Domain Name Dispute Considerations

September 2016

By: Nathan Harris 

In today’s digital world, it is quick and easy for “cybersquatters” to register a domain name that includes the brand owner’s trademark–often interfering with the brand owner’s business. In extreme cases, the cybersquatter may use a website and email addresses at the domain to impersonate the mark owner and dupe would-be customers or job seekers.

The Uniform Domain-Name Dispute Resolution Policy (UDRP) can be a quick and cost-effective option to cancel or recover domain names in the hands of cybersquatters. The UDRP is binding upon virtually any registered domain name, including those ending in .com, .biz, .net, and .org, as well as country-level domains. Under the UDRP, a brand owner files a complaint, and the domain registrant is given the opportunity to respond. A one- or three-person panel reviews the parties’ positions and evidence, and decides if the brand owner is entitled to the domain. If so, the domain registrar responsible for the domain is instructed to transfer the domain to the brand owner or cancel it.

The entire process, from the filing of the complaint to the transfer of the domain, can take as little as 2-3 months, and can cost much less than a full-blown court proceeding. Below are ten points to consider in determining whether a UDRP proceeding may be the right avenue for recovering a domain from a cybersquatter.

Can you demonstrate rights in your trademark?

A trademark registration in one or more countries is the most straightforward way to prove that you have rights in a mark registered as part of someone else’s domain name. But a mark need not be registered to be protectable; simply using a mark in commerce may be enough. Sales figures, advertising materials, media coverage, and other evidence can be used to show that you have accrued goodwill in your brand name.

Is the domain name identical or confusingly similar to your mark?

The body of the domain name (i.e., the part between “www.” and “.com”) will be compared to the mark to determine if they are identical, or similar enough to cause confusion. For example, <apple.net> would be considered identical to the APPLE trademark. The domains <apple-inc.com> or <apple-tablets.com> would be considered confusingly similar, as would the registration of a common misspelling of the brand name (such as <appple.com>).

Does the registrant have any rights or legitimate interest in the domain name?

The UDRP is not intended to strip a domain name from someone using it for a legitimate purpose, even if that legitimate purpose began after the brand owner’s trademark was established. For example, a registrant using <applesales.com> to sell fruit would be entitled to continue doing so under the UDRP. Similarly, a registrant using <applefacts.com> or <badapple.com> to offer fair and noncommercial criticism of the technology company would likely be found to have the right to do, as long as the registrant was not a competitor doing so for a commercial subtext.

Is the domain being used in bad faith?

A brand owner must show that a registrant has used the domain to capitalize on the trademark value of the domain name, or otherwise interfere with the brand owner’s business. Such bad faith use would include, for example, attempting to attract customers by creating confusion with a domain incorporating the mark, or using the domain name to impersonate the brand owner. Bad faith use is also exemplified by an offer by the registrant to sell the domain at an inflated price to the brand owner, or by a pattern of registering domains incorporating trademarks simply to prevent the brand owners from doing so.

Was the domain registered in bad faith?

The brand owner also must show that the domain was registered to interfere with the brand owner, or to capitalize on the trademark value of the brand name. This requires that the mark was registered and/or in use at the time of registration (or renewal) of the domain. Factors such as the registration of a domain incorporating a famous mark, or the registration and immediate use of the domain to interfere with the brand owner’s business, may be used to infer the registrant’s bad faith at the time of registration.

Is the registrant likely to fight an adverse ruling?

If the brand owner prevails in the UDRP proceeding, the domain registrant is allowed a short time in which to appeal the decision by filing a court action. Where the registrant is not likely to give up without a costly fight, filing a UDRP may simply delay the inevitable court battle, and it may be more practical to file a civil action for cybersquatting in federal court in the first instance.

Where is the domain registrar located?

For purposes of the appeal discussed above, the brand owner is required to submit to the jurisdiction in which either the domain registrant or registrar is located. For example, initiating a UDRP proceeding on a .cn domain may require a brand owner to defend any subsequent appeal in a Chinese court, even if the registrant is located elsewhere. As a brand owner, you should consider whether filing a UDRP complaint for a domain registered in a foreign country will be worth the cost in the event the registrant files an appeal in that country.

What remedies are you seeking?

The Panel in a UDRP is only empowered to transfer or cancel a domain. If monetary damages are sought, a cybersquatting/trademark infringement lawsuit may be a better option. A judge overseeing a court proceeding would also have the ability to impose an injunction where the registrant’s behavior has been particularly egregious.

How many domain names and registrants are at issue?

In situations where the brand owner seeks the transfer or cancel of a single domain name—or of multiple domain names having identical registrant details—a UDRP proceeding may make sense. On the other hand, where it is unclear from the registration details that the disputed domains are under common control, the UDRP panel may decline to decide the case with respect to some (or all) of the domains. In such situations, multiple UDRP complaints may need to be filed, or the dispute may be better suited for a court proceeding.

Is the relationship between the parties suitable for a UDRP proceeding?

The UDRP is best adapted to handle straightforward disputes between unrelated parties. Because the Panel makes its decision based largely on the complaint and related papers, it is not equipped to wade into a factual dispute and evaluate the credibility of each party. For that reason, brand owners may have a difficult time recovering a domain from a former employee who registered the branded domain in an individual capacity, and who now claims ownership of it. Similarly, a brand owner that has had its branded domain “hijacked” by a hacker who seized control of the domain by changing its registration details should consider legal options besides the UDRP, particularly where the new “registrant” claims to have acquired the domain through sale or other legitimate means.

*********

For additional information on Domain Name disputes, feel free to follow our weekly blog and our Twitter feed.