Have you ever typed a company’s name in a URL only to be taken to a non-functioning website filled entirely with ads or be re-directed to a website for a competitor of the company? This is likely the work of a cybersquatter. Cybersquatting generally refers to the practice of registering a domain name in bad faith with the intent of profiting from the goodwill of a trademark. Individuals buy domain names of popular companies with the hope of reselling the domain name back to the company or trademark owner. Or the website will be filled with ads related to the company’s business, and the domain owner is paid if users click those links.
Cybersquatting harms a company’s brand and cuts into its sales. Fortunately, this practice is illegal. The Anticybersquatting Consumer Protection Act (15 U.S.C. § 1125(d)) makes it illegal for a person to use a trademark in a domain name with the bad faith intent to profit from such trademark. Violators of this section are subject to forfeiture of the domain and possibly statutory damages.
Moreover, trademark owners are able to go after cybersquatters that infringe on their trademarks through the Uniform Domain Name Dispute Resolution Policy (“UDRP”), which has been adopted by the Internet Corporation for Assigned Names and Numbers (“ICANN”). Trademark owners can file complaints in accordance with the UDRP through one of ICANN’s affiliates; typically either the National Arbitration Forum or the World Intellectual Property Organization.
To prevail in a UDRP proceeding, the complainant must prove:
(i) the domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and
(ii) the domain owner has no rights or legitimate interests in respect of the domain name; and
(iii) the domain name has been registered and is being used in bad faith.
Bad faith can be demonstrated in a number of ways, but the most common evidence is that the domain owner purchased the domain name for the purposes of selling it to the trademark owner, or that the primary purpose for registering the domain name was to disrupt the business affairs of the trademark owner.
If a complainant can prove these three elements in a UDRP proceeding, then the domain name can be canceled or transferred to the complainant. This process is generally less expensive and quicker than filing a complaint in federal court.
KJK’s Brand Enforcement Group has experience in filing UDRP complaints and can assist you if a third party has registered a domain name that uses your trademark (or a confusingly similar mark) and that harms your company or your brand.
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