Yesterday, Karmaloop won ownership of three domain names occupied by cybersquatters. The domains <karmaloup.com>, <karmamloop.com>, <marmaloop.com> were in dispute.
I had the opportunity to speak with CEO and Founder Greg Selkoe over the phone, who described Karmaloop as a “lifestyle and media company”, and pointed out the over $130 million in revenue his company achieved in the last year. Of course, a company of Karmaloop’s stature will have its imitators, as well as persons who will try to profit from Karmaloop’s success through cybersquatting.
In a UDRP action filed on August 11, 2011 by CitizenHawk on behalf of Karmaloop, Karmaloop alleged that the domain owners engaged in bad faith disruption of Karmaloop’s business due to the fact that the infringing domains contained links to Karmaloop’s competitors. The Panel thought so as well, holding that the cybersquatter’s “inclusion of links to [Karmaloop’s] competitors on its websites constitutes bad faith disruption of [Karmaloop’s] business.”
Due to the existence of links to Karmaloop competitors on the cybersquatter’s domains, the Panel assumed that the cybersquatters were collecting click-through fees. This is notable because the Panel used this reasoning to establish that the domain owners were commercially gaining from the confusion caused by the similar domain names, and thus a violation of the UDRP Paragraphs 4(c)(i) and 4(c)(iii) (lack of rights and legitimate interests in the domain).
The combination of domain names which are almost identical, along with advertising of direct competitors, is a scenario the UDRP seeks to discourage. <karmaloup.com> and <marmaloop.com> only exchange one letter from Karmaloop’s trademark, and <karmamloop.com> only adds one letter. These types of minor, single-letter changes to a trademark are typically held by UDRP panels to be insufficient to claim that a domain is distinguishable from a trademark owner’s mark.
The internet is a great space for innovative business tactics, but it is also a place for innovative foul play. In the world of domain names the UDRP is a way for those who engage in fair business practices to take control of their brand and business, and prevent the uninventive from free-riding.