Pinterest, inarguably one of the fastest rising stars of the social media world this year (and the subject of a FairWinds Perspectives study this past spring), filed a comprehensive lawsuit against Chinese cybersquatter Qian Jin, citing a host of violations related to trademark infringement and cyberpiracy. The lawsuit, filed in a San Francisco court, accuses Qian of registering dozens of Pinterest-related domain names, using a number of different ccTLDs and misspellings of the Pinterest brand name, and attempting to trademark some of the names in both the United States and China.

The domains were registered over a six-month period in the second half of 2011, as Pinterest was just beginning to really hit its stride and gain widespread popularity. According to the lawyers for the Bay Area company, Pinterest is just the latest company in a long line of social networks that Qian has targeted. The lawsuit refers to Qian as a "serial cybersquatter who has registered and owns hundreds of infringing domain names," including some related to Facebook, Google, Twitter, and Foursquare.

The lawsuit seeks damages and an order preventing Qian or any associated parties from using the Pinterest name. Additionally, the company wants the trademark applications in U.S. courts for "Pinterest" and Pinterests" thrown out.

Although the practice of cybersquatting almost as old as the domain name system itself, squatters constantly seek new ways to capitalize on emerging trends or habits to make money. Cybersquatters like Qian, for example, are actively targeting rising tech companies that didn’t have the foresight to procure potentially valuable domain names when they first set up shop. This lawsuit will certainly be a lesson for Pinterest, as the company will want to ensure that they won't have to spend this amount of time or money on similar cases in the future.

Other brands, especially those with explosive success like Pinterest, should look at this as a cautionary tale. Keeping tabs on your domain portfolio from the outset will save you from having to go through legal battles to prevent opportunistic third parties from benefitting off of and potentially tarnishing your brand.

Given Qian’s history of cybersquatting and Pinterest's rights to the intellectual property in question, they should come out on top in this case, but legal battles like this are easily preventable with forward thinking.
 

The Russian Legal Information Agency (RAPSI) is reporting that the Russian Ninth Commercial Court of Appeals will hear an appeal from Tissot, the luxury Swiss watchmaker and member of the Swatch Group, over Holmrook Limited's use of the “Tissot” trademark and the domain name Tissot.ru. Back in December, the Moscow Commercial Court ruled against Tissot on the grounds that the Tissot.ru domain was operated by an authorized third party as an informational website about the French painter, James Tissot. Tissot (the brand) contended that this content was only put on the site after it had filed its suit.

Indeed, the Court's decision does seem curious given that it had previously ruled in favor of other Swatch Group brands Rado and Longines, against Holmrook Limited, over similar trademark and domain name issues. In September 2011, for example, the court ordered the Rado.ru domain transferred to Rado and commanded that Holmrook pay out 50,000 rubles (about $1,650) to Rado in damages. Given that the Tissot suit marks the third case in which Holmrook Limited has been the defendant in domain name disputes involving Swatch Group brands, all signs seem to point towards a bad faith registration. And yet, the Russian court did not see it that way.

Unfortunately, the inconsistencies in this case are (ironically enough) quite consistent with my experience with the .RU ccTLD. The bottom line is, thanks to lax copyright enforcement and a rampant counterfeiting industry, cybersquatting flourishes in the .RU space. Compounding the problem is the lack of any kind of dispute resolution policy (DRP) for .RU domains, which leaves trademark holders with the unpalatable choice of pursuing legal action through the expensive, slow, and inconsistent Russian court system, or attempting to purchase the domain directly from the domain owner.

For brand owners, the best defense is a strong offense: I advise registering all key trademarks in the .RU domain before cybersquatters can. If you're already too late, attempt to negotiate a sale of the disputed domain with the registrant. When all else fails, try the Russian courts as Tissot is now preparing to do for a second time. I will be closely following the appeal, which the court is scheduled to hear on February 8th. 

Things could be about to get real for Filipino cybersquatters. The Filipino Senate recently passed the Cybercrime Prevention Act of 2012. While still awaiting passage in the Filipino House of Representatives, the proposed legislation criminalizes cybersquatting, making it a "punishable act." Those found guilty could face six to twelve years in prison, a fine of up to 500,000 Philippine pesos (the equivalent of about $11,600), or both.

That's quite a contrast to the U.S.'s Anti-Cybersquatting Consumer Protection Act (ACPA) of 1999. Although ACPA allows for the awarding of damages between $1,000 and $100,000 for cases involving willful cybersquatting, research by FairWinds in 2008 revealed that courts have rarely assessed damages at the upper end of this range. Accordingly, trademark holders prefer the relative ease and lower cost of recovering cybersquatted domains through the Uniform Domain-Name Dispute-Resolution Policy (UDRP), which only has the power to transfer or cancel domains, and therefore provides little deterrent to cybersquatters. The result? Just about anybody can register a domain that is identical or confusingly similar to a registered trademark with relative impunity.

If the Cybercrime Prevention Act passes, it will be interesting to see what happens to cybersquatting in the Philippines. As for the U.S., I suspect that the risk of twelve years behind bars would be enough to deter all but the boldest of cybersquatters.

“Bad faith” can some times be the trickiest element to prove when trying to demonstrate that a registrant has cybersquatted a domain name. Many times, whether a domain owner has acted in bad faith comes down to timing, specifically when he or she first registered the domain name. This principle was called into question during a recent cybersquatting lawsuit in a Los Angeles federal court.

Erik Bethke, the founder of the virtual pet game and social network GoPets Ltd., had attempted to purchase the domain name GoPets.com from its owner, Edward Hise. Bethke initially offered Hise $750 for the domain, but when Hise rejected the offer, Bethke filed a UDRP arbitration with the World Intellectual Property Organization (WIPO). Unfortunately for Bethke, because Hise had registered GoPets.com five years before Bethke created GoPets Ltd., the complaint lacked evidence of bad faith and the WIPO Panel denied Bethke’s request to transfer the domain.

After the failed UDRP, Bethke again offered to purchase the domain, this time for $40,000. Hise responded asking for $5 million and threatening to add metatags to the code of GoPets.com in order to redirect visitors to Bethke’s site back to Hise’s domain. After sending that demand, Hise transferred ownership of the GoPets.com domain to Digital Overture, the company that he co-owns with his brother. Through Digital Overture, the Hise brothers have registered over 1,000 domain names.

After Hise transferred the domain, Bethke took legal action, suing him in a Los Angeles federal court for cybersquatting and trademark infringement. He attempted to circumvent the issue of when the domain had originally been registered by arguing that Hise’s renewing the domain name registration and then transferring it to Digital Overture amounted to a new registration. The Los Angeles judge sided with Bethke, awarding him $100,000 in damages as well as the domain name GoPets.com.

However, a three-judge panel of the 9th Circuit judges partially reversed this ruling, on the grounds that the Anitcybersquatting Consumer Protection Act (ACPA) is very clear about its definition of “registration” as referring to the initial domain name registration. In the decision, Judge William Fletcher wrote, “We see no basis in ACPA to conclude that a right that belongs to an initial registrant of a currently registered domain name is lost when that name is transferred to another owner.”

The judges did agree that both Hise and his brother had shown bad faith after the UDRP proceedings, and had also violated unfair competition laws during their negotiations with Bethke. The Los Angeles judge is now left to decide what relief might be appropriate for these offenses. Whether this decision will have any impact on the way domain transfers are regarded under UDRP precedent has yet to be seen.

Aside from highlighting how complex domain name-related matters can be, this case opens up the question of whether or not ACPA needs to be adjusted to more adequately cover scenarios of domain name transfers, as well as other issues.