Microsoft sues 'cybersquatters'

updated 4:54 p.m. ET Aug. 22, 2006

NEW YORK - Microsoft Corp. said it has filed three lawsuits against "cybersquatters," in an effort to fight back against a surge of online trademark infringement by people seeking profit from pay-per-click advertising.

The Redmond, Wash., software giant said cybersquatters and typosquatters — people who register Web addresses either with trademarked terms or with common misspellings in the hopes of luring Web surfers who mistype addresses into their browsers — are now registering more than 2,000 domains each day targeting Microsoft.

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The vast majority of the sites, which have addresses like "microsoftrebate.com," "xbox36com.com" and "msnfinance.com," are bought by professional operations that place nothing on the pages but pay-per-click ads served by online-ad networks, Microsoft said. About a quarter of the sites use privacy services to disguise their identities.

"Microsoft has witnessed a virtual land rush for Internet domain names with the goal of driving traffic for profit," said Aaron Kornblum, the company's Internet Safety Enforcement attorney. The company noticed the surge in sites earlier this year as part of its efforts to monitor so-called phishing sites, which mimic bank and other sites as part of identity-theft schemes.

In response, Microsoft filed two civil lawsuits Monday against four defendants it said are profiting from domain names that infringe on Microsoft trademarks. One filed in U.S. District Court in Utah alleges that Jason Cox of Albuquerque, N.M., Daniel Goggins of Provo, Utah, and John Jonas, of Springville, Utah, together registered 324 domain names targeting Microsoft. The defendants do business as Jonas and Goggins Studios LLC and Newtonarch LLC.

In the second suit, filed in U.S. District Court for the Central District of California, Microsoft alleges that Dan Brown of Long Beach, Calif., whose firm is Partner IV Holdings, registered 85 domain names targeting Microsoft.

The company also filed a "John Doe" lawsuit in the U.S. District Court for the Western District of Washington. The suit is aimed at identifying cybersquatters and typosquatters who conceal their identities, and Microsoft said it will soon issue subpoenas to domain-name registrars.

Microsoft argues that the Web sites are forbidden under the Anticybersquatting Consumer Protection Act. That law, which was signed into law by President Clinton in 1999, imposes fines of up to $100,000 in damages for anyone who, with bad-faith intent to profit, "registers, traffics in or uses a domain name that is identical to, confusingly similar or dilutive of" an existing trademark, according to Microsoft. The suits also cite state laws and common law forbidding unfair competition.

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