Domain Owl

I am considering the news of the verdict in the reverse hijacking lawsuit between X6D Limited (XPAND 3-D sunglasses) and Telepathy, the original xpand.com domain owner, and I have two main streams of consciousness about this legal outcome. I must say the process is very confusing no matter how many times I read it.

1. I like that the original domain name owners do not have to release their domain because some clown came along years later, liked the name, and decided to found a company on it without securing the name.Were the business people involved inexperienced, arrogant, or simply not thinking ahead?

In this case allegedly the sunglasses company went ahead and made their brand the equal of an existing domain name, then either refused to acknowledge lack of due diligence or decided to force the court’s hand. That is not only the lazy man’s way to doing business, but makes one wonder how critical the business drivers are to let it happen.

Of course, this is why domain name owners track lookups and clicks. they want to know if someone is repeatedly checking out if there is a site or not, who owns it, and how much they might offer. This is the fear of many large portfolio domainers, that they will not be able to predict if some company is waiting for their dream name to expire unwanted. They’ll give it up and see another organization reap traffic and clicks on their effort.

2. I don’t like that if you find the perfect name, you are being held up for greenmail by the wild-eyed money grubbing domainer who has aid the renewal fees since the name’s acquisition or inception. Many domainers assume anyone serious about starting a company will secure the domain name before founding the brand, printing the business cards, funding the business model and painting the shingle.

But the reverse hijacking case had me worried. What if any company could simply hijack the name and start a company, then run to a judge (like in this case) and say golly this domainer has ESP and stole our name in advance! Securing the domain name of a company before releasing, titling, labeling or promoting any product of a same name is simply common sense. Companies who find the name already in play either buy it or move on.

The panel decided rightly, since they know that the plaintiff corporation could easily have chosen one of a billion brands to associate with their goods and services. If they had started the company in 1979, maybe they had not thought of acquiring the domain because the internet did not exist yet. but in that case the precursor of copyright would have belonged to the plaintiff, and no domainer would have bought (or renewed) a domain name protected by the copyright of another company.

All in all, it looks like the best case business practice is to consult with a new media or domain name attorney when forming a business to get an informed opinion. The record of this type of inquiry may come in handy later in court.