Attorney Steve® - Domain Name Disputes - WIPO Arbitration - Recerse Domain Name Hijacking under ACPA.
Reverse Domain Name Hijacking sounds more complicated than it really is. In its purest essence Reverse Domain Name Hijacking, (abbreviated to RDNH), is the reverse form of cybersquatting. Cybersquatting is basically buying a companies trademarked name and trying to sell their domain for profit. Reverse domain name hijacking is when someone contacts you claiming to be a trademark holder and demanding that you give up your domain for free arguing you are infringing on their trademark. It's a form of bullying and extortion and can be legally actionable.
Example of Reverse Cybersquatting
I once bought a domain called DeerValley.guru. It was purchased in good faith as a domain name that I was going to use for real estate sales in Arizona (Deer Valley area). I never attempted to sell the domain to anyone, and one day some rude guy calls me on the phone and tries to bully me telling me I was infringing his trademark. I basically told the guy to "pound sound" and sent him a written demand letter pointing out how he was engaged in reverse domain name hijacking. Needless to say, he messed with an internet and IP lawyer and lost and I never heard from him again. I still have the domain. Unfortunately, there are copyright bullies, and trademark bullies in the world and this blog may provide you some help if you are facing this situation over a domain name.
What is Reverse Domain-Name Hijacking?
According to Wikipedia:
"Reverse domain name hijacking (also known as reverse cybersquatting or commonly abbreviated as 'RDNH'), occurs where a rightful trademark owner attempts to secure a domain name by making cybersquatting claims against a domain name's "cybersquatter" owner. This often intimidates domain name owners into transferring ownership of their domain names to trademark owners to avoid legal action, particularly when the domain names belong to smaller organizations or individuals. Reverse domain name hijacking is most commonly enacted by larger corporations and famous individuals, in defense of their rightful trademark or to prevent libel or slander.
Reverse domain name "hijacking" is a legal remedy to counter the practice of domain squatting, wherein individuals hold many registered domain names containing famous third party trademarks with the intent of profiting by selling the domain names back to trademark owners. Trademark owners initially responded by filing cybersquatting lawsuits against registrants to enforce their trademark rights. However, as the number of cybersquatting incidents grew, trademark owners noticed that registrants would often settle their cases rather than litigate. Cybersquatting lawsuits are a defensive strategy to combat cybersquatting, however such lawsuits may also be used as a way of strongarming innocent domain name registrants into giving up domain names that the trademark owner is not, in fact, entitled to"
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Domain Name Disputes in Uniform Domain-Name Dispute Proceedings ("UDRP")
There are times when a trademark bully (not satisfied with you NOT turning over your domain) may seek to file a Uniform Domain Name Dispute at WIPO or the National Arbitration Forum (two forums where domain name disputes are heard). In these cases, you have either a single judge or three-judge panel hear and decide the case. If you lose, you have to turn over your domain per the UDRP policy set by domain registrars like Godaddy.
When breaking down the phrases “Reverse Domain-Name Hijacking” or “Reverse Cybersquatting” one may be confused. RDNH is a “bad faith” ruling during a Uniform Domain-Name Dispute-Resolution Policy, or UDRP, by the arbitration panel.
"Cybersquatting" is registering a domain name in bad faith and where the domain name is "confusingly similar" or identical to a well-known trademark with the intention to sell it to the trademark owner for profit (for example buying MicrosoftSoftware.com with the intent to sell it to Microsoft). As you might imagine "reverse cybersquatting" is someone demanding your domain name by claiming you are violating their trademark.
So, who does this all play out of the trademark bully wants to get your name and initiates a UDRP domain arbitration? First, one needs to understand what a Uniform Domain-Name Dispute-Resolution Policy is. This is a process designed to resolve domain disputes through a route other than the court system.
The benefits of a UDRP versus courts are lower costs and proceedings that are completed in a more timely manner. Another lesser known benefit is confidentiality.
To “win” a dispute a complainant must be able to successfully establish all three (3) elements to a panel of either one (1) or three (3) arbitrator(s).
- The first element is proving that the domain name at issue is identical or “confusingly similar” to the trademark of which the complainant has rights.
- Second is proving that the registrant does not have any rights or legitimate interests in the domain name.
- Finally, third is that the domain name was registered in or being used in “bad faith”.
When it comes to domain cybersquatters, they will commonly falsify facts or seek to get around one or more elements so that they can keep their domain name (or perhaps reach a settlement agreement during the dispute to sell the domain).
If the party seeking your domain proves all three elements, again, you will be forced to transfer your domain to the trademark holder (note, the domain is "locked" while the proceeding takes place so you cannot try to sell it at that time in anticipation of losing your domain arbitration.
