Spring is in the Air

With much of the nation’s, and therefore the Senate’s, focus on gun control and immigration reform, schedules are tight and visiting hours, short. But, given the economic, national security, and consumer protection implications of cybersquatting and intellectual property infringement, shrewd politicians are keenly aware of and supportive of strengthening the ACPA.  

Specifically, our contacts were interested to learn more about the impending roll out of new gTLDs from CADNA President Josh Bourne. Cybersquatting is a serious issue in the current domain name space, and with the launch of new gTLDs, the opportunity for cybersquatting will only increase. Bourne described the first launches as “the chickens coming home to roost.”  The cost of defensive registrations in total, he continued, will be – conservatively – $2 billion. That’s money companies won’t spend on jobs, expansion, or investment. Some companies will simply decide to throw up their hands and decline to defensively register, leaving themselves and consumers exposed to the cyber crooks. 

Bourne’s proposed solution: updating and strengthening the ACPA by: 

1.  Increasing penalties against cybersquatting. 

Under current law, cybersquatters face statutory damages of between $1,000 and $100,000 per domain name. The courts have, however, generally awarded limited damages closer to $1,000 per domain name. For cybersquatters that monetize hundreds of thousands, or even millions, of Internet domain names through automated programs, this is not a lot of skin in the game. Cybersquatters know that, for brand owners, the cost of filing and pursuing legal action far exceed the potential damages the mark owner is likely to be awarded, and are therefore unlikely to use the ACPA as a weapon. Amping up the risks associated with cybersquatting by increasing the damages (and implementing a “loser pays” system for the associated legal fees) would make more bad actors opt out of the business.

2. Expanding the parties that are held responsible for cybersquatting.

Certain parties profit from revenue-sharing arrangements with cybersquatting entities through Internet parking pages, pay-per-click advertising, and other monetization schemes.  ACPA should be expanded liability to cover those in active concert or participation with the registrant. This isn’t about pursuing third parties that act in good faith and support a safe and flourishing Internet – this is about discouraging third parties who purposefully shield bad actors and turn a profit because of it.

With spring quickly turning into summer and the first new gTLDs poised to launch before summer becomes fall, we are eager and committed to helping lawmakers take action to protect their constituents and support a trustworthy and innovative Internet. 

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