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David Beckham Sparks Cybersquatting Bonanza

David Beckham Sparks Cybersquatting Bonanza

So, late last week you may have heard about international football star and metrosexual David Beckham signing a reported $250 million dollar deal with the LA Galaxy to play in North America. What you may not have heard is how the signing sparked a cybersquatting bonanza.

As reported by the Sunday Herald, within minutes of the announcement being made, there was a flurry of activity in domain registration leading to hundreds of permutations of “David Beckham” and “LA Galaxy”, including, of course, purposely mispelled permutations as well.

The surprising thing, of course, is how neither LA Galaxy, nor David Beckham, had the foresight to secure a few domains for themselves:

“A domain name is easy to secure in the first place, but retrieving it from a cybersquatter is easier said than done,” Robinson said. “The potential damage a malicious registration could do to a celebrity’s brand is untold. Just imagine what will be said if one of Beckham’s sponsors finds his most popular unofficial websites are actually directing surfers to rival products.”

Nobody was available for comment at SFX, Beckham’s management company. A spokesman for LA Galaxy said that the club was taking the matter seriously, however, and would be taking legal advice on how best to proceed.

Cybersquatting is the practice wherein individuals buy up domain names related to a known trademark in bad faith, aiming to do malicious things with it, including reselling it to the trademark holder at an elevated price.

While I’m no expert on cyber-law (and, to be quite frank, we’re still looking for one … email me at anthony{dot}hung{at}gmail{dot}com if you’re interested) it may create an interesting cross-atlantic conundrum, as the question of jursidiction may come up.

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For example, while the United States has the Anticybersquatting Consumer Protection Act, I’m not sure if there is such a law in the UK, where, for example, some of these domain names have been registered. In the United States, those individuals found guilty under the ACPA, for example, are liable for fines up to $100,000 for each name found to be inviolation.

Ouch.

If there are any legal beagles out there who would like to comment on this I’d love to hear from you below.

View Comments (7)
  • Poor old Becks can’t win a trick. Sold down the river of mediocrity, while Posh can shop ’til she drops. And to think people were giving Fergie stick for selling him for 25 million quid. What has Real won since they bought him? Nada. And who did MU buy for less than half the price? Ronaldo- 21 and probably the best footballer in the world at the moment- or at least one of them.

  • I liked your article, Tony.

    You asked for comments from Legal Beagles – well here I am – woof woof.

    I have been dealing with cybersquatting disputes since they first appeared, and in fact filed one of the very first suits under the US Anti-cybersquatting legislation.

    There is indeed no UK equivalent of the US Act, but this does not mean that UK law is soft on cybersquatters. As is so often the case in England and Wales, the innocent party is protected by Common Law.

    The landmark case came about following the merger of Glaxo and Wellcome in the mid 1990’s. The case did not actually involve domain names, but rather company names. Within a very short time of the merger being announced, someone registered the company Glaxowellcome Limited. On being sued, he stood up in the High Court on oath a said, at the time of registration, he had not heard of the potential merger; he chose the name because he thought it was “catchy”; and it was only afterwards he thought of writing to the merging companies asking for large sums of money. The court was having none of it and forced him to assign the company to Glaxo and pay costs.

    Soon after, I handled a similar case for the Rugby Football League which hit the national press – a “squatter” registered the company The Rugby Football League Limited, and on the basis of the Glaxo case we gained free transfer of the company into rightful hands.

    The first big cybersquatting dispute came a couple of years later and involved two businesses called “One in a Million” and “Global Media”. They had registered a wide range of cybersquatting domain names and argued very hard for the legitimacy of this practice. Some of the names such as http://www.bt.org could potentially be used by one of the many organisations around the world with the initials “bt” and not just by British Telecom. This argument was not as easy to apply to some of their other sites, though, such as http://www.burgerking.co.uk and http://www.buckinghampalace.org. The courts had little sympathy with the squatters, and ordered return of the relevant names.

    One significant difference between the UK and the US is that unlike in the States, English law in this area is not geared towards the levying of fines. Instead, the law tries to put the innocent party in the position it would have been in had the cybersquatting not taken place (eg compensation for lost sales). Obviously, the amount of such damage is not always easy to prove. However, when this is compounded with legal fees, the cybersquatter usually ends up licking its wounds (well at least when I am suing them!).

    As you point out, jurisdiction is always a thorny issue. Do you sue where the innocent party is based, where the cybersquatter is based, where the ISP is based, where most people are accessing the site, or where most of the money is being lost? I am afraid there is no easy answer, with different jurisdictions having different ideas on the subject. However, as I am sure you are aware, national courts are not the only solution – ICANN and Nominet both have their own procedures for trying to resolve such disputes.

    So in summary, it might be a headache for Beckham and crew, but at least the boot is on his foot. Tackling the problem should be as easy as taking a penalty. When you speak to Dave and Victoria next, just tell them to give me a call and I will sort them out.

    James Love
    Intellectual Property Lawyer

  • James, what a great summary!

    And the next time I speak to becks and posh, I will certainly pass your name. ;)

    Here’s a question for you … what would happen with domain disputes where servers or registrants are from places like China or Russia? I understand the legal standing there is particularly tenuous.

    Cheers
    Tony.

  • While I’m not a lawyer, this is one topic I’m passionately interested in as part of my previous work in the domain registration business.

    As Mr. Love mentioned, jurisdiction is always a thorny issue if the party opts to sue in Court. The IP commnunity eventually “pushed” ICANN into creating the Uniform Dispute Resolution Policy (UDRP) to resolve no-brainer cybersquatting cases.

    You can read more about UDRP below:

    http://www.icann.org/udrp

    In a nutshell, UDRP is a more cost-effective solution wherein the complaining party, if successful in satisfying the conditions laid out, can wrest control of the domain name/s or ask that they be deleted (which is kinda silly). However, UDRP also gives registrants the chance to “plead” their side and possibly deny transfer if they can.

    Should the respondent/registrant win the dispute, the complaining party can then go to Court but notify the UDRP provider (like the World Intellectual Property Organization/WIPO or the National Arbitration Forum/NAF) about it. During this whole time, the registrar (if notified in a timely manner) will keep the domain name/s “locked” pending notice of resolution.

    It’s a bit complicated at this point how complaining parties can go about it. But they CAN if they don’t have any problem taking up the challenge (and if they have the time and money to burn, too).

  • As Dave points out, using UDRP through ICANN can be an excellent way to circumvent jurisdiction problems.

    This is particularly so where the servers and registrants are in countries such as China and Russia as suggested by Tony. In some cases, laws in these countries should suffice in theory, but it is very often the practical enforcement of those laws which proves difficult.

    When I started enforcing intellectual property rights in the late 1980’s, infringements from China and Russia reaching the UK existed, but were relatively exotic. Now, I find the large majority of the infringing items I come across have their source in these countries. With tangible goods, a common tactic is to take action in the UK against the importers. Eventually, the copiers run out of outlets for their goods and try copying someone else’s items. The obvious difficulty with cybersquatting is that there is no easy importer to sue.

    An interesting point in the Beckham case, though, is that all the reports I have seen indicate the cybersquatting registrants are based in the UK or USA, and so successful action should be possible.

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