The rules within the UDRP specifically defines Reverse Domain-Name Hijacking as “using the UDRP in bad faith to attempt to deprive a registered domain-name holder of a domain name”. This definition is very transparent in what RDNH is but the biggest takeaway is the use of “bad faith”. During a UDRP the arbitrator(s) will compare the facts and submissions of both the complainant and the registrant, throughout this process everything should and frequently does come to light. According to paragraph 15(e) of the UDRP Rules if “after considering the submissions the panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding”.
UDRP Case example
WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Poker Host Inc. v. Russ “Dutch” Boyd
Case No. D2008-1518
In one UDRP complaint, a respondent asks the panel to find that the complainant is engaged in Reverse Domain Name Hijacking. Here is part of the filing:
The Respondent submits that “Poker Host” is a generic term describing a person who hosts poker games and tournaments or the host of a television show dealing with poker or a person employed by a casino to participate in poker games at its tables. The Respondent further contends that even if the Complainant has trademark rights, the Domain Name is not confusingly similar to its mark.
The Respondent claims that he has a right or legitimate interest in the Domain Name since he has been employed as a poker host by a casino and has hosted a pilot programme for a television gameshow. He adds that he is a well-known poker player, being one of about 600 World Series of Poker bracelet winners.
The Respondent contends that in any event he registered the Domain Name in good faith. He disputes the Complainant's claim to have used its <pokerhost.com> domain name for a website since February 2002. He states that the earliest record retained by “www.archive.org” of the Complainant's website is dated October 24, 2004 and announces that its operation would be commencing in December 2004. According to the Respondent the Complainant's website did not actually start to operate until the beginning of 2005. By contrast, the Respondent registered the Domain Name on July 14, 2004, began using it to display links to poker websites on September 2, 2004, and has retained it ever since.
The Respondent notes that the Complainant is represented by counsel experienced in domain name disputes who may be taken to be familiar with the Policy. He contends that the Complainant must have known that it did not have trademark rights when he registered the Domain Name and complains that the Complainant sought to distort the facts to suggest the contrary.
The Respondent asks the Panel to reject the Complaint and to make a finding of reverse domain name hijacking.
Here was the finding of the panel:
D. Reverse Domain Name Hijacking
In accordance with paragraph 15(e) of the Rules, if the Panel finds that the Complaint was brought in bad faith, for example in an attempt at reverse domain name hijacking, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.
“Reverse Domain Name Hijacking” is defined in paragraph 1 of the Rules as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name”.
The Panel notes that the details of the Respondent's registration of the Domain Name annexed to the Complaint indicate that the record was created on July 14, 2004. The Complainant asserted in the Complaint that “The transfer to Respondent's possession came years after the registration of Complainant's Trademark and Complainant's registration and use of the <pokerhost.com> domain name”. However, the Complainant provided no evidence of any transfer of the Domain Name to the Respondent after July 14, 2004, and no evidence of the Complainant's use of its <pokerhost.com> domain name prior to that date.
The Panel finds that the Complainant brought the Complaint either without any attempt to verify whether it had a case for claiming that the Respondent had registered the Domain Name in bad faith or knowing that it did not have any viable case on this point. In these circumstances, the Panel concludes that the Complaint was brought in bad faith and constitutes an attempt at reverse domain name hijacking.
For all the foregoing reasons, the Complaint is denied.
The Panel further finds that the Complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.
Another WIPO domain arbitration case discusses some other examples of reverse domain hijjacking and abuse of the adminitstrative proceeding:
Numerous panels have identified a number of factors supporting a finding of abuse of the administrative process that are present in this case:
- "Ordinarily if the face of the complaint itself demonstrates a settled reason why the complaint must be denied, a panel may make a finding of RDNH." Tarheel Take-Out, LLC v. Versimedia, Inc., WIPO Case No. D2012-1668, citing Liquid Nutrition Inc. v. liquidnutrition.com/Vertical Axis Inc., WIPO Case No. D2007-1598. The obvious and fatal omission from the Complainant's case is any allegation or proof of targeting.
- The Complainant's "case has failed by a large margin." Central Media S.C. v. Valentin Lotrean, WIPO Case No. D2016-2598. Here, because of a failure to allege targeting, the Complainant's case was dead on arrival.
