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Domain name disputes and cybersquatting

Stephen Hunt - Law on the Web

  1. 10 April 2015
  2. Business
  3. 0 comments
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A domain name is precious to any online business – not only is it the unique location of your enterprise on the internet, but it is also an embodiment of your brand.

If a business has its eye on a domain which is already occupied by somebody else, then disputes can ensue over who is entitled to the web address. Then there are opportunists that attempt to exploit established domain names for financial gain.

Types of domain name dispute

Disputes can arise when one entity believes for whatever reason that they have a right to own a particular domain which overrides that of the current occupier.

A business which has long been operating using a certain brand name in a non-online arena may, for example, believe that this gives them a right to usurp somebody who owns the desired domain and simply uses it to run a modest personal website.

It should be stressed, however, that registrars – the bodies that have responsibility for allocating domain names – operate on a first-come-first-served basis. In spite of this, however, the holder of an applicable trademark may still have a right to the domain name that outstrips that of the person who registered the domain.

Once a brand has been established online, there is the potential for people to try and profit from this by engaging in what is known as cybersquatting – acquiring URLs that are similar to the real address or may be desirable to a business and hoping to attract traffic.

The phenomenon of cybersquatting is essentially the act of encroaching on another business’s cyberspace in pursuit of some financial gain. Typo URLs are a way of achieving this – for example registering may prove profitable if it ends up attracting enough users that Google decide it is worth paying to acquire the site. Alternatively cybersquatters could register a domain identical to that of the business they are targeting, but with a different extension, using in place of .com or even using a lesser-used extension such as .info, .net, etc.

Cybersquatters can equally seek to register a domain that may be in the interests of a company to possess, before that company thinks to register it themselves.

In some, less common cases, a disgruntled customer or other malcontent may decide to vent their frustration at your company in the form of a ‘gripe site’ which may disparage your business in the domain name, for example www.(yourcompany), as well as in its content.

Taking action against a domain holder

If you believe that the holder of an internet domain is violating your trade mark in selling a similar service or product, then you are likely to have a strong claim against them, particularly if you can demonstrate that the other party acted in bad faith in acquiring the domain.

It should be noted, however, that pursuing an offender can be costly, especially for smaller businesses, so seeking a settlement may be the preferable option. It is for this unfortunate reason that cybersquatters will most likely continue to be successful in extorting money from businesses.

In the case of gripe sites, owners have been known to be allowed to keep their domains as long as the grievances they are airing are legitimate and that they have not demonstrated any bad faith by trying to extort any financial gain.

So it may be more prudent to let gripe sites be, according to what is known as the Streisand effect, by which attempting to remove something only draws more attention and legitimacy to it. The effect is named after singer Barbra Streisand and her attempts to suppress photos of her home on the internet, which only served to draw more attention to them.

For more information on running an online business, see our E-commerce section.

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