Petroliam Nasional Berhad v. GoDaddy.com, Inc.

Filing 114

Declaration of Michael D. Palage in Support of 112 MOTION for Summary Judgment Notice of Motion, Motion, and Memorandum of Points and Authorities ISO Go Daddy's Motion for Summary Judgment filed byGoDaddy.com, Inc.. (Attachments: # 1 Exhibit 1)(Related document(s) 112 ) (Slafsky, John) (Filed on 11/2/2011)

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JOHN L. SLAFSKY, State Bar No. 195513
DAVID L. LANSKY, State Bar No. 199952
HOLLIS BETH HIRE, State Bar No. 203651
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304-1050
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]
[e-mail]

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Attorneys for Defendant/Counterclaimant
GODADDY.COM, INC.

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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PETROLIAM NASIONAL BERHAD,

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Plaintiff,

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vs.

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GODADDY.COM, INC.,

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Defendant.

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GODADDY.COM, INC.,
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Counterclaimant,
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vs.
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PETROLIAM NASIONAL BERHAD,
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Counterclaim Defendant.
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CASE NO.: 09-CV-5939 PJH
DECLARATION OF
MICHAEL D. PALAGE
IN SUPPORT OF GO DADDY’S
MOTION FOR SUMMARY
JUDGMENT

Date:
December 7, 2011
Time:
9:00 a.m.
Courtroom: 3
Honorable Phyllis J. Hamilton

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I, Michael D. Palage, declare:

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1.

I have been retained by GoDaddy.com, Inc. (“Go Daddy”) to provide expert

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opinions and testimony concerning the allegations contained in the First Amended Complaint as

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well as other pleadings in this matter. I make this declaration in support of Go Daddy’s Motion

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for Summary Judgment.
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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I.

QUALIFICATIONS
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I received a Bachelor of Sciences Degree in Electrical Engineering (B.S.E.E)

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from Drexel University and a Juris Doctor (J.D.) from Temple University’s Beasley School of

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Law, and I am currently an active member of the Florida Bar.

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3.

I have worked within the domain name industry for over a decade in connection

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with both registrars and registries. During that time, I have been intimately involved with the

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Internet Corporation for Assigned Names and Numbers (ICANN), the international non-profit

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organization that has been designated by the United States government to manage and coordinate

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the Internet’s unique identifiers (domain names and IP addresses).

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4.

Over the past twelve years I have held various leadership positions within

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ICANN, including: a three-year term on its Board of Directors from 2003 to 2006; Chair of the

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Registrar Constituency, the representative body for registrars before ICANN, from 1999 to 2003;

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Co-Chair of Working Group B, which was tasked to address the protection of trademarks in new

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gTLDs, in 1999; and Chair of the High Security Zone Advisory Group, which was charged with

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reducing malicious security issues in new gTLDs, from 2010 to 2011.

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5.

I was involved in drafting the original ICANN Uniform Dispute Resolution

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Policy (UDRP) for resolving trademark disputes between trademark holders and domain name

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registrants. The UDRP is now incorporated into over 130 million gTLD domain name

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registration agreements between registrars and their registrant-customers.

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6.

I have previously served as a domain name panelist (arbitrator) for the World

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Intellectual Property Organization (WIPO), a specialized agency of the United Nations and one

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of the providers approved by ICANN to administer UDRP proceedings.

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7.

I have testified before Congress and the United States Copyright Office on

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various Internet issues and have spoken as a lecturer or panelist concerning domain name issues

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at numerous meetings, seminars and conferences around the world.

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8.

In my role as a consultant, I am regularly involved in operational, technical, legal

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and policy matters of domain name registration authorities (registrars and registries). I have also

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consulted with registrars and registries to implement and operate trademark protection
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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mechanisms in approximately half of all new generic top-level domains (gTLDs) approved by

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ICANN over the last eleven years, among other projects.

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personal and business capacity.

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I am also the registrant of multiple domain names that have been used in both a

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A current CV setting forth my education and professional experience is attached

hereto as Exhibit No.1.

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Included in my CV is a list of legal proceedings in which I have testified at either

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deposition or trial in numerous Internet and domain name related matters.

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II.