- The Complainant has utterly ignored settled Policy precedent on several matters fundamental under the language of the Policy and longtime Policy precedent. Coolside Limited v. Get On The Web Limited, WIPO Case No. D2016-0335 ("The Complainant ignored settled Policy precedent in presenting its case as it does"). A few of the more egregious examples are failure to allege or prove targeting, failure to provide proof of either registration or use of the disputed domain name in bad faith, and citing a number of Policy provisions and precedent misleadingly out of context. The circumstances of this case, consisting most significantly of the facts that the GRANDSTAND mark is also a word with dictionary meaning, the Respondent having registered the disputed domain name over 20 years ago, and the lack of targeting demonstrated on the record, at a minimum calls out for an explanation from the Complainant.
- The Complainant has advanced arguments, on both facts and Policy precedent, that are at best misleading and at worst intended to mislead the Panel. Skyline Communications NV v. WebMagic Staff, WebMagic Ventures LLC, WIPO Case No. D2016-1667 ("Finally there are several of the Complainant's factual and legal contentions that border on the misleading"). While admittedly the Complainant's assertions under this point are ancillary to its primary (albeit flawed) bad faith arguments,in the former category are the reference to use of a proxy service as conclusive evidence of bad faith, an unsupported allegation that the word GRANDSTAND is "distinctive," and relying upon the example of bad faith set out in paragraph 4(b)(ii) of the Policy without bothering to allege much less offer proof to support the "pattern of such conduct" required under that provision. In the latter category is reference to the Telstra doctrine, which among other things absent from the Complainant's proof demands that "the Complainant's trademark has a strong reputation and is widely known . . . and the Respondent has provided no evidence whatsoever of any actual or contemplated good faith use by it of the domain name." Telstra, supra.Both these Telstra conditions are conspicuously absent from this case.
- The Complainant is represented by counsel, who should have recognized these shortcomings before signing the Complaint. If the Complainant's or its representative's undertaking under paragraph 3(b)(xiii) of the Rules3 is to mean anything more than a rote and boilerplate addition to its pleading this obligation requires at a minimum a basic understanding of the Policy's limited scope, the Policy and Rules themselves, and basic Policy precedent. BERNINA International AG v. Domain Administrator, Name Administration Inc. (BVI), WIPO Case No. D2016-1811 ("The Complainant is represented by counsel, who ought to know better and who is under an obligation imposed by paragraph 3(b)(xiii) of the Rules to undertake at least minimal due diligence before filing a complaint.")"
How to deal with reverse domain hijacking
Fighting back against an attempting hijacker can be challenging without the right understanding and with the help of legal counsel. By reading this blog you already have a leg-up on the hijacker but a legal professional will be incredibly effective not only in holding your ground but also in fighting back.
Trademark bullies attempting a domain hijacking are betting on their prey not being up to date on the law and being too busy to deal with such a hassle. This is exactly why hiring a professional who can dedicate their time and expertise is so useful. Now it is not completely necessary since one can go through a UDRP without any legal counsel and can ignore any letters but it does open one and one's business up to potential liability if wrong.
Now, establishing RDNH during the UDRP process is completely on the shoulders of the respondent. The World Intellectual Property Organization, or WIPO, states :
“To establish Reverse Domain Name Hijacking, a respondent would typically need to show knowledge on the part of the complainant of the complainant's lack of relevant trademark rights, or of the respondent's rights or legitimate interests in, or lack of bad faith concerning, the disputed domain name.
Evidence of harassment or similar conduct by the complainant in the face of such knowledge (e.g., in previously brought proceedings found by competent authorities to be groundless, or through repeated cease and desist communications) may also constitute a basis for a finding of abuse of process against a complainant filing under the UDRP in such circumstances.”
So, doing research into the bully or complainant is essential to proving RDNH through UDRP. Some large companies such as Louis Vuitton and Caterpillar Inc. have (to some) gained the title of “trademark bully” leading to proving RDNH easier than with smaller or sneakier businesses.
The WIPO states four (4) other circumstances where RDNH was found, these are:
- the complainant in fact knew or clearly should have known at the time that it filed the complaint that it could not prove one of the essential elements required by the UDRP;
- the complainant failed to notify the panel that the complaint was a refiling of an earlier decided complaint [see further discussion regarding refiled complaints in paragraph 4.4 above] or otherwise misled the panel;
- a respondent's use of a domain name could not, under any fair interpretation of the reasonably available facts, have constituted bad faith;
- the complainant knew that the respondent used the disputed domain name as part of a bona fide business for which the respondent obtained a domain name prior to the complainant having relevant trademark rights.
There are other potential factors depending upon the facts of the case. If you prove your case, they will not get your domain. However, if you lose, you will have 10 days to file a federal court lawsuit to challenge the ruling.
