Jan 15, 2020 09:01 PM EST
What is Cybersquatting? Examples and What You Need to Know
Cybersquatting is a broad term for several cyber offenses regarding domain names. It refers to using, selling, or registering a trademarked domain name in bad faith. Essentially, cybersquatters ignore a company's trademark to make a profit. Since most domains sell to the first person trying to register the name, it is relatively cheap and easy for a cybersquatter to register a domain before a legitimate company has the chance to do so.
There are two significant problems with cybersquatters that companies face. First, cybersquatters try to force the company to repurchase its name. For example, let's imagine that a cybersquatter registered the domain exampleforyou.com before the business ExampleForYou.
The business then tries to register their domain and finds that it is unavailable. They reach out to the cybersquatter to try to take their name back, but the cybersquatter responds by charging the business an inflated rate for their name. If this is the case, there are a few solutions, and we will address those a little later. However, there is also a possibility that the cybersquatter is not just attempting to make a profit, but is also using the trademarked name to defame the trademark holder.
Defamation is the other major problem businesses face with cybersquatters. Many times, cybersquatters, either in a type of cyber blackmail or through ill will, use the trademarked domain name to tarnish a business's online reputation. Let's go back to the previous example to see how this works. Suppose that ExampleForYou tried to register their trademarked domain and found that it was already registered.
However, when they looked up the website, the cybersquatter set up the site to imitate the business. On top of this imitation, the cybersquatter then either listed fake products to steal money or credit card information, posted false information, or displayed explicitly derogatory information about the business. To protect their name, ExampleForYou feels that their only option to save their reputation is to accept any price that the cybersquatter requests.
While this isn't the only option a business with a trademark has (we will talk about protection further on), the fear of losing business may inspire a company to succumb to the cybersquatter's demands. There are plenty of options for stopping cybersquatting, as laid out in this post by 101domain.
Under the broad term of cybersquatting, several subtypes exist and operate in unique ways.
Types of Cybersquatting
There are three main ways that cybersquatters try to prey upon your business. They are cybersquatting, typosquatting, and Gripe sites.
This is the most basic style of cybersquatting. In this type of cybersquatting, cybersquatters look to profit from businesses that haven't yet purchased a domain. They operate on the hope that when a company goes to register their domain, they will be forced to buy the domain from them.
Typosquatters prey on the fact that every internet user makes a typo from time to time. So, typosquatters purchase domains with typos in them that are similar to a business name (i.e., facedook instead of facebook) and establish what are called phishing sites. A phishing site works through the hope that an unwitting internet user will stumble onto their fraudulent website, which usually looks almost identical to the original website. This user will then proceed as usual. However, as in the example with facebook, these phishing websites steal the user's information and use it against them and the business.
This type of cybersquatting is the trickiest to handle as these sites often exist not for profit but critique. Gripe sites, also sometimes referred to as "name jacking," usually exist to critique and/or mock politicians, celebrities, or corporations. In most cases, the trademark holder loses because the Gripe site does not fit the definition of using the trademark in ill will with the intent to profit.
Fun fact: Sometimes, Gripe Sites exist for good and, when they are, they are typically not illegal. This was the case with a pastor who filed a lawsuit over a website using one of his trademarks. The site existed to contradict his homophobic remarks. The court ruled that since the website existed without intent to profit, the website was not infringing on the trademark.
Bonus: In recent years, a new type of cybersquatting has come into focus; social media squatting. This type of cybersquatting involves registering social media profiles for trademarked names and public figures. However, after a few complaints from notable figures, social media sites like Facebook and Twitter made cybersquatting on prominent names a violation of their terms and services. So, there's a good chance that, with the right complaint, this won't affect you.
As you can see, cybersquatting is not always cut and dry. Cybersquatting assessors look at each case according to its type, so you need to learn what you can do to protect yourself from cybersquatters.
If you own a business and are worried about someone cybersquatting on your name, the first thing you should do is file for a trademark on your name. All a trademark really does is distinguish your products or services from competitors. While not every domain qualifies for a trademark, when you're setting up your business online, you should definitely check. The typical qualifications for a domain trademark are:
1. Your domain is distinct, or your customers associate your name with your internet business, and
2. You, the owner of the domain, are the first to use this name in association with the sale of goods and/or services.
If your business fits these qualifications, then you should begin the trademarking process.
While a trademark is a great place to start, it does not fully protect you from cybersquatters. As mentioned above, there is the chance that a cybersquatter beat you to your desired name, registered a typo version of your name, or is using your name as a Gripe site. If any of these are the case, then, after reaching out to make sure that the assumed cybersquatter is indeed squatting with ill will and the desire to profit, you can proceed to court.
Two provisions protect trademarked names. The first is the arbitration system of ICANN (the Internet Corporation for Assigned Names and Numbers). The ICANN procedure works to solve domain name disputes through arbitration rather than more expensive litigation. ICANN looks to make sure that the disagreement meets three qualifications.
1. A URL is the same, or similar enough to confuse a trademark which the complainant has rights to
2. The cybersquatter purchased the URL with no legitimate interest in the domain
3. The domain is registered and used in bad faith
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