Beware of Domain Name Monetization – It Can Cost You

We recently have come across an issue where, in the enforcement of one of our client’s marks in a Domain Name Dispute the bad guy (i.e., registrant of the confusingly similar domain name to our client’s mark)(hereinafter “Bad Guy”) responded, “Well, I am not using the domain name – I only registered it – so there is no bad faith here.”

“Survey Says – XXX” (Sorry for the Family Feud Reference). Simply put, the Bad Guy registered, we’ll say, WidgetOnline.com. Our client’s Federally Registered U.S. Mark is Widget. Our client sells furniture under the mark Widget. Bad Guy, although not posting a site at WidgetOnline.com, has allowed his domain host to monetize the site (e.g., show ads on the site and Bad Guy gets a cut of all click through traffic through WidgetOnline.com’s ads). And guess what, the ads on WidgetOnline.com are for competitors to our client’s furniture business.

So does the Bad Guy’s defense hold water? Like a sieve.

In short, to prevail in a domain name dispute the trademark holder must show:

1. The domain name is identical or confusingly similar to a trademark or service mark in which the trademark holder has rights and had said rights at or before the registration of the disputed domain name; and

2. The Bad Guy has no rights or legitimate interests in respect of the domain name; and

3. The domain name has been registered and is being used in bad faith.

There are many examples of bad faith out there, but for the purposes of this discussion guess what – Monetization of a Web Site for Pecuniary Gain is Evidence of Bad Faith! Game. Set. Match.

So what have we learned? If someone registers a domain name similar to your trademarks even if they do not post a site to the domain name but do monetize the same – especially if those ads are for your competitors – the Bad Guys loose. Win one for the Good Guys.

As always, if you have any questions regarding this or any other issue Blog on it or just send us an Email.

The Trademark Company