UDRP: An alternative to traditional litigation

published in McAfee & Taft tIPsheet | April 3, 2017

Imagine for a moment that after investing time and money in branding and marketing your product or service, someone registers a domain name that matches your trademark. Now imagine that the owner of the domain name will only sell it to you at an inflated price. Or, perhaps, that the domain name owner is using the domain name in a way that suggests affiliation with your business or for a phishing activity to steal information. For many, these scenarios are real, not imagined. However, you’re not necessarily doomed to brand reinvention or a long, expensive legal battle.

The Uniform Dispute Resolution Policy (UDRP) is a process that allows a trademark owner to challenge the registration of an abusive domain name. It is available in connection with all generic top-level domains (gTLDs) — including .com, .net, .info, and .org — as well as some country code top-level domains (ccTLDs), including .au, .mx, and .fr. In order to prevail in a UDRP proceeding, the trademark owner must show:

  • The trademark owner owns a trademark (either registered or unregistered) that is the same or confusingly similar to the domain name;
  • The domain name owner has no legitimate right or interest in the domain name; and
  • The domain name was registered and used in bad faith.

Upon successfully proving all three points, the domain name is cancelled or transferred to the prevailing trademark owner. No money damages or attorneys’ fees will be awarded under this procedure, as relief is limited to cancellation or transfer. Most successful plaintiffs choose the transfer option to prevent the domain name from falling back into nefarious hands.

Although the form of relief is limited, the procedure has some distinct advantages in time and cost. Most domain name disputes are resolved within 60 days of filing a complaint with an approved service provider, making this procedure much faster than the courtroom for the resolution of domain name disputes. In addition to the speed of resolution, UDRP proceedings are very cost-effective. Service provider fees range from $1,300 to $1,500 per domain name for a single-panelist proceeding, and attorneys’ fees for preparation of the submissions are relatively inexpensive, especially as compared with those incurred in a full-blown federal court action.

In today’s world, domain names are essential and valuable assets that allow customers to easily identify and interact with your business. Someone improperly using your mark as a domain name can create a whole range of problems, including customer confusion, damaged reputation, decreased sales, and preventing you from registering the prefect domain name for your business. Therefore, when protecting your brand from cybersquatters or other bad actors, consider the UDRP as an alternative to traditional litigation.