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Cyberspace 2011: The Year of the Squatter?
By Christopher J Sherliker

A domain name – the web address that is the main way users navigate to sites – is central to your brand and becomes more important every day, as marketing, communications and transactions move into e-space.

Cybersquatting, or domain name hijacking, is the practice of registering other people’s company names in an attempt to sell them on to businesses at a vastly inflated price.

A domain name can be purchased in minutes for as little as £3 or £4 per year – but when a cyberquatter parks themselves on your company name, you may find an asking price of several thousand pounds.

Typical methods of hijacking business names include putting in punctuation (such as dots and dashes), abbreviating words (‘limited’ becomes ‘ltd’) or even getting hold of the name in other countries. Cybersquatters may also purchase common misspellings of a name or simply include a word that describes that company’s products.

If this sort of scammer targets your business name, they may purchase ten or twenty different variations of it all at once.

Combating the Scam

One way to protect yourself is to register several domain names yourself. If you beat the scammers to it, you can get rights to all the common misspellings and some descriptive words, then set them up to redirect to your original website.

The domain names can be set up quickly and at low cost. If you find the right provider, you may even be able to get a discount for purchasing several at once.

Getting a portfolio of domain names is a smart business tactic too – as it gives you scope to present several different websites to the public, perhaps to market different services.

It is, however, impossible to protect yourself against all the various combinations out there, simply because there are so many. The best way to defend yourself is by taking action: it is possible to obtain trade mark rights in the name.

Trade Mark Registration

Trade Mark Registration is a process by which your trade mark can be protected across the UK, Europe or any country worldwide. The rights are very strong indeed, and a Registered Trade Mark is the scourge of domain name hijacking.

Registration doesn’t just protect you online, but in every area of business and for every communication channel from printed labels to mass mailouts – and not just for identical names, but for anything that’s confusingly similar.

Intellectual Property and Branding Consultant Robert MacGinn commented: “These are legal rights that every business should have”. He continued, “A Registered Trade Mark saves businesses money if they ever encounter a problem – it is insurance for the future, and protects reputation, branding and the goodwill of your customers”.

Enforcing your Rights

Nothing ruins a cybersquatter’s day like a Registered Trade Mark. Instead of having to gather endless evidence to prove your claim (as you would have to do if you had no Registered Trade Mark), a single legal letter is all that is required to demonstrate your rights to the disputed domain name.

If they won’t surrender the domain name to you after a formal letter of demand, there is even an efficient legal process to have the rights transferred – so if you have your Registered Trade Mark, there is no need to go to court to enforce them.

World Intellectual Property Office statistics for this tribunal process – known as the Uniform Domain Name Dispute Resolution policy or UDRP – show a dramatic 28 percent rise in anti-cyberquatting claims. This is the sharpest rise since the UDRP was introduced in 1999. On average, over 17 domain name disputes were resolved each working day through the UDRP in 2010.

Some of last year’s claimants include global brands such as MasterCard, Ferrari and Tiffany, as well as online companies – perhaps those hit hardest by cybersquatting – like Twitter, eBay, and Wikimedia foundation (the organisation behind Wikipedia). SMEs of all types also used the UDRP.

The UDRP is quick and operates under a strictly defined set of legal principles. While costs are not covered, they are minimised by the efficiency of the process and judgments are often delivered within two months of the initial complaint being posed. As well as tribunal arbitration, other paths of dispute resolution exist, including mediation and negotiated settlements.


If you have a brand but haven’t registered it, your business may be vulnerable to attack, both in cyberspace and in the physical world.

Added: 19th May 2011

Christopher J Sherliker is a partner for Silverman Sherliker LLP who provide legal solutions across a spectrum of requirements.  Find out more about Silverman Sherliker LLP.


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