United States: Ladas & Parry LLP Initiates Study of Online Infringement Practices Using Domains Acquired During .eu Landrush
Last Updated: April 18 2006

Chicago, IL - April 7, 2006 - Ladas & Parry LLP, an intellectual property law firm with over 90 years of experience protecting its clients’ brands worldwide, has initiated a study of abusive online practices. The study will include domains acquired through Ladas & Parry’s affiliate private corporate registrar, Ladas Domains LLC during the .eu landrush period as well as traditional gTLDs (.com, .biz, .org, .net, and .info). The .eu process, ripe with the type of abusive institutionalized practices that Ladas & Parry is attempting to study, is illustrative of the challenges intellectual property owners and the general public face online. These practices such as phantom registrars used to circumvent the first-come-first-served principle and domain speculators basing applications on spurious trademark rights, have caused great harm to intellectual property owners as well as the public at large.   

"Third parties that register domains that are the same or similar to trademarks pose the greatest threat to brand owners online because customers are diverted from the brand owners' website to search engine websites that often offer links to the brand owners' direct competitors, pornographic websites, or websites that install spyware on a pay-per-click basis" explained Marc Trachtenberg of Ladas & Parry and Ladas Domains.  Fred Meyers, a Partner of Ladas & Parry, points out that "a similar threat is posed by third party entities that purchase keywords on search engines consisting of trademarks so that their websites appear as sponsored search results, or modify the content on their websites so that they appear as natural search results."

 Internet users who accidentally mistype a brand name into their browser or click on a "sponsored" or natural search engine result are increasingly being diverted to web pages which appear legitimate but are in fact pages automatically populated with advertising links.  These links are generated by advanced semantic and heuristic techniques that extrapolate from the terms in the domain name or search term links likely to induce the Internet user to click on them.  When the Internet user clicks on the link, the domain owner receives a fee and the user is often directed either to the website of the legitimate brand owner’s competitors, a pornographic website, a website that automatically loads spyware onto the user’s computer, or another of these advertising pages on a domain owned by the same entity, trapping the user in an unending cycle of misdirection and pop-up ads.  There have even been instances where these "typosquatted" domains or search engine links lead to "phishing" sites where a fraudulent copy of a legitimate website is used to induce users to release confidential information such as usernames and passwords, social security numbers, credit card numbers, and bank account numbers.

It is estimated that these techniques generate millions of dollars of revenue for the parties that use them and can significantly damage a brand owner’s online presence and revenue, as internet users buy from competitors or simply get frustrated and never seek out the brand owner’s legitimate site.  Predictably, the providers of services that generate these advertising pages and the search engine operators have refused to disclose their methodology, which has prevented brand owners from developing effective techniques to prevent others from illegitimately profiting from their goodwill online. 

It is for precisely this reason that Ladas & Parry has chosen to undertake this study.  Ladas & Parry intends to use these services and analyze the resulting data, ultimately releasing this information to the intellectual property community and the public at large to increase understanding and decrease the effectiveness of these practices.   

Experts in the field and scholars interested in participating in the study as well as other interested parties should contact domainproject@ladas.com

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