Cybersquatting and Domain Name Infringement: The Internet Hostage Situation
Through Cybersquatting, individuals and businesses have been able to purchase domain names and hold them "hostage," asking for large sums of money to transfer the associated domain name rights to the rightful owners. Cybersquatting was most common in the early 1990s when businesses were still unfamiliar with the business capacities of the Internet and infringers were able to buy domain names unnoticed. This unlawful practice is most harmful when the domain name is associated with a well-known trademark and the trademark owner is forced to pay exorbitant costs to purchase the domain as part of its business enterprise.
In order to provide a remedy for Cybersquatting victims, Congress enacted the Anti-Cybersquatting Consumer Protection Act (ACPA), under Title 15 U.S.C. § 1125(d). Pursuant to the ACPA, trademark owners have a cause of action to bring suit in federal court for an order transferring the domain name to the rightful owner. In some cases, courts may order "cyber-squatters" to also pay money damages. Plaintiffs must show the following elements of the cybersquatting cause of action:
(1) Plaintiff held ownership of a recognizable trademark - such as a logo,
(2) This ownership was entitled to protection,
(3) The domain name at issue bore a substantial similarity to the trademark, and
(4) Defendant had bad faith intent to profit by registering the domain name.
In DaimlerChrysler v. Net Inc., et al., a 2004 case, the United States Court of Appeals for the Sixth Circuit found that the domain name "foradodge.com" violated the ACPA. The court ordered defendants to transfer the domain to DaimlerChrysler and issued an injunction prohibiting defendants from future profits from the domain.
More recently, in Bogoni v. Gomez, a 2011 case, the United States District Court for the Southern District of New York found that individuals hold a trademark interest in their own names. Plaintiff Paul Bogoni brought an action against defendant Victoria Gomez for wrongfully registering websites that substantially incorporated Bogoni's name. Gomez claimed that she registered "paulbogoni.com" and "paulbogoni.org" for her 3-year old daughter, but the sites included an offer to sell each domain for $1 million. The court found Gomez guilty under the ACPA and awarded Bogoni $1 million for each site.
Furthermore, under the ACPA, trademark owners can establish jurisdiction to bring suit against foreign defendants. Plaintiffs must show that the domain name infringes upon trademark rights and that plaintiff cannot reasonably locate or establish personal jurisdiction over the infringing defendants otherwise. This provision is especially helpful when foreign parties infringe upon domain names, violating the American trademark owner's rights, while dodging suit through their remote location. As a countermeasure, the ACPA allows American trademark owners to bring suit against foreign defendants for cybersquatting and domain name infringement.
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