IP & Your Business Case Studies

Tales of cybersquatting - Southcorp*

Southcorp, Australia's biggest wine company, received an unwelcome email through the 'contact us' facility on one of its web sites. It was from a United States based cybersquatter, who told Southcorp that he had registered the name of one of its flagship brands, Lindemans, as a global top-level domain name. He offered to sell or rent lindemanswine.com back to Southcorp.

The response from Southcorp was swift and stern. It sent a letter by email, fax and registered mail, telling the cybersquatter that it would apply under the new 'Uniform Dispute Resolution Policy' (UDRP) to have the domain name transferred to Southcorp. Southcorp also sent a similar message to a British cybersquatter who registered penfolds.org.

A UDRP application costs $US750 (paid by the applicant), is filed by email and is decided within 45 days. In simple terms, the applicant must show three things: the domain name is identical or confusingly similar to a trade mark owned by the applicant; the person who has registered the domain name has no legitimate interest in the name; and, the domain name has been registered and is being used in bad faith.

Before the system began in January 2000, Southcorp would have faced the expensive and slow prospect of suing the cybersquatters in their national courts. In 1998, Southcorp threatened court action against another American cybersquatter, who had registered southcorp.com and was, according to Southcorp, using it as an 'inappropriate' site. Fortunately for Southcorp, that cybersquatter caved in and relinquished the name before court action began. The British registrant of penfolds.org also gave up without a fight, but the cybersquatter who owned lindemanswine.com faced a UDRP application.

The UDRP system has been a godsend for big companies such as Southcorp, which own valuable trade marks that are highly attractive to cybersquatters. Thousands of cases have been filed with the arbitration and mediation centre of the World Intellectual Property Organization (WIPO)**, which is the main forum for determining UDRP disputes. Most decisions have found against the cybersquatter and have ordered that the domain name be transferred to the company that owns the relevant trade marks (without compensation to the person who registered the domain name).

Transfer decisions include christiandiorfashions.com, dior.org, steinlager.com, jpmorgan.org, microsoft.org, niketown.org, veuvecliquot.org, telstra.org, westfieldshopping.com, thelawsociety.com, argylediamonds.com, thewiggles.com, and henrytheoctopus.com.

* Partial reproduction of an article by Lucinda Schmidt, printed in Australian Business Review Weekly, 21 July 2000

** Under WIPO's system, the complainant files a case by email and express mail to an arbitration centre in Geneva, Switzerland, (http://arbiter.wipo.int/domains/). WIPO appoints a panelist from a pool of more than 100 experts in many countries to decide whether the domain name should be transferred to the complainant, remain with the original owner or be deleted from the register.