I posted this earlier in another area but it may not be the right place to post since I got no response.

Is domain name buy and sell legal? What are the pros and cons? What are the normal issues involved in domain name ownership disputes?

It seem to me that people are stocking domain names still and after doing a little research I could see that I can still get some good and premium domain names and I was thinking of investing some money on it.

On another note, NetSol and Registrar.com are holding on expired domains I think basically for purpose of trying to sell these at a higher prices. I think http://greatdomains.com is created by NetSol for this purpose.

Is it legal? Sure! As you point out, look at NetSol and Register not releasing expired domains (especially NetSol). The pro is that you might stumble across that one domain that sets your future for you, by having someone offer you an obscene amount of money for it. The con is that you have to shell out the money to keep those domains registered year after year, hedging your bets. The other con that comes directly to mind is the risk of running into trademark infringement issues with a name that you happen to register, in the event some company gets a wild hair and decides to try and take it away from you without paying. Then you're out the fees you've paid thus far for the domain and, if you fight it, legal fees that you might incur as a result. Interestingly enough, it seems no one has gone after NetSol in a big way for a domain name they hold but which might be seen as infringement by some company.

Trademark Infringement Issues -- how is this specifically defined? I actually did a cursory run of our local phone directory and I could see that many high profile companies' names are still up for grabs.

My friend, I would not get into this. Basically, if they have registered (Registered or Trade Mark) their name or any product names, they have the legal right to have the internet addy. This is a very risky business.

Trademark violations as regards domain names are tough to discuss generally as no two cases are the same. They are very much dependent on the specific names involved and a host of other factors.

Know that registering a domain name does not necessarily give you the legal right to use it. Registrants can be forced to give up a domain name if it can be shown that they have no real claim to it and registered it to ransom it to the rightful owner. They can also be forced to give it up is someone else has a greater claim to it.
I've dealt with a few trademark (3) and copyright (7) infringements of my own and am handling one now for a client. I have no doubt he will end up with the domain name as the present registrant of 2 years has no legitimate claim to it and the domain name is the name of his business, registered with the state for 5 years. The present registrant is in the same state. Had they done an online search of Florida corporations, they would have picked up his company name and known they were infringing on his trademark.

Whether they knew or not, they will eventually lose the domain name, and legal action won't even be necessary. ICANNs UDRP will be enough. Upon my suggestion, my client offered to reimburse them for the domain registration fees. Since they have not responded as yet (it will be a week tomorrow), we initiate a URDP dispute and they can chalk the loss of $140 for domain registration fees (they renewed for 2 years at NSI) to being greedy and stupid.

Here are a couple of links that can provide some additional information:
http://www.uspto.gov/ U.S. Patent and Trademark Office
http://www.wipo.org/ World Intellectual Property Organization

Just because many of those high profile companies you mentioned haven't registered their domain names yet doesn't mean they are truly available. Someone could register them only to be forced to give them up when those companies asserted their rights to them, and lose the registrations fees they paid to boot.

I actually did a cursory run of our local phone directory and I could see that many high profile companies' names are still up for grabs.Registering those in the hopes that you'll be able to get those companies to buy the name from you isn't a good idea -- simply because they don't have to pay you, they can probably get the names from you through the arbitration process, as Duster explained.

The way to legitimately profit from domain name speculation is to buy names that are generic in nature, stuff like the famous "drugstore.com," for example. Buy names containing names of types of businesses, not specific company names. If they were still available, names like ebusiness.com, webhosting.com, autoracing.com, tradingcards.com all would be very profitable. Of course you won't find anything that obvious, but there are still plenty of not-so-obvious ones available.

Hi Mivo,

If you are pursuing a business plan of registering domain names with the purpose of eventually selling them, you may be in for a rough business that may drain your wallet(s). This has been tried in the past, and it was successful for some people in the early beginnings of the Internet, but not laws have been setup that specifically protect companies from this business. The act of registering a domain name before a company registers it, and not really put it to use, has been given many names ranging from hijacking a domain name to cybersquatting.

