Hicksville, NY asked in Intellectual Property, Internet Law and Trademark for New York

Q: I have a question regarding cybersquatting/domain name sales

Hi We have a bundle of domains that are similar to a large corporation/org although the domain names are not trademarked (but are similar/in the same "family" to those that are) They had inquired about purchasing them -they do not like the price and are now suggesting its cybersquatting (even used the word "extortion") and to just turn them over. This is a very high profile company. What are the options here? Originally they were purchased to make destination/travel sites but that never happened and likely will not.

2 Lawyer Answers
Steve Charles Vondran
Steve Charles Vondran pro label Lawyers, want to be a Justia Connect Pro too? Learn more ›
  • Trademarks Lawyer
  • San Francisco, CA

A: The legality of selling domain names that are the trademarks of other companies is a complex issue and one that has been the subject of much legal debate. In order to understand the law on this matter, it is necessary to look at both trademark law and domain name law.

Trademark law protects the names, logos, and other identifying marks of a company or individual. This protection prevents others from using their mark to promote their own businesses or products. When a company or individual registers a trademark, they gain exclusive rights to the use of that mark. This means that they can prevent others from using their mark and can even seek damages if someone uses it without their permission.

When it comes to domain names, the law is slightly different. The domain name system (DNS) is a hierarchical structure that allows computers to locate each other on the internet (like an address). It also assigns domain names to particular websites and computers. Anyone can register a domain. name, but it is often not wise (and can be seen as cybersquatting) to register domains that contain the trademark of another company.

The legal question of whether it is legal to sell domain names that are the trademarks of other companies depends on the particular circumstances. Generally, it is not illegal to sell domain names that are the trademarks of other companies, as long as you do not infringe upon the trademark rights of the other company. However, if the domain name is confusingly similar to the trademark of the other company, or if you are using the trademark in bad faith, then you may face legal action for trademark infringement or possibly cybersquatting under the ACPA.

This can also lead to a potential UDRP action (ex. WIPO or NAF) where the owner can lose their domain name of the complainant can prove the three elements in a UDRP action:

1. Domain is confusingly similar to their trademark

2. No legitimate use

3. Registered and used domain in bad faith.

So, in these types of cases, you really need to get a legal opinion from a Trademark lawyer. All the best, see you at the top! Attorney Steve®

This is general legal information only and not legal advice.

Daniel Michael Luisi agrees with this answer

Daniel Michael Luisi
Daniel Michael Luisi
  • Trademarks Lawyer
  • Licensed in New York

A: I agree with Attorney Steve as to the issue of registration conflicting with a prior trademark owner’s rights. Yet, it is probably advisable for you to be proactive, not simply reactive. You should strongly consider filing USPTO trademark registrations for your domains in available product classes before you are beaten to the punch and checkmated by your adversary. I can assure you that they have a well thought out strategy: you’d best develop one, as well, if you want to swim with the sharks without being eaten for lunch.

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