If You Define the Market Narrowly Enough, Monopolies Are Everywhere

Dell Sues Cybersquatters For Elaborate Shell Game

from the catch-me-if-you-can.com dept

Thu, Nov 29th 2007 5:13pm — Mike Masnick

Hearing stories about cybersquatters taking domains that are confusingly similar to corporate names is nothing new, but a new lawsuit from Dell shows just how far some firms are taking the practice. Dell has sued a group of registrars claiming that they're really a series of shell companies designed to sit on various squatted domains for free. It's no secret that a common practice among domain squatters is to register a domain and put ads on it for a few days to see if it drives any revenue -- and if it doesn't to return the domain within the grace period. We had always heard of this practice as being called "domain kiting," but Dell refers to it (more aptly) as "domain tasting" in its lawsuit. However, what's interesting here is that they're accusing one company of setting up a long series of shell corporations to keep registering the same domain name over and over again -- getting the benefit of the traffic without ever having to pay for the domain name. For example, Dell notes that one company registered "dellfinacncialservices.com" and used it for 5 days (the limit you can go without paying) before abandoning it. However, as soon as it was abandoned, another firm picked up, used it for 5 days and then abandoned it again, only to see another firm immediately pick it up. Basically, they trace a pretty compelling pattern to suggest that this was a coordinated effort, potentially by a single company.

The other interesting part about the lawsuit is that rather than focusing on standard laws having to do with cybersquatting, Dell has gone a step further and is claiming that registering domain names with the Dell name in them is akin to "counterfeiting." That seems like quite a stretch -- and even the legal expert quoted in the article seems to think it's a long shot for Dell to make that argument. If they win on this argument, then it could spell a lot of trouble for people who happen to own domain names that are similar to the names of large corporations. For many years, we've covered the fight between Nissan (the automaker) and Uzi Nissan, the guy who owns Nissan.com (this story is getting some more attention this week, thanks to a Freakonomics post, but the story itself has dragged on for years). Presumably, if Dell wins their case, then Nissan could turn around and accuse Nissan.com of "counterfeiting" and have a pretty strong precedent to back it up.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: domain kiting, domain names, domain tasting, registrars
Companies: dell

15 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

GrammarMan, 29 Nov 2007 @ 5:22pm

"It they win on this argument..." Perhaps "If" would be more appropriate? =)
[ link to this | view in chronology ]
- Dani, 29 Nov 2007 @ 9:00pm
  
  Re:
  It looks to me like it said "If". And if you're going to be picky, I would suggest saying... "If they win this particular argument [or aspect] of the case" since it is less awkward. However, the meaning is perfectly clear as is. You shouldn't nitpick.
  [ link to this | view in chronology ]
Lawrence D'Oliveiro, 29 Nov 2007 @ 6:31pm

Trademarks enough
Surely it would be sufficient to nail the cybersquatters on trademark infringement grounds alone--names like "dellfinancialservices" pretty clearly look like they were trying to pass themselves off as somehow connected to Dell. They shouldn't need to make the further argument that any name with "dell" in it is automatically verboten.
[ link to this | view in chronology ]
Mojo, 29 Nov 2007 @ 6:34pm

You know GrammarMan, I am a big grammar nazi myself, but you doing it in public like this makes you a big, giant, capital A-Hole. I am sickened by your self serving posts that do little more than prove you're an insecure loser, only able to take joy in the mistakes of others.

If you're really interested in helping, proof read articles and send private email to the writers. The way you're doing it begs for severe bodily injury if someone were to discover your identity.

Given the mindset of people who read Techdirt, seems like the right people for the job are already here.
[ link to this | view in chronology ]
- GrammarMan, 29 Nov 2007 @ 8:04pm
  
  Re:
  I may be an insecure loser (and absolutely am a "big, giant, capital A-Hole"), but my posts aren't self-serving. In fact, they're community-serving and I believe Mike appreciates the feedback. But perhaps private correspondence with the authors is a better approach. You're feedback is appreciated. Farewell from GrammarMan...
  [ link to this | view in chronology ]
  - LBD, 30 Nov 2007 @ 12:24am
    
    Re: Re:
    Eh, I don't mind spelling and grammar correction.
    
