Even if the suit is 100% justified (which it is in this case), and you can show damages, the problem will usually be of jurisdiction.
Funko Pop is an American Company.
BrandShield, the "Brand Protection Software" they used, is based out of Israel.
iwantmyname, the registrar, is from New Zealand.
They got bought out by Team Internet, which is British.
And who knows where all of them are actually registered.
They are all going to point the finger at each other for the problem. Who do you sue, and where?
You sue the registrar, because you have the contract with the registrar.
You don't necessarily have to sue them in their place of registration if they're doing business elsewhere. "Defending trademark rights" probably counts as that.
The chain of culpability, in my view as an outsider, goes iwantmyname > BrandShield > Funko Pop.
Funko Pop hired BrandShield, but from what I understand they did so exactly because the latter does all the work without you having to intervene. Kind of like you hiring a lawyer and them using ChatGPT to present the case, full of errors and non-existent sources. The lawyer might have been acting on your behalf, but they didn’t really do so according to your intentions and their fuck up isn’t your fault. On first view I’d say BrandShield is a culprit here, but can’t be so sure about Funko Pop yet.
On the other hand, iwantmyname is absolutely at fault. They took down a client’s website without asking or recourse, then sat on their asses. That’s who you sue, because they’re the ones who ultimately had the power and made the decision that affected itch.io. If iwantmyname wants to sue BrandShield and/or Funk Pop or whatever else in turn, none of your concern. The one’s who hurt the business were iwantmyname by not doing due diligence or contacting the client but just automatically bending over.
Now if they should be sued in Britain or New Zealand, that’s for the lawyers to know.
In fact, all of this is for the lawyers to figure out. I’m not one. I’m merely expressing what makes logical sense to me, which could be incredibly wrong.