Domain Masters Radio Show

Effect UDRP Litigation has on Domainers

Monte: Now, moving on to some of the current domain events that you’ve been working on, you represent a lot of global clients, and, of course, a lot of my biggest clients, one of which, you know, who we’ve had on the show a couple weeks ago, which is Rick Schwartz, and the domain king, but what are some of the things in the industry that’s really landing on your doorstep these days?

Howard: Well, a very disturbing trend that I’ve noticed recently and been getting a lot of inquiries about and involved in a couple lawsuits is the theft of domains from registrars.

Monte: Yeah, no kidding. We were just talking about that with Richard and, of course, spent time last week with Steven Lieberman on that whole issue again.

Howard: Right. Well, in fact, I’ve got to fly out to Salt Lake City next Wednesday because one of my clients who lives in India purchased a domain that in fact it turns out to be stolen. And he spent a great deal of money on this domain, and the company from whom it was stolen has filed a lawsuit against NetworkSolutions, Godaddy, [Inaudible] and a couple of other people, the people actually who my client bought the domain from, because the domain was, in fact, stolen, NetworkSolutions let it go, I don’t know if they were negligent or they just didn’t realize the ramifications, but I just received two more e-mails today about stolen domains, so I think that the change in the ICANN rules has kind of encouraged this, unfortunately, and ICANN needs to sit up and take notice of what’s going on.

Monte: Right. We discussed that in great detail about some of the measures that you need to take to lock down these domain names. As you know, Howard, we at Moniker take a very proactive approach in terms of protecting domain names and people’s assets and prevent that kind of stuff from happening, but it’s--

Howard: Well, [inaudible]--

Monte: --because we have an eyes-on and a hands-on, you know, approach to it.

Howard: Well, it’s smart of a registrar, and I know Moniker does it and I know Fabulous and a few others do it, they automatically lock it down, lock down the domain as soon as it’s registered, so that puts the safeguards in so that it can’t automatically be lifted and taken away.

Monte: Right, right. And what are some of the other legal issues that are coming across your way, regarding domain names?

Howard: Well, I find that, at least from my standpoint, there’s not that much UDRP litigation as there once was, primarily because most domainers, even the smaller domainers, understand now that infringing on trademarks is not a good practice, is not a good business, and it can end up costing you money, and not only directly but indirectly because once you lose a domain through UDRP, you are marked for life as a UDRP loser and it makes things more difficult for you in the future, even if you have a legitimate interest in domains, so--

Monte: Right. I’m emphasizing the point with a lot of our domain owners who are even getting, you know, it’s kind of malicious, even from corporations, getting attacked that they’ve got to stand up and fight some of these things because of the precedents that are involved, and not only does it effect them as domain owners that they get kind of banded with the black stripe, but it also effects everyone else that’s in the industry, because they use it as a precedents case.

Howard: Absolutely. I’ve been telling domainers all over the world that even if you think that you don’t have a great case, if, in fact, you have a legitimate business interest, you must respond, you must fight it, because the chances are very good that you’re gonna succeed as a domainer.

Monte: Now, a lot of people think this process is very complicated on how to respond to this, is there some easy steps that you can provide people? Because generally people are busy, we’re all trying to make a living, we’re putting food on our family’s plates, and to respond to these UDRP claims and the process, can you knock it down into some easy steps that people can follow that they can help protect their interests and help the other people in the industry, so that we have a long, you know, growing industry in this realm?

Howard: Well, the easiest step, of course, is to retain counsel.

Monte: Yeah, of course. Yeah, it’s is in this case--it’s not like filing a trademark here, it’s a lot harder to take care of these issues without an attorney.

Howard: Well, the economics certainly play an important part in it. Obviously, if a domainer has a domain that is not earning a great deal of money, he doesn’t want to put a lot of money in defending it, but by the same token, if he does, as I say, and the key, and I concentrate it over and over again, the key is legitimate business interest. If you have a legitimate business interest or use for the domain, even if you’re not making a lot of money on it, it’s important to respond.

Now, it’s easy to respond, you can--it doesn’t take any genius to put a response together, as long as, you know, you have a legitimate basis for responding. Once you do that, as you know, Monte, and I’m sure most of all the listeners know, it’s strictly a matter of going back and forth on a couple of issues and just looking very carefully at what the complaint is and meeting the complaint by showing that it wasn’t either registered in bad faith, it wasn’t used in bad faith, and how it’s being used. And once you do that, you’re in pretty good shape, particularly if you have three-year member panel. Now, of course, that costs money, getting a three-member panel, ‘cause usually a complainant will only ask for a one-member panel.

Monte: Right, right.

Howard: But, you know, and again, it’s not so much in the particular case if you’re not making money on the domain, it’s what the precedent is set for the future, that you are know as a “cyber squatter.”