iICM Registry, with ICANN's blessing, has launched the sponsored top-level domain (sTLD) .XXX for adult-entertainment websites. The launch of this new sTLD involves a very important sunrise period (named “Sunrise B”)1 for all owners of registered marks.
From September 7, 2011, to October 28, 2011, brand owners (and eligible licensees or assignees) can apply to block their registered marks from being used for a .XXX domain name (e.g., brand.XXX). To participate in the opt-out process, a brand owner must register its trademark(s) with a .XXX-accredited registrar. Registrars generally charge $300 to $400 per registered mark for a 10-year block. 2
If a brand owner participates in the opt-out process, and meets the qualifications,3 the brand owner's mark(s) will be removed from the pool of names available for registration in future phases of the .XXX registry operation. The WHOIS information for the corresponding .XXX domain name will list standard registry information and the domain name will resolve to a standard informational page stating that the domain name is not available for registration. The blocking is for the exact mark only, not for domain names which are confusingly similar to the exact mark.
If a brand owner does not participate in the opt-out process, it is unclear what its later rights will be. ICM Registry has indicated that it will likely launch a service (in 2012 or later) allowing brand owners to block domain names on a rolling basis if the .XXX domain name has not already been registered by a third party, but the cost for this service could well be higher. This new service will also apply to brands created or registered after October 28, 2011. Unless the brand owner is a large brand house with dozens of distinct trademarks such that blocking fees tally in the thousands, the most practical way for a brand owner to protect its currently-registered marks is to participate in Sunrise B and opt out of .XXX for its exact mark brands.
1 “Sunrise A” is an opt-in period for members of the adult entertainment community. Sunrise A runs simultaneously with Sunrise B.
2 The one-time opt-out fee will be co-terminus with ICM Registry's ICANN contract. ICM Registry's current ICANN contract is 10 years.
3 One of the qualifications is that there is not a currently-existing adult-entertainment website concurrently using the brand. If there is, that website owner can participate in a simultaneous Sunrise A period and potentially trump the rights of the brand owner, subject to other Lanham Act and state law causes of action, which can be brought in state or federal court.
