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The Domain Name That Got Away, Part II

Monday, February 28th, 2011

Last month, I wrote about how you can backorder a domain name that someone else has registered so that, if its registration expires, you would have a good chance of getting it.

But what if you don’t think the current owner will let the domain name registration lapse? What can you do to get that must-have domain name?

Start with low expectations. Usually your odds of success are low and the acquisition cost would be high.

There are two groups of options, and then sub-options. The initial choice is between trying to take the domain name by legal force and just trying to buy it.

Using Legal Force

Here you assert a legal claim in court or through arbitration to take the domain name away.

To do so, you have to have a claim for trademark infringement, cybersquatting or both.

Trademark infringement essentially occurs when you have a trademark – usually a company, product or service name – and someone else later starts using a confusingly similar name for a similar company, product or service.

Cybersquatting essentially is where someone registers, uses or traffics in a domain name with a bad faith intent to profit off of your trademark.

You can assert either claim in court or you can claim cybersquatting in an arbitration process.

In addition to giving you the domain name, a court can also award you damages against the bad guy if you win (but it often does not), while arbitration can give you only the domain name.

Yet, going to court is much more expensive. You’ll probably spend $10,000 even if the bad guy rolls over immediately and lots more if he fights. You can conduct the entire arbitration for around $6000.

While it’s not a prerequisite to using legal force, you will be in a stronger position if you federally registered your trademark before your opponent registered the domain name, and if you’ve been diligent about stopping infringements of your trademark. If these things are not so, you may have a weak case.

Offering to Buy

Perhaps you don’t have a legal claim, or you’re not willing to pay to assert one. You can just make an offer to the domain name owner to buy it.

Be pessimistic about your chances. Domain name owners usually demand high prices. Low-ball offers almost always fail. Often you get no response.

The best way to make an offer depends on the nature of the current domain name owner. Is the domain name used by a business or personal user, or is it being used by a domainer and domain name reseller?

A domainer is someone who registers zillions of domain names to put up automated pay-per-click websites. A domain name reseller buys domain names for resale. Often a domain name is put to both purposes simultaneously.

Thus, if the domain name you crave presently points to a website that isn’t for a particular company but has lots of links to buying opportunities, it’s probably a domainer.

These folks are slippery. They deal in high volumes of domain names and big money. They demand premium prices. They may not respond at all. They usually mask their identities with domain name proxy registration services.

Contacting them yourself may be impossible and, anyway, you’ll want to have a trusted third party arrange the transfer. Thus, in that situation, I’d use an online acquisition service.

All major U.S.-based domain name registrars offer registered domain name acquisition services. Commonly used services are at GoDaddy.com, Network Solutions, and Register.com.

These services vary somewhat but are easily understood. Each will perform an inexpensive appraisal of most domain names and will try to negotiate a purchase for you.

If the domain name is in use by a business or personal user, such as a company or family website, presumably the demanded selling price will be high. If you have a legal claim against that business or person, you’ll probably have to use it as leverage.

You could just contact the owner directly and make an offer.

If you are concerned that disclosing your identity will raise the price, you could get an individual or small-firm attorney in another part of the country to be your buying agent. I’ve done that for some clients with modest success.

You also could use an online acquisition service, although that kind of offer might be ignored by a corporate owner or not make it through its spam filter.

By John Farmer
Published in the Richmond Times-Dispatch
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