Domain Name Cases

361

By Leland Gardner *

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This year’s survey of cases brought under the Anticybersquatting Consumer Protection Act (“ACPA”) 1 _{includes a pair of cases demonstrating potential} juris-dictional hurdles for plaintiffs. 2 _{Another case examines whether unauthorized use} of trademarks in third-level domains can give rise to liability under the ACPA. 3 Finally, two cases demonstrate the potential broad scope of the ACPA—one in which the U.S. Court of Appeals for the Ninth Circuit expounded on the bad faith intent requirement 4 _{and another in which a district court affi rmed the validity of} a contributory cybersquatting claim. 5

The survey of Uniform Domain Name Dispute Resolution Policy (“UDRP” or “Policy”) 6 _{actions is focused on the increasingly contentious question of whether} plaintiffs must prove bad faith use and bad faith registration to prevail or whether showing bad faith use alone can be suffi cient. 7

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Plaintiffs often face challenges in obtaining jurisdiction over defendants in ACPA cases. Station Casinos, Inc. v. Murphy illustrates the potential diffi culties of perfecting service on uncooperative overseas defendants. 8 _{The plaintiff owned}

* Leland Gardner is an intellectual property attorney with the law fi rm Jones Day. 1. 5 U.S.C. § 1125(d) (2006).

2. Station Casinos, Inc. v. Murphy, No. 2:10-cv-01770-GMN-LR, 2010 WL 4942988 (D. Nev. Nov. 18, 2010); Facton Ltd. v. Gstaronsale.com, No. 1:10cv1165 (AJT/JFA), 2011 WL 677107 (E.D. Va. Feb. 17, 2011).

3. GoForIt Entm’t, LLC v. Digimedia.com L.P., 750 F. Supp. 2d 712, 723–24 (N.D. Tex. 2010). 4. DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213 (9th Cir. 2010).

5. Microsoft Corp. v. Shah, No. C10-0653 RSM, 2011 WL 108954, at *6–7 (W.D. Wash. Jan. 12, 2011).

6. Uniform Domain Name Dispute Resolution Policy , INTERNET CORP. FOR ASSIGNED NAMES & NUMBERS (Aug. 26, 1999), http://www.icann.org/en/dndr/udrp/policy.htm.

7. See infra notes 58–74 and accompanying text.

8. No. 2:10-cv-01770-GMN-LR, 2010 WL 4942988 (D. Nev. Nov. 18, 2010) (denying preliminary injunction).

several trademarks for STATION CASINOS and operated a website related to casinos and hotels in the United States at the <www.stationcasinos.com> domain name. 9 _{The defendant—allegedly a U.K. resident—registered the} <stationcasinos.org> domain name with GoDaddy.com, Inc. and linked it to an online Vegas website offering online gambling services. 10

The plaintiff fi led a request for a temporary restraining order (“TRO”) that would require GoDaddy.com to place a hold and lock on the defendant’s website. 11 _The court authorized the plaintiff to serve the TRO via the defendant’s e-mail address of record with GoDaddy.com, but the e-mail bounced back as undeliverable. 12 The plaintiff requested additional contact information from GoDaddy.com but none was available, leaving the plaintiff unable to serve the defendant with notice of the suit. 13 _{The court nevertheless granted the TRO ex parte, fi nding that the} plaintiff would suffer irreparable injury and was likely to succeed on the merits. 14 When the plaintiff subsequently moved for a preliminary injunction, however, the court denied the motion and ordered GoDaddy.com to release the disputed website. The court explained that while temporary restraining orders can be is-sued ex parte, preliminary injunctions cannot. 15 _{Under the Federal Rules of Civil} Procedure, a preliminary injunction requires “notice to the adverse party.” 16 In-deed, the court stated that the notice requirement refl ects “ ‘the fact that our entire jurisprudence runs counter to the notion of court action taken before reasonable notice and an opportunity to be heard has been granted [to] both sides of a dispute.’ ” 17 Fortunately, when a plaintiff cannot obtain personal jurisdiction over or locate a potential defendant, as in Station Casinos, Inc. v. Murphy , plaintiffs can fi le in rem actions under the ACPA. 18 _{To establish in rem jurisdiction, however, a plaintiff} must serve the domain name registrant at the postal and e-mail address on re-cord with the registrar, and publish “notice of the action as the court may direct promptly after fi ling the action.” 19

