If you have ever wondered “what is cybersquatting,” then you’ve come to the right place. Cybersquatting is the illegal use of a trademark or domain name for profiting. This article will discuss domain name squatting, trademark infringement, phishing, and First Amendment rights (free speech) when the activity involved is non-commercial in nature.
Table of content
Domain name trademark infringement
Domain name squatting as a form of free speech
Domain name squatting as a form of trademark infringement
How To Deal With Domain Squatting
Examples of Cybersquatting
Cybersquatting is the practice of registering, selling, or using a domain name in bad faith with the intent of profiting from the goodwill of another’s trademark. It occurs when an individual or entity registers a domain name that is similar or identical to an existing trademark, with the intent of selling the domain name to the trademark owner at an inflated price or using the domain name to divert traffic from the trademark owner’s website.
In most cases, cybersquatting is considered a violation of the Anticybersquatting Consumer Protection Act (ACPA) in the United States and similar laws in other countries.
Examples of cybersquatting include:
- Registering a domain name that is similar or identical to a well-known trademark (e.g. examplebrand.com)
- Registering a domain name that is similar or identical to a trademark of a company or person with the intent of selling it at a profit.
- Using a domain name that is similar or identical to a well-known trademark to divert traffic to a website for commercial gain.
- Registering a domain name that is similar or identical to a trademark with the intent of preventing the trademark owner from using that domain name.
Trademark owners can take legal action against cybersquatters to recover their domains. The victim of cybersquatting in the United States has two options: sue under the provisions of the Anticybersquatting Consumer Protection Act (ACPA), or use the WIPO international arbitration system created by the Internet Corporation of Assigned Names and Numbers (ICANN).
Domain name squatting
Domain squatting is the process of purchasing a domain name, often a brand or celebrity’s name, intending to sell it for a profit. These individuals usually target newly-established businesses or global companies.
The profits are substantial enough to justify the risk, and most businesses would pay the asking price for the domain rather than risk losing it to a cybersquatter. Cybersquatters often neglect trademarks and trademark protection.
There are different types of domain squatting. Cybersquatters buy some domains with malicious intent, but many of these actions aren’t malicious.
Cybersquatters often register domains that appear similar to existing domains, causing confusion and profiting from user errors. Though not always malicious, squatting domains is still illegal in the U.S.
Fortunately, there are several ways to fight domain squatting. First, if you can prove your domain name ownership, you can file a lawsuit. A successful domain squatting lawsuit will include factual research and verifiable rights to the domain name.
With enough legal research, a successful lawsuit can negotiate a favorable outcome. If you have a good case, the legal process should be quick and relatively inexpensive.
If you suspect that someone is registering a domain name similar to a trademark, you may want to investigate that person’s intentions. Many people aren’t sure how to pursue cybersquatting cases, but it is essential to be aware of the rules that govern these activities.
Cybersquatters also try to sell their domain names to legitimate businesses. You should report a cybersquatter if you suspect any of these activities.
Domain name trademark infringement
If your business has trademarked a domain name, you have the right to use it only if you have the authority to do so. Cybersquatting is an infringement of your trademark rights, and if it happens to be another party, you should take steps to stop it.
If you think someone else has registered the same name, you should register it immediately. You may be able to negotiate a purchase from the other party, but you should take steps to protect your rights.
UDRP policy allows for fair use of domain names and First Amendment rights. Cybersquatters must prove their intent to use the domain name legitimately.
They cannot register more than one domain name, nor may they use a famous or distinctive trademark. If you are concerned about the legality of your domain name registration, contact a trademark lawyer to protect your rights. UDRP policies do not allow trademarked domains for commercial use.
Before 1999, the Federal Trademark Dilution Act was the primary avenue for responding to cybersquatting. The new law, the Anticybersquatting Consumer Protection Act, created a cause of action for domain owners and a remedy for bad faith domain hijacking.
This act allows trademark owners to recover monetary damages when a cybersquatter registers a domain name that is confusingly similar to a distinctive identifier or dilutes a famous identifier.
In some cases, cybersquatters may use an already registered domain name to register another one. In such cases, the trademark owner has the right to file a lawsuit in federal court.
Alternatively, they can use an online dispute resolution procedure, the Uniform Domain Name Dispute Resolution Policy, which the Internet Corporation for Assigned Names and Numbers (ICANN) administers.
Domain name phishing
You’re probably right if you think that your website name has been registered fraudulently. Cybersquatters target brand owners, using fraudulent emails to entice them to pay for their domains.
If you respond to such emails, you will be identified as a target, making your potential threat real. However, if you are concerned about your brand, you should always be skeptical of these unscrupulous emails.
In addition to the phishing schemes, cybersquatters also create phishing sites to entice fans to divulge private information. Many celebrities have been victims of cybersquatting, including Paris Hilton, Madonna, and Jennifer Lopez.
Cybersquatters keep a close eye on their target’s domains, registering them in their names when their original owners fail to renew them.
These sites use a domain spoofing technique to fool internet users into thinking that they’re visiting a legitimate website. To avoid this scam, never copy a website address from an email. Instead, type the website’s address into a new browser.
Trust your instinct and err on the side of caution. Cybersquatters are not always malicious. Nonetheless, if you’ve fallen victim to cybersquatting, there are several steps you can take to protect your brand.
Cyber-criminals frequently impersonate popular global brands. According to a study by Palo Alto Networks, the most popular domains impersonated were those related to mainstream search engines, social media, financial websites, and shopping sites.
