF April 10, 2006)). SR 7(f) prohibits supplementals that would amend a complaint.

Even those panels accepting supplemental filings have limited them to exceptional circumstances. Prior panels have repeatedly held that and the failure to submit evidence of trademark rights does not qualify as “exceptional” and “does not constitute sufficiently exceptional or proper circumstances for the Panelist to exercise discretion and to request any further information from the Complainant.” (Autobytel.com inc. v. Sand WebNames, D2001-0076); see also: Universal City Studios, Inc. v. G.A.B. Enterprises, D2000-0416 “There is no provision in the Rules for a party to file an additional submission without leave of the Panel.”).

The Policy specifically limits the breadth of supplemental rules:

Supplemental Rules means the rules adopted by the Provider administering a proceeding to supplement these Rules. Supplemental Rules shall not be inconsistent with the Policy or these Rules and shall cover such topics as fees, word and page limits and guidelines, file size and format modalities, the means for communicating with the Provider and the Panel, and the form of cover sheets.”

By listing examples, the Policy makes it clear that supplemental rules are permitted to cover only non-substantive matters. Imposing a 5-day deadline for a supplemental reply is clearly non-administrative and such a short period inherently conflicts with the Policy.

In this decision the panel ignored the language of Paragraph 12 AND the prior precedent which limits supplementals to (a) those requested by the panel and (b) to those reflecting exceptional situations where Complainant could not have reasonably anticipated the need to incorporate the supplemental matters in the complaint.

By ignoring Paragraph 12 and the Policy limitation on supplemental rules, the respondent is faced with a bush-whacking opportunity. The Complaint has all the time in the world to prepare and file the complaint (even laches is not a defense). The Respondent is limited to a 20-day window. The CSF amounted to a complete “do-over”. The complainant filed a boiler-plate “place-holder” complaint and then filed its “real” complaint as a “supplemental” leaving Respondent with virtually no time in which to respond.

Given the repeated references to fairness (both in the UDRP and in NAF’s own website), the issuing of the decision without an opportunity to respond is morally and legally wrong.

ICANN must resolve this issue. NAF’s SR7 is in inherent conflict with the UDRP which is the only binding obligation of the respondent. The ADR provider may not adopt rules that are in conflict with the UDRP and the panels may not enforce supplemental rules to the extent they are in conflict with the UDRP and the basic concept of fairness that is supposed to prevail under the Policy. By failing to address such abuse, ICANN is exposing the entire contractual arbitration process to distain and legal challenge. While not perfect, stability and inherent fairness is fundamental to the proper functioning of the UDRP. The panel (and NAF) in this case ignored both.

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1 Comment

Steve Jones

February 22, 2012 @ 6:46 pm EDT

That’s awful that the respondent wouldn’t be told he has a certain amount of time to respond once the CSF was filed, let alone the problems with the CSF itself. So was the panel expecting the respondent to inform the panel immediately of his intention to respond if he wanted to? Obviously coming up with a full response to it would have been ridiculous to expect within 4 days.

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