Domain Hijacking

In 1999 the Congress passed the Anti Cyber Squatting Consumer Protection Act (ACPA), which extended the rights of trademark ownership to include websites. Cyber squatting is the practice of registering a trademark as a domain name with the intent of profiting from it by selling it, usually to the trademark owner. As long as the cyber squatter owns the domain name, the trademark owner cannot register its own trademark as a domain name. In Cyber Squatting, a person may register well-known names or words, or common typographical errors, or a dilution of, existing trademarks.

The cyber squatter then offers to sell the domain to the person or company who owns a trademark contained within the name at an inflated price or diverts the web traffic to a website where they make money from advertising or product sales. The acknowledged arch-cyber squatter is Dennis Toeppen, who registered a host of well-known trademarks as domain names (including deltaairlines.com, neiman-marcus.com and numerous other famous marks), and who has been unsuccessful in defending his rights to them when sued by the trademark owners.

The Court found that defendant’s registration of a domain name, which was identical to the plaintiff’s trademarks, in order to sell the domain name to the trademark owner constituted trademark dilution. Intermatic v Toeppen and Panavision v Toeppen are considered the pivotal cyber squatting cases and have had a profound impact on the development of cyber squatting case law, as well as on the drafting of the ACPA. The Panavision case illustrates some of the typical issues encountered in cyber squatting cases where trademark infringement is raised. Toeppen registered the domain name www.panavision.com and used the web site to display pictures of the city of Pana, Illinois.

He offered to sell the domain name to Panavision for $13,000. Panavision declined and brought an action under the Federal Trademark Dilution Act (FTDA). Godaddy.com uses TDNAM.com , which is a domain aftermarket at which people can buy and sell domains. GoDaddy also auctions off expiring domains that are currently registered at GoDaddy, but they also park expiring domains on its servers for a couple weeks before auctioning them at TDNAM. Which allows the company to calculate the amount of visits the domain receives and the associated revenue from pay-per-click ads. Pmly to set higher stating bids for the expiring domains that produce revenue. Domain hijacking is the practice of stealing an organization or individual domain name.