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Protect your Kentucky business against cybersquatting

On Behalf of | Nov 9, 2020 | Business Law, Intellectual Property, Trademark |

In today’s online world, strong commercial domain names are critical to your brand and for many businesses during this economic downturn, online sales are keeping the wheels turning. More and more commonly, a company’s internet presence is its only storefront.

Protecting your online presence is important to the bottom line, especially now.

Protect your trademarks and domain names from bad actors

A recent article in The Fashion Law (TFL) discussed the risks of cybersquatting even for small-to-medium-sized businesses and startups. Even new commercial endeavors in their relative infancy may be on the internet radar of people who are up to no good and would love to profit from your hard work.

As TFL noted, it is not that unusual for a new startup business to quickly take off and become a “well-known [brand] in a shorter time than it may have taken in a less digitally-connected world.”

What is cybersquatting?

Cybersquatting is the bad faith use or registration of an online domain name based on another party’s trademarked word or phrase. A cybersquatter may try to use the pirated domain name in commerce to make money based on the goodwill and reputation of the original owner such as by selling counterfeit goods through the stolen domain name. Or, the squatter could try to sell the URL to the original trademark owner because the owner may think that if they buy it – paying a sort of e-ransom – the pirate will not be able to profit from it.

Federal cyberpiracy prevention

When a party with “bad faith intent to profit” by registering, using or trafficking in a domain name based on a mark owned by another, including a mark consisting of a “personal name,” federal law provides for a cyberpiracy lawsuit. This law is concerned about domain names that are exactly the same as or “confusingly similar” to distinctive or famous protected marks.

In certain situations when the lawsuit is not available, if a trademark owner discovers a domain name that violates the owner’s rights, they can file an “in rem” lawsuit (based on property and not aimed at a specific defendant personally).

In each of these kinds of lawsuits, the court can order that the defendant forfeit or cancel the domain name or transfer it to the underlying trademark owner.

Takeaways for business owners and entrepreneurs

Part of opening a new commercial entity is setting up a system for trademark protection from domain name piracy from the beginning, with which a lawyer can assist. Get all potential URLs registered and regularly monitor the internet for lookalike domain names. If you discover them, talk to an attorney about your potential legal remedies to protect your brand rights and stop the other party from misuse.

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