This is the fourth part of our guide dedicated to Cybersquatting, if you have missed the other parts you can read them:
- Top 5 Domain Name Scams - Cybersquatting Guide (1/5)
- ICANN Procedure - Cybersquatting Guide (2/5)
- How to Negotiate your Domain Name - Cybersquatting Guide (3/5)
You have tried the first two solutions and none of them were successful, in this case the last remaining solution is to bring your case to the court. The process is much more difficult than for the previous ones and you may be surprised with the results.
In this guide we only focus on the solution that exists for customers dealing in China.
1. Which Court Jurisdiction Will Be Chosen?
1.1 Between Chinese Companies
The first issue to solve is the choice of the court jurisdiction; if the new owner is in the same country as yours then you can choose between your local city jurisdiction and him. In case the two parties are bound with a contractual statement, it is very likely that the choice of the court has been clarified through an agreement in advance known as a choice of law agreement.
In China, In the context of the Internet and IP cases the general rules which have emerged (especially in the copyright area) based on existing laws and cases are that jurisdiction will be found at the place where:
- The defendant is domiciled or the Hukou will be used if a Chinese person in involved
- The equipment (such as the server or computer terminal) by which the tortuous acts is committed, is located; or
- In domestic cases, if the previous two are unidentifiable or difficult to determine, the equipment (such as computer terminal) by which the plaintiff finds the infringement, is located.
- The primary place of business for a legal person or where the company is registered
In a situation in which the activities extend beyond the boundaries of any one state and where potentially conflicting laws could may appeared, the court needs to determine which law has to be chosen. The rules used by the court to choose the one to apply are known as the choice of law rules.
If the situation involves foreign elements (Shewai cases) then the foreign law may be applicable under certain conditions within China. While dealing with claims for damages, the law of the place where an infringing act is committed must be chosen.
1.2 Shewai Cases - Cases Involving Foreign Parties
Under the Chinese law, a set of provisions are applicable to civil proceedings involving foreign elements, Shewai cases, within the territory of China. Shewai cases refer to cases where:
- One or more parties involved are a foreign natural or legal person or organization; or
- The legal relationship between the parties establishes, changes, suspends or occurs outside the territory of China; or
- The place of the object of litigation is based outside mainland China.
If the defendant has a representative entity within China, the case would be under the jurisdiction of the Chinese court where the property is located, where the company is registered or where the tort happens.
Local Parties: In most of the cases involving only local parties, it appears that the place of the equipment (computer or server) by which the plaintiff finds the infringement will only be a part of the procedure in cases where it is hard to determine exactly the domicile of the defendant or the location where the equipment (server or computer) in which the act committed is located.
Foreign elements: In most of the cases which only include foreign elements, it appears that the place of the equipment by which the plaintiff finds the infringement will be the primary fact to be taken into consideration for the choice of jurisdiction in order to allow the Chinese courts to proceed.
An involved party may apply to a Chinese intermediary court for the enforcement of a judgment made by a foreign court provided the Chinese court has jurisdiction. Moreover, under international treaties in which China is a signatory party or the principle of reciprocity, a Chinese court may enforce foreign judgments upon the request of a foreign court.
2. Domain Name Court Procedure: Advantages
- While with the UDRP you cannot ask for damages and any compensation resulting of the bad use of your domain names, under the court procedure you may receive a financial compensation.
- You can use the UDRP procedure and even if you have been granted the use of your domain name, you can later go to court and claim financial compensation and present the result of the UDRP as evidence in a court case.
- If the loss of your domain name is a matter of time, you can directly seek an urgent injunction from the court, which may be given in few days but in this case the costs will increase very quickly.
- Contrary to the UDRP procedure, which can only be used if you have the rights on a domain name, court action can be started on other fields such as intellectual property rights, trademarks, copyrights, …
3. Domain Name Court Procedure: Disadvantages
- The procedure takes, very often, a lot of time and will probably need several procedures and interventions in order to establish the final decision.
- It’s much more costly than the URDP process and the situation is highly uncertain.
- Before starting any international dispute, do not be surprised if the defendant (if you are the claimant) would present arguments to the court explaining why it should not hear the case.
- In the same manner, the defendant can claims that you have chosen the wrong court jurisdiction and while interpreting the law propose a new court jurisdiction.
- It may be difficult or even impossible to enforce judgment, particularly against individuals or companies based outside of China.
Be sure to read th last part of our cybersquatting guide as you will learn some useful tips and advices to avoid troubles with your domain name: 20 Advices to Secure your Domain Name - Cybersquatting Guide (5/5)
This is the second part of our guide dedicated to the Cybersquatting, if you have missed the other parts, we strongly advise you to read them:
- Top 5 Domain Name Scams - Cybersquatting Guide (1/5)
- How to Negotiate your Domain Name - Cybersquatting Guide (3/5)
- How to Recover Your Domain Name in Court - Cybersquatting Guide (4/5)
- 20 Advices to Secure your Domain Name - Cybersquatting Guide (5/5)
Cyber-Squatting: ICANN Procedure
First, do not worry, you are not the first one to handle this issue and several solutions are available and you can try them one by one in order to take back your domain name. The possibilities are as following:
- ICANN Procedure,
- Trade with the new owner,
- Court Procedure
1. ICANN Procedure
This international policy results in an arbitration of the dispute, not litigation. An action can be brought by any person who complains (referred to by ICANN as the "complainant") that: This arbitration mechanism has proved to be an effective way to gain control of domains for many trademark holders, but success is by no means certain.
