Domain Names Considered Property: Protect Your Domains

Mike Valentine

21 years ago

Your Piece of Cyber Real Estate
By S. Denise Hoyle

In a landmark case, the 9th US Circuit Court of Appeals has just stated that domain names, despite their virtual nature, should be treated exactly as a "plot of land" would be. This is a huge victory for all domain name registrants, not just for Gary Kremen who can now continue his lawsuit against Network Solutions for allowing the theft of his Sex.com domain name. NSI had argued that domain names are intangible property and therefore they could not be held liable for damages. (Kremen vs. Cohen Case #01-15899)

This ruling means that traditional property protections can now be legally applied to domain names. Further, the ruling firmly establishes that domain names are valuable properties and shows that old-fashioned property laws also apply to the registration of web addresses.

While this ruling may also aid victims of electronic fraud and identity theft, this article focuses on the impact on domain rights. Since domain names are now officially looked upon as cyber real estate, domain holders should be aware of their rights and take steps to protect them. For instance, a domain name can be extremely valuable on its own – as examples business.com sold for $7,500,000 and loans.com sold for $3,000,000. Domain names can also have a “value in use” – an example of this might be google.com, which doesn’t have a defined meaning and probably wouldn’t be worth very much on its own, however it provides a valuable service and is ranked #5 in traffic on the internet and as such has a very high value in use.

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Just as your home or other property is considered to be an investment, so are your rights to a domain name. In the event of your death your domain rights will become part of your estate. If you were to get a divorce, it may be left up to the courts to decide who gets to keep the domain name, and whether one party will need to pay the other party for half of the value of the name.

Since your domain name is your piece of cyber real estate, it should be valued in the same fashion as your home or other property would, using the same tried and true principles. Additionally, you should take any necessary steps to protect your domain as you would your other properties – such as including your wishes regarding your domain name in your will. Although registrars are now legally responsible for safeguarding the rights of domain name holders, domain registrants should also take all available steps to protect themselves.