An Australian technology consulting firm claimed Monday it had won a court-endorsed triumph over a cybersquatter, the first such local legal victory.
After scaring off a couple who had registered domain names similar to its own, Melbourne IT, a large domain-name registrar and consulting firm, boasted that "domain-name pirates will not be tolerated by the Australian legal system."
The battle wasn't tried in the courts. Melbourne IT's self-proclaimed victory was little more than a legal filing that the defendants didn't challenge for fear of a protracted legal battle.
Defendants in the case say the only thing that the skirmish proves is that big companies can use legal muscle to strong-arm smaller companies, and although Melbourne IT's CEO is proudly trumpeting the news, his solicitors say that both he and news reports about the victory may be overstating its importance. "Insofar as a comprehensive court decision, we await that," says Natalie Hickey, Melbourne IT's attorney. "In relation to cybersquatting, it was very important for [Melbourne IT] to be seen to be doing something."
Hickey says that the company was anxious to make an example with this case, "something that sends a message". Defendant Neil Pentland, owner of the ISP that hosted the offending site, bristles at Melbourne IT's tactics. "They rang us, and within 15 minutes, we took it off [line]," Pentland says. "That made no difference to them, they went ahead and filed anyway."
Pentland's clients, Simon and Marilyn Strauss, had registered a number of .com domain names, including Melbourne-IT.com, IT-Melbourme.com, and ITMelbroune.com. The couple had listed these and other domain names for sale on a Web site hosted by Pentland's company, AtNet.
Although Melbourne IT owns the domain name MelbourneIT.com.au in the Australian domain, CEO Peter Gerrand says he wanted to register a less cumbersome .com name. Since MelbourneIT.com was taken by a consultant in England, Gerrand began looking at variations of the name.
He quickly discovered the Strauss' site, and had the company's solicitor draw up a trademark infringement brief.
Pentland says he and the Strausses were given no choice but to sign away rights to the name. Fighting the brief would have been too expensive for such a small company. Pentland says he was advised that a lawsuit could cost him as much as $100,000.
"They said if we signed this statement (admitting culpability), they wouldn't proceed," Pentland says. "I didn't know they were going to tell the world we were bad guys."
Pentland argues that Melbourne IT only has rights to its name in Victoria, not in Queensland, where his company is based, or even in the world at large.
The controversy comes just after legislation was passed in the US Congress allowing trademark owners to recover damages in instances of cybersquatting. Gerrand says that renewed interest in cybersquatting last week prompted him to take his story to the press.