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BASIS FOR TESTIMONY
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In preparing for my testimony, I have familiarized myself with the issues in this

case by reviewing the following documents:

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Plaintiff’s First Amended Complaint;

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Go Daddy’s Notice of Motion, Motion, and Memorandum of Points and
Authorities in Support of Defendant’s Motion to Dismiss First Amended
Complaint;

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Court’s Order Denying Motion to Dismiss, dated 5 May 2011;

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ICANN-accredited registrar Go Daddy’s website;

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ICANN-accredited registrar eNom’s website;

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ICANN-accredited registrar Network Solutions’ website;

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ICANN-accredited registrar TUCOWS’ website;

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ICANN-accredited registrar Schlund + Partner website;

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ICANN-accredited registrar MelbourneIT’s website;

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ICANN-accredited registrar ResellerClub’s website;

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ICANN-accredited registrar Moniker’s website;

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ICANN-accredited registrar Register.com’s website;

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ICANN-accredited registrar Key-System’s website;

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The legislative history of the Anti-Cybersquatting Consumer
Protection Act (ACPA), 15 USC 1125(d);

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Historical newspaper and periodical articles in connection with
domain name industry facts and figures;

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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ICANN’s website;

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The United States Government National Telecommunication and
Information Agency (NTIA) website;

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WIPO website; and

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Miscellaneous technical documentation. 1

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I understand that copies of these documents have previously been disclosed to plaintiff’s counsel.

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A copy of my expert report in this matter is attached hereto.

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III.

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SUMMARY OF CONCLUSIONS
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Based upon my professional expertise as set forth above, it is my opinion that the

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services provided by Go Daddy in connection with the domain names petronastower.net and

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petronastowers.net are consistent with core registrar services routinely provided by all the

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leading registrars. These routinely provided services include, but are not limited to, domain

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name resolution services. Domain name resolution services, such as routing and forwarding,

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have been consistently offered and rendered by registrars to their registrant-customers since at

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least as early as 1998.

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It is my further opinion that these core registrar services are the very type of

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services intended to fall within the registrar safe harbor provision set forth in the Anti-

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Cybersquatting Consumer Protection Act (ACPA), absent evidence of bad faith by the registrar.

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It is my further opinion that, based upon the allegations set forth in the First

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Amended Complaint and my analysis of Go Daddy’s conduct, there has been no bad faith

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exhibited by Go Daddy; in particular there has been no bad faith in connection with the domain

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name registration or resolution services that Go Daddy has provided with respect to the domain

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names petronastower.net and petronastowers.net.

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It is my further opinion that Go Daddy’s actions in not directly interjecting itself

into the middle of this trademark dispute between a trademark owner and domain name

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This documentation includes a Requests for Comments (“RFC”) and a book on the Domain
Name System (“DNS”).

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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registrant, and instead referring the trademark complainant to the UDRP (the expedited domain

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name dispute resolution process), is consistent with the standard operating procedure most

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registrars would follow. I do not believe that Go Daddy’s general practices for handling

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trademark complaints, as alleged in the First Amended Complaint, constitute bad faith in any

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way.

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It is my further opinion that granting the relief requested by Plaintiff – actual,

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treble or statutory damages, plus an attorney fee award, based on the conduct exhibited by

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Go Daddy in this dispute – would create new law with a direct and detrimental impact on a

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multi-billion dollar domain name industry and would impose a standard of operation on domain

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name registrars that was deemed unscalable and unduly burdensome as early as 1997, when

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only a million or fewer domain names were registered globally. Today there are over 215

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million domain names registered worldwide, so the responsibilities that Plaintiff now seeks to

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impose on registrars would even be more impracticable, particularly in light of ICANN’s

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proposed expansion of the Domain Name System (DNS) to encompass an unlimited number of

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new top-level domains.2

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IV.

THE DOMAIN NAME SYSTEM (DNS)

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A.

Evolution of the Domain Name Registration Authority (Registry/Registrar)
Marketplace

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Although the domain name system was first created in 1985, it was not until the

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mid- to late 1990’s that the number of domain names registrations by businesses and individuals

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began to explode.

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On January 1, 1993, Network Solutions Inc. (NSI) obtained the exclusive right to

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provide domain name registration services in the .COM, .NET and .ORG top-level domains. At

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that time there were a total of 21,000 domain names registered globally.

