Domain Name News

Groupon Addresses Australian Cybersquatting Problem

Posted: 05 Jan 2011 11:06 AM PST

Groupon has addressed a question in their blog titled Why Groupon Isn’t in Australia. The short answer is a cybersquatter / competitor has registered Groupon.com.au and the Groupon Pty Ltd business name as well as filed for a trademark for Groupon.

The cybersquatter is Scoopon, a Groupon clone, which is owned by two brothers, Gabby and Hezi Leibovitch. This doesn’t appear to be an isolated incident either. The brothers also own Woot.com.au and redirect it to a site similar to Woot.com (a deal of the day site owned by Amazon). Their list continues with owning DealExtreme.com.au, DealExtreme.com is a popular deals site in the US, which redirects to their own deal website. Andrew Mason doesn’t express as much concern about the cloning issue, but the trademark infringement seems to cross a line.

Andrew Mason writes:

"The way we see things, this is a classic case of domain squatting – an unfortunate reality of the Internet business. As Groupon became internationally known, opportunistic domain squatters around the world started to buy local Groupon domain names, thinking that we'd eventually be forced to buy them at an insane price. In fact, we tried to do just that, reluctantly offering Gabby and Hezi Leibovich about $286,000 for the Groupon.com.au domain and trademark—an offer they accepted. But now they've changed their minds, and we believe that they'll only sell us the domain and trademark if we're willing to buy the entire Scoopon business from them. Left with no other options, we've filed a lawsuit against Scoopon, claiming that their Groupon trademark was filed in bad faith (amongst other things)."

Despite believing they could win the lawsuit, they still offered $286,000 for the domain name and trademark. The cost of litigation and the amount of time it would take to resolve the dispute before they could start building a business using their own name must have been factored into that price. Mason states it could take ‘over a year to resolve.’

Ultimately, Mason announces Groupon is filing a lawsuit against Scoopon and launching in Australia under the name a temporary name: Stardeals. His final message is directed towards Scoopon stating the $286,000 offer is still on the table and asks users to help persuade Scoopon to accept their original deal.

What do you think? Is trying to pay off the alleged cybersquatter for $286,000 is a savvy business move or sending the wrong message and encouraging others to follow suit?

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