Judge Awards Verizon $33.5M in Cybersquatting case

David Naffziger Dec 24, 2008

Verizon issued a press release today that announced a record $33.5M cybersquatting judgment against OnlineNIC. There were 663 domains in question and the judge chose to award $50K per domain, presumably under the guidelines of the Anti-Cybersquatting Protection Act (ACPA), which allow a penalty of between $1K and $100K per domain. Very little is known about the actual case, and nearly all of the blog posts and press coverage simply restate the press release.

The Justia docs from the case are still behind the PACER pay wall, but there are a few interesting aspects that should be mentioned and hopefully cleared up in the next few days:

  • Was OnlineNIC registering and directly profiting from these domains, or were they serving as a registrar for third parties? Anyone can register domains at OnlineNIC today, so it is conceivable that these were domains registered by OnlineNIC customers. If so, this may have implications for large registrars in particular (GoDaddy, Network Solutions, etc.) For example, look at the whois of verizonphnes.com registered at OnlineNIC - it is actually registered by an individual in Thailand.
  • Where is OnlineNIC headquartered? Although they list an address in San Francisco under their Internic registration, Verizon has not been able to locate them. WIPO documents (doc) suggest that they may be headquartered in China.
  • What will happen to the Microsoft case against OnlineNIC? Microsoft has a similar case filed against OnlineNIC. While the details still remain behind the PACER pay wall, I'm sure there are a number of similarities to this case.
  • This was a default judgement. That means that OnlineNIC didn't bother to show up in court. The outcome may have been significantly different had they appeared. This may also suggest that it will be hard for Verizon to collect.

It is great that Verizon went on the offensive against typo squatters. However, they are missing a great opportunity to collect on the tremendous number of infringing domains that remain registered by hundreds of other entities. Verizon should be publishing a process whereby current cybersquatters can return the domains to Verizon.

Topics: Trademark Bidding, Trademark and Law, Affiliate Marketing

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