In Facton Ltd. v. Gstaronsale.com , Magistrate Judge John Anderson held that a notice-via-publication provision requires publication even if a plaintiff actually served the registrant with the complaint. 20 _{The court began by analyzing} incon-sistent authorities on this issue. 21 _{In the Eastern District of Virginia, two courts} had previously found that the publication requirement could be waived when a

9. Id . at *1. 10. Id . 11. Id . 12. Id . 13. Id . at *1–2. 14. Id . 15. Id . at *2. 16. FED. R. CIV. P. 65(a)(1).

17. Station Casinos , 2010 WL 4942988, at *2 (quoting Granny Goose Foods, Inc. v. Bd. of

Team-sters & Auto Truck Drivers, 415 U.S. 423, 438–39 (1974)). 18. 15 U.S.C. § 1125(d)(2)(A) (2006).

19. Id . § 1125(d)(2)(A)(ii)(II).

20. No. 1:10cv1165 (AJT/JFA), 2011 WL 677107, at *3 (E.D. Va. Feb. 17, 2011) (requiring pub-lication of notice).

plaintiff provided actual notice to the registrant, 22 _{but two other courts had} deter-mined that publication was mandatory. 23 _{Magistrate Judge Anderson deemed the} second line of cases more persuasive, stating that although sending notice to the registrant’s addresses may adequately notify the registrant, it fails to “provide pub-lic notice of the action to any and all potential claimants of the res as needed in an in rem proceeding.” 24 _{The court also noted that in the cases waiving publication,} the registrants had responded to delivery of the notice, but the defendant in this case had not. 25 _{Accordingly, the court held that the plaintiff must publish notice} of the action to proceed in rem . 26

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ACPA

The presence of another’s trademark in a third-level domain name cannot violate the ACPA, according to the court in GoForIt Entertainment, LLC v. Digimedia.com L.P . 27 _{A domain name typically comprises three fi elds separated by} dots: a rightmost fi eld (e.g., .com) referred to as the top-level domain (“TLD”); a center fi eld that identifi es a company or service (e.g., Google) referred to as the second-level domain; and a leftmost fi eld (e.g., www) referred to as a third-level do-main. 28 _{Although a registrar issues second-level domains within specifi ed top-level} domains, it does not issue third-level domains as these are registrant- generated. 29 _At issue in GoForIt Entertainment was the use of the Wildcard Domain Name System (“Wildcard DNS”), a technology allowing a registrant to use a generic third-level domain (e.g., *.google.com), which causes any web address query having a match-ing TLD and second-level domain to be directed to the registrant’s website regard-less of the contents of the third-level domain in the query. 30

The defendants had registered a wide variety of domain names such as “com.org” and “recipes.com.” 31 _{GoForIt Entertainment, which owned federal}

22. Id . (citing Banco Inverlat, S.A. v. www.inverlat.com, 112 F. Supp. 2d 521, 523 (E.D. Va. 2006)

(holding that it was appropriate to waive the publication requirement upon a showing of actual no-tice); Harrods Ltd. v. Sixty Internet Domain Names, 110 F. Supp. 2d 420, 422 (E.D. Va. 2000) (holding that publication was not required if there was actual notice to registrant)).

23. Id . (citing INVESTools, Inc. v. investtools.com, 81 U.S.P.Q.2d 2019 (E.D. Va. 2006) (holding

the publication requirement was not waivable); Shri Ram Chandra Mission v. sahajmarg.org, 139 F. Supp. 2d 721, 723–24 (E.D. Va. 2001) (fi nding that the court lacks discretion to determine whether publication must be affected)).

24. Id . at *4.

25. Id .

26. Id .

27. 750 F. Supp. 2d 712, 723–24 (N.D. Tex. 2010).

28. Top-Level Domains (gTLDs) , INTERNET CORP. FOR ASSIGNED NAMES & NUMBERS , http://www.icann.

org/en/tlds (last visited Sept. 28, 2011).

29. Sallen v. Corinthians Licenciamentos LTDA, 273 F.3d 14, 19 (1st Cir. 2001) (explaining that third-level domains are user-generated).

