Volume 6 / Number 1 / Introduction
In the fall of 2001, Lewis and Clark Law School hosted its seventh annual Business Law Forum, bringing together scholars from around the country to discuss a topic of interest to small and emerging businesses. The topic of the 2001 Forum was Deciding ICANN Domain Name Disputes: Questioning Delegation, Fairness, and Consent. The papers presented at this Forum, along with two additional articles relating to the topic by individuals who were unable to attend the conference in person, are contained in this issue of the Journal of Small and Emerging Business Law.
The conference title only hints at the importance of the topics that are discussed in the articles contained in this issue. Since the creation of the Internet Corporation for Assigned Names and Numbers (ICANN) in 1998, many have questioned its legitimacy in various ways. The articles in this symposium issue address two central themes of legitimacy. The first theme concerns the legitimacy of ICANN’s role as regulator of the domain name system (DNS). ICANN considers its role to be to “coordinate the technical management of the Internet’s domain name system, the allocation of IP address space, the assignment of protocol parameters, and the management of the root server system.” In fulfilling this role, ICANN has established and implemented a variety of rules, guidelines, and policies. ICANN, structured as a not-for-profit corporation organized under the laws of California, took on this role after signing a series of documents with the U.S. Department of Commerce (DOC).
In the first article of this symposium issue, Edward Brunet places the arrangement between the DOC and ICANN in the context of the larger trend toward privatization. His article also provides a factual context, describing the emergence of ICANN and the series of contracts it has entered into with the DOC. While acknowledging the facts that support an argument that the U.S. government may not have had recognized authority over the DNS to begin with and thus could not delegate such “authority” to ICANN, he argues that the legislatively authorized contractual relationship between the DOC and ICANN fails to raise a delegation problem of any constitutional dimension. His article also foreshadows the second major theme of this symposium, discussing the quasi-judicial role assumed by ICANN in establishing a mandatory dispute resolution mechanism for resolving disputes between domain name holders and trademark owners. Brunet concludes, again, that there is no constitutional problem with ICANN’s activities. Finally, Brunet highlights the antitrust concerns that may loom in ICANN’s not so distant future.
Sidney Shapiro continues the discussion of privatization, arguing that “new institutional economics” offers a useful way to analyze the issue of accountability when private actors like ICANN are used to achieve public ends. New institutional economics, he asserts, supports the use of some private actors in policymaking roles. In the context of the DNS, he recognizes the following reality:
Some entity must perform the functions that ICANN undertakes. Because ICANN’s functions are essential for the development of the Internet, if ICANN (or some other private actor) did not perform these functions, the DOC (or some other governmental entity) would have to do so. Thus, when the DOC decided that it would permit ICANN to undertake these functions, it was making a make-or-buy decision.
Shapiro explains the reasons for the DOC’s decision in light of new institutional economics. While he finds the DOC’s decision to enter into the agreements with ICANN justified under this analysis, he notes that ICANN’s role does not eliminate collective action problems. Shapiro also concludes that ICANN may not be sufficiently accountable to the public to legitimately fulfill the policymaking role set out for it. Accountability could come in the form of appropriate governance structures, APA-like oversight, or other governmental oversight, all of which Shapiro asserts are lacking. The necessary level of governmental oversight could have been negotiated for in the contractual arrangement between the DOC and ICANN, but Shapiro suggests that bounded rationality prevented comprehensive contracting by the DOC with ICANN.
Contributors to this issue who were unable to attend the Forum itself have furthered the intense discussion of the legitimacy of both the DOC’s and ICANN’s activities. Joe Sims and Cynthia Bauerly, attorneys who currently serve as outside counsel for ICANN, argue that ICANN’s formation and governance has been misunderstood by at least one vocal critic, Michael Froomkin. Sims and Bauerly respond to legal theories previously articulated by Professor Froomkin in his article, Wrong Turn in Cyberspace: Using ICANN to Route Around the APA and the Constitution. They assert that neither ICANN nor the DOC has violated the APA. They also argue that, as a private actor, there can be no constitutional challenges to ICANN’s activities.
Professor Froomkin responds to the Sims and Bauerly arguments by first succinctly restating the legal theories set forth in his important Duke Law Journal article and clarifying how the U.S. government continues to assert control over aspects of the domain name system. This control and the relationship between the DOC and ICANN, he explains, are grounds for reviving the moribund nondelegation doctrine set out by the Supreme Court in Carter Coal. Professor Froomkin then turns his attention to responding to the points raised by Sims and Bauerly, describing the ways in which ICANN’s authority is derived from the DOC and the legal and constitutional problems this raises. This pair of articles vividly illustrates the sometimes heated nature of the debate over ICANN’s role in the DNS.
