Domain parking, speculation, and other methods that attempt to monetize the traffic generated by popular phenomena and typographic errors weren’t necessarily the types of issues U.S. lawmakers had in mind when they drafted the Anticybersquatting Consumer Protection Act in 1999, but they managed to hit the nail right on the head. Basically, the issue was seen solely as trademark infringement, or dilution of same. [15 U.S.C. 1125(d)] This cyberpiracy prevention amendment allows for civil recourse if it is proven that a domain name was registered or used with the “bad faith intent” of capitalizing on or hurting the reputation of a company’s trademark. Without getting into trademark law, superficially, one can gain preliminary trademark protection just by adding the ® the ™ symbol to that for which protection is wanted, provided it is not already registered. Obviously, formal registration with The US Patent and Trademark Office, establishes precedence.
Grabbing a “good” domain name and sitting on it until someone wants to buy doesn’t really fall into this bad faith intent, unless you get lucky enough to register a domain name related to a company that’s been around. Here’s where speculation comes in; Let us suppose that a reliable source has indicated that The X Company (a hypothetical company for the purpose of demonstration) is set to start marketing and selling “Super X Widgets” in the next year. You check for variations of superxwidgets.com, .net, etc. Fortunately for you, the marketing folks at The X Company only registered superxwidgets.com and you snap up all the rest. Assuming The X Company has a trademark for Super X Widgets, holding these additional domains with the intent of profiting when The X Company calls you is explicitly covered by this law. If they don’t hold trademarks on these widgets, The X Company should consider hiring different people.
While capitalizing on a popular brand names and trademarks are apparently violations of this law, what about typo-piracy? One of the most common mistakes when entering a URL is to mistype .com as .cm. If I want to go to www.coke.com, miss the “o” and end up typing www.coke.cm, I am redirected to the coca-cola worldwide website. This is often not the case though; For example, www.hotmail.cm loads a page with several paragraphs about consumer debt and three AdSense blocks surrounding the top of the page. Incidentally, Google is in the process of weeding out these ad farms. Their advertisers want to be in front of quality traffic that is more likely to click through, and not this transient numbers game. Is the registrant of hotmail.cm capitalizing on the trademark of Microsoft? They certainly are monetizing traffic – traffic that is fairly good according to a quick alexa search. The authorities in Cameroon, where the .cm domain is assigned to, have authorized a DNS wild-card to further monetize this typo traffic.
Is it right to capitalize on these errors? Is it okay to speculate about who or what will be a desired domain name in the future? These are some of the questions that need to be addressed when considering the purchase of domains for these uses. If you manage to get a domain name that could be related to or possibly construed as a trademarked name, product, or known company, don’t be surprised if you have to give it up for nothing. Tread cautiously as many may take the attitude that someone else will get this money if they don’t. Someone else will also get the lawsuit. Keep in mind too, someone may be willing to pay you for a good domain name.