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ICANN has proposed the addition of countless new domain name extensions, such as
.hotel, .blog, .hitachi, .cannon, etc. New top-level domains of this kind are expected to be
introduced to the Internet as early as 2012.

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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Five years later that number increased to 2.2 million domain names registered

globally.

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From 1993 through December 1997, NSI provided these domain name

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registration services to end-users (registrants) primarily through a network of resellers (e.g.

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Internet Service Providers, web hosting companies, etc.). These resellers were largely

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responsible for providing the primary and secondary domain name servers associated with each

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domain name. As explained below, these name servers are necessary for “resolution” of domain

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names.

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In January 1998, NSI introduced “WorldNIC,” a suite of domain name services –

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including domain name resolution services – designed for small and medium size businesses.

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This represented NSI’s first “retail” domain name service, directed at registrants.

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In 1998 the United States government acknowledged ICANN as the global

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technical coordinator of the Internet’s unique identifiers (domain names and Internet Protocol

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(IP) addresses).

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One of ICANN’s initial objectives was to spur competition in the domain name

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space by introducing a marketplace of registrars to provide competition to the incumbent

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monopoly provider, NSI. Thereafter, NSI lost its monopoly and ICANN created a competitive

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marketplace with numerous ICANN-accredited registrars.

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Today there are over 215 million domain names registered across approximately

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300 top-level domains (generic top-level domains (gTLDs) and country-code top-level domains

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(ccTLDs)). However, over 130 million of these domain names are registered within five gTLDs

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(.COM, .NET, .ORG, .INFO, and .BIZ).

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Today, a few ICANN-accredited registries serve as the exclusive wholesaler for

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each specific TLD, and numerous competitive ICANN-accredited registrars function as retailers

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of domain name registration services in the various top-level domains.

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gTLD
.COM
.NET
.ORG

Registry Operator
VeriSign
VeriSign
Public Interest

DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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Domain Names
97,236,181
14,152,241
9,436,538

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.INFO
.BIZ

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Afilias
NeuStar

8,040,460
2,134,085

Source: DomainTools: http://www.domaintools.com/internet-statistics/ (September 2011).
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The diagram below provides a high level over view of the current domain name

marketplace:

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A “registry” is the entity responsible for maintaining the authoritative, master

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database of all domain names and associated function information registered in each top-level

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domain. The registry for the .NET gTLD is VeriSign.

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A “registrar” is an entity that registers and maintains domain names with the

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Registry on behalf of the Registrant. All ICANN-accredited registries must use ICANN-

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accredited registrars to perform domain name registration and maintenance. Today, Go Daddy,

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according to its public statements, is the world’s largest of over 900 ICANN-accredited registrars

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with in excess of 50 million domain names registered.

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A “registrant” is the individual or organization that registers a specific domain

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name within a given TLD, and holds the right to use that specific domain name for a specified

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period of time, provided certain conditions are met and the registration fees are paid.

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Go Daddy’s domain name customers are examples of registrants.

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31.

Registrants can freely transfer domain names among registrars (after an initial,

brief time period following registration).

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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B.

TECHNICAL OVERVIEW OF THE INTERNET’S UNIQUE
IDENTIFIERS

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It is a fundamental principle of the Internet’s architecture that each host computer

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has a unique address (IP Address). This guarantees that the information being sent across the

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Internet will arrive at the proper designation. This is somewhat analogous to the postal system

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that distinguishes between Hollywood, Florida and Hollywood, California.

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IP Addresses have historically been represented by a series of numbers and dots

that represent individual host computers on the Internet.
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For example, the IP Address for the computer currently hosting the United States

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District Court for the Northern District of California’s website is 206.18.146.127. This unique IP

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Address allows all the computers connected to the Internet to find the Court’s website. This is in

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the same manner that the unique telephone number 1-415-522-2000 allows people to contact the

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Clerk’s office through the existing telephone network.

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It is not practical for people to have to remember IP addresses for the websites

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they are seeking on the Internet. The Domain Name System (DNS) thus allows users to utilize,

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user-friendly names when looking for other host computers, instead of having to remember and

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use their IP Addresses. An Internet user, for example, instead of having to remember the IP

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address 206.18.146.127 to get to the Court’s website, can simply type http://cand.uscourts.gov

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into her Web browser.

