2007.12.02

CADNA Seeks Further Protection Against Cybersquatters

Cybersquatting and typosquatting continue to attract attention of trademark rights groups internationally. As domain name theft and other domain scams become more common, new non-profit organizations seeking to assert and protect companies with valuable trademark rights are sure to be organized.  One relative newcomer on the scene is CADNA, a non-profit organization.dedicated to combating cybersquatting, typosquatting and domain tasting on behalf of companies with valuable trademark rights.

The  lawyers of Traverse Legal are proud to sponsor this radio interview with Josh Bourne, a founding member of The Coalition Against Domain Name Abuse (CADNA), a non-profit organization whose objective is to facilitate dialog, affect change, and spur action on the part of policymakers to address the gaps in both the law and ICANN policies that enable domain name abuse and consumer frauds. In doing so, CADNA seeks to decrease occurrences of cybersquatting in all of its forms by requesting anti-cybersquatting legislation updates and ICANN policy reforms.


VTalk Radio Spotlight
Today's Guest: Joshua Bourne The Coalition Against Domain Name Abuse
Today's Host: John Bentley

 

ANNOUNCER: Welcome to VTalk Radio Tech Spotlight with your host, John Bentley.

JOHN: Today we are in the studio with Josh Bourne. He's a founding member of Fairwinds Partners. Fairwinds Partners is the leading authority of domain name online trademark enforcement and direct navigation strategies. Welcome to VTalk Radio's Tech Spotlight today, Josh.

JOSH: Hey John, thanks alot. I appreciate the opportunity to be on your show today.

JOHN: Well, we're talking... the subject matter today is CADNA. Can you tell our listening audience, what is CADNA.

JOSH: CADNA stands for the Coalition Against Domain Name Abuse. A group that my partner at Fairwinds, Philip Lodico and I started with ten trademark owners large corporations who collectively found that things weren't moving fast enough to right size the level of domain abuse that's out there. The funny story is we're thinking about using a name like the Coalition Against Domain Name Tasting at one point. Going back in time, seriously, the reason this group came together on day one was domain name tasting was getting to be out of control and was being recognized by different groups as somewhat of a problem, but nobody really had a good plan in mind. We thought a group of businesses could try to unite and affect some change around that. And it very quickly evolved into something very different which was that so long as we're trying to recognize and address the issues around domain name tasting, it's really all about cybersquatting in general and tasting is just a way to get scale and cybersquat more. There are other uses that are non-cybersquatting of tasting, but none the less, this coalition is about cybersquatting in general.

JOHN: Ok, when you say tasting, can you define that a little bit more?

JOSH: Oh yeah, no problem. One analogy that I think is really funny is if you were to go to a nice department store and buy a sport coat, for instance, you bought it because you had a dress up party or something over the weekend, and you wore, you didn't really like the way you dressed, but people saw you in it, and you got some benefit from it, and then Monday morning you went back to the department store and said, "I didn't cut off the tags, and I want my money back." And they hand it to you. So, in some rare cases, you can try things out and decide whether or not you want to return it to the store, but you're not allowed to use it. You're not allowed to wear it, you're not allowed to soil it, you're not allowed to get value from it. Domain name tasting leverages the add grace period which has been around so long as I know. ICANN and some of the registries introduced this as a period of five days that enables registrars to get their money back if for unforeseen reasons their customer either failed to have the money themselves. Maybe they used a stolen credit card, or potentially a small customer or a large customer said, "you know guys, I'm really sorry I typed the wrong name and I'd rather not buy this name, I'll buy a different one." So its intended purpose at first was to give registrars an avenue to limit their exposure or loss. But there are no limits to the AGP. So, some very cleaver registrars have found ways to paste massive numbers of names, millions a day really, that they add. They then set up very rudimentary websites. Usually with recycled or syndicated contextual advertisements. They have traffic measuring software. They determine after maybe three, four days how many people have navigated to that domain name. How many of those people clicked on ads and then they make an educated guess whether they want to spit it out and get their money back or to keep it. So, it shifts the environment and it allows for much bigger scale, both domaining and cybersquatting. Just speculation on domains with or without value, knowledge up front.

