As website owners, it’s easy to assume that domains are just like other types of commodities that can be owned for a lifetime. The reality is, domains are not owned but are rented for a few years at a time.
Domain registrations are similar to utilities (water, electricity, rent, etc) that you need to pay regularly to continue using the service. This has led others to go the unethical route by profiting from this setup.
A domain squatter or cybersquatter registers a certain domain name with the bad intention of flipping them for profit from someone else’s trademark. If you’re in the business of domaining, you might want to read this article to understand what domain squatting (cybersquatting) is and why you need to stay away from this route.
What is Domain Squatting (Cybersquatting)?
Domain squatting (or cybersquatting) is the practice of buying, selling or using a domain name with the intention of profiting from a trademark owned by someone else. The domain squatter will then sell the domain to another person or companies that owns the trademark at exaggerated price.
A domain squatter can earn when a visitor is redirected to their website and clicks on the ads or hold the domain hostage until the real owner pays up. The practice of domain quatting stemmed from the time when businesses were not aware about the profitable opportunities with the domaining business.
Some entrepreneurs on the Internet took advantage of this weakness by riding on popular brands’ trademark and selling it back to them at an inflated price. Wal-Mart, Hertz and Panasonic are just a few big name companies that were victims of domain squatters.
Types of Domain Squatting
We may think of domain squatting as a practice that’s criminal by nature but it can also be purely accidental, depending on the type of domain squatting. Here are the three types of domain squatting that you should take note of.
A criminal cybersquatter will intentionally register and sell a domain name with the motive of selling it back to the legitimate trademark owner and profit from it.
Let’s use Google as an example. Since Google is brand that everyone knows, a domain squatter might attempt to register a domain of the same name (if it’s available), hold it hostage, and charge Google to buy back that domain name.
Since some companies share similar names, the lack of available domain names may lead to accidental cybersquatting. If you’re using a trademarked domain, the trademark owner might bring you to court to get back the domain name.
An example of this Entrepreneur Media, Inc. which owns the trademark for the word “entrepreneur”. If you try to use “entrepreneur” or any of its variations as a domain, EMI might sue you over that. Aside from entrepreneur, other popular words trademarked are Photoshop, WordPress and Scotch Tape. Using any of these trademark words or phrases are subject to trademark rules.
Protective Domain Squatting
Domain squatting is not always criminal. In fact, some companies may opt to buy several domain variations to protect their brand. For example, Facebook registered “facebook” and “fb” as domain variations to their business name.
More often than not, visitors mistype a company’s name on search engines. Criminal domain squatters is cashing in on this by registering all spelling variations of the original domain if they think they can monetize the traffic from it.
In 2013, Pinterest won their case against serial cybersquatter Qian Jin and was awarded complete control over 100 domains registered by Jin which include: pintesrest.com, pinterests.com, pimterest.com, and pinterest.es.
Typosquatting is fairly common and its damage to a company’s branding can be fatal. This is why popular brands are advised to register any common misspellings, acronyms and typos of their domain name before someone else can do so and to avoid possible legal battles in the future.
Legal Consequences for Domain Squatting
Just like Pinterest’s case, trademark owners can sue domain squatters for millions of dollars in damages and transfer ownership of all domains.
ICANN implemented the Uniform Domain Name Dispute Resolution Policy (UDNDRP) to resolve domain disputes between the registrants and third parties. Disputes can be filed with any of the approved dispute resolution service providers.
Don’t be a Domain Squatter!
To ensure that you don’t step on someone else’s trademark, it’s best to do a quick search for possible conflicts in domain names. To search for trademark registrations and applications, go to the United States Patent and Trademark Office (USPTO) website and click on the “search trademark database” link.
Here at Vodien, we can help you with your domain search and see if the domain you like is available. Register your .com or .net and other top-level domains TODAY and get instant access to 24/7 Customer Support and hassle-free transfer and registration. Just click on the link below to know more.