Cybersquatting on the Rise, Microsoft Looking to Take Action

The number of cybersquatting complaints received by the World Intellectual Property Organization (WIPO) increased by twenty-five percent in 2006. Most of the cases involved registration of trademark names as domain names, and most of the companies who reported the cases are information technology, pharmaceutical, and financial companies. A total of 1,823 alleged cybersquatting complaints were filed in 2006, the most complaints handled by WIPO since 2000.

Under Federal Law, cybersquatting is any form of registering, trafficking in, or using a domain name with a bad-faith intent to profit from the goodwill of a trademark belonging to someone else. The domain name owner will often try to offer to sell the domain name to the mark owner or will try to make money from accidental internet traffic. Passed in 1999, the Anticybersquatting Consumer Protection Act (ACPA) makes alleged cybersquatters liable to civil action. To state a claim under the ACPA, the trademark owner must show: (1) the mark is distinctive or famous; (2) the domain name owner acted in bad faith to profit from the mark; and (3) the mark and the domain name are either identical or confusingly similar.

Microsoft plans to launch a series of lawsuits against alleged cybersquatters and is urging other companies to take action. According to Microsoft, the suits are targeted at companies which have registered trademarks that infringe on Microsoft's intellectual property. In the last seven months, Microsoft has won two cybercrime lawsuits and has also recovered 1,100 domain names since commencing its anti-cybersquatting campaign.