Brand Owners on Web Offensive Against Typo Domainers, Cybersquatters

Commonly called cybersquatters by critics, the domainers who register these names hope to gain traffic—usually to domain parking pages— and advertising revenues when people enter these domain names and click on ads on their parked pages. Many typo domainers fall into this category, though not all such domains are typos of brand names.

For example, producers of The Simpsons movie complained to the World Intellectual Property Organization (WIPO) over the domain name TheSimpsonsMovie.com, registered by Keith Malley of New York.

The WIPO found Malley "has no rights or legitimate interests with respect to the domain name," and ordered the address be returned immediately.

CADNA says that according to a recent independent report, cybersquatting increased by 248% in the past year, and the organization notes that "cybersquatting is costing brand owners worldwide well over $1 billion every year as a result of diverted sales, the loss of hard-earned trust and goodwill, and the increasing enforcement expense of protecting consumers from Internet-based fraud."

The organization, whose membership includes companies such as as AIG, Dell, Eli Lilly, Hilton, HSBC, Marriott, Richemont, Verizon, Wyndham, and Yahoo!, plans to pursue congressional legislation that would increase the statutory damages set forth by the existing Anti-Cybersquatting Consumer Protection Act

Additionally, CADNA plans to work with World Intellectual Property Organization (WIPO) to introduce an international anti-cybersquatting treaty, and urge ICANN to take decisive action on abuses by domain name registrars and registrants. The also want to close the loophole that allows domain speculators to “taste” domain names—that is to register a domain name to find out if it's traffic will be profitable, and cancel the registration within a few days at no cost if the domain shows little potential.

“As a result of the automation of the registration process and the monetization of domain name portfolios, the policing burden placed on brand owners has become almost insurmountable,” said Susan Crane, Group Vice President of Intellectual Property of Wyndham Worldwide. “We have joined CADNA in this fight because we believe a coalition of companies from across multiple industries will be a more effective voice to address this issue than any one company or industry standing alone.”

“The countermeasures available to brand owners are too slow and ineffective to respond to this trend and often too late to prevent damage to the brands and consumers,” said Martin Sutton, Manager of Fraud Risk & Intelligence at HSBC Holdings plc. “CADNA brings together brand owners that are concerned with the lack of preventative measures in place to deter these cybersquatting activities and want to make effective changes in order to safeguard their IP and protect consumers.”