In this case study video, I discuss the first UDRP dispute related to NFTs, or non-fungible tokens, which involved the domain name <nftmorganstanley.com>.
NFTs, or non-fungible tokens, have been described as a type of digital asset that exists on the blockchain — the same tool used for tracking cryptocurrency such as Bitcoin — which is essentially a public ledger that allows anyone to verify an asset’s authenticity and ownership. Every NFT has a unique digital signature, meaning that it is one of a kind, sort of like an original work of art or a collectible playing card. But NFTs are digital, which is why electronic works such as animations, photos, and audiovisual files, and even music are among the more popular NFTs.
The sudden attention around NFTs — including the widely reported sale of one digital image for $69 million — has created a tremendous market for NFTs, with copyright owners and collectors all cashing in on the craze.
Which means that cybersquatters, who also never miss an opportunity to cash in, are doing the same. This should surprise no one, after all, because cybersquatters often follow trends, from pornography to politics to the pandemic, looking for domain names that may quickly become valuable.
As I explain in the video about the <nftmorganstanley.com> case, the UDRP panel considered whether the domain name was confusingly similar to the trademark owned by the financial services firm, which claimed trademark rights dating back to 1935.
In its decision, the UDRP panel wrote:
The Domain Name consists of the Complainant's MORGAN STANLEY mark (which is registered, inter alia in USA for financial services with first use recorded as 1935), the acronym ‘nft’ meaning non fungible token and the gTLD “.com”.
The addition of a generic term and a gTLD does not negate confusing similarity between a domain name and a trade mark contained within it…. Accordingly the panel holds that the addition of the term ‘nft’ and the gTLD “.com” to the Complainant’s mark does not prevent confusing similarity between the latter and the Complainant’s mark.
Accordingly, the Panel holds that the Domain Name is confusingly similar for the purpose of the Policy to the MORGAN STANLEY mark in which the Complainant has rights.
In the rest of its analysis, the UDRP panel found that the registrant of the <nftmorganstanley.com> domain name had no rights or legitimate interests in it, and that the domain name was registered and used in bad faith. So, in the end, the panel not surprisingly ordered the domain name transferred to Morgan Stanley.
I wouldn’t be surprised to see many more UDRP disputes related to NFTs — especially if trademark filings are any indication. In just a little over two months, more than 50 applications have been filed for trademarks that consist of or contain NFT, in the United States alone. Indeed, at least two other UDRP cases were pending when this video was recorded: <comericanft.com>, which contains a trademark owned by a bank; and <geiconft.com>, which contains a trademark owned by an insurance company
And while these first NFT domain name disputes under the UDRP all involve financial services companies, any and every trademark owner is potentially a target of this newest cybersquatting trend.