    Need to learn my native tongue someday. I get damn lazy with it otherwise. I don't know about other people though.
    [ link to this | view in chronology ]
  - BTR1701@hotmail.com, 30 Nov 2007 @ 7:54am
    
    Re: Re: Grammar
    > But perhaps private correspondence with the
    > authors is a better approach. You're feedback
    > is appreciated.
    
    Also, a bit of helpful advice: if you're going to call yourself "GrammarMan" and spend your time correcting the linguistic mistakes of others, you might want to suss out the difference between "you're" and "your" before making yourself look like such a public fool.
    [ link to this | view in chronology ]
    - GrammarMan, 30 Nov 2007 @ 11:38am
      
      Re: Re: Re: Grammar
      Your right! Their must be something the matter with me. I've been negatively effected by my haste. Its not my fault because I ain't never done nothing wrong!
      
      Seriously though, you're right. We all make mistakes, even the best of us, as Mike would probably agree ;) I'm done with the off-topic spam. My apologies...
      [ link to this | view in chronology ]
linuxamp, 29 Nov 2007 @ 8:11pm

This is where juries are necessary. Black and white laws, while easy to interpret can sometimes have adverse effects. In the case of Nissan, this guy had a company for quite some time, his name is Nissan, and he's using the site for business. It seems that a jury should be able to distinguish this from counterfeiting.

On the other hand, would it mean that sites that use a misspelling of a name which are obviously counterfeit sites be protected against this? mcaffee.com

And lastly what about names that are not company names but sound like a product that a company may produce? icar.com ikeyboard.com itable.com
[ link to this | view in chronology ]
steve, 29 Nov 2007 @ 9:46pm

dam right
About time dell did something right. Get there asses i've been in the same fight for over a year. I really hope that Dell wins. Sue the crap out of there sitesquatting asses!
[ link to this | view in chronology ]
Evil Mike, 29 Nov 2007 @ 10:45pm

Nissan cannot sue for Nissan.com as the person who owns the site has a legitimate claim to the name; ergo, he's not squatting.
[ link to this | view in chronology ]
√, 30 Nov 2007 @ 12:38am

Go Dell Go!
I think dell is justified.Its these people that are the real scammers/spammers.About Nissan case-car ads take up about 50% commercial time.They got far enough ads on TV(for TOO much).Damn money grubbrs.Its the guy's domain,let him be.
[ link to this | view in chronology ]
Easily Curtailed, 30 Nov 2007 @ 5:32am

Just change the rules
They could curtail this type of domain-kiting by locking out a domain from being registered for free. Failing that, they could lock a domain name for 90 days after it is released unless you want to pay for registration during the lockout period
[ link to this | view in chronology ]
BTR1701, 30 Nov 2007 @ 7:50am

Counterfeiting
> Presumably, if Dell wins their case, then
> Nissan could turn around and accuse Nissan.com
> of "counterfeiting" and have a pretty strong
> precedent to back it up.

Well, not really, since the entire essence of the counterfeiting issue doesn't apply in the Nissan case. Dell is claiming that people who have nothing to do with Dell are using their name to "counterfeit" an ad business.

In the Nissan case, the guy's name is actually Uzi Nissan and he has a long-established legitimate business under that name that pre-dates the incorporation of Nissan Motors, so he's not counterfeiting anything. He's using his own legitimate name. The fact that his name is the same as an auto maufacturer doesn't mean he's engaged in counterfeiting. If anything, the "counterfeit" argument would be a weaker argument for Nissan Motors to use than standard trademark infringement in their case.
[ link to this | view in chronology ]
JohnOpincar, 30 Nov 2007 @ 9:55am

Last Paragraph Is Way Off
Why the last paragraph was included in this story is a true mystery. There's a huge difference between domain squatting using a name and a mispelled word to intentionally mislead people (the Dell case) and a real person that happens to have the same name as a company (the Nissan case). Did the author stay up to late last night? Were they drinking?
[ link to this | view in chronology ]