Risk Management

In Pursuit of Cybersquatters

What's in a name? Hamburger giant Wendy's International Inc. is about to find out.
Kris FrieswickNovember 1, 1999

What’s in a name? Hamburger giant Wendy’s International Inc. is about to find out. Wendy’s recently filed a lawsuit against Beswick Adams Corp. for allegedly registering a number of Internet domain names (Web addresses, such as www.wendysrestaurants.com) that were closely related to its trademark, for the express purpose of trying to sell them back to the company. It’s a practice known as cybersquatting.

Current trademark law prohibits a company from registering a name that exactly duplicates a registered trademark, but cybersquatters frequently register names that are only slightly different, knowing that Web surfers often will type in a variation of a company’s name when searching for its site. They then either attempt to sell the names or use the sites to disrupt the company’s commerce.

“When you’re searching for our site, you could type in wendysrestaurants.com, and you’d get their site, not ours,” says Denny Lynch, vice president of communications for Wendy’s. “Whether they’ve infringed on our trademark specifically is for the lawyers to figure out.” The issue also is being examined by the International Trademark Association (INTA), the World Intellectual Property Organization, and the Internet Corporation for Assigned Names and Numbers. These groups are attempting to draft a clear definition of cybersquatting so that laws can be passed against it.

However, too broad a definition might prohibit individuals from registering domain names for legitimate purposes, says Michael Heltzer, government-relations manager at the INTA. For instance, labeling and consumer-goods giant Avery Dennison Corp. recently lost a lawsuit in which it attempted to block FreeView Listings from using dennison.net and avery.net, two domain names that it had registered as part of an online business that creates E-mail addresses based on family names. The Ninth Circuit Court of Appeals ruled in August that the names were common enough that Avery Dennison could not claim exclusive use.