I have heard about big companies suing people who purchase domains that they have trademark protection for. Is this true ? If so, won't the original domain holder not get back the amt he initially paid for ? Thanks
It would depend on if there was something in the contract that covered a refund - and I would say 99% do not and the buyer would be out the money. If the seller had been notified of the trademark infringement and failed to mention it, you might have some legal recourse, but unless you are talking about tens of thousands of dollars, it probably wouldn't be worth the legal fees to go after them. You do not have a right to use a trademarked name for a domain just because you own it. Any buyer should at least go to the USPTO and check for a Federally trademark registration. A Federal trademark is NOT required to own rights to a trademark - however, most larger companies file for a trademark to cast their rights "in stone", establish first usage date, and to try and prevent infringement problems. The first to use, for that particular use, and continue to use, has rights to that name (provided it is not a generic term not able to be trademarked). For a few hundred dollars, you can have a trademark search done to see potential infringement - but even that is not 100%. Trademarks are granted by classification. Some companies have broad protection in many or all classifications (IBM) where any use of the name is going to be infringement. You can't use a name like AMAZON even if you add to the name if the content is going to conflict with the trademark holders. If you were doing a site that had its content about the river, then it likely wouldn't be infringement. If you are trying to ride the name of a large company (i.e. use "MySpace" in you domain name) and have content that is related or about "MySpace" then you are infringing upon their trademark and will also be subject to a C&D and damages. With Federal Trademarks, you can also be required to pay treble legal fees for the trademark holder.