Plugable Hit with RDNH Ruling in WIPO Domain Fight

The Uniform Domain-Name Dispute-Resolution Policy (UDRP) process was created to give brand owners an affordable way to fight back against cybersquatters acting in bad faith. However, if a large corporation tries to abuse the UDRP process to take a generic domain name from a private investor, there is an effective remedy in place. A recent panel from the World Intellectual Property Organisation Arbitration and Mediation Centre issued a strong condemnation of tech accessory company Plugable. Not only did the panel rule in favor of the defendant, but they also concluded that Plugable committed Reverse Domain Name Hijacking, hereinafter RDNH. This decision should send a strong signal to in-house legal teams that they should think twice before strong-arming registered domain owners with administrative actions.

+------------------------------------------------------------------------+
| UDRP FIGHTING BACK FUNNEL |
+------------------------------------------------------------------------+
| BEFORE YOU KNEW ABOUT RDNH: |
| [Submit UDRP Complaint] ---> [Have Big Trademark] ---> [Bullish Against Private Owner] |
| Outcome: Successfully Hijack Domain | Punishment: None |
+------------------------------------------------------------------------+
| AFTER YOU KNOW ABOUT RDNH: |
| [Research Valid Rights] ---> [Publish Proof] --->[Get RDNH Issued Against Brand] |
| Outcome: Gain Public Black Mark Against Brand | Punishment: Brand Is Publicly Shamed |
+------------------------------------------------------------------------+

Reverse Domain Name Hijacking focuses on the tense intersection between domain names and trademark law. Many rightful domain investors strategically register short, generic, and brandable terms before they have any commercial meaning with the intention of developing them in the future. Just because a company files a trademark application and opens a store five years later does not mean that the domain was registered in bad faith five years ago. During Plugable’ s panel decision, which you can read in full on the DNJournal.org Domain Name Industry News Website, they clearly stated that there was absolutely no evidence presented to prove that the defendant even knew about Plugable when they registered the domain name back in 2012. Once the panel realized that Plugable had absolutely no legitimate legal theory under which the defendant violated their rights, they shifted their investigative goal post to finding corruption on the side of Plugable.

What ultimately changed the direction of this corporate domain fight was a single screenshot of an online comment made by Plugable’ s founder. Around the time Plugable filed their complaint, the owner of the domain posted publicly on Reddit that Plugable had contacted him about purchasing the domain name but didn’t want to pay market prices. In plain text on a public internet message board, Plugable basically admitted that they planned to strong-arm the investor into selling cheap or donating the domain through the UDRP process. Domain investors should take note of this story because it perfectly illustrates how important it is to document your entire portfolio’ s history.

Trademark ownership alone is never enough to win a UDRP case.

Plugable lost because the domain name was registered years before they even considered entering the market space related to plugableproducts. For a complainant to win their UDRP case, they must prove that: 1) the domain name is identical or confusingly similar to a trademark or service mark in which they have rights; 2) the defendant does not have any rights or legitimate interest in the domain name; and 3) the domain name was registered and is being used in bad faith. If a trademark didn’t exist at the time of the domain name’ s registration, it is impossible for the domain name to have been registered in bad faith.
+------------------------------------------------------------------------+
| TRADEMARK TIMELINE VALIDATION |
+------------------------------------------------------------------------+
| TIMELINE FEATURE | PLAUGABLE PRODUCTS TIMELINE | DEFENDANT DOMAIN OWNER TIMELINE |
+------------------------------------------------------------------------+
| Domain Name Registered | Founded and Trademark Filed: June 2018| Purchased: January 2012 |
| Purpose for Registration| Buildout Product Line | Speculative Registration |
| Knowledge of Domain at | Not Aware ( Trademark not created ) | Zero |
| Registration | | |
| Strength of Legal Claim | Weak, fails prong 3 | Valid, Clean Title |
+------------------------------------------------------------------------+

The domain owner’ s attorney successfully argued to the panel that it is perfectly legal to register generic and descriptive domain names for the sole purpose of selling them at a higher price. While cyber squatting specific trademarks is illegal, holding onto domain names before they are used in commerce is a legitimate business. Every domain investor has the right to buy and sell domain names on the secondary market. ICANN EPP and Dispute Resolution Center made it clear that just because a company trademarks a generic term, they don’ t get to own every generic word or short domain combination that could ever be used on the internet. If Plugable didn’ t have a website called “plugableproducts.com” in 2012 when the defendant registered “plugable.com”, the defendant had every right to keep and develop the domain as they saw fit.

Corporate Trademark Bullying: Reading Between the Lines of Reddit Comments

It should come as no surprise to business professionals that anything you say on the internet could come back to haunt you years later. Many large brand leaders have offices on Reddit where they answer questions and interact with the general public. The founder of Plugable simply tweeted about their strategy to strong-arm the domain owner through the UDRP process without having to pay Greywire Marketing Group the normal retail prices. This simple comment was enough proof to show the panel that Plugable knew they had no case against the defendant.

