Contributory Cybersquatting under the Anitcybersquatting Consumer Protection Act

Welcome to Cybersquatting Law Radio. My name is Attorney Enrico Schaefer, and I specialize in cybersquatting issues, domain disputes, and domain theft.  Today, we are talking about contributory cybersquatting under the Anticybersquatting Consumer Protection Act.

Contributory cybersquatting is important for a number of different players in the Internet space.  We represent a number of Internet companies such as technology companies, software companies, ISP’s, web hosting companies, registrars, privacy and proxy services, these types of entities.  And the question always comes up.  If someone is cybersquatting – a domain registrant is cybersquatting – and infringing a third party trademark by their registration, use and trafficking  or trafficking of a domain name, can a service provider to the domain registrant also be included in a threat of cybersquatting or lawsuit alleging cybersquatting on the theory of contributory cybersquatting? 

And so, what this really comes down to is that if you are a proxy service, then the Whois information for a particular domain name is going to show the proxy service.  If you are a privacy service, then, in fact, the registrant for the domain in the Whois Database is going to show the privacy service.  Now, there is a domain registrant using that service, that Whois information cannot be seen.  Therefore, oftentimes, there is a threat letter or threat email that goes through the proxy or privacy service and hopefully eventually finds its way to the person who is using that privacy or proxy service, considered the domain registrant. 

There’s also parking companies who put up advertising pages or allow people to use their service to put up advertising pages on domain names.  If the domain name itself is being used for cybersquatting purposes – it is a typo domain or other domain that infringes the third party trademark – can the parking company be sued for contributory trademark infringement / contributory cybersquatting? Can the domain registrar, for instance, Go Daddy, Network Solutions or Moniker, be named as a defendant in a contributory cybersquatting action if, in fact, they are providing a service to the domain registrant who has registered, used or trafficked in a domain as described under the Anticybersquatting Consumer Protection Act (ACPA)? 

So, these are the types of entities that have to worry about claims of contributory cybersquatting. The fundamental basis for a claim of contributory cybersquatting is that the service provider knew or should have known that their service was being used for trademark infringement.  This typically comes down to a couple of different theories.  One is that a large number of domains on the platform, the privacy service or the proxy service are using the parking page software, or as a registrar, that a vast number of domain names on the service are, in fact, infringing third party trademarks.  So, as an Internet law attorney, I see this all the time, where you’ve got a series of domain names and the service provider looks really bad because they seem to be providing services to people who are engaging in unlawful activities – unlawful cybersquatting activities. 

A service provider, whether you are a proxy service, a privacy service, a domain registrar or offering parking page software to different players, you can be held liable for the underlying cybersquatting allegations if, in fact, you knew, or had good reason to know, that there was infringing activity occurring on your platform, so there is risk.  The reason this is important is that we are starting to see a large number of cases filed against these third party service providers, registrars, domain parking services, proxy services and privacy services. 

What is happening is that trademark owners are getting tired of chasing people in China, Russia or some island in the middle of the Caribbean, a domain registrant who has provided bad Whois information and is using a service to engage, typically, in not only isolated, but also mass cybersquatting on third party trademarks.  So, as a service provider, you do have risk. You have to make sure that you handle threat letters alleging cybersquatting and trademark infringement properly because that’s usually the trigger that puts you on notice of trademark infringement. 

So, if you receive a threat letter because someone who is using your service is engaged in cybersquatting, that provides the hook for that trademark owner to come back after you later and say, “as of that date you received the threat letter, you were on notice of trademark infringement and cybersquatting.”  Therefore, you are potentially liable under the Anticybersquatting Consumer Protection Act for contributory cybersquatting.  And courts have recognized contributory cybersquatting as a theory of liability, which, under the right facts, can apply and create liability to a service provider or domain registrant. 

So, my message to service providers, especially domain proxy services, domain privacy services and parking software platform providers, and registrars, is this:  You need a program in place to handle claims of cybersquatting against those for whom you are providing the service.  You need to intelligently handle those threats, have them reviewed by counsel, figure out what may reasonably be meritorious, and make sure you unlock the privacy or proxy service upon receipt of a threat letter under your terms of service.  These are critical things that you are going to need to do in order to reduce the risk that you ultimately are sued for violating the cybersquatting statutes and are pulled into a litigation case where you now have to spend tens or hundreds of thousands of dollars defending yourself. 

My name is Internet Law Attorney Enrico Schaefer.  Thank you for listening to Cybersquatting Law Radio today.  We’ll see you next time.