JOHN: Ok, now isn't that a form of cybersquatting then?

JOSH: Well, cybersquatting is defined as the registration of domain name that is identical or confusingly similar to a trademark. So, cybersquatting isn't a matter of speculation. You can certainly cybersquat Z as a tasting vehicle. But you can also register local names like Traversecitycherries.net which doesn't infringe on any trademarks to my knowledge, but it could be a name that people type in from time to time.

JOHN: Ok, well what do you think is the scale of the problem today?

JOSH: Well, it's really massive. You know, back in August one authority who on domain names named Jay Westerdal at Name Intelligence posted a blog because he monitors the number of adds and drops in every given day. He said that in one day, I believe it was August 12th, 8 million domain name transactions took place. The general turn around domain name tasting is around 2 million a day. But cybersquatting in general which has been amplified through tasting has gone up significantly. Mark Monitor, a domain name registrar and brand and trademark monitoring company performed a survey where they found that cybersquatting based on a test sample of brands grew last year 248%. Some of that growth in cybersquatting is definitely attributable to the facility of domain name tasting because it's such an easy way to scale how many names you grab and making sure that you grab names that are getting traffic; which is really the currency here. In order to monetize user experiences to domain names at marked websites, people have to be typing it into the browser. And people type in a variety of different things. They call these people direct navigators, by the way. They are people who start an internet journey at a search engine, like Google or Yahoo, and then there are other people who start out in the browser bar. And they might type in myspace.com and they slip, you know, I don't know if you've ever done a fat finger or something like that, mistake or a sticky key error and they omit the "a". Well they might go to a site that isn't owned by the parent company of My Space which is Newscorp. Other direct navigators compose very creative domain names. They are looking for a more targeted result. So they might enter, they might compose a domain name such as fedextracking.com hoping they might land on the exact page where they can track a package. So, people do practice direct navigation. In fact, they say that 1 out of 3 people on the internet practice it from time to time. Some more than others. Some rarely. But 1 out of 3 people practice this.

JOHN: What are some of the hot topics that require a coalition like CADNA?

JOSH: Well, there are really major objectives of the coalition. One is to try to reduce the level of cybersquatting the ICANN based solutions such as making it a little bit more difficult to gain an ICANN accreditation. The ability to link directly to registries and either be consumer or non-consumer facing, getting the full benefit of being a registrar which includes lower pricing. That also includes technical advantages such as computer driven communications with registries to add and drop names more efficiently. You know, domain tasting can't take place if you're just a regular Joe Citizen. You register a million names on go daddy and then call them 5 days later and say, "I want my money back." You really need to be very sophisticated as a registrar yourself to taste on that scale. So definitely ICANN solution around those tightening up the registrar accreditation agreements and also eliminating the add grace period which has been adapted to enable massive cybersquatting and other domain name registration abuse. The other objective of the group is U.S. Legislative strategy. It was in 1999 when the Anti-cybersquatting Consumer Protection Act was written into law in this country and the principal reason for that is there was no law against cybersquatting to protect both consumers and the brand owners. That law sets forth some statutory damages 1,000 to 100,000 up to the court in penalties against the cybersquatter. For the most part, trademark owners haven't really utilized that law because it's very costly to file a lawsuit and it's very unclear whether or not those damages would be collectible so they've avoided it for the most part. And it also hasn't been well communicated I think to the general public. They're not afraid of the liability of cybersquatting. You know, there are a lot of small-time cybersquatters who may or may not know what they're doing is harmful or illegal. We think that if those damages were increased, it'll change behavior, and I think people will view it as too high of a risk to register or renew a domain name that includes a trademark in it. The third piece of CADNA is to pursue an international cybersquatting treaty. You know, outside of this country, even in Canada, there really aren't any anti-cybersquatting laws. Some of the more cleaver cyber criminals who do practice cybersquatting or at least dabble in it to enable other things that they're doing that are harmful on the internet, have varies quickly offshore to other jurisdictions where they can find safe harbor. And maybe working through international bodies such as the UN's WIPO Court in Geneva, we can institute some change on a global level. Now that's a longer process. We're aware that it could be a least a decade before an international treaty could be formed.