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The names in the DNS database establish a logical tree structure called the

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domain name space. The top of the DNS is called the dot (“.”) or root of the DNS database on

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the Internet. Under the root is a set of names called top-level domains. Each of these top-level

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domains contains a set of records (zone files) comprising information about certain domain

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names registered in that TLD.

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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37.

This hierarchal/tree structure is illustrated in the diagram below.

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This DNS query system leads an Internet user from the root nameserver to the TLD nameserver

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and then to the authoritative nameserver, which does not host any web content but does (via

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resource records) point the user to the requested website. In this manner the DNS functions as

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the Internet’s equivalent of “directory assistance.”

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When an individual or business wants to register a domain name, she or it must

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register it through an ICANN-accredited registrar, who is required to collect a set of information

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from the registrant.

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In particular, in accordance with Section 3.2.1 of the 2009 ICANN Registrar

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Accreditation Agreement (“RAA”) between registrars and ICANN, a registrar is required to

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collect the following data from a domain name registrant as well as reasonable assurance of

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payment of its registration fee:

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3.2.1.1 The name of the Registered Name being registered;

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3.2.1.2

The IP addresses of the primary nameserver and secondary

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nameserver(s) for the Registered Name;

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3.2.1.3 The corresponding names of those nameservers;

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3.2.1.4

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Unless automatically generated by the registry system, the identity of the
Registrar;

3.2.1.5

Unless automatically generated by the registry system, the expiration
date of the registration; and

3.2.1.6 Any other data the Registry Operator requires be submitted to it.
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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Prior versions of the RAA imposed similar obligations on registrars.
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Because almost all gTLD domain name registrations are accepted on a first-come,

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first-served basis, the vast majority of registrars provide default information in connection with

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sections 3.2.1.2 and 3.2.1.3 of the RAA – nameserver information – to speed the registration

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process, unless, where expressly instructed otherwise by a registrant. The nameservers are used

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in connection with domain name resolution: linking domain names to their corresponding IP

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addresses on the Internet. Each domain name is said to “resolve” to a corresponding IP address.

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C.

RESOLUTION SERVICES

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Registrars routinely provide resolution services, such as routing and forwarding,

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to registrants. The terms resolution, routing and forwarding are commonly used interchangeably.
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Registrars have been routinely providing resolution services since as early as

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1998, when NSI began providing primary and secondary domain name resolution services in

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connection with its WorldNIC suite of services.

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Registrars play a critical role in domain name resolution, as they are the exclusive

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avenue by which registrants can make changes at the registry in connection with nameserver

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information. Without registrars providing this service, third parties would be unable to access

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websites or to send e-mail messages associated with that domain name.

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44.

A registrant, after registering the domain name, has a number of resolution

options to choose from:
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The registrant can do nothing and allow the name servers to be propagated
with the default IP address information provided by the registrar. This
default information is most probably going to have the domain name
resolve to a “coming soon” page;

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The registrant can develop some basic content on the website;

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The registrant can configure the name servers to point the domain name to
a web hosting plan hosted by that registrar;

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The registrant can configure the name servers to point the domain name
to a web hosting plan hosted by a third party;

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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The registrant can point the domain name or a sub-domain within that
domain to an existing domain name and/or URL3;

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The registrant can configure the Resource Records on the nameserver so
they return a “record not found” error; or

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The registrant can configure the domain name so that it points to a parked
page/link farm to generate pay-per-click revenue, typically via online
advertising.

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In short, “resolution” services refer to the process when an Internet user accesses

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a website by typing the domain name into a browser window. At that point the Internet user’s

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ISP (typically a phone company or a cable service, like AT&T or Cox Cable) checks the registry

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for the IP address and location information, and then sends the Internet user to the proper website

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content.

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D.

DOMAIN NAME FORWARDING SERVICES

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46.

I am familiar with domain name forwarding, including the history of

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forwarding and its current uses.

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A registrant who desires her registrar to provide resolution of her domain name

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provides the registrar with nameserver information. A registrant who desires her registrar to

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forward her domain name provides a URL address for a pre-existing website.

