"To reduce network spam, a small transaction fee is imposed on claiming and withdrawing from a transient name.
The assumption is, that the real brand owner will value the control over their brand more than the impostor/squatter, and thus always win the bidding war."
This is an interesting and potentially elegant system for handling this problem. Does this provide an incentive for squatter to drive up the prices of certain names, holding them hostage? If so, this problem would be magnified the larger the target would be.
What does the squatter gain? They just paid the fees for nothing, because the real brand owner will just lock up more.
Could the squatter extort a fee from a large hypothetical user, say "McDonald's", that was lower than the bond necessary to overbid the squatter? (Off-chain or unofficially through back-channels).
Probably not a big problem for entities smaller than corporations, but maybe people like PewDiePie?
My grasp of the relevant economic concepts WRT view.ly may be lacking.
No.
If the squatter is small, the brand owner can outbid them easily.
If the squatter is large, say Pepsi steals Coca-Cola brand, well, Coca-Cola can take them to court because they own the trademark.