WIPO Arbitration and Mediation Center - Conference 2000

International Conference on
Dispute Resolution in Electronic Commerce

organized by the WIPO Arbitration and Mediation Center

Geneva, November 6 and 7, 2000

(See presentation)

David H. Bernstein (Footnote 1)
Partner, Deveboise & Plimpton
New York, United States of America

The advent of computers was supposed to save paper. Instead, new forests have fallen to satisfy computers’ insatiable appetite. Skeptics might thus similarly scoff at the notion that technology can usher in an era of expedited litigation conducted through electronic transmissions. The truth, however, is that the dawn of that new era has arrived.

Late last year, the Internet Corporation for Assigned Names and Numbers ("ICANN") – the non-profit entity that manages the Internet’s domain name system – instituted a "Uniform Dispute Resolution Policy" ("UDRP") for domain name disputes. This alternative dispute resolution procedure allows an aggrieved trademark owner to challenge a third party’s registration of a domain name that incorporates or is confusingly similar to its trademark. (Footnote 2) The procedure is truly international in scope: the parties can be located anywhere in the world, and the list of approved arbitrators spans six continents.

The UDRP currently is administered by four ADR providers selected by ICANN. The first approved provider (since December 1, 1999), and the one with the most cases filed, is the World Intellectual Property Organization Arbitration and Mediation Center ("WIPO"). Additional approved providers include the National Arbitration Forum ("NAF"), Disputes.org/eResolution Consortium, and the CPR Institute for Dispute Resolution. Although there are some minor differences in the ways in which these four providers administer the UDRP, the basic procedure is quite similar, and provides a model for the electronic resolution of a wide variety of disputes.

Basics of the UDRP

A domain name dispute is initiated with the submission of a complaint and payment of a filing fee (which ranges from $750 to $6,000 or more, depending on the provider, the number of domain names at issue, and the number of panelists). Once the provider checks the complaint to ensure that it complies with the basic requirements of the UDRP, the complaint is sent to the domain name registrant, which has 20 days to file a response. When both the complaint and the response are in, the provider then selects the arbitration panel (generally one arbitrator, although either side can request a three-member panel, in which case each party can nominate one member) and sends the record file to the panel. The panel has two weeks to issue its decision, which is then emailed to the parties, as well as to ICANN and the registrar of the domain name.

In rendering its decision, the panel is directed to apply the principles set forth in the policy that governs these proceedings. In brief, to prevail, a complainant must prove that:

  • the domain name is identical or confusingly similar to a mark in which it has rights,
  • the registrant has no rights or legitimate interests in the domain name (factors relevant to this inquiry include whether the registrant has used the domain name for the bona fide offering of goods, commonly was known by the domain name prior to the dispute, or is making a fair use of the domain name without intent for commercial gain), and
  • the respondent registered and used the domain name in bad faith (e.g., to sell the domain name to the trademark owner for a profit, to prevent the trademark owner from registering the domain name, to disrupt the business of a competitor, or to attract Internet users to its website for commercial gain by causing confusion).

Although there is no right of appeal, either party can subsequently pursue its claims and defenses through a lawsuit, and any order transferring or canceling a domain name registration will be stayed if suit is filed within ten days. Not including the rare subsequent litigation, the entire dispute should take no more than 45-60 days from start to finish.

Benefits of the UDRP

The UDRP’s successes to date – over 2,000 proceedings have been filed (involving more than 3,900 domain names), and more than 1,600 already have been resolved -- are a testament to the many advantages offered by the UDRP. The process is quick and inexpensive, the rules are easy to understand, and most commentators have found the vast majority of decisions to be fair.

First, speed. As noted above, the electronic dispute resolution process is remarkably fast, resulting in decisions in about 45-60 days. In many court litigations, the defendant will not have answered by then; even in expedited proceedings, it may not be possible to obtain a preliminary injunction in just two months. The availability of rapid relief makes electronic dispute resolution an attractive option when speed is of the essence.

Second, electronic dispute resolution is quite inexpensive as compared to traditional litigation. The UDRP proceedings generally require only one filing from each side. This minimal amount of paper in the record translates into a low cost dispute resolution system. The typical UDRP proceeding costs less than US$10,000, including the filing fee and attorneys’ fees. Needless to say, this is a mere fraction of the expense of a traditional litigation; indeed, in some litigations (at least in the United States), it may cost more than that to research, draft, file and serve the complaint. Moreover, because the entire process is conducted by email without any discovery, litigants save the significant executive time that otherwise would be diverted to responding to documents requests, sitting for depositions, and preparing for trial.

Third, participating in electronic dispute resolution is simple. Each side submits a single document (which can include both factual submissions and legal argument); a number of the providers have helpfully posted model complaints and responses on their websites. Filing and serving the complaint is a snap: one need not worry about finding and tracking down reticent registrants (a significant problem in traditional cybersquatting litigations given that registrants often provide false address and other contact information); instead, the complainant need only hit the enter button and send the complaint by email to the address provided in the registration agreement.

