Don't let your IP slip through the net

The number of domain name disputes lodged in terms of the Uniform Domain Name Dispute Resolution Procedure (UDRP) that applies to .com, .net and .org domain names increased by 18% in 2007, compared to the number filed in 2006 and by 48% versus the number lodged in 2005.

Increase

The increase can be attributed to:

• The rise of “pay-per-click” advertising, whereby cybersquatters associate the domain name they have registered with a website containing adverts promoting a variety of competing brands. Every time Internet users access this website and click on one of the adverts, the cybersquatter receives money.

• Domain tasting, whereby cybersquatters register a number of domain names and then wait several days before paying for the domain names. They then count the domain names that attract the most Internet users and then pay for only for those. The remaining domain names are then deleted. Problem is, in the period between the cybersquatter registering and paying (or does not pay) for the domain name, it is reflected as being registered.

• The use of privacy services by cybersquatters, who are thereby able to register domain names without revealing their identity to the general public. Cybersquatters can thus remain anonymous while trademark proprietors must go to great lengths to establish the cybersquatter's identity.

There are a number of steps that companies can take to combat cybersquatting, the most important of which is to develop a domain name registration and conflict policy.

Such a policy would clearly identify relevant criteria to determine which domain names should be registered, whose responsibility it is to administer them and in which countries they should be registered.

General rule

As a general rule, companies should ensure that companies register their trademarks and trading names in the countries in which they trade, thereby preventing third parties from launching a website to sell competing goods and services under a domain name identical to a company's trademarks and trading names.

Not only should a company continually ensure that its most important trademarks and trading names are registered as domain names, but it should continually monitor what domain names have been registered that incorporate its trademarks and trading names.
In short, companies must monitor the domain name space to check what domain names have been registered that might incorporate their trademarks and domain names.

If possible conflicts are revealed, a company would need to specify in a domain name registration and conflict policy how such conflicts should be dealt with.

Typically, companies can make use of domain name dispute resolution procedures such as the UDRP (which applies to .com, .net and .org domain names) of the ZADRR (which applies to co.za domain names) to take action against cybersquatters, where countries have adopted such domain name dispute resolution procedures.

Quicker and more cost-effective

These procedures are quicker and more cost-effective than trying to resolve a domain name dispute in Court. For example, both the UDRP and ZADRR typically take about 60 days (from start to finish) to be resolved. High Court litigation, on the other hand, can take years to resolve.

By failing to follow simple procedure, several South African companies have encountered problems when, for example, trying to establish foreign representative offices.

In one such instance, a South African vehicle tracking company found that a non-affiliated company in Kenya had adopted its trademark and domain name and was actively trading as the South African vehicle tracking company in the Kenyan market, despite there being no relationship between the two companies.

Unfortunately for the South African company, Kenya does not have a domain name dispute resolution procedure, which resulted in substantial legal fees in an attempt to wrestle ownership of the domain name back from the cybersquatter.

In effect, the South African company let its intellectual property (IP) slip through the net. It's a lesson well worth learning.