NEWS Ascending clock to separate gTLD applicants


An ‘ascending clock’ auctioning model will decide who will own the gTLDs leſt in direct contention, according to ICANN.


Tere are 207 gTLDs, including .app and .home, which will require separating at a ‘last resort’ auction unless the applicants can resolve ownership disputes privately. Some private auctions have already been held.


Under draſt rules published on October 31, Power Auctions LLC will oversee the online auctions, setting a start and end price for each round. Parties matching the end price will enter the next round.


When only one applicant matches the end price, it wins the auction, paying the price of the highest exit bid—which is less than the end price. If no-one meets the end price, the party with the highest exit bid will be the winner, with the price equalling the second- highest exit bid.


In some cases, a tie breaker may be needed to separate exit bids. In this round, the highest bid wins, but a party cannot submit a bid that is more than $50,000 higher than its deposit.


Each applicant will have a bidding limit, based on a pre-paid deposit. If the deposit is less than $2 million, the bidding limit will be 10 x the deposit, while the limit will be deemed ‘unlimited’ if the deposit is more than $2 million.


Te rules published by ICANN apply only to directly contested applications. Some bids may be indirectly conflicted, however, which means they are in contention with some applicants in one contention set, but not others. Tis situation can arise when only one applicant for a contended .shop, for example, successfully objects to a rival .shopping application.


According to Power Auctions, if indirect conflicts arise, “ICANN or the auction manager may issue an addendum to the auction rules to address indirect contention. Such an addendum will have the same force as these auction rules.”


Te lack of clarity regarding indirect contention is just one of several examples of the draſt’s worrying lack of details, said Stéphane Van Gelder, chairman of Stéphane Van Gelder Consulting.


“Tere is vagueness with regards to the amount of money needed to run auctions beyond the $20


Zynga scores partial victory over Mattel in Scrabble battle


An imitation of popular word play game Scrabble did not infringe on trademarks belonging to the original game but will have to change part of its logo, a UK court has ruled.


Te High Court ruled that the name ‘Scramble With Friends’, produced by online games company Zynga, was not too similar to Scrabble.


Mattel, the owner of Scrabble, had sought an injunction against Zynga from marketing the game on the grounds that its name would confuse customers into thinking they were purchasing a Scrabble game.


It asserted Community Trademarks numbers 401737 for the word Scrabble, 401489 (a figurative mark) for its logo and 6223077 for the word registered in respect of computer soſtware and computer games.


However, in a ruling issued on November 1, High Court Judge Justice Peter Smith dismissed Mattel’s argument but accepted Zynga’s use of a curved letter ‘m’ in its logo could cause confusion because it could be interpreted to spell out Scrabble.


Judge Smith wrote he was “firmly of the view” 12


that Zynga’s present logo, which features a slanted ‘m’ “gives the impression that the word is Scrabble when one looks at it quickly”.


But Smith added: “Other than that I do not accept there is any actionable claim against the use of the word Scramble in respect of the Scrabble trademarks.


“Zynga is using a word which is descriptive of the game and is in the public domain as regards describing games of that nature and is commonly used in word games.”


Matthew Sammon, trademark attorney at Marks & Clerk LLP in Manchester, UK, said he was “surprised” so much emphasis had been placed on the shape of the letter ‘m’.


“Given how well Zynga fared in regards to the rest of the case it’s quite surprising that this part went against them,” Sammon said, adding that Mattel would have been expected to claim the ‘m’ was shaped differently on purpose.


“Te fact it’s not an ordinary shaped ‘m’ does bring it slightly closer, but the strong wording from Judge Smith seems fairly adamant it looks like a ‘b’. I’m not sure I would agree.


Trademarks Brands and the Internet Volume 2, Issue 4


“I think it is likely Zynga will appeal against this part, although given the platform (a mobile app) amending the logo should prove a fairly minor task.”


During the case, Mattel had permission to refer to two surveys when providing evidence of confusion, but Judge Smith wrote that none of those involved in giving answers was called as a witness and, as a result, ruled that the surveys carried “no evidential weight whatsoever”.


“It’s interesting to note how difficult it is to get survey evidence accepted into a trial,” Sammon added.


“It’s pretty much the norm to reject survey-based evidence these days. If you use a survey as part of the evidence it is vital to call on the respondents as witnesses.


“Judge Smith was clear in his view that there is no substitute to hearing directly from witnesses or from those involved.”


Te case centred on a total of three trademarks aſter one of Mattel’s claims over the appearance of the game’s playing tiles was dismissed earlier this month. 


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million mark. If an applicant wants to run at more than $20 million, they have to deposit $2 million or more up front. Tat is per auction. What about when an applicant has an auction pending where the TLD has an objection from another party and that objection has not been resolved—will applicants be able to add money to their deposits?”


Other unanswered questions, he said, cover what country the deposits will be sent to, who gets the interest and what proceeds.


ICANN will do with auction


“It feels like ICANN has not been able to respond quickly enough; the auctions were supposed to begin in November and the rules have still not been set.


“I’m not very impressed,” he said, adding that applicants have been leſt in an “unfair situation”. 


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