Watch your back has taken on an entirely new meaning in cyberspace. It is easy for someone to steal business away from you or to ruin your reputation by misrepresenting a domain name associated with your business. With the cost of registration and basic web hosting being fairly cheap, anyone can set up shop using a variation of your domain name or company name. Most registration services are automated and as long as the exact name is not already recorded almost any domain name gets approved. There's generally not any kind of ownership check or trademark research involved, leaving room for cybersquatters to infringe on your good name.
The traditional definition of cybersquatting is the practice of registering names, especially well-known company or brand names, as Internet domains, in the hope of selling them for a profit. But the term is more commonly used when referring to bad faith domain registration. The more widespread misuse today is registering a slight variation of a popular site to reap the benefits off added traffic from customers who mistype the URL. It is not unheard of for a competitor to register a close variation of your domain name for the sole purpose of diverting your customers into visiting their site.
"People search the web all different kinds of ways," says Jeremiah Johnston, president of the Internet Commerce Association. "Some will go to the address bar in their browser and type cars.com because they assume that site will have information about cars. A lot of those generic domain names have natural traffic." Johnston says that these sites get hundreds of thousands of unique visitors, making them very valuable since that traffic can be sold to advertisers. The illegitimate business use lies in someone who goes out and gets a slight misspelling of Coca-Cola, for example, and then routes that traffic to a page where they are selling Pepsi products. "That is the new threat in cybersquatting—trying to divert traffic away from another site," he adds.
Johnston says this also is part of the reality of doing business on the web. If you chose weak descriptive keyword oriented names for your business or trademark, it's easy for others to do the same. "If I registered a domain name steeringwheels.com, I wouldn't have much of a case to stop another company who created a website steeringwheel.com," he explains. Olympic.com, for instance, is owned by Olympic Paint in Pittsburgh and not the famous international athletic competition (their site is Olympic.org).
Many business owners fail to realize that cybersquatting is a civil matter and not a criminal matter. You can protect yourself and your good name. But safeguarding your presence on the Internet requires ongoing vigilance. Here are some steps to take toward ensuring that your domain is not easily undermined or stolen by unscrupulous characters.
1. Have a registered trademark.
That is the first protective strategy which is to register your trademark with the United States Patent and Trademark Office, says San Francisco attorney Richard W. Stim, who is the co-author of Trademark: Legal Care for Your Business & Product Name. "There are two ways you can have a trademark: it can be registered or unregistered. Having it listed in the government registry is the right way to go," he says. There are hundreds of millions of domain names that are being registered and renewed every year. The number of legitimate trademark claims that comes out of those registrations is a tiny percentage.
2. Record the proper domain ownership.
The domain information that is registered is the ownership information. So, if you are allowing a member of your IT team to register in his or her name it might make it easier for them to administrate it, says Johnston. "But if that employee leaves, especially on bad terms, that makes it harder for you to claim ownership, because it is technically under the name and control of someone else." Just the same, if you hired someone to design your website, your domain name could very likely be registered under that person's name. Make sure it is registered in the name of senior management or the company itself. Have at least two names on the registration so that when there are changes both parties are notified. Also, don't let your domain expire right under your nose. Domain registrars are for-profit companies; they are basically record keepers, says Johnston. "So, when a domain name expires from a customer they will keep it for themselves if they think that it is valuable." You may be forced to buyback your own name.
Dig Deeper: A Host of Options
3. Buy up variations of your domain name.
Johnston suggests business owners have a portfolio of domain names. The easiest and cheapest way to protect your company is to register common variations of your domain before someone else does so and before any damage is done. "You may want to spend that extra $7 a year to register variations of your name. The only reason a third-party would go out and register those domain names was if they thought that there was valuable traffic out there," he says. "That means if a mistype of your name is valuable to someone else you need to get it first."
If your domain is made of more than one word, consider registering it with hyphens; for example, race-horsing.com and racehorsing.com. Consider also registering the singular and plural versions of your domain, such as product.com and products.com. Typosquatting is a form of cybersquatting; so, be sure to register any known common mistypes or misspellings of your domain name; for example, lawcounsel.com and lawcouncil.com. You also are going to want to register your acronym, like the NBA.com, if that's how people refer to your business.
4. Get more than one extension.
In addition to registering common mistypes, consider registering all of the common versions of your domain, such as .com, .net, and .biz. You might also consider registering .org and .info. If you are doing business outside of the country you will definitely want country extensions, such as .uk, says Stim. But don't get too distracted by all of these extensions. If you are not a nonprofit organization you shouldn't get an .org, for instance.
Dig Deeper: How to Protect Your Trademark From Infringement
5. Head off the haters.
A common practice is to take a domain or company name and add "sucks" to it, such as Nikesucks.com. Angry former employees, dissatisfied customers, or anyone with a personal grudge may use a "sucks" site to bad mouth your company and your products or services. Legal cases have stated that this is not trademark infringement, says Stim. It is considered free speech. Consider buying your companynamesucks.com site. You don't have to use it, just keep someone else from having it. On the other hand, if someone uses a thiscompanysucks.com site to push products, competing goods, or advertisements, then they are no longer exercising their "free" speech, says Stim. There is a case for the domain and that site to be taken down the minute it becomes commercial.
6. Fight back through arbitration.
You can, of course, sue if cybersquatters go too far and infringe on your trademark or libel your company. But domain-related lawsuits can cost dearly—at least $5,000 to get started. Victims of cybersquatting in the United States have two options: one is to sue under the provisions of the Anticybersquatting Consumer Protection Act (ACPA) and two is to use an international arbitration system known as the Uniform Dispute Resolution Process (UDRP) administered by the Internet Corporation of Assigned Names and Numbers (ICANN). In order to stop a cybersquatter, you must prove the domain name registrant had bad-faith intent to profit from your distinctive name or trademark and that the domain name is identical or confusingly similar to your name or trademark.
Arbitration is a lot cheaper. It costs around $1,200-$1,500 to file a complaint and this procedure does not require an attorney. Arbitration may be unpredictable; "so, some people feel more comfortable waving a bigger stick by filing a lawsuit," says Stim. Also, arbitration can take six months to a year to resolve to get the domain name transferred back to you, he adds, whereas with a lawsuit the court may get an injunction within six weeks to stop the other party from using the domain name. Stim says sometimes it is cheaper to buy the name back than to go to court. In a situation where someone owns the domain name you want; they will set a sell price that is cheaper than arbitration or court costs, say for example $600 versus $1,200.
Dig Deeper: How to Choose the Best Name For Your Business
7. Think like a consumer.
Don't look at the web like "I navigate it this way so everyone else must." Take a step back, Johnston says. "What we see most often is that a lot of businesses have a closed view about what domains are and how they can function as part of their overall web strategy? So, they go out and get a domain name based on the company's name. But that might not be how people are searching for them," he explains. "When people are searching for you, they are going to go to the browser and type whatever you sell and add a .com at the end of it."
Johnston points out that sometimes the most valuable domain names are the ones that you don't have an exclusive right to. For example, Calvin Klein owns underwear.com. "That domain is more valuable to them than calvinklein.com. It generates significant new business for them just from all the people who type underwear in their browser," he says. "They have a legal right to protect calvinklein.com but they have no legal right to protect underwear.com."
Your domain name is an investment in more than just your company's website. The best defense is to be proactive and to have a robust domain strategy. "If you take a passive approach, everything is going to get bought up and once that happens," Johnston says, "you will have to take a litigious route and that's only if you have the right to do so."