TAGS: sucks, domain, name, registrar, ICANN, website, TLD, top level domain, Vox, Populi, sunrise, period, priority, operate, trademarks, contract, controversy, sale, price, premium, lock up, open, market, predatory scheme, pricing, coercive, extortion, cybersquatting, FTC, remedies, gripe, complaint site, consumer, advocacy

Domain names are an essential part of modern commerce and convey important information about a site’s affiliation and legitimacy. Consumers may briefly glance at the .com or .edu at the end of the page they land on to make sure they’re on the right site, but soon they may see an unfamiliar suffix next to their favorite brand’s page – .sucks.

In 2014, the Internet Corporation of Assigned Names and Numbers (ICANN), a California-based nonprofit that manages and coordinates domain names, agreed to allow Vox Populi, a Canadian domain name registrar, to operate the registry for the new “.sucks” top-level domain (TLD).
A registrar like Vox Populi provides important benefits to trademark owners. Owners have priority to register their trademarks with a new TLD during a “sunrise period,” before the TLD goes on sale to the general public. As part of Vox Populi’s contract with ICANN, Vox Populi was given the right to set the sale price of the “.sucks” domain, which it set at $2499 during the “sunrise period” – and promptly set off a public firestorm.

Critics claim that charging brands a premium price to obtain a “.sucks” domain during the short sunrise period forces trademark owners to pay high prices to lock up .sucks before it goes on the open market and “bad actors” can appropriate it to hurt a brand. In fact, big companies like Apple, Microsoft, and Taylor Swift “Inc.” have already begrudgingly paid up and bought their .sucks domain for fear of brand abuse.

Despite allowing Vox Populi to sell the .sucks domain, ICANN itself raised concerns over the registrar’s pricing scheme with the FTC, prompting Vox Populi to respond with a strong defense of its own. Vox Populi pointed to the legitimate purpose of the .sucks domain: to gather legitimate commentary and criticism of brands, and to promote free speech. Vox further noted the lack of proof that it broke any existing law, saying “[ICANN] merely suggest[ed] (without explanation or logic) that Vox Populi’s pricing may lead to “cybersquatting” that could damage trademark owners.”

In this respect, Vox is correct, as aggrieved trademark owners can still turn to ICANN’s dispute resolution process as well as remedies available under national trademark laws. Vox Populi also noted that it charges “market value” for the .sucks TLD, and that even ICANN’s president noted that price restrictions on TLDs like .sucks would be detrimental to the internet.

Nonetheless, U.S. federal regulators held a hearing in May to look into allegations that Vox Populi’s pricing was “predatory, exploitative, and coercive.” According to a letter to ICANN from the Intellectual Property Constituency, charging “exorbitant” prices for a TLD extorts companies by forcing them to preemptively register thousands of different TLDs to retain control of their brand and protect themselves from domain name squatters or other competitors. But in reality, this type of extreme defensive maneuver may not be feasible, or practical, for trademark owners.

Commentators Andrew Baum and David A. Copland, writing on Foley & Lardner’s blog, note that there is no way to block all potentially offensive variations of a “complaint” domain like .sucks (even if CompanyX bought “CompanyX.sucks,” a consumer could still buy “CompanyXreally.sucks,” etc.) Andrew and David further note that the high price charged by the registrar “[applies] to all purchasers — not just the trademark owner. It is questionable whether any person or entity wanting to establish a Transnational Airlines gripe site will want to spend that much for ‘transnational.sucks’ if “transnationalsucks.com” is available for a fraction of the cost.”

Moreover, once the sunrise period for .sucks ends, Vox Populi says it will drop the wholesale price of .sucks to $199, with a suggested retail price of $249 – both well within the range of most common TLD prices, according to domainincite.com. Thus trademark owners can always wait until the .sucks name hits the open market. Besides, there are other “complaint” domains – such as .gripe or .fail – so companies have had fair warning that their trademark may be a target of consumer anger.

The .sucks controversy likely reflects the term’s popularity as a slang term, as well as the TLD’s initial novelty and consumer advocacy potential. But this effect may dissipate once consumers become familiar with – and immune to – the “.sucks” message, or use available cheaper alternatives to air their grievances. Or, as Adobe’s General Counsel says, “the best way not to get included [in a .sucks domain] is not to suck.”