Nov 09 | 2016

Domain Name Dispute Options

It is difficult to overestimate the value of a good domain name.  Not only do domain names act as a key way for customers and other interested parties to reach your business online, but they oftentimes reflect the valuable trademarks of your company.  Unfortunately, domain names that reflect your company’s trademarks can attract cybersquatters who buy domain names and seek to sell them for profit or otherwise use those domain names to exploit the goodwill associated with your company.  The struggle to combat domain name abuse can be challenging, but there are steps you can take to enforce your rights.

Overview of Domain Name Dispute Options

There are currently three primary options for combatting domain name abuse.    The first two options involve a written arbitration procedure while the third option involves federal litigation.

UDRP Process: The most common avenue for domain name disputes is a Uniform Dispute Resolution Policy (“UDRP”) proceeding through the World Intellectual Property Organization or the National Arbitration Forum.  The UDRP process was developed to provide an international means of efficiently resolving domain name disputes through a streamlined complaint-response-decision format.  The UDRP process can be used for traditional domain names such as those ending in .com, .net, .org and for newer generic top level domain names (“gTLDs”) such as .lawyer or .doctor.  A decision is usually issued within 60 days from the date of the complaint filing.

URS: The UDRP’s younger cousin is the Uniform Rapid Suspension System (“URS”).  This procedure began a few years ago and only covers domains registered with one of the gTLDs that launched in 2013 or later (e.g., .phone, .shop, or .organic).   URS cases are decided on a written record that is less lengthy than the UDRP, since one initiates a URS case by filling out an online form instead of drafting and filing a complaint like in a UDRP case.  Also, in a URS proceeding, the respondent has fourteen days to respond, and a decision can be expected 21 days from the date of the online filing.  URS proceedings are the least expensive and quickest way to resolve a domain name dispute.

Lawsuit Under the ACPA: If the arbitration options fail, or if you decide to bypass those options altogether, a lawsuit in federal court under the Anticybersquatting Consumer Protection Act (“ACPA”) is a third option.  The ACPA involves a far greater investment of time and money, and ACPA actions are often tied to other trademark claims against the defendant, but not always.  The duration of an ACPA case can range from several months to a couple of years.

Determining the Best Option

As is typical, your strategy depends on the facts of the case.  The following four considerations will help you choose the best option.

Type of Domain Name Involved – The UDRP and ACPA options can be utilized for most types of domain names, but the URS proceeding can only be used for domains that include new gTLDs registered in 2013 or later (click here for a list of all new gTLDs).

Whether the Trademark is Registered – URS can only be used if the trademark at issue is registered, because the URS proceeding is meant for clear trademark violations where the rights of the complaining party are not in question.  You may use the UDRP and ACPA options for registered trademarks and for unregistered common law trademarks where you can demonstrate ownership of a protectable, distinctive trademark.

Available Remedy – The weakest remedy is offered through URS, where a successful claim results only in suspension of the domain name for the remainder of the domain registration period.  So, under URS, a successful complainant cannot obtain the domain name until its registration period expires.  In contrast, under the URDP, the remedy is cancellation of the domain or a transfer of the domain to your company.  An ACPA lawsuit not only can result in cancellation or transfer of the domain, but it also allows for recovery of monetary damages, including statutory damages of $1,000 to $100,000 per domain name.

Cost – URS is the least expensive approach.  The filing fee is only $375, and because this is a streamlined procedure utilizing fill-in forms, attorney time should be minimal.  The UDRP process is more expensive due to higher filing fees ($1,300 – 2,600) and more substantial pleading requirements, but it is still less costly than litigating an ACPA action.

Final Thoughts

As with any legal issue, there is no one-size-fits-all approach to domain name dispute resolution.  The UDRP proceeding has been quite popular and will likely continue to be, but now that there are more domains in the marketplace utilizing the new gTLDs, there may be an uptick in URS filings.  The prospect of statutory damages will continue to make ACPA actions desirable to those companies that have the means to litigate those claims in court.

By Adam W. Sikich, Esq.

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