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Do We Need Title Insurance for Domain Names?

Over the Thanksgiving holiday I read an article in Forbes (November 13, page 148) about real estate title insurance. The article was about how real estate title insurance is a joke and overpriced. But as I read in the article how titles are investigated, in dawned on me that a title check service for domain names would be helpful.

Title checks and title insurance would prevent you from losing money when you bought a stolen domain. Last year I almost got bilked for $5,000 buying domains…before I discovered they were stolen. I basically ran my own title check to find out the domains were stolen.

Here’s how domain name title insurance might work:

You pay a company to research the history and ownership of a domain to make sure it doesn’t have any past legal issues such as UDRP proceedings, suspicious transfers, etc. This would require using a historical whois database and perhaps making a few phone calls to previous owners of the domain to make sure it traded hands properly. The service might also run a trademark search to make sure there aren’t trademark issues. For an additional fee, the domain name title company would insure you against any losses should it turn out that the domain didn’t have a clear title or should you lose the domain in a trademark dispute.

A company like Name Intelligence might be a good provider of this service given its historical database of domain name information.

Purchasers of expensive domains frequently hire law firms to run trademark checks and do their own investigations. But this is a service that could be productized to the benefit of the domain name community. Stolen domains and trademark domains are a cloud over the industry and title insurance could help evaporate it.

Apparently I’m not the only person to envision a need for domain name title insurance. I checked a few domain names, including the ones below, and they were already registered.

DomainTitleInsurance.com
DomainInsurance.com
DNTitleInsurance.com
DNInsurance.com
DomainNameTitleInsurance.com
DomainNameInsurance.com

By Andrew Allemann, Domain Name Blogger

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Comments

Dave Zan  –  Nov 29, 2006 7:18 AM

Chances are someone’s already looking into this. But they’re probably still working out the legalities and the market demand for such.

OTOH, some big firms (e.g. ven-cap) have covered this possibility via their registrar acquisitions.

Adam Strong  –  Dec 1, 2006 3:09 AM

This has been tried. Itwas a product of a company that I came across during Bubble 1.0

Alan Shea  –  Dec 1, 2006 8:20 PM

Domaintools.com already has historical whois data, and will also show blacklisting information on a domain. As for pending UDRP on a domain, the UDRP process should already have locked the domain.

Andrew Allemann  –  Dec 1, 2006 9:15 PM

The DomainTools data is a good start, which is why I mentioned NI is a potential provider of this service.  But it’s not enough…

Brett Lewis  –  Jan 11, 2007 3:36 PM

It is an interesting idea, but extremely difficult to put into practice.  How does the title company insure against trademark claims?  The overwhelming majority of trademarks are not exclusive, but based on dictionary words.  Often, there are multiple uses being made of even descriptive, ordinary words. 

Take the word “apple.”  There are 2053 trademark applications, live and dead marks containing some variant of the word “apple.”  There are fifty-five such marks dedicated to the word “apple,” alone.  Vetting a domain name for possible use involves an investigation of existing uses of the root word(s) of the domain name by third party companies in their trademarks, and making certain that a proposed use will not violate existing rights.

Even so, there are many aggressive trademark owners that will sue to acquire a domain name, whether it is has been registered in bad faith, or used in an infringing or competitive manner, or not.  Although I agree that the idea of title insurance for domain names is an interesting one, the premiums would have to be prohibitively high to cover the risk inherent in insuring domain names. 

Traditional title insurance can look at a recorded chain of ownership to determine whether title has properly passed.  When dealing with the intersection of domain names with intangible property rights in trademarks, it is far more difficult to determine or predict whether a competing claim will ever be made. 

It may be more feasible to have a service that would insure simply the validity of the chain of ownership, dating back to the original owner, but even this raises issues not typically present in real estate transactions.  There is no formal record of domain name transfers—real property transactions are recorded at the county level.  Much would likely need to be changed about the way that domain names are bought and sold to make insuring them a viable idea.

Brett E. Lewis, Esq.
http://www.lewishand.com

joyce levin  –  Mar 5, 2007 7:11 AM

Can anyone help me please?  How can I find out who the previous owners of a domain name are?  Any advice would be much appreciated.

Brett Lewis  –  Mar 5, 2007 2:10 PM

Name Intelligence.  http://whois.domaintools.com/

You may need to set up an account.  They keep archived records of whois changes under “Domain History.”

Brett Lewis
.(JavaScript must be enabled to view this email address)

David W. Nance  –  Apr 6, 2007 12:49 AM

Domain insurance would at best pay for the high legal fees incurred trying to recover stolen domains; so why not instead find cheap solutions.

I set up TROANN.com so that people don’t have to guess who really owns a domain and can now safely buy domains without having to worry about them being taken back or never transferred after payment is sent because your TROANN title certificate . Going by the WHOIS registry ownership can be change in an instant by anyone with account access at the registrar level. You might think your doing a ownership history search, but the registrar is going to stand by the current registrant because that is what they are contractually required to do under ICANN policy. TROANN relies on case law I helped make to supercede ICANN policy to stop domain owners from having to live with completely unnecessary risks. TROANN doesn’t insure against threats and litigation regarding trademark rights, but I also have a patent pending that addresses that problem and TMclearinghouse.com will be up in about a month.

Anyone with a little time or questions, please check out TROANN and let me know what you think or tell me about a domain problem you have so I can improve these services. If the public can improve on the news and TV, then we can certainly fix unnecessary problems the establishment hasn’t in over 10 years.

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