The fastest way to lose a domain and your investment is to buy a name that infringes on someone’s trademark. Here is what every investor should know before buying. This is general information, not legal advice.
- Generic and descriptive words are the safest ground for investors.
- Under UDRP, bad faith is central: registering a name to target a known brand is the problem.
- Run a trademark search before every purchase, and walk away from names that point at a brand.
What cybersquatting is
Cybersquatting means registering a domain in bad faith to profit from someone else’s trademark, for example registering a famous brand name plus a product word to sell back to the company or to capture its traffic. It’s illegal in many countries and grounds for losing the name.
How UDRP works
The Uniform Domain-Name Dispute-Resolution Policy is ICANN’s process for trademark owners to claim domains. In broad terms, a complainant must show that:
- The domain is identical or confusingly similar to their trademark.
- The domain owner has no rights or legitimate interest in the name.
- The domain was registered and is being used in bad faith.
If the panel agrees, the domain can be transferred to the complainant. Cases are handled by providers such as WIPO, whose published decisions are useful reading.
Where investors are safe, and where they aren’t
Generally safer
- Generic dictionary words used in their ordinary meaning, like “options blog” or “rare chord.”
- Descriptive phrases for a product or service category, like “home restoration experts.”
- Invented brandables that don’t imitate an existing brand.
Risky
- A famous brand plus any other word.
- Typos of well-known brands.
- Generic words used in a way that targets a specific brand, such as a common word that’s also a famous company, parked with ads for that company’s competitors.
A pre-purchase trademark check
- Search the USPTO trademark database and, for international names, WIPO’s global brand database.
- Search the name on the web. Is a well-known company using it?
- Check the Wayback Machine for how the domain was used before, especially for expired names.
- Ask: would a reasonable person think this name belongs to a specific company? If yes, pass.
How you use and sell a name matters
Even a generic name can get into trouble if you park it with ads for a trademark owner’s competitors or pitch it aggressively to a company whose brand it resembles. Pitch generic names on their generic merits, and keep landing pages and parking neutral.
Reverse domain name hijacking
Sometimes a company files a UDRP claim against a legitimately registered generic name in an attempt to take it cheaply. Panels can find reverse domain name hijacking when a complaint is brought in bad faith. Keeping records of why you registered a name, and when, helps if you ever need to defend it.
When to get a lawyer
If you receive a demand letter or a UDRP complaint, consult an attorney who handles domain disputes. Deadlines in these proceedings are short.
Scout names safely with the NAR Score, and learn more terms in our glossary.