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Any distinctions between domain name forwarding and other resolution services

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are highly technical. From the perspective of a domain name registrant or Internet user,

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however, domain name forwarding is essentially the same as other resolution services. Simply

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stated, domain name forwarding is an automated process in which a registrant points a domain

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name to a website, and then the registrar directs traffic to that designated website.

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Domain name forwarding is a ubiquitous service offered by the leading registrars.

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The registrars have bundled domain name forwarding into the basic “tool box” or “dashboard”

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that a domain name registrant uses to manage her domain names. These dashboards, accessed

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through the domain name registrar’s websites, are user-friendly graphical interfaces that allow

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This is the option which, I understand, the registrant of the two disputed domain names in
this lawsuit selected.

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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domain name registrants with little or no technical expertise to manage their domain names.

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With easy to use point-and-click options, the dashboards allow registrants to make changes

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regarding their domain names seamlessly and automatically.

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One of the easily accessible features available on the registrar’s dashboard is

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the option to change the resolution of the domain name. In a few mouse clicks, a domain

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name registrant can quickly access the dashboard feature and direct the domain name registrar

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to route the domain name to a different IP address (i.e., a different hosting computer), or to

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forward the domain name to a different URL or existing website. For example, beginning

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from Go Daddy’s My Account page, a registrant simply clicks on the domain name that she

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wishes to configure. (See circle below)

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51.

The user/registrant then pulls down the Forward menu-bar and clicks on Forward

Domain. See red circle below.

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DECLARATION OF MICHAEL D. PALAGE
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52.

The registrant is then provided a simple interface to point the domain name to the

domain and/or URL of her choosing. This is “forwarding.”

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53.

Registrars like Go Daddy, by giving registrants an efficient way to configure

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domain name servers to point to desired Internet content, play a critical role in the domain

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name resolution (routing or forwarding) process.

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54.

There are a number of widely accepted personal/commercial uses that incorporate

domain name forwarding services, including but not limited to:
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In connection with corporate mergers. Pacific Telesis (PacBell) was one
of the seven original Baby Bells created back in 1983 following the
break-up of AT&T. Any user typing PACBELL.COM into a web
browser today is automatically forwarded to the current ATT.COM
website. This feature allows companies to phase out trademarks and
domain names while providing a seamless navigation experience to the
end user – when an Internet user types in the old, retired trademark or
domain name, he or she is automatically forwarded to the new website
located at the new domain name.

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Business and trademark owners also use domain name forwarding to
help Internet users more seamlessly navigate to where they are intending
to go. If an Internet user was to type the domain name wwwyahoo.com
into a browser window with no “.” between the www and yahoo, domain
name forwarding seamlessly and automatically redirects the Internet user
from the wwwyahoo.com domain name to the yahoo.com website.

•

A domain name registrant can choose to forward a domain name with or
without “masking.” The only difference is: when “masking” is enabled,
the domain name that the Internet user typed appears in the browser
window (i.e., wwwyahoo.com, without the “.” between the “www” and
“yahoo”). When masking is not enabled, the destination website’s domain
name appears in the browser window instead (in this example,
“www.yahoo.com”). Masking is a useful tool in connection with website
migration/ transition, allowing a company to simultaneously launch a new

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DECLARATION OF MICHAEL D. PALAGE
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website with increased structure and functionality, while still linking to the
old content hosted at the old domain names and URLs.

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Domain name forwarding also represents a potential cost saving to
students and consumers. Individuals are commonly given free web sites
by their local ISP or school, however, the URL is generally not very
attractive or memorable, e.g. www.local-isp.com/~user-xyz or www.localschool.edu/~student-name. Domain name forwarding with masking
empowers a registrant to automatically redirect traffic from content hosted
on a lengthier domain name/URL to a shorter and more memorable
domain name that appears in the browser window.

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55.

In preparation of this report, I identified the top-ten ICANN-accredited registrars

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based upon their current gTLD market share:
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Source: WEBHOSTING.INFO (http://www.webhosting.info/registrars/top-registrars/global/)
(September 2011)

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My review of these registrars’ websites revealed that domain name forwarding is

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a ubiquitous service offered by the top-ten registrars, irrespective of their geographic location or
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their business model.
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E.

