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Unlawful Targeting of Trademarks and Consumers in Registering Domain Names

Unlike trademark applications which go through a lengthy examination process before advancing to registration, anyone (anywhere in the world) can register a domain name identical or confusingly similar to a trademark—instantly and no questions asked, at least, in the traditional space (the legacy gTLDs)! With the new gTLDs registrants will receive notice of possible infringement if the brands are registered with the Trademark Mark Clearing House, but notices do not function as injunctions to block registrants from registering infringing names. TMCH notices are not enforceable; compliance is voluntary!

Whether deliberate or not, registrars’ agreements extract representations and warranties that registrants are acting lawfully—“you are not registering the domain name for an unlawful purpose; and . . . you will not knowingly use the domain name in violation of any applicable laws or regulations”—and that registrants agree they will be “subject to” the provisions specified the UDRP. Registration Accreditation Agreement, In agreeing to the “subject to” language registrants also bind themselves to the truth of their representations set forth in Paragraph 2 of the Policy which concludes that “[i]t is your responsibility to determine whether your domain name registration infringes or violates someone else’s rights.”

It is possible (although suspect) that in registering domain names identical or confusingly similar to trademarks some registrants sincerely believe (or have convinced themselves) that the mere fact of availability is the measure of legality. How else to account for <volkswagen.live>, <volkswagen. website>, , , , and a dozen other “Volkswagen” domain names with a menagerie of new TLD extensions? Registrants and their representatives on one end of the spectrum whose registrations essentially target trademarks are certainly ignorant of the law; that is not true of registrants on the other end who target consumers by pretending to be mark owners, but the two classes are alike in ignoring the warranties and representations they are supposed to comply with.

The Respondent (admittedly ignorant of the law) in Volkswagen AG v. Richard Roberts, HD Home Theater, D2016-0231 (WIPO April 21, 2016) wrote to the Provider that he was

willing to transfer the distributed domain name volkswagen.forsale over to Volkswagen A.G.. How do I do this? I never sold a domain, or transferred a domain. (I am not a broker) I am willing to transfer for $524.17US. The cost of domain and out of pocket expenses ($24.17 for domain registration + $500 for legal consultation). My only intention for the use of this domain was to partner with Volkswagen A.G., or Volkswagen Group of America, in creating a global sales, and marketing channel, for Volkswagen dealerships.”

The Responded concluded his plea with “Can you help in resolving this issue?” Well, no!

Another class of registrants (more sophisticated than Mr. Roberts claims to be) know their registrations are unlawful but have developed a business model based on inducing trademark owners to pay them something on the theory that it’s quicker and less expensive for complainants to give in. But, giving in doesn’t always work, either. In Thule Sweden AB v. Cameron David Jackson, D2016-0414 (WIPO April 12, 2016) (<thulegroup. club>) after Complainant paid the extortion fee the Respondent simply turned around and purchased another infringing domain name, and the extortion continued.

In this unusual situation with thin precedent the Complainant requested that the Panel include the new registered domain name in the pending complaint, and the Panel agreed to accept it:

One final equitable consideration favoring allowing such addition [to the complaint] is that this instance is not the first time, or the second, that this Respondent has employed a new registration for this very purpose [of continuing the extortion]. See Statoil ASA (“Statoil”) v. Cameron Jackson, WIPO Case No. D2015-2226, in which this Respondent registered two additional domain names involving the same prominent trademark within three weeks after selling a domain name to the markholder complainant.

Respondent of course was outraged that the Panel would do this, and indignantly objected to adding the new extortion domain to the pending complaint: “I think” quoting from the response, “it is very unfair that Thule group can or could possibly include another name in the same WIPO case. They should have to lodge another or separate WIPO case.” A response to be cherished! But, compelling complainants to file new complaints would be a waste of arbitral resources.

In a number of other recent cases respondents asked for settlement discussions only to be rebuffed by complainants not interested in giving respondents the satisfaction of settling. In William Grant & Sons Limited v. Dave Chandler, D2016-0476 (WIPO April 17, 2016) the “Complainant informed the Respondent that it would settle the dispute provided that the Respondent transfer the Disputed Domain Name and pay for the Complainant’s cost of bringing the proceeding” (emphasis added). Registering clearly infringing domain names is not a good investment model, although if it’s done on a large enough scale and allowed to continue for a long enough period it could be profitable!

While hilarious registrations targeting trademarks are essentially innocuous, not so the other model that primarily targets consumers “in a phishing scheme to defraud Internet users.” Kames Capital PLC v. Tom Harrison / Kames Capital Plc Limited, FA1604001671583 (Forum May 20, 2016) (KAMES CAPITAL and ). Phishing is an impersonation scheme that induces “consumers into revealing personal and/or proprietary information. Capital One Fin. Corp. v. Howel, FA 289304 (Forum August 11, 2004). Such conduct is neither a bona fide offering of goods and services, nor a legitimate noncommercial or fair use of the domain name. Where there is evidence of fraudulent conduct respondent’s knowledge of the complainant and its trademark is conclusive not just presumed.

