The first step to protect yourself from cybersquatters is to obtain at least one registered trademark. When you register a trademark for your company name, brand, product, or service, you can enforce that trademark against competitors in the marketplace who are profiting off of your trademark. Additionally, A US law called the Anticybersquatting Consumer Protection Act (ACPA) provides a legal cause of action for trademark owners. Under the ACPA, a trademark owner may bring suit against the owner of a domain name that is identical, confusingly similar, or dilutive of a registered trademark, where it can be shown that the domain name owner has a bad faith intent to profit from the mark in question. One important thing to note is that in order to benefit from the ACPA, the trademark in question must be “distinctive” at the time of registration. This means that the trademark in question must be a “strong” trademark, in that it has been deemed to be a fanciful, arbitrary or suggestive mark, which is a requirement to obtain an initial registration on the principal trademark register.
Courts consider many factors when determining whether the cybersquatter is acting in bad faith. These factors include:
- whether the cybersquatter has trademark or other intellectual property rights in the domain name,
- whether the domain name contains the cybersquatter’s legal or common name,
- whether there is prior use of the domain name in connection with the bona fide offering of goods or services,
- whether the cybersquatter made a bona fide non-commercial or fair use of the mark in a site accessible by the domain name,
- whether the cybersquatter intends to divert customers from the trademark owner’s online location that could harm the goodwill represented by the mark, for commercial gain or with the intent to tarnish or disparage the mark,
- whether the cybersquatter is attempting to transfer, sell, or otherwise assign the domain name to the trademark owner or a third party for financial gain, without having used the mark in a legitimate site,
- whether the cybersquatter provides misleading false contact information when applying for registration of the domain name, and
- whether the cybersquatter owns multiple domain names that are identical or confusingly similar to trademarks of others, and the extent to
- which the trademark in question is distinctive or famous.
See 15 U.S.C. § 1125(d)(1)(B).
Trademark owners can also file a complaint with the Internet Corporation for Assigned Names and Numbers (ICANN) under the Uniform Domain-Name Dispute-Resolution Policy (UDRP). The UDRP provides a mechanism for resolving domain name disputes through legally binding arbitration. This process is more streamlined and less costly than filing a lawsuit under ACPA. It also allows you to appeal a negative decision using the ACPA should the outcome of arbitration be unfavorable. Similar factors are considered under the UDRP as with the ACPA when determining bad faith on the part of the domain name owner.
In view of the above, it is important that a business owner registers a trademark for their business, brand, product, or service prior to searching for that perfect domain name. If your desired domain name is taken by a cybersquatter who is not using the domain name for legitimate purposes and who wishes to charge an extortionary sum for the rights to the domain name, having a registered trademark allows you to take legal action and potentially obtain your domain name for a reasonable price. Sometimes, the mere knowledge of the existence of a registered trademark is enough to convince the cybersquatters to sell the domain name rights at a reasonable price. Consider acquiring trademark protection during the early stages of your business and product development so that you will be able to obtain the perfect domain name for your business.