Fourth, to help ensure consistency in the rulings of arbitrators, ICANN has promulgated at least somewhat bright line rules for the standards governing domain name disputes. Although litigants (and even arbitrators) can fairly debate whether a particular domain name registration constitutes cybersquatting, for the most part, the rules regarding whether the respondent has a legitimate interest in the domain name or acted with bad faith are clear and easy to apply. ICANN has even gone so far as to provide illustrative (but not exclusive) examples of conduct consistent with a legitimate interest and conduct that constitutes bad faith. Significantly, arbitrators need not make difficult factual findings on complicated, contested factual issues (such as whether there is a likelihood of confusion).

Finally, to help streamline the procedure, ICANN provided for just two remedies: transfer of the domain name to the complainant, or cancellation of the registration. There are no provisions for damages, no provisions for attorneys’ fees, and no provisions for other injunctive relief. Although the stakes can still be quite high (given that some domain names can be worth millions of dollars), the elimination of any dispute over money eliminates many issues that otherwise could complicate both the submissions and the panel’s decision.

Abuses of the UDRP

As with any new procedure, the UDRP has experienced a few hiccups during its first year of operation. The problems that have emerged provide valuable lessons both on making the UDRP an even better process and on structuring other systems for using electronic submissions to resolve disputes. In some cases, the difficulties have been caused by parties trying to use the UDRP for disputes that are better resolved in other forums; other problems, though, can be traced to minor glitches in the rules.

One common problem has been that some trademark owners have filed cases that were inappropriate for the UDRP procedure. For better or worse, ICANN designed the UDRP only to adjudicate cases of abusive domain name registrations. Parties set themselves up for disappointment when they try to accomplish through the UDRP what more appropriately should be pursued as a trademark infringement complaint in court. Moreover, because of the truncated nature of the proceedings, electronic dispute resolution is not well suited to cases with hotly disputed factual assertions, requiring complex credibility determinations. Given the absence of a live hearing, cases that turn on disputed facts should instead be resolved in court, where discovery and cross-examination can permit a fact finder to navigate the shoals of conflicting testimony.

Other issues that have arisen in the first year of the UDRP center around procedural aspects of the rules. Foremost among the misunderstandings is whether complainants can submit a reply after the domain name registrant responds to the complaint. The ICANN rules do not have any provision for replies, and thus a number of panels have refused to consider replies absent a compelling showing (such as to present new facts to the panel, to alert the panel to new case law developments, or to address a factual argument that could not possibly have been anticipated). Other panels, though, willingly accept replies (and even sur-replies), which inevitably causes delays of the final decision and increased cost for the parties. These divergent practices undermine the goal of consistent application of the UDRP rules, which tends to reduce the public’s faith in the process as providing an unbiased, fair forum for resolution of disputes.

To address this perceived unfairness, one of the four approved providers (NAF) has revised its supplemental rules to expressly permit replies so long as they are filed within 5 days and accompanied by a $150 filing fee. This revision, though, has beget its own unfairness: because complainants in NAF proceedings are treated differently, this new rule encourages forum shopping. The better practice would be for the ICANN rules (and for the rules of any similar systems set up for online resolution of other kinds of disputes) explicitly to address whether and under what circumstances replies may be filed (and whether respondents may then submit sur-reply) to ensure consistency in the process among the various providers. Moreover, making this decision at the ICANN level is more appropriate because ICANN is in the best position to weigh, as a matter of policy, the benefits of allowing further replies against the disadvantages of greater cost and delay. (Footnote 3)

In the meantime, because of the inconsistent application of the rules on replies, parties in UDRP proceedings are well advised to submit detailed complaints and responses so that all of the relevant facts and arguments are before the panel in the initial submission. These submissions should be approached like summary judgment briefs – gather all relevant evidence, organize it in a way that makes sense and tells a compelling story, and present it to the panel with appropriate affidavit support and citations to analogous UDRP decisions.

In addition to preparing a detailed submission, each party should consider whether it prefers a one- or three-member panel of arbitrators. The advantage of a single arbitrator, in addition to the lower cost, is that one person generally can write and issue a decision more quickly. In contrast, it sometimes can take weeks for three-member panels to issue their decisions, especially when the members reside on different continents. It thus is not unusual for three-member panels to take three- or four-week extensions of time for issuing their decisions, which is a significant delay in the context of a proceeding that should take just 45 days. When the dispute raises a close, difficult issue, though, it may be worth requesting (and paying for) a three-member panel, notwithstanding the delay, to try to ensure that the dispute is considered from a number of different angles and that the decision openly is discussed among three arbitrators.

Consistency and the Role of Precedent

Which leads to another substantive reform that would improve the UDRP process and should be considered in any other electronic dispute resolution programs: ensuring more consistent decision making by arbitration panels. To this end, panels should be required to provide fully reasoned decisions that explain the basis for their conclusions. Although most UDRP decisions already do so, some decisions are quite cryptic in their analysis. These short, win-or-lose decisions provide little guidance to the parties, let alone to potential future litigants.

