The term cybersquatting derives from the premise that individuals buy up certain internet domain names over the internet for a brief period before selling them on. This is seen as ‘squatting’ and is controversial because cybersquatters will generally target domain names that are sought-after by well-established businesses, which will then be forced to buy the domain names at a premium.
For example, ‘Company A’ is a well-established and famous brand but it does not yet have an internet domain name. A ‘cybersquatter’ has anticipated the company’s need for a domain name and has bought all suitable names such as www.companya.com or www.acompany.com The company is now forced to either buy the domain name at a much higher price from the squatter, or purchase a different domain name that is not as easy to remember or relevant to Company A.
Cybersquatting is seen as immoral to certain people because the squatter has done very little to earn his money. His contribution has not helped society in anyway and has merely raised the cost for a legitimate company to buy a domain name. This problem in terms of domain names was particularly prominent in the early 90s with the explosion of the internet, as many major companies did not have domain names at the time.
Nowadays, a more concerning problem is individuals buying certain domain names which would make people think they are related to a certain company when in fact they are not.
Disputing domain names
In terms of disputing a domain name there are several likely complications or restrictions. Firstly, if the website host is not in the UK the
UK courts may not have jurisdiction and thus power to bring a claim against the individual. There is also the possibility that the alleged cybersquatter could legitimately be using the website for its own purposes and just happens to have a similar name to that of another company. Even if it does not, if the website is not designed to take advantage of the company, and is not claiming to be affiliated to the company, it may be a reasonable use of the domain name, such as a dedicated fan site. However, if cybersquatting is clearly taking place an individual or company may be able to bring a claim for ‘passing off’.
In order to bring a claim for passing off, an individual or company must show it has built up sufficient ‘goodwill’ that an average individual would actually know who that company or individual was. If the cybersquatter has created a website with the domain name relevant to a legitimate company and the site is likely to lead to consumers believing it is the company’s official site, and subsequently a loss is suffered, then a claim can potentially be brought. This type of claim can stop those cybersquatters which use obvious domain names for companies and then try to make money through that domain name and the firm’s reputation.
Cybersquatting can be complicated and may come in a number of different forms. The old-style cybersquatter who jumped in quickly, anticipating a firm’s success and hence the opportunity to sell on the domain name, may be being diminished, but there are still several cases in which individuals will use similarly named websites in an attempt to make money out of them. It is important therefore to know about cybersquatters and how you may be able to protect yourself from them.