If your intentions were pure, collecting evidence like this can turn an UDRP case against you into a clear example of RDNH. Domain Name Hijacking occurs whenever a complainant files a UDRP complaint with the full knowledge that their legal theories are invalid. Case Law on RDNH listed on the Domain Name Wire News Site proves that in order for a panel to grant a RDNH declaration; they must be able to prove that the complainant knew they had no case. Posting your screen dumps and clearance letters in a public UDRP dashboard allows the panel to easily see your clean intentions.

+------------------------------------------------------------------------+
| CORPORATE DOMAIN SCAM TIMELINE |
+------------------------------------------------------------------------+
| Step 1: Company founder comments on brand’s UDRP strategy on a public social media platform. |
| Step 2: Brand files aggressive domain seizure case against private domain owner. |
| Step 3: Domain investor submits clear evidence of company’s intentions to the WIPO panel. |
| Step 4: Panel denies corporation’ s claim and tarnishes their reputation with RDNH. |
+------------------------------------------------------------------------+

There are countless benefits to scraping the public web for any incriminating information about the company that is threatening to file a UDRP against you. By conducting your own due diligence before they file a case, you may be able to catch a company in their own lie and issue them an RDNH. While the internet may feel like the wild west, most big corporations leave digitalbreadcrumbs that prove their ill intentions before filing a UDRP. If you can catch them in these lies before they file a UDRP, you may be able to put an end to their corporate game of domain chicken.

Reverse Domain Name Hijacking: Understanding the Brand Stigma

RDNH doesn’ t mean the defendant gets to take financial compensation from the bully brand. However, the stain of RDNH will live on throughout all of Plugables future legal filings. An RDNH will show up for eternity on the public WIPO database and future attorneys will know that Plugable abused the UDRP system in this instance. If Plugable attempts to file another UDRP in the future, opposing council can point to this moment as concrete evidence that Plugable acts in bad faith. Just like this story made it to DNJournal and several other domain name industry blogs, high-profile loses like this are likely to be covered by larger technology blogs. The negative press from a public loss can hurt your brand equity with influencers that value brand integrity on the internet.
What RDNH does give you, is the ability to market your domain name as dispute cleared. When your domain name successfully fights off a UDRP case, you gain something called “clearance value”. Clearance value is a premium that professional domain investors are willing to pay for a domain name that has been disputed and cleared by an international panel of attorneys. Domains that have an RDNH snag become even more valuable because future buyers know that the trademark claims against the name have been fully tested and rejected.

*Subject to market conditions and demand.
**Subject to current market conditions and demand.

Reasons Why The Domain Name Industry Appreciates Cases Like This

The domain name industry loves this story because it guarantees that big corporations think twice before filing a UDRP against your domain name. If a company knows that they can’ t bully you into selling cheap and they will be publicly shamed on the internet, they are much less likely to file a claim. As more commentators and small business owners become aware of RDNH, brand lawyers will start thinking twice before filing. This entire ecosystem works because it forces mega corporations to respect the rights of private investors.

How to Protect Yourself From Corporations Trying to Hijack Your Domain Name

The best way to fully protect your domain name portfolio from predatory corporations is to DOCUMENT EVERYTHING. From the moment you start developing your new website, you should preserve a history of your progress. If a cyber security company sends you a cease and desist letter because they think your new hardware startup is infringing on their trademark, immediately freeze communications with the law firm. In your panicked state, it is very easy to accidentally tip your hand and make things worse for yourself. Once you prevent yourself from saying something you will regret, you should immediately document your rights to the name.

+------------------------------------------------------------------------+
| DEFENDIAN |
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| Step 1: Retain a Qualified Domain Name Attorney You Can Trust. |
| Step 2: Archive any public trade secrets the company’ s made about your domain name. |
| Step 3: Document your ownership of the domain name predates their trademark through chronology.|
| Step 4: Include a demand for RDNH sanction against company in your response to complaint. |
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Hiring a domain name attorney will allow you to collect your facts and have someone expertly evaluate the company’ s trademark filing history. Similar to Plugable, chances are the company you are in a dispute with lied about their intentions at some point online. When you find the comment or article where the company violates their own injunction and acknowledges your rights to the name, save it and send it to your attorney. Your lawyer can use this information to issue an RDNH which can cost the company thousands in legal fees and tarnish their brand equity.

Once you document everything in your portfolio’ s history, make sure you register every domain name through an attorney friendly domain portfolio manager like DomainNameEscrow. DNSRF aligned registrars like DNStudio have proprietary advanced levels of corporate privacy protection and account authentication to ensure your information never falls into the wrong hands. Corporate attorneys tend to bully investors who don’ t know or follow internet governance rules. By taking these extra measures to protect your assets, corporate law firms will think twice before filing a costly UDRP against you.

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