- Coinbase is suing Tobias Honscha on grounds that he has been using coinbase.de to make affiliate gains and refer users away.
- There are risks of phishing and coercive threats to purchase the domain under alleged bad faith use.
- The crypto exchange demands damages, control of domain names, and seizure of ill-gotten gains.
The American-based crypto giant, Coinbase, has sued a German man, Tobias Honscha, claiming that he had cybersquatted on the domain coinbase.de. In the case heard by a federal court in California, the lawsuit accuses Honscha of taking advantage of the established brand, as it had possession of a domain name that was nearly identical to the official site of the company, thereby causing confusion among users and profiting from the exchange’s reputation.
The complaint explains that Honscha redirected visitors of coinbase.de to a mobile application to trade in physical coins. In the past, there was an affiliate link to Coinbase on the site that earned Honscha commissions. Coinbase, however, states that this violated its affiliate agreement, which prohibits affiliates from engaging in the use of domain names containing the term, making it appear as though they have any kind of direct relationship with the company.
Allegations of Bad Faith and Coercion
Coinbase said that Honscha is operating in bad faith by taking advantage of the goodwill that Coinbase has developed since its inception more than a decade ago. When he was asked to stop using the domain as an affiliate, he changed his strategy and directed the users to services that had nothing to do with them, and used possibly deceptive email addresses with the domain coinbase.de in the end. According to Coinbase, this exposes users to phishing and other malpractices on the internet.
In addition, the lawsuit asserts that Honscha attempted to coerce Coinbase into purchasing the name by intimidating the firm with the possibility of phishing attacks and data loss in the event that the company declined to purchase the domain. Coinbase interprets these statements as a threat of some type that is intended to artificially boost the price of the domain.
At the moment, coinbase.de refers users to a forum for coin collecting, with Honscha listed as the person to contact for any questions or concerns. In addition to this, Coinbase is demanding that Honscha hand over management of the domain, pay any losses that have been incurred, and give up any financial gains that it has gained under the guise of misappropriation.
Protecting Brand Integrity in the Digital Age
The consistent problem with global companies such as Coinbase is cybersquatting, in which people purchase domain names that are close to existing brands in the hope of capitalizing on them or confusing consumers. The crypto exchange underlines that the practice can significantly harm the user’s trust and the reputation of the company.