HISTORICAL OVERVIEW OF DOMAIN NAME CYBERSQUATTING

57.

Cybersquatting can be broadly defined as an individual’s bad faith intent to profit

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from the goodwill of another's trademark, by registering, trafficking in, or using a domain name
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that is identical to, or confusingly similar to a distinctive mark, or dilutive of a famous mark. See
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15 U.S.C. § 1125.
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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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Pre-ICANN

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58.

When the Internet was perceived to have de minimis commercial value, the first

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attempts to profit off of domain names failed. In August 1994, Jim Cashel registered 18 domain

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names that incorporated well-known trademarks such as HERTZ and ESQUIRE. However, after

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responding to a flood of calls from curious reporters, Mr. Cashel simply relinquished the domain

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names.

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59.

During NSI’s monopoly over the registration services in the .COM, .ORG and

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.NET top-level domains (1993-1999), it provided domain name registrations on a first-come

9

first-serve basis. Its original policy on disputes was set forth in RFC (“Request for Comment”)

10

1591, which provided in relevant part:

11

In case of a dispute between domain name registrants as to the rights to a
particular name, the registration authority shall have no role or responsibility
other than to provide the contact information to both parties.

12
13

The registration of a domain name does not have any Trademark status. It is up to
the requestor to be sure he is not violating anyone else's Trademark.

14
15

60.

In response to a growing number of trademark disputes involving domain names,

16

NSI modified its domain name Dispute Policy three times over the next two and half years. The

17

basic premise of this new Dispute Policy was one in which a registered trademark owner could

18

have a domain name placed on hold if the domain name registrant was unable to demonstrate

19

equal or superior rights.

20

61.

However, under the Dispute Policy, putting a domain name on hold did not entitle

21

the trademark owner to secure the domain name. In order to effectuate a transfer of the domain

22

name, the trademark owner still had to file a proceeding in a court of competent jurisdiction and

23

prevail by securing a court order. This process was not only costly but time-consuming, as

24

registrants could evade service of process by using fraudulent registrant data in the public

25

WHOIS database.

26

62.

27

Notwithstanding its domain name registration policy, designed to mitigate harm

to trademark owners, by 1997 NSI had been named as a defendant in over 30 trademark

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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litigation disputes based upon its role as a technical domain name registration authority

2

(registry/registrar).

3

63.

However, in November 1997 Judge Pregerson of the federal district court in Los

4

Angeles issued the landmark decision in Lockheed Martin Corp. v. Network Solutions Inc. 985 F.

5

Supp 949 (C.D. Cal. 1997), granting summary judgment to the defendant registrar NSI. The

6

Court ruled, in particular, that NSI could not be held liable for direct or contributory

7

infringement in connection with its limited technical role as a registrar. This decision was

8

subsequently affirmed by the U.S. Court of Appeals for the Ninth Circuit.

9
10

The Uniform Dispute Resolution Policy (UDRP)
64.

On October 24, 1999, the ICANN board adopted the Uniform Dispute Resolution

11

Policy (UDRP) and contractually required all ICANN-accredited registrars to incorporate this

12

provision into their domain name registration agreements. This provision subjected all domain

13

name registrants to a mandatory administrative review where a complaint is filed alleging

14

abusive domain name registration.

15

65.

The UDRP was designed to address many of the shortcomings of the previous

16

NSI dispute policies, by providing a way for trademark owners to obtain a transfer/cancellation

17

of a domain name in a timely and cost-effective manner.

18

66.

Under the UDRP, in order to prevail, a trademark complainant must establish:

19

(1) the domain name is identical or confusingly similar to a trademark or service mark in which

20

the complainant has rights; and (2) that the domain name registrant has no rights or legitimate

21

interests in respect of the domain name; and (3) the domain name has been registered and is

22

being used in bad faith.

23
24
25
26
27
28

67.