This raises the question of the role that precedent should play in UDRP cases. Parties often cite favorable UDRP decisions in their submissions in an effort to persuade panelists to rule in their favor. This is very helpful to the panelists for two reasons. First, given the lack of any effective index to UDRP decisions and the limited time that panelists have to write their decisions, it is difficult for panelists to conduct independent research. Second, reviewing the decisions of other panels that have grappled with the same issues can help panelists as they analyze the circumstances in the cases pending before them.

That is not to say that subsequent panels are necessarily bound to follow earlier decisions. Although precedent must have its place in any system of laws (especially if the system is to earn the respect of participants), panels effectively act as sister courts, and they are not strictly required to follow the rulings of other panels. Nevertheless, if panels regularly ignore precedent, the result will be a loss of confidence in the process, especially if parties come to believe that results are random, based on the identity of the panel in each case. Thus, where relevant precedent exists, subsequent panels should either follow the precedent or, if they disagree, provide detailed reasoning to explain why the panel declines to follow the particular holding. This will foster a debate among panels that, eventually, will result in the emergence of a consensus. At that point, even panelists who disagree with the consensus should have an obligation to follow the precedent and ensure consistency. Otherwise, the UDRP system will degenerate into a meaningless stream of inconsistent decisions, confused jurisprudence, and forum shopping by litigants.

Another way to address the problem of inconsistent decisions would be to add an appellate layer to the ADR process. If heavily used, though, that new level of complexity would undermine the process’ goals of speedy, inexpensive decisions. A possible compromise solution would be an appellate panel that had the discretion to accept a small number of appeals each month, by petition (and upon payment of an appropriate fee by the appellant), for the sole purpose of resolving conflicting rulings among the panels.

A Model for the Future?

There are other, smaller, ways in which the UDRP process could be improved. For example, it would be more efficient if all exhibits were scanned and submitted electronically, which would allow all communications to be done by email (instead of by email with hard copies to follow by courier). The rules should provide an easy mechanism for the automatic transfer of domain names when parties are able amicably to settle a dispute after the filing of a complaint. And it may be fairer to give the parties some ability to object to proposed arbitrators (perhaps on a peremptory challenge basis) rather than forcing the parties to accept

These comments, though, are mere quibbles when compared with the substantial success already achieved by the UDRP process. Those successes not only show that the UDRP is a viable model for the resolution of domain name disputes, but also suggest other kinds of disputes that may be amenable to resolution using similar processes. Many domain name disputes are well suited to this system because there are few facts in dispute, and because the standards for cybersquatting are fairly well developed. Traditional trademark infringement claims, in contrast, are poorly suited to this system because they turn on the fact-specific question of whether there is a likelihood of confusion. Other classes of cases that may be naturals for similar systems include disputes over on-line auctions, consumer complaints arising out of e-commerce transactions, challenges to competitors’ online advertising, and B2B breach of contract disputes.

ICANN’s innovative electronic dispute resolution process has helped resolve thousands of disputes over domain names quickly and efficiently. It also can serve as a model for the future – for a future where a wide variety of disputes are resolved, quickly and efficiently, in the online environment.


  1. David H. Bernstein is a partner in the international law firm of Debevoise & Plimpton. Mr. Bernstein, who is resident in the firm’s New York office, is an active UDRP arbitrator and has presided over more than 30 UDRP cases. He is a member of the arbitration panels of both the WIPO Arbitration and Mediation Center and the National Arbitration Forum. An earlier version of this paper was published in The New York Law Journal on August 21, 2000, under the title "Litigating by E-Mail With ‘UDRP’: Lessons From New Dispute Resolution Procedure for Domain Name Disputes." © Debevoise & Plimpton, 2000.
  2. Although the UDRP applies primarily to domain names in the .com, .net and .org top level domains, a number of countries (including Antigua and Barbuda, American Samoa, Ascencion Island, Bahamas, Cyprus, Guatemala, Namibia, Niue, Philippines, St. Helena, Trinidad and Tobago, Tuvalu, Venezuela and Western Samoa, as well as the Internet One listing service) have adopted a version of the UDRP, thus allowing disputes involving domain names in those country code top level domains to be resolved under the UDRP process as well. In addition, a number of the parties who have filed proposals with ICANN for new generic top level domains have agreed to adopt the UDRP for the resolution of domain name disputes in their registries.
  3. Because the NAF rule is inconsistent with the ICANN uniform rules, at least one NAF panel (on which the author sat) has refused to accept supplemental submissions, notwithstanding NAF’s rule: "Although Article 7 of The Forum's Supplemental Rules purports to permit . . . supplemental filings, the Rule does not require a Panel to accept those materials. In fact, the Supplemental Rule could not require Panels to accept these supplemental filings because that would violate Uniform Rule 12 of the ICANN Policy, which vests the discretion to request and accept supplemental materials solely with the Panel. No provider's Supplemental Rules can override the Policy or Uniform Rules and the discretion they vest in the Panels appointed thereunder." Electronic Commerce Media, Inc. v. Taos Mountain, Case No. FA0008000095344 (NAF Oct. 11, 2000).