30. IAB Commentary: Architectural Concerns on the Use of DNS Wildcards, September 2003 , INTERNET

ARCHITECTURE BD. (Sept. 19, 2003), http://www.iab.org/documents/docs/2003-09-20-dns-wildcards.

html.

mark registrations for GOFORIT and operated a website at <www.goforit.com>, fi led a complaint alleging cyberpiracy, various Lanham Act violations, common law trademark infringement, and unfair competition. 32 _{In particular, GoForIt} En-tertainment contended that the defendants intentionally used the complainant’s “GOFORIT mark as a subdomain in connection with defendants’ websites” to divert web traffi c from the plaintiff’s website to the defendants’ websites when internet users entered web address queries such as “goforit.com.org” and “goforit.recipes.com.” 33

The defendants moved for summary judgment on all claims, and the court granted their motion. 34 _{With respect to the cyberpiracy claim, the court} deter-mined that a “domain name” under the ACPA must be “ ‘registered with or assigned by’ ” a registrar. 35 _{Because third-level domains are generated by the registrant} 36 _— not assigned by a registrar—the court concluded that these domains are beyond the scope of the ACPA. 37

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In DSPT International, Inc. v. Nahum , a panel of the Ninth Circuit reviewed a jury verdict from the Central District of California holding Mr. Nahum liable for cyberpiracy and awarding DSPT International $152,000 in damages. 38 _{Under a} contract with DSPT, Mr. Nahum had created a website at <www.eq-Italy.com> that, by 2005, served as DSPT’s catalog and was used extensively by both custom-ers and DSPT salespeople, generating most of the company’s revenue. 39 Unbe-knownst to DSPT’s founder, Mr. Nahum had registered this domain name in his own personal name, rather than under DSPT’s name. 40 _{When Mr. Nahum and} DSPT’s relationship deteriorated in late 2005, Mr. Nahum redirected the domain name to a website that said only, “All fashion related questions to be referred to Lucky Nahum at: [email protected].” 41

When Mr. Nahum refused to return the website, DSPT brought suit against him for cybersquatting and trademark infringement. 42 _{The jury returned a special} verdict fi nding that Mr. Nahum had used the <www.eq-Italy.com> domain name, which was confusingly similar to DSPT’s “EQ” and “Equilibrio” trademarks, with

32. Id . at 717.

33. Id . at 718–19.

34. Id . at 722–23.

35. Id . at 723 (quoting 15 U.S.C. § 1127, which states: “The term ‘domain name’ means any

alpha-numeric designation which is registered with or assigned by any domain name registrar, domain name registry, or other domain name registration authority as part of an electronic address on the Internet.”).

36. See supra note 29.

37. GoForIt Entm’t, 750 F. Supp. 2d at 723.

38. 624 F.3d 1213, 1218–19 (9th Cir. 2010). 39. Id . at 1216–17.

40. Id . at 1217.

41. Id .

a bad faith intent to profi t. 43 _{Mr. Nahum appealed, arguing, among other things,} that the ACPA did not apply to his conduct because he lacked the bad faith intent to profi t contemplated in the statute. 44

The Ninth Circuit panel disagreed. Judge Andrew J. Kleinfeld, writing for the court, opined:

But the [ACPA] statute, like so many, is written more broadly than what may have been the political catalyst that got it passed. . . . Though there was no evidence of any-thing wrong with Nahum’s registration of the domain name to himself, the evidence supported a verdict that Nahum subsequently, years later, used the domain name to

get leverage for his claim for commissions. 45

The court analyzed the nine statutory bad faith factors in the ACPA and deemed Factor VI to be the most relevant in this case. 46 _{Factor VI relates to offering to} “transfer, sell, or otherwise assign the domain name to the mark owner . . . for fi n-ancial gain without having used, or having an intent to use, the domain name in the bona fi de offering of any goods or services . . . .” 47 _{This factor, according to the} court, “may fairly be read to mean that it is bad faith to hold a domain name for ransom, where the holder uses it to get money from the owner of the trademark rather than to sell goods.” 48

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Plaintiffs must typically prove, among other things, that a defendant directly used, registered, or traffi cked in a domain name to establish liability under the ACPA. 49 _{Under the right circumstances, however, several courts have indicated} that they would also be willing to impose liability on a defendant who induces others to commit cyberpiracy. 50

In Microsoft Corp. v. Shah , the court considered the viability of a contributory cybersquatting claim. 51 _{The court fi rst reasoned that the theory of contributory} liability was already well established in the trademark infringement context. 52 Next, the court observed that several federal district court cases had accepted the theory of contributory cybersquatting and established a framework for deciding such claims. 53 _{The court fi nally noted that the Ninth Circuit’s opinion in DSPT}

43. Id . at 1218. 44. Id . 45. Id . at 1219. 46. Id . at 1220. 47. 15 U.S.C. § 1125(d)(1)(B)(i)(VI) (2006). 48. DSPT Int’l, 624 F.3d at 1221. 49. 15 U.S.C. § 1125(d)(1)(A)(ii) (2006).

