By April Hiroshima Gatling
This month, a United States District Court ruled that retailer Land’s End will get a trial in a case where defendant website owners are accused of profiting from the company’s online affiliate program through a scheme that gave “typosquatting” a new twist.
“Typosquatting” is a form of cybersquatting that relies on typographical mistakes made by Internet users when inputting a website address into a web browser. Most typosquatters are either in the practice of tricking or diverting Internet users to alternative websites or attempting to sell the domain name back to the trademark owner. In this case, however, defendants directed Internet users to the Land’s End’s website, but only after channeling them through “affiliate” sites owned by defendants, who in turn received commissions associated with subsequent purchases.
Land’s End operates an affiliate program that allows owners of approved websites to link to the Land’s End website. When a visitor clicks on a link of an affiliate’s website, connects to www.landsend.com and makes a purchase, the affiliate earns a 5% commission on the purchase. During the application process, defendants disclosed information regarding their legitimate websites, but failed to disclose their ownership or interest in numerous typosquatting domain names, including: www.lnadsend.com, www.landsende.com, www.landdend.com, www.landswnd.com, among many others. The defendants set up these other domain names so that if an Internet user accidentally mistyped one of them into a web browser, he or she would be automatically and invisibly redirected to the Land’s End site via an affiliate site. If one of the typosquatting victims purchased something off of the Land’s End website, the defendants picked up an extra commission. A twist is that defendants set up their scheme to only redirect the first time someone mistyped the domain name. Subsequent misspellings led to an error message.
After noticing unusual referral patterns and payments made to affiliate sites, Land’s End investigated and filed suit in the United States District Court for the Western District of Wisconsin alleging cybersquatting, fraud, false advertising, and breach of contract. The defendants moved for summary judgment on all claims, asking the court to rule in their favor without a full trial. U.S. District Judge Barbara B. Crabb denied the motion and held that Land’s End presented enough evidence to show that the defendants exploited the Land’s End trademark to get commissions of which they were not entitled.
The defendants argued that they should not be held liable because their scheme actually helped Land’s End by sending more people to their website. Without the defendants’ setup, they argued, users who mistyped the www.landsend.com address would likely have given up and gone elsewhere. Land’s End argued that the defendants “hijacked Land’s End’s own customers, sold them back to Land’s End, and collected a ransom for doing so.” In her ruling, Judge Crabb called defendants’ argument “specious at best” and pointed out that most people would have noticed their mistake and corrected it. Accordingly, Land’s End will proceed to trial and the issues surrounding the remaining cybersquatting, fraud and breach of contract claims will ultimately be decided by the finder of fact.
Combatting Against Typosquatting*
The law is generally not concerned about registrations of domain names that are similar to other domain names or existing trademarks, unless some other factor, such as unfair competition, is involved. For example, it may be perfectly acceptable to use a domain name that is confusingly similar to an existing trademark if the web page standing behind the new domain name is not used to compete with the trademark owner. So, what can a business and webpage owner do to combat again typosquatting? The following are a few ideas:
· A victim website can send a cease and desist letter to the offender, in hopes of suppressing the activity.
· A victim website may also try to purchase the website address from the typosquatter, which could have been the typosquatter’s aim all along.
· Occasionally, lawsuits may be filed if other legal factors are involved.
· A company may try to preempt typosquatting by obtaining a number of websites with common misspellings and redirect them to the main, correctly spelled website. For example, Governor Arnold Schwarzenegger is reported to control the domain names with the ten most common misspellings of his surname.
*Disclaimer: This article is written to give general information and provide a general understanding of the law, not to provide specific legal advice. The suggestions in this article should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.
April is an associate in the Disputes, Trials and Appeals and Labor and Employment Groups at Weintraub Genshlea Chediak Tobin & Tobin. April focuses her practice on litigation, assisting in complex business, employment, trade secret, and real estate disputes