What is Reverse Domain Name Hijacking ?

19 07 2016

The term Reverse Domain Name Hijacking or RDNH is becoming more prevalent as the cost and availability of valuable domain names makes them less attainable.

What is Reverse Domain Name Hijacking ?

Reverse Domain Name Hijacking (‘RDNH’) is defined by the auDRP as meaning “using the Policy in bad faith to attempt to deprive a registered domain name holder of a domain name.”. This often takes place where the Complainant has been unable or unwilling to negotiate the purchase of a domain name from the registrant holding it. Some in the industry refer to RNDH as the process to ‘steal rather than pay’ for a domain name.

While RDNH findings remain rare in cases of genuine dispute, there are numerous authorities which provide useful insights into the circumstances in which a RDNH finding may be made.

In Futureworld Consultancy (Pty) Limited -v- Online Advice (WIPO Case No. D2003-0297), it was held that in order to prevail in a RDNH claim, the respondent “must show either that the complainant knew of the respondent’s unassailable right or legitimate interest in the disputed domain name or the clear lack of bad faith registration and use and nevertheless brought the complaint in bad faith”. That is, that a RDNH finding may be made if the complainant “knew or should have known at the time it filed the complaint that it could not prove that the domain name was registered or used in bad faith”.

In recent years, RDNH findings have been made where:
• The complainant failed to disclose the history and nature of its relationship with the respondent which could have distorted the Panel’s impression of the nature of the dispute (Paessler AG -v- Assured IT Pty Ltd, WIPO Case No. DAU2015-0030).

• The complainant launched proceedings following failed purchase attempts but did not disclose that the registered trade marks they claimed to own were governed by a license and misrepresented correspondence made between the parties in relation to the sale of the disputed domain (Carman’s Fine Foods Pty ltd -v- Ross Wayne Carman, Carmans Consulting, WIPO Case No. DAU2015-0041).

• The complainant omitted relevant information including that an administrative complaint to auDA about the respondent had been dismissed and that the complainant had attempted to purchase the domain name but was rejected and then sought to commence proceedings to acquire the domain name which was registered six years before it could have conceivably acquired trade mark rights (Orient Express Travel Group Pty Ltd -v- Mookstar Media Pty Ltd, WIPO Case No. DAU2015-0004).

• The complainant would have been aware that the respondent had more than a negligible business in Australia and therefore knew or should have known that it could not prove that the domain was registered in bad faith (Adjudicate Today Pty Limited -v- The Institute of Arbitrators and Mediators, WIPO Case No. DAU2012-0033).

• The complainant’s conduct was viewed as an attempt to harass and undermine the business of the respondent, and the complainant offered an incomplete history of the disputed name to the Panel (Cairns Airport Pty Ltd -v- Chris Ford (Christopher William Ford / C and C Family Discretionary Trust, WIPO Case No. DAU2013-0023).

We are seeing more cases of RDNH or attempted RDNH. The most telling evidence of this is that of the five RDNH findings that have been made since 2010 (as outlined above), all five have been made in the past three years; with three of those being made in 2015. This lends weight to the fact that there is a trend of bad faith auDRP proceedings increasing.

Reform of the auDRP

As the incidence of RNDH is more frequent, we consider that there is a justifiable basis for the auDRP to be amended to provide for some form of ‘penalty’ or consequence, where a Complainant uses the administrative process in bad faith.

This is something that has been adopted in Canada. Canada’s equivalent of the auDRP is the CIRA Domain Name Dispute Resolution Policy (‘CDRP’). Like the auDRP, the CDRP is largely based on the UDRP which provided the genesis of many administrative dispute processes around the world.

Of particular note in clause 4.6 of the CDRP is the following:

4.6 Bad Faith of Complainant. If the Registrant is successful, and the Registrant proves, on a balance of probabilities, that the Complaint was commenced by the Complainant for the purpose of attempting, unfairly and without colour of right, to cancel or obtain a transfer of any Registration which is the subject of the Proceeding, then the Panel may order the Complainant to pay to the Provider in trust for the Registrant an amount of up to five thousand dollars ($5000) to defray the costs incurred by the Registrant in preparing for, and filing material in the Proceeding. The Complainant will be ineligible to file another Complaint in respect of any Registration with any Provider until the amount owing is paid in full to the Provider.

The effect of this clause is that there are costs consequences for Complainants who use the CDRP in bad faith. The concept is not new, this principal is something which is part of the Court process across most Western jurisdictions such as Australia, New Zealand, Canada and the USA.

As the auDRP stands, a Complainant who chooses to use the auDRP in bad faith with the hope of taking a valuable domain name without having the pay for it (in other words RDNH) there are no consequences except a finding of RDNH by the panel. Unfortunately, many panelists are reluctant to make these findings, presumably to avoid the Complainant being embarrassed publicly. In cases where a RDNH finding is made, there is in effect no real consequence except a public finding, so a Complainant who abuses the auDRP has nothing to lose.

If the auDRP were amended to incorporate a provision similar to that found in the CDRP, then there would be an added consequence for an abuse of process by a Complainant. There would be something to lose for a Complainant, and as a consequence a reason to think twice before making a bad faith complaint.

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