Facebook wins $2.8 million in domain squatting case, local experts say Australian cases unlikely

Social networking giant Facebook has won $2.8 million in damages from domain-name squatters who registered variations of the company’s name, but local experts say any budding Australian squatters may not have as easy a time.

The US District Court of Northern California ruled against 11 typo squatters, which were using the misspellings of Facebook’s trademarked domain name.

The 11 defendants were ordered to pay damages ranging between $5,000 and $25,000 per domain name, with some made to pay additional fees for redirecting visitors to other sites, and all the domain names were ordered to be transferred to Facebook’s control.

The use of “domain-name squatting” is common, with users often snapping up a popular name in order to leverage a higher price from an eager buyer.

The practice of registering misspelled domains is also common. Businesses like to register these names and direct them back to their own site, so if a user misspells the domain they still end up in the right place.

Squatters leverage the demand for these sites and often sell them to the companies in question.

But Australian domain name industry expert Josh Rowe told SmartCompany similar cases are unlikely to occur in Australia because of tighter legislation.

“The .au domain has quite a strong policy in regard to domain name misspellings,” he says.

“If you register a .au, there is actually a list of domain names which are blocked from registration for all kinds of things. For example, many variations of the Yellow Pages and Yahoo are banned.”

From a global point of view, Rowe says, the .com and .org domains basically have “zero policy requirements”.

“People can register anything, and then if a company or person has an issue with it, they can take it to the universal dispute resolution process, or take it up with the courts like Facebook have done,” he says.

.au Domain Administration, Australia’s domain name authoritative body, has had a policy regarding domain name misspellings in place since 2008.

This policy states eight separate categories which constitute misspellings, including using the singular version of a plural name, using a name with missing letters, adding additional letters, or whatever the auDA determines is a “deliberate misspelling”.

StewArt Media founder Jim Stewart told SmartCompany because of these restrictions, it’s far more unlikely a misspelled name with a .au ending extension would come into existence.

“Australian laws are a lot stricter. You can appeal someone having a domain name even close to yours and for a .com.au extension, but it probably wouldn’t even get that far.

“If I went out to register a domain name similar to a known brand or trademark, it’s unlikely you’d be permitted to use it. This is also done with acronyms.

“I’ve seen people try and register a .com.au site with a similar acronym to a .gov.au site and this is usually flagged.”

The US District court determined the defendants had purposefully made money by using similar domain names to Facebook and had confused users.

In the judgment, it was stated the defendants had purposefully made their websites look similar to Facebook’s.

“The Default Defendants then monetized their schemes with interactive, commercial landing websites designed to look like Facebook’s website.”

“These landing websites were designed so that, when they were viewed in California, they displayed text specifically targeting California users.”