JOHN: And for our listeners, ICANN is the Internet Corporation for Assigned Names and Numbers. Today we are in the studio with Josh Bourne of Fairwinds Partners. You're listening to VTalk Radio's Tech Spotlight. We're going to step aside for these messages, we'll be right back.

ANNOUNCER: This VTalk Radio Spotlight is brought to you by Traverse Legal, a high-tech law firm providing international representation in business technology, intellectual property and complex litigation matters. You can contact an attorney through its website at www.traverselegal.com.

VTALK RADIO: VTalk Radio.

ANNOUNCER: We now return you to the VTalk Radio Tech Spotlight, only on vtalkradio.com.

JOHN: Welcome back to the program you're listening to VTalk Radio's Tech Spotlight. Today we are in the studio with Josh Bourne of Fairwinds Partners and we are talking about CADNA the Coalition Against Domain Name Abuse. Welcome back to the program, Josh.

JOSH: Thanks, John.

JOHN: Now, we've been talking about the Coalition's objectives. Let's talk about who can effect change on the subject of cybersquatting and the tasting?

JOSH: That's a great question. You know, just about everybody can affect change here. You know, you think about the consumers that are on the internet. I think that if they had more information about what to look out for, they could help affect change by changing their own habits. You know, what they are likely or unlikely to fall for in terms of phishing or click schemes or other things that could attract their attention that they could help enable by falling into those kind of traps. The U.S. government; certainly ICANN could affect change through broader education platforms. The other groups that can affect change are small business owners. We get letters constantly from small business owners who say things like, you know, we're a small owner and somebody grabbed our name and the remedies available such as UDRP are too expensive for us and this other guy is getting all our traffic and they're confusing our customers, you know, what can I do about that? Well, by writing in and allowing us to use their voice is really helpful on the hill especially here in Washington, because lawmakers really they want to know that these types of practices affect more than just big corporations. So, small businesses can definitely help us. Other groups that can affect change are corporate sponsors and other members that can step up and for the good of the whole B-leaders and contribute in a meaningful way to CADNA, lending their experiences, lending their leadership, helping us do more faster here in Washington. There are also professional groups that are necessarily focused on the domain name industry who aren't criminals. They're good people filling a need. They are providing relevant research to people who practice direct navigation. Some of them get mixed up in domain name abuses from time to time by accident. Sometimes it's not an accident, but I think they can affect change through broader and in other cases more specific self regulation. And finally the lawmakers here in Washington can probably make the most change by getting involved and recognizing that internet commerce is a good thing and confidence is low right now. Companies will be more profitable and pay more taxes if they are able to use the internet as a vehicle to do more business and have more exchanges with their customers. If we can bridge that trust gap or make it smaller by eliminating some of the frauds that are out there, and cybersquatting is one of them, but it is also an enabler. Think about phishing for instance. When you see a brand or a domain name that looks similar to your bank, while you guys might not do it, and probably most of your listeners might not fall for it, there are a lot of people who do. I mean, my own parents sometimes forward me emails and they say, "Is this legitimate?" and I say, "No, mom, your bank would never ask you to confirm your social security number over email." So, a lot of people can affect change in this space.

JOHN: Now, when you say, "Phishing", what exactly do you mean by phishing?

