Article by Alisa C. Key, counsel at Tysons CornerThe Insurgence of a Fraudulent Domain Name Solicitation Scheme in Various ccTLDs
"Mark Jones is attempting to register your company's mark as a keyword and domain name for <brand.cn>, <brand.com.cn>, <brand.hk> and <brand.tw>, and we thought you should know. We would rather you register it with us instead. This is urgent and we need your response by April 1, 2008.
In the past couple of months, we have been barraged with emails from
somewhat frantic clients who have received a version of this bulk email
solicitation. No, this is not an April Fool's Day joke gone bad, but it
certainly could be.The substance of the email clients receive is virtually the same, with form language vigorously suggesting that a third party has attempted to register various domain names and keywords for trademarks in which the client has rights. Often, the domain names encompass Country Code Top Level Domains (ccTLDs) in Asian countries such as <.cn>, <com.cn>, <.hk> and <.tw>. More recently, the solicitations have expanded to include "Internet brands" as well as keywords. Since the expiration of the sunrise period for the .asia domain name, domain name registrations under the .asia TLD also have appeared. Variations on these bulk solicitations may even include other TLDs and ccTLDs such as <.net>, <.org>, <.info> and <.in>.
The solicitations attempt to gain a reader's confidence by identifying official, accredited registrars such as Asian Network, Asia DNR, Shanghai Huibai Internet Service Co., China Net Technology and Shanghai MIP Internet Solutions as their source. However, these solicitations also attempt to create a false sense of urgency and a need to react because they set a specific deadline for response. Absent that response the solicitations suggest that the domain names will be registered to the third party. The spike in the number of these email solicitations has given US-based Squire Sanders lawyers the opportunity to reach out to our counterparts in Squire Sanders offices in China to determine how lawyers closer to the source are addressing these solicitations.
In addition to providing translation assistance when needed, our Shanghai-based lawyers seem to have reached the same conclusion as our US-based lawyers - these solicitations are a scam. They are nothing more than veiled attempts and marketing ploys to attract brand owners to register as many domain names as possible with various ccTLDs and other TLDs through a particular registrar. Unfortunately, this behavior does not appear to have been regulated or addressed by the appropriate authorities.
The reality in many countries, including China, is that the domain name registration system (DNS) operates on a "first come, first served" basis. The DNS does not require the domain name applicant to show legitimate prior interests or rights to a domain name. The domain name registrar also has no responsibility to examine the qualification of the domain name applicant or to notify a brand owner about a possible domain name registration.
However, as the saying goes, "every cloud has a silver lining" and this fraudulent cloud may provide some benefit to our clients. First, although the domain names identified in the bulk solicitations generally have not been registered, our investigations into these matters have, at times, disclosed additional domain names which have been registered by third parties without the knowledge of our clients. These results allow our clients to consider their options for recovery such as the CNNIC Domain Name Dispute Resolution Policy (CDNDRP), a modified version of ICANN's Uniform Dispute Resolution Policy that has been adopted by CNNIC for Chinese ccTLDs.
Equally important, these solicitations have prompted our clients to take a closer look at their business activities in Asia and to undertake a cost-benefit analysis considering the defensive measures they can now undertake through domain name registration. One of the most pressing issues to address is whether clients truly want to expend thousands of dollars to recover domain names using such measures as the CDNDRP or, instead, spend the initial US$35 to US$65 per domain name to ensure the registrations are in the appropriate hands from the outset.
This article by Alisa C. Key, counsel at Tysons Corner was sourced with permission from Squire Saunders' Intellectual Property Update at www.ssd.com/publications/pub_detail.aspx?pubid=10321 or go directly to the article here. David Goldstein