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Rachael Ray Lasers Delayed Indefinitely: An Update on the State of Cybersquatting

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It looks like we're all going to have to wait a little while longer to purchase our Rachael Ray lasers. At the very least, we're not going to be able to order them online any time soon.

Cybersquatting is a practice as old as the Internet. It generally involves one party, the squatter, using the trademark or personal name of a well-known brand or person to register a website domain name. The squatter seeks to profit from the domain name by either ransoming the domain to the rightful owner or by exploiting individuals who inadvertently wind up at the fake website. There are a few variations of cybersquatting, one of the most common of which is typosquatting. A typosquatter registers the misspelled trademark or personal name of a well-known brand or person. Then, when a careless web surfer types the misspelled name into their browser he or she is directed to the typosquatter's website (which invariably contains an advertisement or malware).

Ultimately cybersquatting is a form of trademark infringement or trademark dilution, and there are a number of ways that trademark owners deal with cybersquatters. In 1999, Congress passed the Anticybersquatting Consumer Protection Act which established a new cause of action designed to address this practice.
"A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark under this section, if, without regard to the goods or services of the parties, that person..." The problem with using the Act against cybersquatters is the Act requires the injured party to initiate a lawsuit in federal court, which is never a cheap process. Using the federal courts to protect domain names is especially problematic because most squatters are "judgment proof," a term used to describe defendants who simply do not have the money or assets to pay a judgment entered against them. In other words, even if you win your case against the squatter, you might not be able to collect any damages. Another big problem with cybersquatter lawsuits is that the squatters are often located abroad.

In order to avoid some of these problems, ICANN, the entity responsible for managing domain names, has established the Uniform Domain Name Resolution Policy or "UDNRP." The UNDRP is a non-binding arbitration process that allows trademark holders to resolve domain disputes much more cheaply than prosecuting a federal lawsuit. The UDNRP generally requires the trademark holder to show that the squatter's domain (a) is confusingly similar to the holder's trademark; (2) is controlled by a third-party; and (c) is being used in bad faith.

What does any of this have to do with Rachael Ray? Ms. Ray recently instituted an UDNRP arbitration proceeding against an Indian company that had registered www.rachelray.com (note the missing "a"). Ms. Ray contended that the disputed domain was being used to, "redirect customers to a website that offers 'Rachael Ray' cookware and... attempts ultimately to obtain personal contact information about Internet users undoubtedly looking for the [Ms. Ray's] website."

The arbitration panel issued its decision a few days ago, and it is noteworthy because of the convoluted defense advanced by the squatter. The company claimed that it selected the name "Rachel Ray" for its business "because the daughter of the technical partner of the original firm was named 'Rachel,'" and because the business manufactured laser rays. The company would have used the name "Rachel Lazer," it claimed, but "for reasons related to the practice of numerology, there was a decision to switch to 'Rachel Ray.'" The arbitration panel quickly dismissed this explanation, noting that the squatter could not show any evidence that it ever manufactured or sold lasers. "[T]he Panel discerns an obvious omission in Respondent's business presentation: there is no reference to sales volume or revenue in connection with its products. The Respondent presents to the Panel only a paper facade of activity."