Crystal clear #7: reverse domain hijacking

14.09.2017

A good domain is worth money – at times, a great deal of money. This has over the years led to certain practices concerning domains that would raise eyebrows. One of these is reverse domain hijacking. What is it exactly, and how can you guard yourself from it? 

Imagine that you have designed a product and named it XYZ. A nice sounding name, you think, so you register xyz.be as a domain name. Henceforth, you sell your product successfully via your website. Then all of a sudden, a company in the US grows enormously successful with its new product, that is also called XYZ, and is sold via the website xyz.com. Then, one fine day, you get a letter from a lawyer, accusing you of cybersquatting.

In other words, you are accused of having registered the domain xyz.be with false intentions. Not in order to use it yourself, but to sell it to the legitimate owner, xyz.com, for a lot of money. The letter states that if you want to avoid legal proceedings, you must transfer your domain at once without compensation.

This may be a standard letter from a trademarks office that wants to protect the interests of a trademark owner. It writes to every company that has a domain name with a trademark name that has been registered with said office.

But sometimes, it may well be that xyz.com was clearly aware that your company was first, and that you acted in good faith when you registered your .be domain name. Nevertheless, xyz.com will try to wrest your domain name through threats. This is known as reverse domain hijacking. Wikipedia describes this practice as follows: “Reverse domain name hijacking (also known as reverse cybersquatting) occurs when a rightful trademark owner attempts to secure a domain name by making cybersquatting claims against a domain name’s so called cybersquatting owner.” 

How can you defend yourself against reverse domain hijacking?

Often, the registrant accused of cybersquatting will be intimidated to such a degree by this claim, that he will relinquish the domain name. Proceedings concerning domain names are resolved by a special body appointed by ICANN, known as UDRP (Uniform Domain-Name Dispute-Resolution Policy). Such proceedings would cost a lot of money and take a lot of time – neither of which is available in abundance.

It is not evident however, that a lawsuit will automatically be settled in favour of the plaintiff. There are two things that the party which claims a domain name must be able to prove:

  1. The current registrant had no right or legitimate interest to register this domain.
  2. The current registrant registered the domain name in bad faith and uses it for illegitimate purposes.

In our example, you would defend yourself against the first argument by showing that you have a product or service which you have offered via the domain name for some time. If you already did this before the product of the other party became known, then you are in an even stronger position.

The second argument, ‘in bad faith’, is more difficult to prove with facts, because it concerns an intention. Indications are key here. Bad faith can be deduced for instance from the fact that at this moment the domain name does not refer to a website where a product or service is actively offered, or that you yourself have offered to sell the domain name to third parties (including the opposing party in this dispute).

Do not let yourself be intimidated by reverse domain hijacking

Have you been active on the web with your own website and domain name and are you accused of cybersquatting? You may be the victim of attempted reverse domain hijacking. Do not give in immediately to intimidating claims from a trademarks office that calls on you to relinquish your domain name to a third party without compensation. Consult your legal advisor first – you might be in a stronger position than you think! 

ICANN

The Internet Corporation for Assigned Names and Numbers, a non-profit organisation that is responsible worldwide for managing domain names.

registrant

Domain owner, person who holds a domain name.

cybersquatting

Harmful practice where a cybersquatter registers domain names that are identical to well known and registered brand names or trade names, merely with the aim of harming the brand name holder or the trader or to sell the domain name at an inflated price.

UDRP

Uniform domain name dispute resolution policy. Years ago, ICANN, the international caretaker of the DNS, developed an alternative dispute resolution policy (UDRP) for the resolution domain name disputes in the so called gTLDs. These are TLD zones of a generic nature, such as .com, .org and .net.
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