PetSmart acquired Pet360 for $130 million in cash and up to $30 million more in future performance-based payments.
The online retailer of replacement parts wins a ‘typosquatting’ case against Spoofy.
RepairClinic.com Inc., an online retailer of replacement parts for household appliances, vacuum cleaners, lawn mowers and similar equipment, has won a ‘typosquatting’ case against Spoofy Inc., a California-based firm.
Typosquatting refers to the practice of a company operating a web site whose address is a common misspelling of a retailer’s legitimate e-commerce site. In this case, Spoofy claimed ownership of repairclinc.com” —the “i” is missing between the “n” and the “c”. The World Intellectual Property Organization, a United Nations Agency, awarded ownership of the misspelled web address to RepairClinic. The illegitimate site no longer appears, and has only a message saying “the page you requested was removed.”
RepairClinic.com began its online business in 1999, says a spokeswoman for the retailer; the legitimate site is a federally registered trademark. The merchant filed a complaint with the U.N. agency, commonly called WIPO, in January after first trying to contact the Internet service provider that hosted the illegitimate site but receiving no answer. In a decision handed down in late March, Jeffrey Kaufman, the sole WIPO arbitrator judging the case, ruled that Spoofy registered and used the domain name in bad faith.
“The domain name has no independent dictionary meaning and has apparently been used to host a pay-per-click site with links to (RepairClinic.com’s) competitors,” Kaufman states in the ruling. In a report released last year, consulting firm FairWinds Partners identified 2,675 domain names that receive traffic from one-character misspellings of the domain names of the 25 major retailers it studied.
Spoofy could not be reached, and the company did not respond to notification from WIPO about the case. RepairClinic.com sought no damages from Spoofy, the spokeswoman says. “The cost to recover damages was too great compared to the estimated losses,” she says. RepairClinic.com estimates that it lost thousands of dollars in revenue as a result of traffic going to the illegitimate site; it is unclear when Spoofy launched that site, but according to the WIPO ruling, RepairClinic.com was aware of the other site no later than Nov. 11, 2010.
The online retailer spent $3,500 fighting the case: $2,500 to file the case with WIPO, and $1,000 for an attorney, the spokeswoman says. “That’s a lot of money for what is essentially a simple set of formalities,” she says. “It could have cost more had Spoofy fought the case.”
RepairClinic.com’s victory offers an important lesson for other e-commerce operators, the spokeswoman says.
“For e-commerce companies it doesn’t take very many misdirected clicks to accumulate significant losses. Use readily available tools to estimate the traffic to a typo domain in order to determine the potential lost revenue,” she says. “If the typo domain is very similar to a trademark, it is very likely WIPO will rule in favor of the trademark holder. And it’s unlikely the typosquatter will fight the case because of the high probability of losing the case.”