JOSH: Ok, no problem. Phishing is actually not spelled with an "f", but "ph" and in this context on the internet phishing is fishing for information. Fishing for identities using email as a spam or even websites that are confusingly similar to what you might expect to see as portholes to gain people's confidence that the person on the other end is who they think it is, meaning their bank, their health company, their university, whatever association they might be a member of. And using that identity to get those end users to share something about them that could compromise their bank account, their credit cards, extract money from others.

JOHN: Ok, well let's go to... what are the objectives of these tasters. What are these people after?

JOSH: Well they're after high traffic domain names. See, before domain name tasting became a broad scale way of identifying domain names, different kinds of domain name speculators would have to make very educated guesses if possible on what domain names might be valuable. The way they used to be valued, maybe 5 years plus, was how much could they resell that domain name for? So if you were early to the table and you registered a name like "Retirement.com" that could be a valuable name you could resell to another for a big profit. Remember it costs as little as $7 or $8 a year to register and maintain a domain name. These domain names are selling in some cases for millions of dollars. That type of speculation was focused on reselling. Today, however, speculation is about aggregating and monetizing web traffic. So, have you ever seen a pay per click website? It's a website you might go to that has sponsored links much like the ones you find on Google. Well, they are Google ads a lot of the time. They're advertisements that have been syndicated out to other locations such as newspaper websites, other retailer websites, all kinds of websites, but they also syndicate out their ads directly to websites that only list ads. They provide no other services. So, when you speculate on a domain name, you're looking for a domain name that gets sufficient traffic to yield sufficient clicks to yield sufficient revenue to justify owning that name. I had a call earlier today with somebody who owned a very valuable generic domain name that produces over $2,000 in click fees a day. So, owning that domain name nets them over $700,000 a year and it costs them just $7 to maintain.

JOHN: Wow, well that's a lot of great information, Josh. I want to tell ya, we're grateful to have you on the program today and I'm afraid our time is up. I want to thank Josh Bourne of Fairwinds Partners for joining us today on VTalk Radio's Tech Spotlight. Thank you so much, Josh.

JOSH: Well, thank you, I really enjoyed this, and I appreciate having the opportunity to spread our message of good work against cybersquatting.

JOHN: You have been listening to the VTalk Radio's Tech Spotlight. I'm your host, John Bentley . Thanks for joining us this afternoon. Everybody have a great day.

VTALK RADIO: You have been listening to the VTalk Radio Spotlight. Only on vtalkradio.com. Radio for the 21st century.

 

COMMENTS

is a good writing and will be here always congratulations

In order to get a handle on the growing problem of cybersquatting, it seems we have to think outside the box. The Anticybersquatting Protection Act provides great penalties, including punitive damages for bad faith registration. But most cybersquatters don’t live within the jurisdictional limits of the United States. Even establishing minimum contacts will likely only achieve a default judgment which would prove to be uncollectible. I know Dell recently sued some registrars, and I think Microsoft has as well, but those are located outside the territorial limits as well.

So changing the ACPA doesn’t seem to move the ball very much.

We can talk all we want about modifying the UDRP, but that’s a political thicket. ICANN isn’t likely to make significant changes to the uniform domain resolution policy, at least not any time soon.

Registrars almost always require as part of their registration agreement verification from the registrant that they are not infringing any trademarks. But registrars rarely (dare we say never) enforce those provisions. Registrars simply want to stay out of the fight. Someone mentioned on a different section of this blog that we should try and find a way to target “habitual cybersquatters.” That’s a goal which sounds both viable and doable. Many habitual cybersquatters hold domains under a single registrant account. Accessing the back-end registry data through ICANN or otherwise of habitual cybersquatters would reveal their entire portfolio of domains. Instead of a $1,300.00 arbitration fee, it seems that a streamlined process and direct notice to trademark holders concerning variations of their domain might increase the risk and reduce the financial benefits of cybersquatting. I would be interested to hear what CADNA is doing in order to increase the leverage against habitual cybersquatters or reduce the economic incentives to engage in cybersquatting..

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