You may want to read this random article that we dug up for you, that may shy you away from pursuing the idea of company name domain name registering:

http://www.gigalaw.com/articles/isenberg-2000-11a-p1.html

It will show you that it is very well possible for you to be fined up to $100,000 per domain name that you 'register in bad-faith', and that there is indeed a law that you would be running against (ACPA) which has been in effect since 1999.

In other words, not only is it a very risky business that you have set your mind on, but it is most likely one of the worst investments that you can make, with a least amount of return (if any).

The suggestion by JayC (on this thread) is very valid; so, if you still want to take a chance on this, try to stay with neutral names - even apple.com would be okay, as long as it would not mislead the public (thus, you would not be able to sell computer-relate merchandise, most likely) and if the domain name would be available in the first place.

Thanks for your replies.

Indeed this is a risky business but there are still many grey areas on trademark infringements. One is each country has its own patent office and if a mark is patented in more than one country, and all of these will claim ownership of the domain name, which one will prevail?

I am doing a bit of reading on this subject right now and yes, it would be wise to register domain names that cannot be registered as a trademark like generic names and surnames.

As a sidepoint there is a landmark (and funny) case in the PI between the giant Philippine Long Distance Telephone Co. (PLDT) which monopolized the PI phone industry for years and Gerry Kaimo, who registered pldt.com and used the site to spoof PLDT itself. The trial is still ongoing.

Well, making a fortune on domain names maybe too late for me... or maybe not. Way back in 1996, I designed a local web site for Alta Vista Golf and Country Club to be included on the real estate section of my site. I checked altavista.com then and it was available but I backed out to pay the $70 to get the domain name when the country club itself refused to pay for it. This was before Digital launched its highly successful AltaVista search engine. Later of course altavista.com was taken by another person. I also read later that altavista.com was sold for $3.5 million to the present owners.

Originally posted by Mivo
Indeed this is a risky business but there are still many grey areas on trademark infringements. One is each country has its own patent office and if a mark is patented in more than one country, and all of these will claim ownership of the domain name, which one will prevail? That's a good point, but not really relevant if you're buying names for speculation. If you buy a name that's not clearly useful for anything other than as an existing company's name -- like those company names you saw in the phone book -- and you're offering it for resale you'll likely lose should you go to arbitration. If you actually try to sell it to that company, you've met ICANN's definition of "bad faith." If you don't use a name at all you'll have a hard time demonstrating that you have "legitimate interest" in it.

On the other hand, it's kind of expensive to file a domain dispute, so if you're selling name for less than it would cost the company to dispute it, they might just buy it from you anyway. It'd be hard these days to take a mcdonalds.com for thousands of dollars, but you might be able to get a couple hundred from some smaller businesses. The big corporations would probably just take you to arbitration on principle, to aggressively protect their trademarks, and because they're paying the lawyers anyway -- might as well give them something to do.

Originally posted by Mivo
checked altavista.com then and it was available but I backed out to pay the $70 to get the domain name when the country club itself refused to pay for it. This was before Digital launched its highly successful AltaVista search engine. Later of course altavista.com was taken by another person. I also read later that altavista.com was sold for $3.5 million to the present owners. Yeah, that $70 probably stopped a few people back then. Now that you can buy just a year, and for $10 or less, it's pretty easy to buy a domain on a whim.

I remember altavista used to only be available as altavista.digital.com, but I don't remember whether there was actually anything else at altavista.com before they started using it.

JayC, it was actually $100 back then not $70. Quite expensive isn't it?

Hi JayC,

Yes, altavista.com was a domain name owned by AltaVista Communications, if not mistaken. This was a seperate company, and Digital had to, most likely, buy the domain name from this company.

As for Mivo's question, which company has the right to a domain name, if the domain name contains a internationally trademarked name; the answer will not be of your concern, since the first thing that will most likely happen, is you having the domain name taken away from you, if you do not have a legal claim to it. Then the companies who have legal claim to it, will dispute the rightful owner - in which, you will no longer have any participation. You may want to contact your lawyer for a more precise and legal advice, but since you will most likely lose either way, you may as well just not get involved in the first place.