WIPO Reports Rise in Cybersquatting

The World Intellectual Property Organization (WIPO) reported 1,117 cases of cybersquatting in 2004, a 6.6% increase from the previous year.  In the late 1990s it became apparent to both squatters and trademark owners alike that the territorial nature of trademark law, and the global nature of the Internet would conflict when it came to domain names.  A "cybersquatter" is someone who uses the registered trademark of another entity and registers it as a domain name.  The domain registered under the name is usually left blank while the cybersquatter waits for the trademark owner's best offer.   An entrepreneurial cybersquatter would have registered an exact tradename, plus several confusingly similar others.   WIPO created the Uniform Domain-Name Dispute Resolution Policy (UDRP) in response to an international cry for alignment of national and international IP rights on the Internet.

Although most disputes originate with companies in the United State, in 2004 WIPO also handled claims of cybersquatting from more than 20 countries around the world.  There are four approved Domain-Name Dispute Resolution Providers, WIPO, The National Arbitration Forum, CPR Institute for Dispute Resolution, and the Asian Domain Name Dispute Resolution Center.  All organizations operate under UPRP Although disputes can be brought to court or arbitration either before or after the determination of the dispute by an approved organization, decisions of UDRP have equivalent effect of a binding international arbitration and as such are likely to be upheld in court. 

80% of WIPO domain name disputes are resolved in favor of the trademark holder. And, WIPO Deputy Director General Francis Gurry feels that, "UDRP has been highly successful in creating a deterrent effect as well as providing trademark holders with an effective international remedy against cybersquatting."