Trademark owners should not underestimate the harmful effects that cybersquatting has on their business and on the goodwill associated with their trademarks. Cybersquatters hope that trademark owners will simply ignore their misconduct as a minor problem. In reality, however, the problem is much more severe.

Cybersquatters count on Internet users going to their websites by mistake. Unfortunately, this is not a rare occurrence. A cybersquatted domain name can easily attract in excess of 10,000 visitors a month. And these are 10,000 people who intended to go to the legitimate website, but ended up at the cybersquatter’s website instead. The cybersquatted website presents these 10,000 people with advertisements, typically for competitors of the legitimate trademark owner. As a single example, the cybersquatted website www.Macyss.com—a clear infringement on the department store chain Macys—displays ads for Victoria’s Secret, Sears, and Ann Taylor.

Nor should trademark owners count on Internet users to re-enter the correct domain name once they have arrived at a cybersquatted website. The fact that a cybersquatter retains a domain name, in of itself demonstrates that consumers are not only visiting the cybersquatted website, but are also clicking on the advertisements. Cybersquatters buy domain names because they are profitable. If users are not consistently clicking on the advertisements, the cybersquatter will drop the domain name from its portfolio.

Moreover, data suggests that users become frustrated with the trademark owner when the user lands on a cybersquatted website. Users expect trademark owners to police the cybersquatting of their trademarks, to acquire domain names containing common variations of their trademarks, and to adopt easy-to-remember domain names. Users become frustrated when trademark owners have not followed these steps. The fact that a user has arrived at a cybersquatted website indicates that the trademark holder has not undertaken these efforts—and does not respect the user’s business.

Finally, trademark owners must worry about the effects of cybersquatting on the value of their trademarks. A failure to police such misuse can result in the abandonment of the claim against the cybersquatter, and even the abandonment of trademark rights generally. As such, trademark holders should not downplay the serious harmful effects of allowing cybersquatters to misuse their trademarks. Rather, trademark holders should actively police potential cybersquatting and take corrective action when such misuse is discovered.