Memo #12/13-International Internet Issues



This Memo will focus on the issue of Cybersquatting on the Internet, and the challenge for trademark owners in attempting to stop a cybersquatter from misappropriating a trademark. What is a cybersquatter? In a simplified nutshell, a Cybersquatter obtains an Internet domain name that uses language that is very similar to an existing trademark. Or the squatter looks for a new company that has failed to register the most likely domain names that one would use to market your brand. In many cases, the domain names obtained are misspellings or slightly modified from the trademark holder's website. Here is an example (which is not actual, but just a intellectual thought). if the main website for Coca-Cola is www.coke.com or www.coca-cola.com, a cybersquatter would attempt to register www.koke.com or www.koka-kola.com or other variations. Then the cybersquatter would then populate the website with ads and wait for the consumer/user to enter the misspelled website and visit the site (driving up viewership numbers and earning more money from ad sales). Of note, there is also a concern for malicious use, such as posting a virus or malicious code on the squatted website, or directing consumers to a competing product (sending a user looking for Coca-Cola to a Pepsi website). Also there are legitimate uses for a misspelling, such as a personal name (morgan&stanley.com instead of the site for the MorganStanley company, morganstanley.com) or selling a legitimate product. I will ignore this issue and simply focus on squatters looking to drive-up ad revenues.
Why is this an issue? Well companies look to protect their trademarks and to protect their market by directing customers to their main website. Trademark holders want to own misspelled or one-off websites so as to direct the use to the main website. International users, where vagaries in language could send a user to a misspelled site (of course the same problem happens within the U.S. of course).
So why is cybersquatting an international issue? Well, because many of the Domain Name registrations occur outside of the United States through procedures established by ICANN. The Patent and Trademark Office for the United States has 3,000,000 registered trademarks. But there are 33,000,000 registered domain names throughout the world. There is a likelihood that the trademark holders will face a cybersquatting issue in an attempt to protect their trademarks. And if a cybersquatter is outside of the U.S., American law and courts are helpless to stop them. That is why ICANN, through the World Intellectual Property Organization ("WIPO") have established procedures and arbitration panels to help fight against cybersquatting. Domain Name registration services have been required by ICANN, as the root authority for the DNS service, to follow the arbitration panel decisions.
Thus, international cybersquatting is one example of establishing a quasi-judicial solution to an International Internet issue.