Costs of fighting the big guys for domain names

Forbes writes of a dispute between eBay with sales of US$1.8 billion per year, and Perfume Bay, an online fragrance retailer with annual sales $17 million. eBay is protesting against Perfume Bay’s use of the word “bay” and “are making sure that Perfume Bay cannot be confused with eBay in any way and that customers are clear that if they purchase something off of Perfume Bay, they are not protected in any way by the consumer protection programs eBay has in place,” says Catherine England, an eBay spokeswoman.A bit of a David and Goliath battle this one. I find it a little hard to see eBay winning this one. But, back to Forbes’ story. Forbes says “Jacqueline Tran, Perfume Bay’s founder, first felt eBay’s concern about her customers in 2003 when she received a cease and desist letter saying that the Perfume Bay name and domain name, www.perfumebay.com, violated the eBay trademark. She chose to fight rather than change her company name. ‘I hired an attorney to respond. I felt this was without merit,’ says Tran. ‘I’ve never had anything remotely close to eBay.'”And then Tran changed her domain name to perfume-bay.com as an initial compromise, but this cost her 12 per cent in turnover. It’s also cost her $100,000 in legal fees, along with a waste in marketing and diminished search engine rankings.For small business, this type of battle can be catastrophic. Forbes says, “In 2005, the Small Business Administration estimated that each lawsuit would cost $50,000 to $100,000 in legal fees just to get to trial. Lawsuits also mean hours diverted from the daily operations of the business that could add up to years.”To see the complete article in Forbes, click here.
http://www.forbes.com/entrepreneurs/2007/10/05/lawsuits-litigation-sba-ent-cx_ll_1005lawsuit.html