Unstoppable Domains Seeks Injunction Against “Counterfeit” Handshake Domain .wallet – Domain Name Wire

The company first argues that offering second-level blockchain domains in a TLD should get exclusive rights to it.

After filing a lawsuit against Gateway.io for the .wallet Handshake domain two weeks ago, Unstoppable Domains asked the court for a preliminary injunction (pdf) to stop the sale of competing domains.

In its request, Unstoppable compared .wallet Handshake domains with duplicate mailing addresses:

Imagine someone tries to create an alternate universe of street addresses, where they intentionally sell the address “844 North King Street, Wilmington, DE” to a third party, so that it doesn’t match this palace of justice, but in a different place entirely (knowing the address already pointed towards this courthouse). Further imagine that when one searches for “844 North King Street, Wilmington, DE” on the Internet, the only thing that determines which location was revealed to the searcher is the type of computer used to perform the search. This is exactly the kind of chaos Defendants are creating with the infringing .WALLET domain names they offer for sale, even though Plaintiff is already the exclusive provider of the .WALLET domain names.

Unstoppable noted that on the internet, there is a single authority (ICANN) that assigns top-level domains, ensuring there are no name collisions like this. For blockchain domains, he believes that the first entity to start offering a blockchain top-level domain to the public should be able to block any other entity from running the same extension:

Because there is no central authority guaranteeing that no two users register the same .WALLET address, and because there is no technical barrier to prevent competing registries from offering the same NFT domain name, NFT domain name registries operate on a first come, first come basis. -served to providers of such domain names. In other words, once a registry has started offering a specific NFT top-level domain name such as .WALLET, no other domain name registry can or should register .WALLET domain names. This is similar to how trademarks work – once a company creates restaurants called McDonald’s, no one else should name their restaurants McDonald’s.

If Unstoppable’s view were accepted, there would be a rush to offer second-level domains on alt-root blockchain domains, both from Handshake top-level domain owners and competing services. (.Wallet was registered on Handshake before Unstoppable started offering the domain, but it wasn’t made available to others to register second-level domains until later.)

To further bolster its claim, Unstoppable again cites a pending trademark application that is unlikely to be granted:

To further secure its exclusive rights in the .WALLET domain, Unstoppable has filed a trademark application with the U.S. Patent and Trademark Office for its WALLET trademark, U.S. Serial Number 90/886,517, which is currently pending.

The company did not mention that its .wallet application (along with the previous bullet point) was denied and that the U.S. Patent and Trademark Office issued a non-final Notice of Action to Unstoppable regarding the cited trademark because it does not does not grant trademarks for top-level domains. .

Unstoppable Domains also revealed that a registrant of domains under Handshake’s .wallet domains threatened to sue Unstoppable if it sold matching domains in its naming system.

Unstoppable Domains just raised $65 million, and you can expect it to devote a lot of resources to this lawsuit in an attempt to defend its business model.