The ACPA Act can help guard against overly bullish trademark owners seeking to take your domain.
Here is an important case in the area of UDRP and reverse domain hijacking:
BARCELONA.COM, INCORPORATED, Plaintiff-Appellant,
EXCELENTISIMO AYUNTAMIENTO DE BARCELONA, Defendant-Appellee.
330 F.3d 617 (2003)
United States Court of Appeals, Fourth Circuit.
Argued: February 28, 2003.
Decided: June 2, 2003.
In this case, the Court looked at reverse domain name hijacking issue:
(defining "reverse domain name hijacking" as use of the UDRP "in bad faith to attempt to deprive a registered domain-name holder of a domain name"). Thus, when a person obtains a domain name, the person agrees, in the registration contract with the registrar, to follow the UDRP as established by ICANN.
In 1999, Congress amended the Trademark Act of 1946 (the Lanham Act) with the Anticybersquatting Consumer Protection Act (ACPA), Pub.L. No. 106-113, § 3001 et seq., 113 Stat. 1501A-545 (codified in scattered sections of 15 U.S.C.), principally for the purpose of protecting trademark owners against cyberpiracy:
The purpose of the bill is to protect consumers and American businesses, to promote the growth of online commerce, and to provide clarity in the law for trademark owners by prohibiting the bad-faith and abusive registration of distinctive marks as Internet domain names with the intent to profit from the goodwill associated with such marks — a practice commonly referred to as "cybersquatting."
S. Rep. No. 106-140, at 4 (1999). Although the ACPA was enacted primarily to redress cyberpiracy or "cybersquatting," it also provides limited liability for trademark infringement by registrars who participate in the administration of the registration, transfer, and cancellation of  domain names pursuant to a "reasonable policy" that is consistent with the purposes of the trademark laws. See 15 U.S.C. § 1114(2)(D)(i)-(iii).
And to balance the rights given to trademark owners against cybersquatters, the ACPA also provides some protection to domain name registrants against "overreaching trademark owners." S.Rep. No. 106-140, at 11; see also 15 U.S.C. § 1114(2)(D)(iv)-(v).
Thus, § 1114(2)(D)(v) authorizes a domain name registrant to sue trademark owners for "reverse domain name hijacking."
Under that reverse domain name hijacking provision, a domain name registrant who is aggrieved by an overreaching trademark owner may commence an action to declare that the domain name registration or use by the registrant is not unlawful under the Lanham Act.
This section provides that the court may "grant injunctive relief to the domain name registrant, including the reactivation of the domain name or transfer of the domain name to the domain name registrant." 15 U.S.C. § 1114(2)(D)(v)
This case also noted that while UDRP arbitration is the contractual way to resolve domain disputes, this does not foreclose on resorting to the relevant local courts when needed. In fact, the Court noted:
"In sum, domain names are issued pursuant to contractual arrangements under which the registrant agrees to a dispute resolution process, the UDRP, which is designed to resolve a large number of disputes involving domain names, but this process is not intended to interfere with or modify any "independent resolution" by a court of competent jurisdiction."
It is important to note, your remedies may be limited to injunctive relief (keeping your domain from being transferred), but in exceptionally egregious cases attorney fees may be awarded. The trademark law is limited in remedies as the video below shows.
Watch Attorney Steve® explain Trademark Damages (which may be treated as reciprocal in nature)
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However, it is also important to note, that "damages" (including potential punitive damages) may be recoverable under other causes of action (besides trademark law with its limited remedies). For example, in the Barcelona case, various causes of action were brought which can warrant different and additional remedies for RDNH:
"Bcom, Inc.'s complaint, brought in the Eastern District of Virginia where the domain name was registered with Network Solutions, Inc., originally asserted three claims in three separate counts: a claim for declaratory judgment and injunctive relief under 15 U.S.C. § 1114(2) (D) (v); a claim for fraud and unfair competition; and a claim for tortious interference with prospective economic advantage."
HELPFUL [VIDEO] RESOURCES
To learn more about the UDRP process, watch our videos (Make sure to SUBSCRIBE) as we like to say - "Be Smarter Than Your Friends":
1. UDRP Part 1
2. UDRP Part 2
3. UDRP Part 3
4. UDRP Part 4
As a potential victim of reverse domain-name hijacking, it is in one's best interest to know their legal rights fully and know where to turn for assistance and counsel when in need of Domain Name IP counsel. There is no sure-fire way to avoid being approached and targeted by a domain name hijacker but there are ways to fight instead of being strong-armed into giving up your legitimate rights and ownership.
Contact us at (877) 276-5084 or email us through our contact form if you need legal assistance.