Cyber Squatters Pose Problems for Websites

The primary concern of a proposed website is to find a domain name. Creative people spend hours to coin a name suitable for the Site. But there are others who try to make money illegally profiting from domain names. Such abusers are called cyber squatters.

Cyber squatters use a domain name with motivated intention to profit from the goodwill of a trademark of someone else. Once on the Internet, the cyber quatters offer to sell at a premium the domain to the company which owns the trademark contained within the name.

The cyber squatters usually buy domain names through registration process and ask for higher amount while selling those. Sometimes the cyber squatters intentionally put up derogatory comments on the company in the Site to force the firm to buy it from them.

The business is so rampant in the United States that the US Government has framed laws to curb the trend. The advocates of cyber squatters argue that in a free market economy, such trade is not illegal. However, in most of the cases the cyber squatters have lost. But the court process is lengthy and the real company suffers as long as the case is pending. Sometimes questions are raised on jurisdiction. A domain name, containing an American firm, obtained from Britain cannot be contested in the United States.

Facing the legal tangle, many companies go for arbitration. The World Intellectual Property Organisation under the United Nations offers an arbitration system since 1999. There were as many as 1823 complaints filed with the UN arbitration agency in 2006. The number was a twenty five per cent increase over that of 2005.

A recent study has revealed that the arbitration process came fruitful to the actual companies owning the trademarks. It is shown that over eighty per cent cases were settled in favor of the trademark holding firms.