Waging War Against Cybersquatting

By Eric Sinrod, 

(August 14, 2007) - There appears to be a new sheriff in town when it comes to cybersquatting - the Coalition Against Domain Name Abuse (CADNA). A non-profit organization based in Washington, D.C., with members including Yahoo!, AIG, Dell, Eli Lilly, Hilton, HSBC, Marriott, Verizon and Wyndham, the CADNA has just announced the launch of a national campaign against the fraudulent abuse of domain name registration that is at the core of cybersquatting and that the CADNA says threatens the future viability of Internet commerce.

Even though the Anti-Cybersquatting Consumer Protection Act (ACPA) was enacted as far back as 1999, cybersquatting still remains a threat according to the CADNA. The CADNA notes that the number of .com domain names has doubled since 2003, the number of cybersquatting disputes filed with the World Intellectual Property Organization (WIPO) has increased by 25% from 2005 to 2006, with cybersquatting itself having increased 248% over the past year.

The problem, as outlined by the CADNA, is that sophisticated cybersquatters are exploiting a supposed flaw in the domain registration process. Domain names can be registered and later dropped risk-free within an accepted five-day grace period. By abusing this grace period, cybersquatters apparently can "taste" and "kite" domain names so that they can test their profitability.

The CADNA reports that more than 1 million kited sites are re-registered on a daily basis. This is said to bring in over $100 million annually for profiteers. Indeed, the CADNA claims that worldwide cybersquatting is costing brand owners over $1 billion annually as the result of diverted sales, the loss of goodwill, and expenses incurred in combating fraud.

The CADNA points out that by registering domain names emanating from famous brands, cybersquatters can lure consumers into purchasing counterfeit products, cause them to reveal their personally identifiable information, and expose themselves to spyware.

So, what does the CADNA plan to do about all of this as part of its new national campaign? First, the CADNA states that it will work at federal and international levels to difficult to establish and unprofitable to maintain. But what does that mean?

More specifically, the CADNA says that it will pursue Congressional legislation that would increase statutory damages under the ACPA and to work with WIPO to introduce an international anti-cybersquatting treaty. On top of this, the CADNA will place pressure on ICANN to take decisive action with respect to domain registrar abuses and to close the "tasting" and "kiting" loophole.

Of course, it is too early to know for sure whether the CADNA's campaign will have a full impact in terms of rooting out cybersquatting. However, the motivations behind the campaign are good, and it certainly is backed by important and relevant players. Let's cross our fingers with hopes for success.

Networking and Storage

© 2007 FindLaw