Business Law: The Perils of Cybersquatting

By Nina L. Kaufman, Esq

Amassing domain names may seem expedient when needed for a client or handling a pet project of your own. However, should those names approach the trademarks of others, you might violate the Anti-cybersquatting Consumer Protection Act (ACPA).

The ACPA, enacted in 1999, seeks to prevent the "bad faith" registration of domain names that violate the rights of trademark owners. "Bad faith" can include a registrant's offer to sell or transfer the domain name (especially at a price higher than originally paid), and the registration of a number of domain names that are similar to others' trademarks.

Significantly, the improper registrant need not actually use the domain name. Statutory penalties can range from $1,000.00 to $10,000.00 per domain name.

Through various agencies, the Internet Corporation for Assigned Names and Numbers (ICANN) coordinates domain name assignment and disputes. Most notably, the World Intellectual Property Organization (WIPO) resolves international disputes between private parties; the National Arbitration Forum (NAF) is the largest provider of domain name dispute resolution in North America.

Arbitration through WIPO and NAF has several advantages. First, the process can be significantly less expensive and time-consuming than litigation in court. Also, a complainant can draft and submit a complaint online, as the WIPO website in particular offers a form complaint that can be completed easily. Finally, decisions of the arbitration panel are binding upon the parties and the domain name registrars.

So, before you gobble up a bunch of domain names without looking into the trademark rights of others, keep in mind that the new cyber-justice can be swift!

© 2004-2009 The Legal Edge LLC. Nina L. Kaufman, Esq. is an award-winning business attorney, author, and speaker. Under her Ask The Business Lawyer umbrella, Nina offers easy-to-understand business law resources that protect small businesses and save them money. To learn more, and receive our FREE "LexAppeal" ezine, visit http://www.GreatBusinessLawTips.com  or contact Contact Us. This article is for your general information only. Be sure to consult with an attorney regarding your particular situation to make sure you get the specific advice you need.

Nina Kaufman, Esq. Award Winning Business Lawyer, Author & Speaker