The case takes
Name.com and Spot Domains to task over the relatively new
phenomenon of 'domain tasting'. This is the practice of registering
domains for five days then cancelling those that do not attract
enough traffic. Taking advantage of a five day cancellation period,
that practice costs the registering party nothing.
Within that five day period, adverts are
published on the pages, and any page that receives enough hits to
earn more than the $6 per year domain name registration fee is kept
and paid for.
Often the pages involved are slight
misspellings of famous names or trade marks which attract people
who incorrectly type addresses into their computers.
The case accuses the companies of
cybersquatting, trade mark infringement, false designation of
origin, and unfair competition in the District Court for the
District of Colorado. It says that some of the domain names
registered and offered for sale by the registrars were "confusingly
similar" to trade marks that belonged to Neiman Marcus.
The
suit also says that the sites were used to display adverts for
competitors to Neiman Marcus. It says that the registrars had no
legitimate or fair use of the domain names and did not trade under
any name similar to the domains it registered, which included
neimancmarcus.com and neimanmarcucs.com.
"Neiman Marcus allege[s] that Defendants' acts
are wilful and malicious, and intended to injure and cause harm to
Neiman Marcus," said the court documents lodged by the firm. It
claims damages of $100,000 per domain name registered, which means
that the total requested damages amount to more than $4
million.
The suit goes on to say that because the
alleged behaviour of the two registrars was wilful, Neiman Marcus
is entitled to have its damages trebled, to over $12 million. In
addition to those damages, it says that the company will ask for
damages relating to trade mark dilution and infringement, the
amounts of which will be determined at trial.
Neiman Marcus has already taken a successful
case against another registrar, Dotster Inc, which that company
settled by promising not to register any domains connected to
Neiman Marcus or its subsidiary retail chain Bergdorf Goodman.
The practice of domain tasting is said to be
increasingly widespread, because companies can set up automated
systems to register hundreds or even thousands of domains and
de-register them automatically. Reports claim that up to six
million domains are tied up in tasting systems at any one time.