50. See, e.g ., Microsoft Corp. v. Shah, No. C10-0653 RSM, 2011 WL 108954, at *4 (W.D. Wash.

Jan. 12, 2011) (discussing cases that recognized the cause of action for contributory trademark dilu-tion as potentially viable and cases that declined to dismiss the cause of acdilu-tion).

51. Id . at *1–3.

52. Id . at *1 (citing Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 264 (9th Cir. 1996)).

53. Id . at *2–3 (citing Ford Motor Co. v. Greatdomains.com, Inc., 177 F. Supp. 2d 635 (E.D. Mich.

International, Inc ., mandated a broad interpretation of the ACPA’ s scope, which

would likely cover claims for contributory cybersquatting. 54

Based on these cases, the court determined that the defendants’ alleged con-duct was suffi cient to deny the motion to dismiss the contributory cybersquat-ting claim. 55 _{Specifi cally, the defendants allegedly taught others to use Microsoft’s} marks to drive traffi c to others’ websites and also sold software that allowed buy-ers to incorporate Microsoft’s marks into their websites. 56 _{The court concluded} that the defendants’ conduct, if proven, “falls squarely within the statute’s goal of imposing liability on those who seek to profi t in bad faith by means of registering, traffi cking, or using domain names that contain identical or confusingly similar marks.” 57

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Last year’s survey discussed the “Octogen Trio,” a set of decisions by panelist M. Scott Donahey reasoning that bad faith use can be retroactively applied to establish bad faith registration, as opposed to the traditional view that paragraph 4(a)(iii) of the UDRP requires independent showings of bad faith registration and use. 58 _{The Octogen Trio engendered a major split of opinion among other} panel-ists that has continued into this year. 59

Three panels considering the issue concluded that the traditional view was more persuasive. In Mile, Inc. v. Burg , the complainant was an adult video and sex toy retailer that claimed use of the trademark THE LION’S DEN in commerce since 1971, even though no federal trademark registration was granted until De-cember 21, 1999. 60 _{Mr. Burg registered the <lionsden.com> domain name on} May 8, 1995, and allegedly used it for “family e-mail, personal projects, and hob-bies.” 61 _{However, by the time the complaint was fi led, the disputed domain name} resolved to an advertising website containing links to various adult products that competed with the complainant’s products. 62

Analyzing the bad faith requirement, a three-member panel noted that, with-out advance knowledge of a complainant’s mark, it is “not logically possible for a respondent to register a domain name in bad faith contemplation of a mark

54. Id . at *3 (citing DSPT Int’l, Inc. v. Nahum, 624 F.3d 1213, 1219 (9th Cir. 2010)).

55. Id . at *4–5.

56. Id . at *1.

57. Id . at *3.

58. See Paul Godfread & Kristine Dorrain, Survey of the Law of Cyberspace: Developments in Domain Names , 66 BUS. LAW. 221, 226–29 (2010).

59. This year also saw the release of the second edition of the WIPO Overview of WIPO Panel Views

on Selected UDRP Questions , an excellent resource summarizing the Octogen Trio cases, as well as a

variety of other signifi cant UDRP issues. WORLD INTELLECTUAL PROP. ORG., WIPO OVERVIEWOF WIPO

PANEL VIEWSON SELECTED UDRP QUESTIONS ( 2d ed. 2011), available at http://www.wipo.int/amc/en/

domains/search/overview2.0.

