Perspective: Waging war against cybersquatting

When it comes to cybersquatting, there's a new sheriff in town: the Coalition Against Domain Name Abuse.

A nonprofit organization based in Washington, D.C., with a roster of members, including the likes of Yahoo, AIG, Dell, Eli Lilly, Hilton, HSBC, Marriott, Verizon and Wyndham, the coalition has launched a national campaign against the fraudulent abuse of domain name registration that is at the core of cybersquatting. Even more, the group has targeted cybersquatting as a threat to the future viability of Internet commerce.

Even though anticybersquatting legislation was enacted as far back as 1999, the practice still remains a threat. The number of .com domain names has actually doubled since 2003, while the number of cybersquatting disputes filed with the World Intellectual Property Organization has increased by 25 percent from 2005 to 2006. Just in the last year, cybersquatting has soared by 248 percent.

The problem is that sophisticated cybersquatters are exploiting a supposed flaw in the domain registration process. Domain names can be registered and later dropped risk-free within an accepted five-day grace period. By abusing this grace period, cybersquatters apparently can "taste" and "kite" domain names so that they can test their profitability.

The coalition reports that more than 1 million kited sites are re-registered on a daily basis. This is said to bring in more than $100 million annually for profiteers. Indeed, it claims that worldwide cybersquatting is costing brand owners over $1 billion annually as the result of diverted sales, the loss of goodwill and expenses incurred in combating fraud.

By registering domain names emanating from famous brands, cybersquatters lure consumers into purchasing counterfeit products, cause them to reveal their personally identifiable information, and expose themselves to spyware.

So, what does the coalition plan to do about all of this as part of its new national campaign? The coalition says that it will pursue congressional legislation that will increase statutory damages under current law and to work with the World Intellectual Property Organization to introduce an international anticybersquatting treaty.

On top of this, the coalition will place pressure on the Internet Corporation for Assigned Names and Numbers to take decisive action with respect to domain registrar abuses and to close the "tasting" and "kiting" loophole.

Of course, it is too early to know for sure whether the campaign will have a full impact in terms of rooting out cybersquatting. However, the motivations behind the campaign are good, and it certainly is backed by important and relevant players. Let's cross our fingers and hope for its success.

Biography
Eric J. Sinrod is a partner in the San Francisco office of Duane Morris. His focus includes information technology and intellectual-property disputes. To receive his weekly columns, send an e-mail to [e-mail] with "Subscribe" in the subject line. This column is prepared and published for informational purposes only, and it should not be construed as legal advice. The views expressed in this column are those of the author and do not necessarily reflect the views of the author's law firm or its individual partners.

More Perspectives

[Hardrada]

Low information density here

Low information density here.

Wow. Legislation. As in.... MORE ineffective legislation.

[andrew999999999]

Good intentions?

It's time to get rid of tasting.

But it would be nice if CADNA would back up its bogus numbers about the costs of cybersquatting.

[ralahinn1]

What happens to people who make a name but can't use it at the time?

I'm wondering if people who want to secure a domain name, but can't use it at the time will be thought of as"cyber squatters eventually, too.
Now one would think that, for example, a name like"Brittany Spears.com" should go to people related to "Brittany Spears" perhaps, but what if someone calls their domain"Retro Rockets.com" and a year or so later,Sony(or another company) makes a game called"Retro rockets" would the domain holder be forced to give that name up?

[M A]

Trademark the name?

I don't know too much about the whole cybersquatting thing, but I'd assume if you're going to use the a name that means you're going to:
A. trademark it
B. secure the domain name

If a name is trademarked you should be able to procure a web address without being labeled as a cybersquatter, no?

[Dave Zan]

Hmm...

Will the coalition also pursue congressional legislation to require the complaining party to pay damages (or something like that) for abusing the process? (read: reverse domain hijacking)

[DerekoEntertainment]

Dereko Entertainment's domain has been hijacked/cybersquatted in a bad faith. Cybersquatting is very real and tragic. We ended up getting a new domain, www.dereko.tv Official site while some sicko out there is ruining our reputation in a bad faith.