The UDRP provides the following non-exhaustive criteria for establishing a

finding of bad faith on behalf of a domain name registrant:
(i)

circumstances indicating that you have registered or you have
acquired the domain name primarily for the purpose of selling,
renting, or otherwise transferring the domain name registration to
the complainant who is the owner of the trademark or service mark
or to a competitor of that complainant, for valuable consideration
in excess of your documented out-of-pocket costs directly related
to the domain name; or

DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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(ii)

you have registered the domain name in order to prevent the owner
of the trademark or service mark from reflecting the mark in a
corresponding domain name, provided that you have engaged in a
pattern of such conduct; or

(iii)

you have registered the domain name primarily for the purpose of
disrupting the business of a competitor; or

(iv)

1

by using the domain name, you have intentionally attempted to
attract, for commercial gain, Internet users to your web site or
other on-line location, by creating a likelihood of confusion with
the complainant's mark as to the source, sponsorship, affiliation, or
endorsement of your web site or location or of a product or service
on your web site or location.

2
3
4
5
6
7
8
9

68.

I understand that the average pendency of a UDRP arbitration proceeding is

10

approximately 60 days. I also understand that trademark owners tend to prevail in these

11

proceedings over 85% of the time.

12

69.

The success of the UDRP as a cost-efficient and timely mechanism to provide

13

trademark owners the relief they are looking for, while removing domain name registration

14

authorities from the dispute, is evidenced by a recent WIPO document. The document states that

15

as of August 2011, there have been over 36,000 UDRP domain name dispute resolution

16

proceedings filed since the original creation of the UDRP back in 1999.

17
18

70.

In fact, Plaintiff has successfully used the UDRP at least four times in the past to

secure the transfer of a domain name that had been allegedly registered in bad faith:

19

•

Petroliam Nasional Berhad v. Daniela Naidu (WIPO D2000-1777);

20

•

Petroliam Nasional Berhad v. Internet Prolink SA (WIPO D2001-0379);

21

•

Petroliam Nasional Berhah(sic) v. Pertronasgas.com Inc. (WIPO
D2002-0709) and

•

Petroliam Nasional Berhad v. Kim Harrison (NAF FA0712001123094)4

22
23
24
25
26
27

4

NAF refers to the National Arbitration Forum, another ICANN-accredited provider of
dispute resolution services under the UDRP.

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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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1

Anti-Cybersquatting Consumer Protection Act (ACPA)

2

71.

The Anti-Cybersquatting Consumer Protection Act (ACPA), 15 USC §1125(d),

3

was intended to boost consumer protection and assist trademark owners in connection with

4

electronic commerce by providing additional tools for trademark owners to pursue

5

cybersquatters. It was intended as well to codify case law limiting the secondary liability of

6

domain name registration authorities (registrars and registries).

7

72.

However, the ACPA was not written in a vacuum; in fact, it was intended to

8

dovetail into the work that ICANN was undertaking at the time in connection with the UDRP, as

9

evidenced by the following excerpt from the Congressional Record:

10

On the one hand ICANN, the private sector organization tasked by the
Department of Commerce to manage domain names, is establishing a
uniform dispute resolution mechanism for domain name registrars. That
work is very important, and I hope the outcome of that process yields a
mechanism that will be truly effective in protecting marks.

11
12
13

However, even with a private party dispute resolution process, there
needs to be appropriate legal remedies where individuals seek to exploit
through what amounts to extortion the registration of domain names. I
think that this legislation sets out the appropriate legal framework and
will certainly enhance the effectiveness of the protection of marks in this
global electronic environment.

14
15
16
17
18

Committee Reports, 106th Congress, House Reports H10827.
73.

The ACPA strengthens the rights and remedies trademark owners have against

19

cybersquatters, most importantly by providing in rem jurisdiction over certain domain names and

20

statutory damages up to $100,000 per bad faith domain name registration.

21

74.

Under the ACPA, a trademark owner must establish that the defendant (1) has a

22

bad faith intent to profit from that mark; AND (2) registers, traffics in, or uses a domain name

23

that is (a) identical to or confusingly similar to that mark, OR (b) identical or confusingly similar

24

to or dilutive of a famous mark.

25

F.

STANDARD REGISTRAR RESPONSES TO TRADEMARK CLAIMS

26

75.

The standard operating procedure for most registration authorities is to avoid

27

unnecessarily placing itself in the middle of two parties’ disputing trademark rights in a domain

28

name. In fact this action is consistent with the advice that ICANN places on its own website:
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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2
3
4
5
6
7
8
9
10

Source: http://www.icann.org/en/compliance/faq.html
76.

