Cybersquatting is the act of registering, trafficking, or using an Internet domain name in bad faith, specifically with the intent to profit from the goodwill generated from the trademark of another. Cybersquatters generally rely on generating profits from the sale of domains to trademark owners at an inflated price. Cybersquatters may also register domains that are not identical to the trademark in question, but are similar enough in spelling to persuade the trademark owner that acquisition of that domain is necessary as well. This practice is known as typosquatting.
Likewise, with the advent of social media platforms, other versions of cybersquatting have evolved such as username squatting. Cybersquatting reemerged as a major issue in 2014 when the new generic top-level domains were released.
Anti Cybersquatting Act and Anticybersquatting Consumer Protection Act (ACPA)
Some jurisdictions have laws that address cybersquatting. For example, the United States passed the Anticybersquatting Consumer Protection Act (ACPA) in 1999. The ACPA, an expansion of the Lanham Act (federal trademark law), provides for a cause of action if someone is found to be registering, trafficking in, or using a domain name that is deemed to be confusingly similar to, or dilutive of, a trademark or personal name. The Federal Trademark Dilution Act has also been historically used to sue domain name registrants that use domains deceptively, such as if they are used to palm off the goodwill of established trademarks.
Despite federal legislation, however, consumers should note that to establish a cybersquatting claim, the mark involved in the domain must generally be considered a distinctive or famous enough mark to warrant protection. Consumers cannot file claims of cybersquatting simply because they covet a domain name.