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WIPO removes theory of Retroactive Bad Faith from Jurisprudential Panel View

June 16, 2017

The WIPO decision to remove references to retroactive bad faith (RBF) from its recently published update of WIPO Panel Views on Selected UDRP Questions, Third Edition WIPO Jurisprudential Overview 3.0 has been welcomed by many, including the Internet Commerce Association (ICA), a non-profit trade group representing the domain name industry who considered that the previous edition of the Overview (2.0) caused considerable damage by providing misleading guidance concerning the aforesaid RBF.

WIPO panel views are widely used by UDRP panelists as a reference tool in analysing UDRP applications and generally have considerable influence over panel decisions. Groups such as the ICA therefore consider it imperative for the Overview to reflect consensus views of panelists based on their UDRP rulings.

Since its establishment in 1999, the Uniform Domain Name Dispute Resolution Policy (UDRP) has required complainants to prove bad faith registration, i.e. that bad faith existed at the time of registering the domain name. If the trademark on which the UDRP was based was registered after the domain name, a finding of bad faith registration would, as a general rule, not be possible.

However, in a handful of decisions in 2009, including WIPO Case No. D2009-0643-Mummygold.com and WIPO Case No. D2009-0786 -Octogen.com, panelists ruled that even if a domain name had been registered in good faith, future use of the domain name in violation of rules existing at the time of registration, implied that bad faith existed at the time of registration. The theory became known as retroactive bad faith (RBF) and enabled certain complainants to obtain cancellation or transfer of domain names registerd prior to their trademarks.

The WIPO Overview 2.0 published in 2011 and intended to bring uniformity to the UDRP decision making process by acting as a guideline for panelists inexplicably included the above decisions characterizing them as a developing area of UDRP jurisprudence and implicitly legitimising the RBF theory.

Following publication of the above Overview, the theory of retroactive bad faith was used by a small number of UDRP panelists and rejected by the majority leading to a number of divergent and imcomprehensible decisions. It also inevitably led to an increase in the number of abusive UDRP applications and rulings of reverse domain name hijacking (RDNP) by panelists rejecting the RBF theory. These RDNP rulings were made against complainants for abuse of the UDRP process in claiming that a domain name was registered in bad faith despite being registered prior to the complainant’s trademark. 37 rulings for RDNPs were made in 2016, making it a record year.

An ICANN working group is currently reviewing the Rights Protection Mechanisms (RPMs) for all gTLDs in order to provide tighter guidelines for panelists in interpreting the Policy.

In the meantime, the decison by WIPO to remove the RBF theory from its Overview 3.0 will be welcomed by all.

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