domain names business

[smallcompany]

I typed .com version of a local sport club (non-profit) and got a parked page (the one with squares and with green and purple being main colors). All links go through “information.com”. I knew the original site was live some time ago, so I did WHOIS and found some “Portfolio Brains” owning it. Bit more research and I came across an agreement between this company and Tucows about sale of “certain domain names” for $983,713.00

What the heck is this business about? Is this some kind of domain interceptor making money based on the history of domain names (site traffic)? Do they simply take domain names that had decent traffic and monetize them by having people clicking on links and they get paid for those clicks? Or they try to sell them back for multiplied price?

I feel unprotected when I start thinking what else is happening out there. I remember some regulation kicking in about grace period that was abused.

[callivert]

Do they simply take domain names that had decent traffic and monetize them by having people clicking on links and they get paid for those clicks?

Bingo. The club let the domain registration expire (silly them), some domainer picked it up, and now they're making money off advertising. It's just one big billboard now.

The world of domain names is the wild west.

[smallcompany]

OK. Fair enough unless they somehow get the deal to get certain domains before anyone else.

Is that possible?

Furthermore, on the note of TMs, isn’t against the law to make money based on someone else’s TM, aka, you can buy the domain name whichever you want (own only), but once you start making money on it, you are in trouble. Is this true for US?

Thanks

[driller41]

When domains names drop they get picked up immediately via automated means.

You cant generally make money off someone else's trademark, but in this case a local club is hardly a trademarked term.