WIPO: resolving domain name disputes

Cybersquatting

Cybersquatting occurs when people register domain names in bad faith with the intention of making a profit from the goodwill of a trade mark that they do not own. One of the earliest examples of a written definition of cybersquatting was the Intermatic Inc. v. Toeppen, 947 F. Supp. 1227 (N.D. Ill. 1996). The definition was ‘These individuals attempt to profit from the Internet by reserving and later reselling or licensing domain names back to the companies that spent millions of dollars developing the goodwill of the trademark.’

Financial cost and reputational risk

Cybersquatting is clearly to the detriment of trade mark owner or business of the same name, not only from a financial perspective if they buy the domain name from the cybersquatter, but also from a reputational risk perspective. The general public may mistake the domain held by the cybersquatter for the official representation of the trade mark owner.
Often, cybersquatters will not use the domain but simply ‘park’ the domain, with the intention of selling it to the trade mark owner. Furthermore, cybersquatters may demand exorbitant prices for high value domains.

A solution amongst the acronyms

Businesses that try to register domain names, only to discover that they are unavailable and in fact are held by cybersquatters do not have to acquiesce to paying high prices or be precluded from registering a domain name for which they own the trade mark. There is a relatively quick and inexpensive solution. The World Intellectual Property Organisation (WIPO) operates the WIPO-initiated Uniform Domain Name Dispute Resolution Policy (UDRP). As part of this policy, trade mark owners can access the WIPO Arbitration and Mediation Centre as an alternative approach to legal action for domain name disputes.

Accessing the UDRP

The UDRP is available for domain name disputes if:

The domain name is identical or confusingly similar to a trade mark or service mark that the complainant has rights; and
The registrant has no rights or legitimate interest in the domain name; and
The registered domain name is being used in bad faith.

Examples of bad faith are:

Domain names registered for the purpose of selling or renting the domain name to the owner of the trade mark or service mark;
Registering a domain name in order to prevent the owner of the trade mark from using the domain;
Registering the domain name in order to disrupt the business of a competitor; and
Using the domain name for financial gain as a result of the confusion by internet users as to the association with the domain name with the trade mark owner.

These examples are not exhaustive and other circumstances may constitute the use of a domain name in bad faith

Prevention may be better than cure

Businesses and trade mark owners should be that domain name disputes can be resolved through the WIPO Arbitration and Mediation Centre, and that the process exists as an effective alternative to costly legal action or costly purchase from a cybersqatter. However, preventative measures such as a comprehensive ‘Intellectual Property Management Policy’ and a maintained ‘Intellectual Property Portfolio’ can assist in staying one step ahead of the cybersquatters.

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