Korea:Reclaiming domain names in Korea

Korea:Reclaiming domain names in Korea

Complainants in domain name dispute cases involving Korean registrants have traditionally preferred to take their cases to arbitration rather than the courts. But, as Donggyun Kim and John Sangho Park explain, new rule changes and a shift in attitude by the Korean courts could change all that

Most domain name disputes filed against Korean nationals as a defendant or respondent arise out of the top level domain ".com", or the country code top level domain for Korea, ".co.kr". It is often the case that ".com" disputes are taken straight to the World Intellectual Property Organization (WIPO) Arbitration and Mediation Center, and that ".co.kr" cases go to the Korean Domain-Name Dispute Resolution Committee (KDDRC). The percentage of cases where the parties go directly to the judicial court is very low in both situations.

Dispute Resolution

In a dispute over a ".com" domain owned by a Korean national, it is very unlikely that the case will go straight to the Korean courts because of language difficulties, litigation costs and, above all, because Korean courts have tended to favour the plaintiff/complainant less than under the Uniform Domain Name Dispute Resolution Policy (UDRP) regulations formulated by the Internet Corporation for Assigned Names and Numbers (ICANN). This is particularly true given the Korean court's judgment that despite cybersquatting on domain names that include internationally well-known trade marks, if the intention of the registrant is other than that of financial gain, the priority status of the registrant will be upheld and the application made by the trade mark holder will be rejected. This attitude by the Korean court has deterred many applicants from filing suits in Korea. Instead they have sought administrative proceedings under the UDRP. This can be evidenced by recent figures published by WIPO that show that as of March 3 2003, a total of 10 complainants were Korean nationals or companies (0.21%), but 246 respondents were Korean nationals or companies, which constitutes approximately 5.24% of all respondents.

Forum shopping

Disputes regarding ".com" domain names can be brought before any of the four dispute resolution centres approved by ICANN and governed by the UDRP. When applicants consider which forum to use, they should consider carefully number of issues. The choice usually comes down to the two factors: chance of success and the language of the proceedings.

Choice of language in the WIPO proceedings

According to Paragraph 11 of the Rules for UDRP, the language of the administrative proceeding is the language of the registration agreement unless the panel decides otherwise. Initially, was interpreted that if the registrant and the registrar are both Korean, the language of the proceeding was Korean. In many recent cases, however, despite the fact the registration agreements were in Korean (but may also have been available in the English language) and both the registrant and the registrar were Korean nationals or companies, the complainants' attempts to have the proceedings in English have been very successful.

Dispute resolution centres appointed by ICANN

CPR Institute for Dispute Resolution (New York, May 22 2000)

National Arbitration Forum (Minneapolis, December 23 1999)

WIPO Arbitration and Mediation Center (Geneva, November 29 1999)

Asian Domain Name Dispute Resolution Centre (Beijing and Hong Kong, December 3 2001)

*eResolution, as of November 2001, is no longer an ICANN-approved institution

Many precedent decisions have recognized that using the language of the registration would lay an undue burden on the complainant. Indeed, in WIPO Case D2003-0679, Deutsche Messe AG v Kim Hyungho, the panellist stated that "the spirit of Paragraph 11 is to ensure fairness in the selection of language by giving full consideration to the parties' level of comfort with each language, the expenses to be incurred, the possibility of translations being required in the proceeding, and other relevant factors." In WIPO Case D2002-0324, Fortum Corporation v Li Yen Chun, the sole panellist observed that "the website was set up in English and pre-complaint correspondence between the complainant and the respondent was conducted in English," and therefore concluded that "there was a de facto agreement or understanding that any administrative proceeding would be conducted in English". Moreover, as held in the previously cited Deutsche Messe AG case, "if the complainant were to submit all documents in Korean, the arbitration proceeding would be unduly delayed and the complainant would have to incur substantial expenses for translation". It is undoubtedly against the spirit of the UDRP procedure to be long and expensive.

The National Arbitration Forum (NAF), in contrast to the WIPO Arbitration and Mediation Center, leans even more favourably towards the complainant in that most proceedings are run in English and strict time extension rules are applied. NAF's policy is the main explanation for a rapid increase of applications filed to the forum, and NAF has been subjected to criticisms that such policies only promote forum shopping and that question fairness of domain name dispute arbitration proceedings governed by the UDRP.

Korean registrants are now seeking judicial review from the Korean courts, by way of either filing an injunction against the transfer of domain names, or for a review of decisions that, in their opinion, were unjust because they were tried in English only.

