In my opinion, there’s a common misconception that if domain investors own trademark domain names, the worst that can happen is they lose them in a UDRP. Some people think their only potential loss would be the loss of revenue from the domain names. An article in Crain’s Detroit shows that cybersquatting can have far greater consequences, and hopefully it will serve as a bit of a wake up call to those who don’t know that they may be playing with fire.
According to the article, Weather Underground filed a lawsuit in U.S. District Court against Navigation Catalyst Systems Inc., Firstlook, Inc and COnnexus, Corp. Weather Underground was represented by two law firms, Traverse Legal (Enrico Schaefer and Brian Hall) and Hooper Hathaway (Anthony Patti).
The case started out with a winning UDRP filing for 41 domain names, but subsequent research showed that the company believed the defendant owned additional domain names. According to the article, Weather Underground filed a lawsuit and obtained a $3.5 million judgment against the defendants after identifying over “250 typos of their long registered and incontestable trademarks in defendant’s portfolio of parked domains,” according to Schaefer.
Yes, a company was awarded $3,500,000 for cybersquatting. Think about that the next time you consider buying typo domain names. Just because they might make some money, doesn’t mean it’s easy money. In fact, you could make a small fortune, but one lawsuit will cause you to have to turn over all of that and more. Perhaps your house and your cars if you aren’t lucky.
I am not going to judge someone else’s business model. We all take risks in this business, and each of us has to consider how much and what types of risks we are willing to take. However, if you think that the worst that can happen with trademark domain name is losing them in a UDRP, you may be mistaken and should read up more on this case.