It's not the only action, but that one was a bit of a PR disaster for Microsoft, just because of the age of the kid. He was 17 - if I can recall - and it was a hobbyist programming site. But domains such as Mikerosoft.net have also been threatened with legal action (I believe that one may have been owned by a chap called Mike Rosoft).
I generally thought title tags are fine for most things (I have Google/MSN/Yahoo in title tags, and it's done me no harm), as if you're promoting other people's stuff, then that's fine. I believe domains are a legal grey area. Say if I have a site about - say - the Nintendo Wii and I sell Wii goods on it and the domain name is something like wiishop.com, then Nintendo could come knocking on my door if it becomes commercially viable. However, if I have a wii blog on the domain name wiiblog.com, then as it's not a commercial venture, I'm okay.
However, if the blog makes money, I'm not sure.
On the list of things that I am, a lawyer isn't one of them. So don't take my words as gospel.
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