1.1 ICANN Procedure: Explanation
Considering the specific circumstances of each case, the World Intellectual Property Organization (WIPO) appoints one to three panelists to review the dispute and issue a decision. The review will take from 30 to 60 days and will be published publicly.
Each panelist must confirm that they are not linked by any manner with each of the parties involved and explicitly reveal in a written statement all information that should be considered prior to appointment. If one of the two parties has some concerned about the viability of a panelist, WIPO will consider offering a replacement.
In order to successfully win an UDRP case, you need to convince the arbiter(s) of ALL of the following three elements:
- A domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights
- The domain name owner has no rights or legitimate interests in the domain name, and
- The domain name has been registered and is being used in bad faith.
All of the elements listed below must be established in order for the complainant to prevail. In the case of the complainant prevails, the domain name will be canceled and directly transferred to the complainant. In order to start the procedure you will need to give the following information:
- The domain name in question
- The registrant of the domain name
- The registrar with whom the domain name was registered
- The grounds for the complaint
Be aware that if the current registrant has re-registered “your” domain is not relevant enough for this procedure. Also, keep in mind that most of the cases brought by trademark holders which do fail, will fail because the trademark holders cannot prove that the domain is being used in bad faith. In this case, you need to prove that the current registrant has offered to sell the domain name; either by emailing you and explicitly proposing to sell the domain name or that he has displayed an announcement explaining its wish to do so.
If you want to start a dispute, a legal counsel is neither compulsory nor required even though it is recommended. The cost of this procedure depends of the number of panelists that you or the respondent is hiring and can be executed through different services like the WIPO or e-Resolution. Also, bear in mind that many of the professional domain speculators will have more experience with the UDRP than you, and will try to use this to their advantage. They know how to deal with this procedure and will use everything they can to not lose “your” domain name.
According to the WIPO organization, from 1999 to 2007 it was stated that 84% of all the procedures were decided in the complaining party's favor. If you are involved in any domain name dispute in which a .cn or .com.cn is implied, you should contact the Asian Domain Name Dispute Resolution Centre (ADNDRC) which is the accredited organism by ICANN as dispute resolution provider in China.
1.2 Advantages of the Dispute Resolution Procedure
- The UDRP process is faster than most of the court related judgment; decisions are given between 30 - 60 days from the day the complaint has been filled.
- The cost of the procedure depends of the number of panelist and domain names involved. It cost around $1,500 for a single panelist and $3,000 for three panelists for a complaint involving up to five domain names. If the complaint involves between 6 and 10 domain names, it will cost USD$2000 if the decision is taken by one Panelist to USD$5000 if decided by 3 Panelists. You can find the list of the official accredited panelists in China here.
- The complainant is usually responsible for paying the fees. However, if the complainant chooses to have the complaint decided by 1 Panelist but the respondent chooses to have the complaint decided by 3 Panelists, then the respondent will have to pay 50% of the fees.
- In exceptional circumstances, either the Panel or WIPO may ask the parties to make additional payments to settle the costs of the administrative procedure. For example, if there are more than 10 domain names in dispute.
- The dispute resolution procedure doesn’t imply any jurisdictional issue which is very interesting as most of the registrants aren’t based in the same country. So you do not need to worry under which law and which jurisdiction you need to start a court-procedure.
- Last advantage, as soon as your start to fill a complaint it will also immediately prevent the registrant from transferring the domain name to any other person or company until a decision has been reached.
1.3 Disadvantages of the Dispute Resolution Procedure
- Contrary to a court, panelists are never bound to any of the previous decisions made and, based on this fact, will take their decision only on the present situation.
- As a consequence, the WIPO has launched an internet information tool in March 2005 containing information and trends of the past decisions to improve the certainty of future decisions.
- Decisions using the UDRP are also not binding on courts and proceedings can be initiated after the panel has published its decision and panelists have no power to issue emergency injunctions.
- The panel’s decisions cannot be kept confidential unlike other Alternative Dispute Resolution possibilities (ADR). This has to be taken into consideration as a company may wish to avoid adverse publicity especially as it can be harmful your brand’s reputation.
- The UDRP isn’t able to process all the disputes but only the generic Top Level Domains (gTLD) such as .biz, .com, .info, .name, .net, and .org.
- The disputes concerning country code Top Level Domains (ccTLD) such as .co.uk, .com.cn (China) are managed by the individual country registry.
The next part of our guide is dedicated to the second solution available to take back your domain: