A recent survey by brand protection firm MarkMonitor reported that the number of cyber-squatting incidents rose by 18% in 2008 to a whopping 1,722,133.
It came as no surprise then when WIPO reported on 16 March that it had received a record number of complaints under its dispute resolution procedure in relation to domain names registered in bad faith during 2008. 2,329 people or companies reported instances of cyber-squatting, including Arsenal Football Club, Google, Nestle and Scarlett Johansson.
The most popular targets are successful brands and the most popular motive for cyber-squatting is to make money. But please do not admire the entrepreneurial spirit of cyber-squatters, as more often than not they infringe intellectual property rights by "passing off" (that is, they misrepresent that their site is in some way linked to, or endorsed by, the target brand owner).
Furthermore, some cyber-squatters also infringe registered trade marks (for example, Research in Motion's trade mark for 'Blackberry' has been referenced on a cyber-squatter's web site). The thinking seems to be that the more blatant the infringement, the more likely the brand owner is to cough up cash for the cyber-squatter's domain name.
Normally, brand owners would set their lawyers onto the cyber-squatters, with letters before action being sent threatening litigation unless the cyber-squatter ceases to infringe the brand owner's trade mark rights. However, cyber-squatters have become masters of disguise, using identity shields to mask their identities from the WHOIS searcher, which means that it is hard to identify where and to whom letters before action should be sent. This fact, along with the other benefits of resolving a domain name ownership dispute by dispute resolution, explains why brand owners are using the domain name dispute resolution routes such as the UDRP instead of bringing court proceedings against the infringer.
To combat the rise in cyber-squatting, WIPO is proposing to introduce a paperless dispute resolution procedure for .com, .net and .org domains, as well as a number of more recently introduced domains such as .aero, .asia, .biz, .cat, .coop, .info, .jobs, .mobi, .museum, .name and .travel (the eUDRP). Nominet already uses its own paperless dispute resolution procedure.