They use these domains to steal credentials from victims and launch phishing attacks. A list of the top 20 most abused domains includes Netflix, PayPal, and Amazon.
Domain name squatting as a form of free speech
The First Amendment can be used to override trademark rights in similar circumstances, as is the case law. In Bosley Medical Institute, Inc. v. Kremer, the Ninth Circuit ruled that it was not trademark infringement for an ex-customer of Bosley to register the domain Bosleymedical.com to run a site critical of Bosley. Kremer’s website was a noncommercial use of the trademark, and therefore it was not infringing the federal law.
The Court found that Kremer did not earn any revenue from the website, and no goods or services were purchased through the website. There were also no links to Bosley’s websites.
According to the Ninth Circuit, “As a matter of law of the First Amendment, commercial speech can be regulated in impermissible ways if applied to non-commercial expressions.” Bosley Court ruled that an infringement lawsuit brought by a trademark owner against a defendant for using the domain name without permission does not automatically impair the defendant’s freedom of speech rights.
Whether domain squatting is a legitimate practice or not is debatable. It’s illegal to use other people’s domain names for commercial purposes.
However, most squatters target global companies, celebrities, and newly formed businesses, and they can easily buy domains for cheap and sell them for a profit. For most settlers, the profit is worth the risk, and they will often buy the domain for less than its asking price.
However, trademark holders can fight domain squatters without resorting to legal action or arbitration. Using UDRP allows trademark holders to challenge domain squatters without resorting to litigation or arbitration.
The UDRP procedure may only obtain limited relief – domain name cancellation or suspension and limited damages. However, they may have a better chance of winning at mediation, as it is cheaper and does not require hiring a cybersquatting lawyer.
Another way to fight back against domain squatting is to register your domain name. This is your first line of defense against attacks from domain squatters. Registering your domain name and listing yourself as the owner of the record will help prevent hijacking.
Additionally, registering your domain name through a company or LLC will increase the chances of a domain squatter attacking your domain name.
Domain name squatting as a form of trademark infringement
Despite various legal defenses, trademark infringement is a common complaint about cybersquatters. There are four different types of cybersquatting: domain name squatting, typosquatting, combo squatting, and doppelganger domains.
Cybersquatters purchase domain names similar to another brand’s already in a user name and do so in bad faith, often to benefit from the brand’s well-established reputation.
The legal definition of domain name squatting is similar to the legal definition of holding property for ransom. However, unlike a kidnapping case, domain name squatting requires the registrant to show legal intent to register the domain name in bad faith.
In many cases, proving bad faith registration is difficult. However, high fines are sometimes assessed in these cases.
In most cases, cybersquatters create websites based on an existing brand. The registrant then resells the domain names to the owner at an inflated price. This activity is illegal under trademark laws, but some states have laws prohibiting domain name squatting altogether.
For example, in the US, the Anti-cybersquatting Consumer Protection Act also states that domain squatters cannot purchase a trademark unless they have the intention to use it for commercial purposes.
If you believe that a domain name squatter is infringing on your copyright, the first step is to contact the domain owner. You can also file a UDRP claim or court proceeding against the domain owner if you have strong evidence that you own the domain name.
To make sure your complaint is accepted, it is best to use a service that ICANN endorses.
How To Deal With Domain Squatting
Before you start a business, make sure to check whether your brand/business name is available for trademark registration and domain registration. You have options: negotiate to buy the domain, file a UDRP proceeding, and file a lawsuit for trademark infringement and/or a claim under the Anti-Cybersquatting Consumer Protection statute at federal court.
To the extent possible, you should include selecting and purchasing domain names in the earliest stages of business or trademark development and securing your domain name before investing in all other aspects of business registration, marketing, and advertising, including similar names and common misspellings of your domain, as is often advised by entrepreneurs when talking about trademarks.
Premium protection services such as Protected Registration from Go Daddy can be purchased. This will ensure that registered domain names are automatically renewed and cannot be canceled without the listed registrant submitting documentation.
Let’s say you have done all of the above, and after you’ve completed all the paperwork required to register your company or trademark, set up your social media pages, and ordered signage, you search for “yourBrand.com” to find a website that lists your brand and/or trademark/business name as a domain.
This could be a webpage that says “under construction,” “domain for sale,” or “cannot locate the server,” or (2) a working website that mainly contains ads, which could potentially include ads for your competitors. What do you do next?
You can take legal action if you feel it is impossible to negotiate and buy the domain early, perhaps because the domain is being held hostage by a squatter demanding a high purchase price. This could include
(1) a cease and desist letter informing the domain owner of potential trademark infringement and asking him or her to cease using your mark and to transfer the domain to yourself;
(2) a proceeding through the Internet Corporation of Assigned Names and Numbers (“ICANN”) international arbitration system; or
(3) a federal lawsuit to be filed for violating the Anti-Cybersquatting Consumer Protection Act (ACPA) The type of relief you are seeking and your resources will determine which route you choose.
ICANN cases are typically shorter than federal suits, don’t require an attorney to file, and can be much cheaper.
A proceeding before ICANN won’t provide any financial relief. A lawsuit against ICANN for violating the ACPA may be more costly and time-consuming, but it will provide some form of financial recovery, such as damages, if you win.
READ NEXT; Trademark Registration, Trademark Infringement, Trademark Search and Selection.