The attitude of the Korean courts

Jurisdictional concerns

Before or after arbitration proceedings, either party may wish to have the matter heard in a judicial hearing. For example, complaints against a Korean registrant may be filed directly in court of foreign country and request the Korean courts to enforce the judgment. However, for Korean courts to allow enforcement of judgments from a foreign jurisdiction, two elements must be satisfied. The first is that Korean courts must recognize that the foreign court had proper jurisdiction to hear the matter, and the second is that the rules of proper delivery of service have been satisfied.

The complainant's rate of success increases where the respondent is a Korean national

138 Cases

Complaint accepted: 123 cases (89.1%)

Complaint denied: 14 cases (10.2%)

Partially accepted: 1 case (0.07%)

In cases where the respondent fails to respond to the complaint, the complainant's rate of success jumps to 95.7%. Choice of language of the proceedings and the short time period allowed for the response to be submitted are main causes of respondents' failure to respond in time.

As seen in "france2.com" and "france3.com" cases, Korean courts have applied UDRP Rules in deciding proper jurisdiction, and, because both the registrant and the registrar were Korean and doing business in Korea in these cases, they refused to enforce the French court's judgment by stating that the French court had no jurisdictional grounds to hear the matter. The test applied is known as the "substantive relationship test". The UDRP and Korea's Conflict of Law Rules Act require plaintiffs to file all domain name suits in a court of the country or state in which either the defendant or domain name registrar that holds the registration resides.

Review or re-trial?

When a domain name dispute matter is brought before the Korean court, in most cases by the respondent of the arbitration proceedings, judges must decide whether to review the decision of the arbitration proceedings following the UDRP Rules, or to initiate a new trial based on Korean laws. The court of first instance and the court of appeal have expressed different views on this issue, causing greater confusion among parties involved. In the "hpweb.com" case, judges from both the court of first instance and the appeals court agreed on applying the "substantive relationship test," but with different interpretations of what "substantive relationship" actual meant. One view, adopted by the judges from the lower court, is that Article 4(k) of the UDRP Rules should be applied strictly and that international jurisdiction on matters of domain name disputes should be accepted regardless of whether the Korean national is a plaintiff or a defendant. However, the appeals judges had a different view and found that when the registrant of a domain name is initiating a suit, the jurisdiction in which he/she resides must be the appropriate forum, and denied international jurisdiction.

This interpretation was viewed to be favouring the local registrant because Korean law did not fully cover the new technologically advanced area of domain registration and related disputes, particularly after the decision handed down by the Korean Supreme Court in the "rolls-royce.co.kr" case. In that case, the Supreme Court justices made clear that they had no intention of creating "new law where it is lacking". They said that was the job of the legislature, not the judiciary.

New rules, new attitude?

Anti-cybersquatting laws

The Korean legislature has passed anti-cybersquatting laws, and in December 2003, the Korean National Assembly enacted the Internet Domain Related Regulations (the Regulations) to control and provide resolutions for domain name disputes within the Korean domain address ".kr". The Regulations are expected to bring about changes in the resolution process to make it more efficient and to cover broader aspects of domain name disputes in relation to the Korean domain address ".kr." The Regulations will bypass the domain dispute resolution process governed by the Korea Network and Information Center, which has heavily relied on ICANN and UDRP operations and their processes. Industry has welcomed the Regulations for introducing Korea's first anti-cybersquatting law that is realistic and practical. In particular, Article 12 of the Regulations, which specifically deals with domain name registrations made in bad faith, will allow rightful owners to protect their name value on the Internet. It states:

  1. Domain names that are well-recognized in Korea shall not be registered by a third party with the intention of cybersquatting, or to gain financial benefit by disturbing and/or interfering with registration by the rightful owner.

  2. Any rightful owner may request cancellation of a domain name registered in bad faith as stated in above Section 1.

The Regulations were announced on January 29 2004, and became effective on July 29 2004.

Success rates compared

Dispute resolution centres

Results as decided

Total

Complaint denied

Complaint accepted

eResolution

24 cases (49%)

25 cases (51%)

49 cases

National Arbitration Forum

49 cases (19%)

203 cases (81%)

252 cases

WIPO

57 cases (18%)

263 cases (82%)

320 cases

Total

130 cases (21%)

491 cases (79%)

621 cases

Figures from Milton Mueller, Rough Justice: an Analysis of ICANN's Uniform Dispute Resolution Policy (http://dcc.syr.edu/roughjustice.htm)

Unfair competition and trade secrets

In December 2003, the Korean National Assembly enacted the Unfair Competition and Trade Secret Related Rules (the Rules), and two of the most relevant changes are noted as follows. First, the Rules have redefined the meaning of unfair competition to include cybersquatting on well-known names, marks, and trade names, whether they are the same or confusingly similar, in Korea. Again, the "purpose" element must be proven before registration by cybersquatting can be deemed unfair competition, and the Article 2, Section 2 (Ah) lists three illegal purposes as follows:

  • Purpose to assign, transfer, or issue license to the rightful owner for financial benefit;

  • Purpose to disturb or interfere with registration by the rightful owner; and

  • Purpose to gain other economic benefits.

