Out of curiosity, how is it an issue with ICANN? I know they can complain to them, but what category will this fall under?

Did you even read the article??

It appears that Meta was aware of Threads before launching its platform of the same name. Company lawyers made four offers to purchase the domain ‘threads.app’ from Threads Software Ltd from April 2023, all of which were declined. Meta announced Threads in July 2023, the same time that the British company says it was removed from Facebook.

They literally made an offer to buy the domain Threads.app 4 times and got rejected.