Domain Wars

Trademark owners say cybersquatting has gone too far -- and they're fighting back.

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"Small to medium-size businesses are screwed," Felman says. "They can't afford our services. They can't afford lawyers. Consumers and small businesses get harmed the most."

IHG uses Cyveillance's monitoring services and receives daily alerts. "I have a person who does nothing but sort through those alerts and decide which to pursue. That's her full-time job," Goodendorf says.

Once a company has determined that it wants to pursue a cybersquatter, it must decide what action to take. It might start by paying a brand-protection service provider like MarkMonitor to contact the domain-name registrant and registrar and ask to have the site taken down. If the registrant is unresponsive, the brand owner has several other options.

Intellectual property owners can sue cybersquatters under the federal Anticybersquatting Consumer Protection Act, but that's expensive and limits damages to $100,000; they can try to shut down sites containing copyrighted content under provisions of the Digital Millennium Copyright Act; and in some cases, they might be able to pursue violators for trademark abuse under provisions of the Lanham (Trademark) Act.

The least expensive approach is to file a UDRP complaint with a dispute-resolution provider such as WIPO or the National Arbitration Forum. But even when the complainant wins -- which, according to WIPO, happens 85% of the time -- that's not always the end of it. Cybersquatters can delay the transfer by challenging it in court.

Some registrars can be uncooperative, too, failing to complete domain-name transfers within the specified 10 days, Isenberg says. ICANN hasn't done enough to deal with complaints about such registrars, he adds. "They get a slap on the wrist and then it happens again," he says.

While IHG uses UDRP, Verizon has passed on that approach because, Deutsche says, a separate complaint must be filed for every domain-name infringement. With tens of thousands of cases to prosecute, the company decided to declare all-out war on cybersquatters. "We've brought high-profile lawsuits against some of them, and there's been a noticeable drop in the last couple of years in [Verizon-related] cybersquatting," Deutsche says.

"A lot of times you'll go out and find 100 brand infringements, and 30 or 40 are coming from the same entity," says James Brooks, director of product management at Cyveillance. Aggressively pursuing those firms, as Verizon has done, may cause cybersquatters to look for "softer targets," he says.

But more cases pile up on the docket every day. For example, Deutsche recently learned of Verizson.com, a Web site that includes affiliate advertising. The owners of such sites get paid a few cents whenever visitors view ads on the site or click on advertising affiliate links.

Many intellectual property holders, already overwhelmed by cybersquatting activities, fear that the problem will become untenable when ICANN makes a potentially unlimited number of new generic top-level domains (GTLD) available in early 2010. Currently, ICANN supports 16 domains, including .com and .net.

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