An International Perspective on Brand Abuse

Charlie Abrahams
Vice President & General Manager, EMEA, MarkMonitor®

The most recent MarkMonitor Brandjacking Index® showed that the distribution of grey market or counterfeit pharmaceutical items online continues unabated. Analysis of just six brands uncovered nearly three thousand sites with questionable items for sale, at a total annual value estimated at more than $10 Billion.

Given the risk to consumer health of medication which has been distributed without regulation, I am often asked how governments can allow this to continue – this is also true for car components, beverages or indeed anything that puts the consumer’s safety at risk. This question, however, fails to appreciate the international nature of the Internet which crosses borders and jurisdictions.

In our report, we found illicit sites that claimed to be based in one country but were hosted in another, processed financial transactions in a third country and shipped goods from yet another country. This type of set-up is a common one and illustrates the cross-jurisdictional challenges of illicit eCommerce. Add to this the fact that consumers from most countries in the world can access any site, anywhere, and you can see that the Internet is a legislative and policing nightmare.

In my home country the Royal Pharmaceutical Society has, in fact, been running a program for more than a year now, where legitimate Internet pharmacies may undergo a certification process and gain an accreditation logo based on a serial number. This has been very successful in that those displaying the logo can be identified as being legitimate outlets selling branded product under the appropriate legislation. But this does not prevent residents of Great Britain from accessing thousands of suspicious online pharmacies located elsewhere and having potentially damaging items shipped to them.

So, what can brand owners do to protect themselves from this global threat, which is outside the jurisdiction of any single government, and is so widespread that thousands of infringement incidents are occurring against many well-known brands every week?

The MarkMonitor view is that only brand owners can take ownership of the issue. A holistic and global approach is required to prevent, detect and respond to these attacks on brand reputations and the diversion of revenues:

Prevent – Register trademarks and domains in all major markets which are relevant to each brand. MarkMonitor can help advise on the right mix of registrations to optimize their domain name portfolio to meet a particular set of defensive and financial objectives.

Detect – Global search and monitoring is required to give the maximum coverage in detecting all visible cases of infringement of the relevant brands. Evidence needs to be captured and many details logged in order to take action. This needs to cover the full breadth of websites, trade and auction sites.

Respond – Most importantly, a number of different actions should be used to avoid a “whack-a-mole” effect (as one infringement is closed another opens up). This can include ISP takedown, cease and desist letters, VERO, and other measures to rapidly remove infringing listings or sites from view and ensure they do not reappear.

Here at MarkMonitor, we consider that with a strategy based upon these principles it is possible to reduce the bottom line impact of online brand abuse significantly and across all borders. We have already done this for a number of Fortune 100 organizations and are considered the market leader in online brand protection.

For more information or to ensure that you are taking a holistic approach to protecting your brand across borders and jurisdictions, please feel free to contact us.

Regards,
Charlie Abrahams

ICANN UPDATE

ICANN Seoul Update

The latest ICANN meeting in Seoul, saw that while the new gTLD program continues to be a widely discussed and hotly debated issue, there was definitely a sense of excitement and accomplishment around the anticipated release of IDN ccTLDs.

Top Level Internationalized Country Code Domains
ICANN's Board of Directors approved the plan to allow ccTLD operators to move forward with fully Internationalized Domain Names (IDNs). While IDNs have been available for years at the second level, IDNs in top-level extensions have only been available in Latin character sets. Under the newly approved plan, ccTLD registry managers may submit applications to operate TLDs in native character sets.

Because registration periods for these new IDN ccTLDs will likely occur in the first part of next year, brand owners should consider preparing now by reviewing international trademark portfolio holdings and identifying important brands that should be promoted and protected. Once these new IDN ccTLDs are allocated, it will be up to each ccTLD operator to roll out registrations in these new extensions as they see fit.

New gTLDs – Comment Periods and Open Timelines
While victory was being declared over the release of IDN ccTLDs, many discussions and sessions were still focused around the launch of the new gTLD program. In fact, many of the meeting attendees were prospective new gTLD applicants, promoting extensions such as .shop, .sports, and .music. There were many other gTLDs proposed and discussed as well.

The latest version of the Draft Applicant Guidebook was released for public comment just ahead of the Seoul meeting, and the public comment period has since closed. While there were some important changes, inclusion of Rights Protection Mechanisms (RPMs) were minimal. Two of the RPMs that had been proposed by the Implementation Recommendation Team (an IP Clearinghouse and a Uniform Rapid Suspension process) are now under review by ICANN's Generic Names Supporting Organization (GNSO). The GNSO is scheduled to provide feedback to ICANN staff this month.

The biggest question of all, 'when will the new gTLD application period open?' was never really answered. Rod Beckstrom, ICANN’s newly appointed CEO, stated that new gTLDs will be made available when, “we’ve adequately addressed the important issues that are on the table.” The important issues to which he was referring include efforts to address malicious conduct, further economic analysis, registry / registrar separation as well as root scaling and trademark protections related to the new gTLDs. Unfortunately, no concrete timelines for the launch of new gTLDs were released at the meeting. Prior to the Seoul meeting, ICANN had stated that the application period would begin in the second half of 2010.

Myriad Changes to Affect the Root Zone
With the introduction of new gTLDs, in addition to IPv6 and DNS Security (DNSSEC), there are concerns whether the existing infrastructure can accommodate all of these changes at one time. Recently, ICANN published a report detailing the potential risks to the root zone and that study is now open for public comment until the end of November. Clearly, ICANN is very cautious about creating instability in the root zone and this issue continues to be a hot button.

GNSO Appointments
In other ICANN news, the GNSO (Generic Names Supporting Organization) announced the election of Chuck Gomes as Chair, Olga Cavalli as interim Vice Chair of the Non Contracted Parties House and Stéphane Van Gelder as Vice Chair of the Contracted Parties House. The permanent Vice Chair of the Non Contracted Parties House will be communicated in the next few weeks. Also, the ICANN board approved WIPO's intention to move forward with electronic filing for UDRP complaints.

The Seoul event marked ICANN's third and final meeting for 2009. We look forward to continuing our participation and advocacy in 2010 and beyond.

For complete information about ICANN’s new gTLD initiative, visit the MarkMonitor dotBrand Resource Center.

 

© 2009 MarkMonitor Inc. All rights reserved. MarkMonitor® and Trusted Brand Broadcast System™ are trademarks of MarkMonitor Inc. All other trademarks included herein are the property of their respective owners. MarkMonitor solutions are protected by US patent rights, including US 7,346,605.  Other patents pending.

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