What You Ought to Know about Cybersquatting

Author: Maria Silvia Martinson, Lawyer at „RestMark Metida“

com-659090_640With the use of cyberspace and its possibilities constantly evolving, we also see more and more creative ways people use to reap someone else’s benefits by taking advatange of random unpredictable situations or entrepreneurs simply not thinking ahead. A good example of that is cybersquatting (also known as domain squatting).

What is cybersquatting

Cybersquatting by definition is either registering, selling or using a domain name with the sole purpose of profiting from the goodwill of someone else’s trademark or other earlier right.

Cybersquatting has been around basically as long as domain names have, mostly due to the nature of the domain name registration system. Internet domain names are issued by registrars on a “first come, first served” basis. For example, in Estonia the registration process is purely a formality as there is no substantial examination (earlier rights to similar names) performed prior to the registration of domain names containing the top level domain .ee.

What it means is, if a third person wanted to register a domain cocacola.ee and it wasn’t currently in use by anyone, the registrar would have to allow the registration even if the third person wouldn’t have any rights or a legitimate interest in the domain name. The owner of the Coca Cola trademark, business name or other earlier right would not be informed of the aforementioned actions and the third person could start using the domain name for his or her personal gain.

The word „squatting“ actually refers to occupying an abandoned or unoccupied space or building that the squatter does not own, rent, or otherwise have permission to use. That is highly similar to the way cybersquatters act – they don’t have a permission to use someone else’s earlier right. Additionally, they hold the domain name hostage and try ransoming it back to the trademark, business name or other earlier right owner.

Cybersquatters hardly ever build a functioning website on the domain and rather post advertising or an error message on the site. If the domain takes you to a site that states „under construction“ or „domain for sale“, you might be dealing with a cybersquatter. However, if a functioning website which has nothing to do with your trademark, business area or other earlier right appears, the owner of the domain name could actually have a legitimate interest for registering and using the domain.

What to do if you’re the victim of cybersquatting

So, what can you actually do when you’re a victim of cybersquatting? Firstly, find out who is the owner of the problematic domain name using the WHOIS database. After that, there are basically three options:

1. Bring an action, which is based on your earlier right, against the cybersquatter in court. This option, however, is usually the most expensive and also the most time consuming. Since your interests lie in getting the domain name transferred to you (or cancelled) as soon as possible, other possibilities might be more suitable for achieving that outcome.

2. Use alternative dispute resolution mechanisms. If the domain name, which is used by a cybersquatter, is:

– a gTLD (generic Top Level Domain, such as .com or .net), you can initiate a complaint based on your registered trademark using the ICANN (Internet Corporation For Assigned Names and Numbers) procedure brought out in the Uniform Domain Name Dispute Resolution Policy;

– a ccTLD (country code Top Level Domain, such as .ee in Estonia), you can turn to your local domain name registrar or a dispute resolution committee that might be created especially for dealing with the likes of cybersquatters (in example, the Domain Dispute Committee in Estonia). The procedure and legal basis for the claims might differ depending on the country in question.

3. Pay off the cybersquatter. Even though this might seem like the most unappealing option, it might be sometimes the fastest and cheapest possibility. If this fails, however, you can always use the abovementioned legal remedies.

As a generalisation it can be said that when you go to court or turn to alternative dispute resolution mechanisms, you need to have an earlier right to base your claim on and you might have to prove the cybersquatter’s bad faith or lack of legitimate interest in the domain name.

In conclusion, cybersquatting is not a thing of the past even though the legislation revolving domain names has evolved a great deal in the recent years. Even though you might have several legal remedies at your disposal when dealing with a cybersquatter, the best remedy is thinking ahead and registering your domain name before anyone else has the chance to. The same goes for all types of intellectual property.

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