The second major theme of the Forum concerns the Uniform Domain Name Dispute Resolution Policy (UDRP). One goal for ICANN was to inject competition into the domain name registration business for generic top level domains (gTLDs), including the most important “.com” gTLD. ICANN set out to achieve this goal by providing accreditation of domain name registrars who would then be technologically permitted to provide update registration information to the database for the “.com,” “.net,” and “.org” gTLDs. Another of ICANN’s goals was to provide some level of protection for trademark owners. In connection with the registrar accreditation process and as a way of achieving this second goal, ICANN requires that all accredited registrars implement the UDRP. To implement the UDRP, each registrar requires, as part of the registration process, that all registrants of domain names ending in “.com,” “.net,” or “.org,” contractually agree to be bound by the UDRP. The UDRP provides a mechanism—for anyone with a right in a trademark or service mark—to bring proceedings against a registrant of a domain name that is identical or confusingly similar to that mark. This process can lead to the loss of the domain name and possible transfer to the trademark owner.
Because anyone wanting to register a domain name in the most popular gTLDs must agree to the UDRP, issues of consent and fairness arise. Stephen Ware’s article explores arguments concerning both the consent to and fairness of arbitration agreements generally, and then specifically assesses these issues in the context of the UDRP. He describes why the UDRP does not create a system of arbitration, but rather creates “mandatory administrative proceedings.” Ware highlights the fact that UDRP decisions are subject to de novo court review upon the filing of a court action by either party, arguing that this nonbinding nature of the UDRP proceedings is central to assessing how rigorously courts should investigate claims of lack of consent or unfairness.
Richard Speidel also argues that the proceedings conducted pursuant to the UDRP are not “arbitrations” and thus are not governed by the Federal Arbitration Act. Instead, the UDRP should be viewed as “an administrative strategy, like court annexed arbitration, designed to weed out domain name disputes on a limited range of issues, save time and money, and avoid litigation.” However, given the expense of filing a court action to challenge an adverse UDRP decision, Speidel suggests that we should be concerned with whether there is adequate protection within the UDRP system itself for the domain name holder who is acting in good faith. He considers whether subjecting the UDRP to analysis under statutory arbitration law, specifically the new Revised Uniform Arbitration Act, would assist in assuring such protections.
Continuing the discussion of the appropriate design of a private dispute resolution system, Elizabeth Thornburg asserts that while there are some positive aspects of the UDRP, “it is a flawed system that does not operate fairly even within its own limited sphere.” Thornburg includes in her list of positive aspects the relatively low cost of UDRP proceedings and their speed of decision, as well as a certain level of transparency. For Thornburg, however, the flaws of the system outweigh the beneficial aspects. The flaws she identifies include the questionable legitimacy of the privately adopted substantive standards contained in the UDRP, as well as the unprincipled use of national laws to fill the gaps in these standards. Additional procedural flaws in the design of the UDRP system lead her to conclude that “a just and equitable system would share few qualities with the [UDRP].”
Adding to the list of positive characteristics of the UDRP model is the “high quality and experienced panelists under the UDRP” identified in the article by Edward Anderson and Timothy Cole. Anderson and Cole are both directors at the National Arbitration Forum, one of four arbitration providers currently accredited by ICANN to conduct UDRP proceedings. Anderson and Cole discuss whether a dispute resolution system for other e-commerce disputes should be designed similarly to the UDRP system. They recognize that the unique nature of the DNS system and of the disputes between trademark owners and domain name registrants means that the design of the UDRP system may not translate well to other e-commerce dispute resolution systems.
The final piece from this symposium is Gillian Hadfield’s thought-provoking essay exploring ICANN’s UDRP as an experiment in privatizing commercial law, and will appear in the next issue of this Journal. In her essay, Hadfield identifies the dual nature of the role of law in society—its democratic function and its market function—and describes how ICANN’s UDRP should be viewed in light of that dual role. She argues that ICANN has exceeded the scope within which a privatized system of domain name dispute resolution could legitimately operate by straying too far into the democratic function through its law making as represented in the UDRP.
Exploring these issues through scholarly dialogue is important not only because lawyers and law professors believe the issues are interesting, but because ICANN represents an important experiment in private governance in cyberspace, governance of the very basic level of the Internet—the domain name system. Learning from this experiment will continue, and we believe this symposium will contribute to that learning process.
(citation for the statements made in this introduction appear in the hard copy)