The Panel in Kames Capital was faced with the unusual situation of having to consider whether Complainant had standing to maintain the proceedings where there was some similarity but not necessarily (or apparently) confusing similarity: “Panels have shown great reluctance in granting a complainant exclusive rights to acronyms [here “kc”] in the absence of registration with a trademark authority.” The interesting question here was whether <kclfx.com> is confusingly similar to the trademark or simply similar.

If a domain name is only similar complainant would lack standing. In Kames Capital, the second level domain is composed of an acronym of Complainant’s trademark plus “lfx”, but “fx” is a standard reference to foreign exchange, which is Complainant’s business. Ordinarily, panelists do not look at the content of the website (the second and third requirements) until they have determined standing, but there may be reason to do so where complainant alleges criminal conduct specifically targeting consumers by confusing them as to respondent’s identity or association with complainant.

The Panel in Kames Capital concluded that “it has some, although limited, discretion in determining whether or not to consider the content of the resolving webpage in making a Policy ¶ 4(a)(i) decision.” Taking into account “all the circumstances . . . including the evidence of the fraudulent activities for which the domain name has been used, the Panel finds that it may have regard to the contents of the website and having done so finds that the disputed domain name is confusingly similar to Complainant’s trademark.” In other words, Complainant prevails based on similarity that is only fully established as being confusing by reference to the content of the website.

Two other recent instances of phishing, The Trustees of Columbia University in the City of New York v. George Billis, FA160400 1671587 (Forum May 25, 2016) (<columbiauniversity.nyc>, Respondent appeared) and 3M Company v. Above.com Domain Privacy, FA1604001668805 (Forum May 4, 2016) (<scotchbrandtape.com> illustrate Respondents’ tactics with domain names mimicking well-known trademarks.

In Columbia University Respondent alleged several different positions; that Complainant did not have a trademark—apparently believing that the extension dot nyc distinguished the domain name from the trademark—with a backup position that he had registered the domain name for a criticism site but

[t]he disputed domain name currently resolves to a page that invites visitors to enter their name and email address in an attempt to phish for personal information.

Respondent is also the registrant of other dot nyc domain names mimicking well-known brands in proceedings conducted under the Uniform Rapid Suspension System (URS).

In the 3M case Respondent’s current use of the <scotchbrandtape.com> domain name is equally blatant. The disputed domain name redirects Internet users to a website displaying an error message that reads: “‘A serious malfunction has been detected,’ which advises users to ‘call the toll-free number below for a Microsoft-certified technician” and provided a telephone number.” This “constitutes phishing, which is evidence of bad faith registration and use.”

Finally, the domain name in Diamond Hill Investment Group, Inc. v. Richard Stroud, D2016-0510 (WIPO April 25, 2016) (, a typosquatting domain name omitting two letters, “d” and “l”) resolves to a website “that [Complainant alleges] is a virtually identical copy of Complainant’s website and that this website is being operated to further a possible criminal enterprise.” The complaint is a reprise of an earlier proceeding against a differently named Respondent who is alleged to be the same registrant:

Complainant alleges Respondent in this matter is the same person or entity that was the respondent in another UDRP action it brought in September 2015, Diamond Hill Investment Group, Inc. v. Carole Elkins, WIPO Case No. D2015-1191. In that matter, the panel found that the respondent had registered and used the domain name, <diamond-hil.com>, in bad faith. Complainant alleges that the same respondent is once again using bogus contact information, a month after the transfer of the prior domain name, and has registered and used the Domain Name to perpetuate the same fraudulent criminal phishing enterprise it began with the transferred domain name in the prior proceeding.

In all these phishing cases, adding proof of criminal acts not just reinforces bad faith but establishes a per se violation of the Policy. The strong inference from typosquatting (stronger even than domain names confusingly similar to marks!) is that respondents are presumed to have had actual knowledge of the marks since they are essentially mimicking them. Not surprisingly, most respondents default rather than defend their registrations (Thule Sweden and Columbia University being exceptions).

By Gerald M. Levine, Intellectual Property, Arbitrator/Mediator at Levine Samuel LLP

Information about the firm can be found on the Firm’s website at iplegalcorner.com. Mr. Levine has a litigation and counseling practice representing clients in Intellectual Property rights and management, Internet and Cyberspace issues, domain names and cybersquatting, as well as a diverse range of legal and business matters from working with client to resolve commercial disputes, to copyright and trademark counseling and registrations. He is the author of a treatise on Trademarks, Domain Names, and Cybersquatting, Domain Name Arbitration: A Practical Guide to Asserting and Defending Claims of Cybersquatting Under the Uniform Domain Name Dispute Resolution Policy. A Second Edition of the treatise was published July 2019 and is available from Amazon or from the publisher, Legal Corner Press (LCP). For inquiries to LCP write to .(JavaScript must be enabled to view this email address) or Mr. Levine at .(JavaScript must be enabled to view this email address).

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