This Article differs from Article 12 of the Regulations in that the Rules include requirements of "well-known names, marks, and trade names, whether they are the same or confusingly similar, in Korea," and covers broader domains, whereas the Regulations only covers the Korean domain address ".kr" and require the name to be "well-recognized in Korea." Secondly, the Rules include "making products of well-known brands to copy their forms" as part of unfair competition. It is further defined that "to copy their forms" is interpreted as reproduction of well-known branded products by copying their shape, appearance, colour, or combinations, and thus prohibits production, sale, import, and exports (Article 2, Section 1 (Ja)).

Until now, protection from such reproduction was only available through design registration, but this has been found to be too time consuming. With the enactment of the Rules, however, well-known branded products can be better protected through combining the two-step protection, initiated by the Rules and further protected by the design registration. The Regulations were announced on January 20 2004, and became effective on July 20 2004.

It is the view of most Korean lawyers that if the Rolls-Royce case had been heard after the above Rules and Regulations became effective, "www.rolls-royce.co.kr" would now belong to the renowned automaker. But this has not yet been proven in a Korean court of law, since only a short time has passed since they were implemented. Owners of a number of well-known marks are carefully evaluating the Korean courts to determine if there really is a turn-around in attitude. If people believe there is, the Korean judiciary is likely to experience an influx of suits filed by foreign trade mark holders. These new Rules and Regulations will raise the bar of domain name rights protection to international standards, and herald a new era in intellectual property rights safeguards in Korea.


Contact details

YOU ME Patent & Law Firm

Seolim Bldg, 649-10 Yoksam-Dong

Kangnam-Ku, Seoul 135 080

Korea

Tel: +82 2 3458 0727

Fax: +82 2 553 5254

Email: email@youme.com

Website: www.youme.com

Donggyun Kim

kim-asiafocus04.jpg

Donggyun Kim is a patent and trade mark attorney at You Me Patent and Law Firm, specializing in internet-related trade mark, copyright, and domain name issues. He is also a professional writer of children's books. His extensive research and educational background makes him an essential part of the team at You Me, where he analyses new legislation and legal interpretations as they apply to the field and provides regular legal information updates for the attorneys and staff. Donggyun also heads the firm's China practice and is fluent in English, Chinese, and Japanese.


John Sangho Park

park-asiafocus04.jpg

John Sangho Park primarily liaises with You Me's major international corporate clients, facilitating dispute resolution and arbitration issues in their Korean-related matters. He is a solicitor/barrister of the Supreme Court of New South Wales and is admitted before the High Court of Australia. He has successfully represented Korean conglomerates before the WIPO Arbitration and Mediation Center, as well as multinationals within the Korean court system, working alongside Korean attorneys at the firm. John heads the international management team at You Me, where he is actively working to expand the litigation practice.

more from across site and SHARED ros bottom lb

More from across our site

News of an alliance between two Malaysian law firms and the launch of a self-help video aimed at supporting IP professionals through menopause were also among the top talking points
Speakers at the EUIPO’s IP Mediation Conference discussed how lawyers can act in tandem with clients during mediation, and the importance of showing a united front
A report that revealed top legal LinkedIn influencers are generating hundreds of thousands in advertising value is the push lawyers need to up their social media presence
Speakers at the EUIPO’s Mediation Conference say mediation can offer a ‘cathartic’ and effective alternative to litigation that IP owners should consider
Partner Scott Sudderth says he is looking forward to building strong client relationships and expanding the firm’s patent practice
Find out which firms secured the most nominations for Managing IP’s Asia-Pacific Awards 2025, ahead of the winners being revealed on November 6
Raluca Vasilescu joins our ‘Five minutes with’ series to discuss patent mining and watercolour painting
Jan Phillip Rektorschek, founding partner at Pentarc in Germany, explains why the firm broke away from Taylor Wessing and discusses its plans for staying competitive
Royal Mail Group wins copyright and database right infringement case, in a dispute that can be linked to the history of postcodes in the UK
Managing partner Mark O’Donnell explains why people are at the centre of the Australian outfit’s investment focus and how being independent benefits the firm
Gift this article