After a company registered 633 domains relating to the telco

Aug 27, 2009 09:12 GMT  ·  By

Cybersquatting can be a big business for the shady parties that engage in it but for one company it may not have been such a wise move. A federal California court has upheld a previous ruling that awarded $33.15 million in damages to the US telecommunications company Verizon to be paid by a company that registered hundreds of domain names similar to Verizon brands or products.

The suit has a longer history and was first filed in June 2008, as reported by The Register. Verizon claimed that OnlineNIC, the company responsible for the cybersquatting, registered 633 domains with names like erizononline.com, myverizonwireless.com, 123verizonphones.com and iphoneverizonplans.com, and the telco was looking for retribution claiming that the false web sites were misleading to its customers.

Cybersquatting is the act of registering domain names similar to the names of real businesses, brands or even celebrities and then creating web sites at those domains filled with advertising, pop-ups and in some cases even malicious code in the hopes that users will, unwittingly, stumble upon them while searching for the genuine brand. OnlineNIC did just that, filling the pages with ads that the lawsuit claimed generated revenue for the company.

In December 2008 a federal court in Northern California found for Verizon and ordered the defendant to pay $50,000 for each infringing domain name, adding up to $33.15 million. The problem at the time was that the real culprits behind the domain name registrations weren't found, as OnlineNIC had obfuscated ownership scheme.

Only after the ruling did the owner of the company, Rex Liu, surface, but even then it took until February 2009 for OnlineNIC to appear in front of a court when it filed a motion to be relieved of the ruling. The company's claims that the damages far outweigh any revenue it has made from the domains, allegedly only $1,468.60, and that the trial should be held before a jury were dismissed by the presiding judge, who ordered the company to pay for Verizon's attorney fees as well. Still, Verizon is highly unlikely to actually see much of the $33 million.