Registration authorities (registrars/registries) will almost always, absent

11

extraordinary circumstances, direct a trademark owner or their representative to the UDRP,

12

and/or inform them of their willingness to comply with a court order from a court of competent

13

jurisdiction.

14

77.

Extraordinary circumstances that would cause a registrar to deviate from its

15

policy include: risk to national security; risk to security/stability of the Internet; evidence of

16

potential fraud in a party obtaining a court order; or an unauthorized domain name transfer

17

(hijacked domain name). An alleged cybersquatting incident where a domain name registrant

18

has registered a domain name and routed or forwarded the domain name to a pornography site

19

would not be considered an extraordinary circumstance.

20

G.

ANALYSIS OF GO DADDY’S ACTIONS IN THIS DISPUTE

21

78.

It is my professional opinion based upon over 17 years of domain name

22

experience (including but not limited to my work as an attorney, my work for ICANN, my work

23

for other ICANN-accredited registrars, my work as a WIPO domain name dispute resolution

24

panelist, my work as a consultant to 50% of all new ICANN approved gTLD registry operators,

25

my Congressional testimony, and my work as author of the intellectual property rights protection

26

mechanism that has now been mandated into the launch of new domain name extensions) that

27

Go Daddy’s actions in responding to the repeated inquiries from Plaintiff in connection with the

28
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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two domain names at issue in this lawsuit were reasonable and consistent with the standard

2

practices followed by most ICANN-accredited registrars.

3

79.

It is also my professional opinion that, based upon the allegations set forth in the

4

First Amended Complaint and my analysis of Go Daddy’s conduct, there has been no bad faith

5

exhibited by Go Daddy; in particular there has been no bad faith in connection with the domain

6

name registration and resolution (routing/forwarding) services that it has provided with respect to

7

the domain names petronastower.net and petronastowers.net.

8

80.

It is also my professional opinion that a domain name registration authority’s

9

(registry/registrar) decision to take no action in connection with repeated demands/threats from

10

a trademark owner does not rise to a level of bad faith today, no more than it did back in 1997

11

when the initial Lockheed v. Network Solutions opinion was issued.

12

81.

It is my professional opinion the registration of the domain names

13

petronastower.net and petronastowers.net by Go Daddy’s customer led to exactly the type of

14

domain name disputes that the UDRP was intended and designed to handle.

15

82.

It is my further professional opinion as a former WIPO UDRP panelist and my

16

extensive firsthand experience with domain name dispute proceedings that Plaintiff could have

17

secured both of these disputed domain names in less than 60 days and for a cost (attorney fees +

18

filing fees) of less than $10,000 if it had used the UDRP back in November of 2009, when Go

19

Daddy first called Plaintiff’s attention to the UDRP. (As stated above, Plaintiff was already

20

aware of the UDRP based on its prior experience with domain name disputes).

21

83.

It is my professional opinion that granting the relief requested by Plaintiff –

22

money damages and an attorney fee award – would create new law with a direct and detrimental

23

impact on the multi-billion global domain name industry with over 215 million domain names

24

registered worldwide, and would seek to impose a standard of operation on registration

25

authorities that was deemed un-scalable and unduly burdensome back in the Spring of 1997,

26

when only 828,000 domain names were registered globally.

27
28

84.

To put this in perspective, Go Daddy now has over 50 million domain names

under management as of September 2011. Back in the fall of 1997, the original and sole
DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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1

registrar NSI was burdened with over 30 trademark litigation matters while managing only

2

approximately one million domain name registrations. Assuming that society has not become

3

less litigious over the last decade, and given the number of domain names under its

4

management today, Go Daddy could be expected to be challenged in excess of 1100

5

trademark lawsuits, if the Plaintiff succeeds in doing away with over a decade of established

6

law shielding registrars from liability in cybersquatting disputes like this one.

7
8

I declare under penalty of perjury that the foregoing is true and correct and that this
declaration is executed the 31 day of October 2011, at Tequesta, Florida.

9
10
11
Michael D. Palage
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15
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DECLARATION OF MICHAEL D. PALAGE
Case No: 09-CV-5939 PJH

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