Everything You Need To Know About Cybersquatting

It doesn’t matter if you’re a brand new company or if you’ve been around for a number of years, you need to be aware of cybersquatting. Cybersquatting has long existed since the early days of the internet but it wasn’t until recent years that there has been a crackdown on this practice that can have an immense negative impact on your business. And it can land you in hot water.

In today’s post, I’m going to walk you through what cybersquatting is and how it negatively impacts your business. I’ll show you how to recognize it and how you can protect your business from it. Lastly, I’ll walk you through on you can reclaim a domain name from a cybersquatter.

Let’s dive in!

What Is Cybersquatting?

In short, a person purchases a domain name similar or identical to your existing trademark or company name and sells it back to you at a high price. It doesn’t stop there, though. Some companies also engage in this sketchy practice for the purpose of attracting customers from their competitors. You can imagine what happens next to that competitor.

You may think another business owner runs a company with the same name as yours. But, when you type the URL of a business into your preferred browser, instead of loading that business’s website, you’re redirected to a “this domain is for sale” type of page.

These cybersquatters often get these business names from business directories. Unfortunately, small and new businesses alike are the most hit by this sketchy practice. Though, it’s also likely those businesses either didn’t have the time (or budget) for purchasing the branded domain name early on.

Now, the question is, “is cyber/domain squatting illegal?”

At this moment in time, there are little to no known policies preventing this kind of practice. However, the Anti-Cybersquatting Consumer Protection Act (ACPA) helps business owners address trademark infringement in court.

If you’re someone who profits from this practice, you can be held liable in court should the infringed brand get involved.

Now that you know what cybersquatting is, how can you identify and recognize it?

Let’s go over how you can identify and recognize domain squatting!

3 Ways to Identify and Recognize Cybersquatting

Let’s recap.

There isn’t anything stopping from someone purchasing a domain name that hasn’t yet been registered. Unfortunately, this means anyone can register a domain name containing your company or personal name.

The good news is there are two things you can do in protecting yourself from these cybersquatters.

Let’s take a look at two critical steps.

1. Register your Domain Name Early On

This is the most effective and simplest method of protecting yourself and your business from cybersquatters. I’m talking about even before launching your business.

Even if you don’t plan on creating your website early on, registering your domain name at this point is an excellent act of prevention. Your domain name isn’t “just a domain name”; your domain name is your brand name, and that creates a whole new level of frustration and a waste of business funds changing your brand name.

2. Purchase Similar Domain Names

For every startup and medical practitioner looking to get their start or even a restaurant I work with, I advise them in purchasing similar domain names to their branded domain name. Not only that, but register similar domain names using multiple extensions such as .com, .net, and even .co. Depending on the region or country you’re in, register a similar domain name with different extensions such as .co.uk (United Kingdom) and .ca (Canada).

Restaurants are also a popular target for cybersquatters. Cybersquatters take advantage of common misspellings, too. Again, little acts like these help prevent this sketchy practice from happening to your business.

3. Purchase Domain Ownership Protection

I highly recommend using the Google Domains service for both registering domain names and utilizing domain ownership protection. Another popular, though highly less recommended, is through GoDaddy. In short, Domain Ownership Protection keeps your domain information private, including preventing you from losing your domain name should you accidentally let it expire.

How Do I Avoid Domain Squatting?

Let’s recap one more time.

Cybersquatting is the practice of registering an existing trademark and selling it back to desperate business owners for a profit. However, this is entirely different from what is called “domain flipping.”

What is domain flipping?

Domain flipping is the practice of buying a domain name as cheaply as possible. Then, without doing anything with the domain, you’ll sell the domain to an interested party for more than you originally paid. There’s a bit more to it than this, but this is the basic premise. (Source).

Typically, there is no ill-will when it comes to domain flipping. But, if you are purchasing and selling domain names that reflect popular interests, niches, products, services, etc., you need to make sure you’re not unintentionally cybersquatting.

Again, if you purchase a trademarked name, you risk potential litigation. Use a trademark database for making sure you’re not infringing on any existing trademarked brand names.

What Can I Do If My Domain Is Taken By A Cybersquatter?

Thankfully, there are some steps you can take if a domain name has been taken by a domain squatter.

The first solution is purchasing the domain name and having it transferred to you. Oftentimes, this is the quickest and cheapest route.

Is your business located in the United States? You can file a lawsuit under the provisions of ACPA. But, it’s only as effective as how much you can prove you own the trademark, that the domain name is identical or similar to your brand name, and that they’re trying to profit from the sale of the domain name.

If either option isn’t available, you can alternatively file a Uniform Domain Name Dispute Resolution Policy (UDRP) proceeding with ICANN. Once more, you must prove you’re the owner of the trademark, and that the domain name was registered solely for profit.

Conclusion

Cybersquatting, also known as domain squatting, is the practice of purchasing a domain name similar or identical to your existing trademark or company name and selling it back to you at a high price. The gray area here is the practice of attracting customers from a competitor.

The best method for preventing your branded domain name from being bought by cybersquatters is registering your domain name when setting up your company. Also, register the domain name in various extensions and variations, redirecting them to your primary site.

Do you have any questions about cyber/domain squatting and how to prevent it from happening to your business? Let me know in the comments section below!

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