60. No. D2010-2011, 2011 UDRP LEXIS 311, at *2–3 (WIPO Feb. 7, 2011) (Blackmer, Arb.). 61. Id . at *3.

that does not yet exist or of which the respondent is not aware.” 63 _{Since Mr. Burg} had registered the disputed domain name with noncommercial intent before the complainant registered its mark, and since the panel, contrary to the Octogen Trio cases, could fi nd no basis in the Policy to characterize retroactively bad faith use as bad faith registration, the panel denied the claim. 64

In Tata Communications International Pte Ltd. v. Portmedia Inc ., two members of a three-member panel reasoned that paragraph 4(a)(iii) of the UDRP requires a showing of both bad faith use and registration. 65 _{The presiding panelist expressed} a nuanced interpretation of the bad faith registration requirement, stating that “the Policy does not necessarily preclude bad faith registration in circumstances where a respondent speculatively registers a domain name in the hope of exploit-ing some future trademark value it might have, in addition to any other value.” 66 Nonetheless, the panel concluded that bad faith use by itself cannot be used ret-roactively to show bad faith registration. 67

Two members of another three-member panel in A. Nattermann & Cie. GmbH v.

Watson Pharmaceuticals, Inc . came to essentially the same conclusion after

review-ing the UDRP’s bad faith provisions in light of Articles 31 and 32 of the Vienna Convention on the Law of Treaties and WIPO’s Final Report on the First WIPO Internet Domain Name Process. 68 _{The panel determined that paragraph 4(a)(iii)} of the UDRP and case precedent required “bad faith to be shown at the time of registration, albeit that such bad faith can be inferred in appropriate cases from the respondent’s subsequent conduct.” 69 _{Signifi cantly, Mr. Donahey authored the} dissenting opinions in both Tata Communications and A. Nattermann & Cie . 70

Indeed, Mr. Donahey’s viewpoint might have been dismissed as a lone voice in the wilderness but for the panelists in Jappy GmbH v. Shimoshita . 71 _{In this decision,} a three-member panel comprising David Perkins, Andrew F. Christie, and Doug-las Clark unanimously interpreted the phrase “has been registered and is being used” in paragraph 4(a)(iii) of the UDRP to be disjunctive, i.e., that the bad faith requirement can be satisfi ed “in the absence of bad faith intent upon initial regis-tration where such registered domain name is being used in bad faith.” 72 _In reach-ing this conclusion, the panel disagreed with the plain meanreach-ing interpretative

63. Id . at *15–16.

64. Id . at *18–19.

65. No. D2010-0217, 2010 UDRP LEXIS 588, at *17–25 (WIPO June 1, 2010) (Barker, Arb.) . 66. Id . at *22.

67. Id . at *24–25.

68. No. D2010-0800, 2010 UDRP LEXIS 947, at *14–32 (WIPO Aug. 31, 2010) (Turner, Arb.) (citing Vienna Convention on the Law of Treaties, May 23, 1969, 1155 U.N.T.S. 331; WORLD INTEL -LECTUAL PROP. ORG., FINAL REPORTONTHE FIRST WIPO INTERNET DOMAIN NAME PROCESS (1999), available at

http://www.wipo.int/amc/en/processes/process1/report/index.html). 69. Id . at *28.

70. See supra notes 65 & 68.

71. No. D2010-1001, 2010 UDRP LEXIS 1217 (WIPO Sept. 28, 2010) (Perkins, Arb.). One of the panelists in this case, Andrew Christie, authored another opinion following the Octogen Trio inter-pretation. Ville de Paris v. Walter, No. D2009-1278, 2009 UDRP LEXIS 1189 (WIPO Nov. 19, 2009) (Christie, Arb.).

approach applied by other panels, and instead focused on the context, object, and purpose of the UDRP. 73 _{The panel found that the intent of the UDRP was “the} avoidance of consumer confusion, the protection of consumers against fraud, the credibility of the domain name system and the protection of intellectual property rights”; the panel’s interpretation was more consistent with this intent than was the traditional view. 74

III. C

The ACPA cases surveyed this year illustrate both the importance of meeting all the requirements when bringing cyberpiracy actions, and the potential fl exibility of the ACPA when these requirements are met. The UDRP cases illuminate a grow-ing rift in authority on whether complainants must prove both bad faith use and bad faith registration, potentially creating inconsistent outcomes in similar cases with different panelists. Nonetheless, this year’s cases also show that the ACPA and UDRP both continue to provide effective means of combating cybersquatters.

73. Id . at *20–22.

74. Id . at *22 (citing WORLD INTELLECTUAL PROP. ORG., FINAL REPORTONTHE FIRST WIPO INTERNET DO -MAIN NAME PROCESS ¶ 168 (1999), available at http://www.wipo.int/amc/en/processes/process1/report/