Anticybersquatting Consumer Protection Act

The Anticybersquatting Consumer Protection Act(ACPA), 15 U.S.C. § 1125(d), is an American law en-acted in 1999 that established a cause of action forregistering, trafficking in, or using a domain nameconfusingly similar to, or dilutive of, a trademark orpersonal name.[1][2] The law was designed to thwart“cybersquatters” who register Internet domain namescontaining trademarks with no intention of creating a le-gitimate web site, but instead plan to sell the domainname to the trademark owner or a third party.[3] Crit-ics of the ACPA complain about the non-global scope ofthe Act and its potential to restrict free speech,[4] whileothers dispute these complaints. Before the ACPA wasenacted, trademark owners relied heavily on the FederalTrademark Dilution Act (FTDA) to sue domain nameregistrants.[3] The FTDAwas enacted in 1995 in part withthe intent to curb domain name abuses.[5] The legislativehistory of the FTDA specifically mentions that trademarkdilution in domain names was a matter of Congressionalconcern motivating the Act.[6] Senator Leahy stated that“it is my hope that this anti-dilution statute can help stemthe use of deceptive Internet addresses taken by thosewho are choosingmarks that are associated with the prod-ucts and reputations of others”.[6]

For example, in Panavision Int’l L.P. v. Toeppen, 141F.3d 1316 (9th Cir. 1998), Dennis Toeppen registeredthe domain name Panavision.com. Panavision, the trade-mark owner, learned that Toeppen had registered theirtrademark when they attempted to register the trademark“Panavision” as a domain name.[6] Toeppen was using thedomain panavision.com to display photographs of Pana,Illinois, and, when asked to cease, he offered to sell thedomain name to Panavision for $13,000.[6] After Panav-ision refused to buy the domain name from Toeppen, heregistered their other trademark, Panaflex, as a domainname.[6] The Court held that the FTDA could be violatedwithout the traditional tarnishing or blurring the courtshad required.[3] Rulings like this extended the FTDA sub-stantially.

1 Overview

Under the ACPA, a trademark owner may bring a causeof action against a domain name registrant who

• Has a bad faith intent to profit from the mark

• Registers, traffics in, or uses a domain name that is

• Identical or confusingly similar to a distinctivemark

• Identical or confusingly similar to or dilutiveof a famous mark

• Is a trademark protected by 18 U.S.C. § 706(marks involving the Red Cross) or 36 U.S.C.§ 220506 (marks related to the “Olympics”)[7]

A trademark is famous if the owner can prove that themark “is widely recognized by the general consumingpublic of the United States as a designation of source ofthe goods or services of the mark’s owner”.[8]

“Trafficking” in the context of domain names includes,but is not limited to “sales, purchases, loans, pledges, li-censes, exchanges of currency, and any other transfer forconsideration or receipt in exchange for consideration”.[9]The ACPA also requires that the mark be distinctive orfamous at the time of registration.[10]

In determining whether the domain name registrant hasa bad faith intent to profit, a court may consider manyfactors, including nine that are outlined in the statute:

1. Registrant’s trademark or other intellectual propertyrights in the domain name;

2. Whether the domain name contains the registrant’slegal or common name;

3. Registrant’s prior use of the domain name in connec-tion with the bona fide offering of goods or services;

4. Registrant’s bona fide noncommercial or fair use ofthe mark in a site accessible by the domain name;

5. Registrant’s intent to divert customers from themark owner’s online location that could harm thegoodwill represented by the mark, for commercialgain or with the intent to tarnish or disparage themark;

6. Registrant’s offer to transfer, sell, or otherwise as-sign the domain name to the mark owner or a thirdparty for financial gain, without having used themark in a legitimate site;

7. Registrant’s providing misleading false contact in-formation when applying for registration of the do-main name;

8. Registrant’s registration or acquisition of multipledomain names that are identical or confusingly sim-ilar to marks of others; and

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2 4 DOMAINING AND THE ACPA

9. Extent to which the mark in the domain is distinctiveor famous.[11]

The ACPA does not prevent the fair use of trademarksor any use protected by the First Amendment, whichincludes gripe sites.[12] In Mayflower Transit, L.L.C. v.Prince, 314 F. Supp. 2d 362 (D.N.J 2004), the courtfound that the first two prongs of Mayflower’s ACPAclaim were easily met because (1) their registered trade-mark was distinctive and (2) Defendant’s “mayflow-ervanline.com” was confusingly similar to Plaintiff’sMayflower trademark.[13] However, when the court wasexamining the third prong of Plaintiff’s ACPA claim,whether Defendant registered its domain name with thebad faith intent to profit from Plaintiff, the court foundDefendant had a bona fide noncommercial use of themark, therefore, the ACPA claim failed.[14] “Defendant’smotive for registering the disputed domain names was toexpress his customer dissatisfaction through the mediumof the Internet.”[15]

The domain name registrar or registry or other domainname authority is not liable for injunctive or mone-tary relief except in the case of bad faith or recklessdisregard.[16]

While § 1125 protects trademark owners, 15 U.S.C. §1129 protects any living person from having their per-sonal name included in a domain name, but only whenthe domain name is registered for profitable resale.[17]

The Ninth Circuit Court of Appeals caused a stir in 2013when it held, in Petroliam Nasional Berhad (Petronas) v.GoDaddy.com, 737 F.3d 546 (9th Cir. 2013), petitionfor cert. filed, 2014 WL 1510251 (U.S. Apr. 14, 2014),that there is no cause of action for contributory cyber-squatting, i.e. secondary liability under the ACPA. It soheld notwithstanding the extensive body of case law per-mitting such liability where a registrar is shown to haveacted outside the normal ministerial bounds of domainregistration.[18] It also relied on Central Bank of Denverv. First Interstate Bank of Denver and premised on theCircuit Court’s determination that the ACPA is not partof the Lanham Act and therefore not included in the rulepermitting secondary liability for trademark infringementenunciated in Inwood Labs v. Ives Labs, 456 U.S. 844(1982).[19]

2 In rem Jurisdiction

The ACPA also provides that the trademark owner canfile an in rem action against the domain name in the ju-dicial district where the domain name registrar, domainname registry, or other domain name authority registeredor assigned the domain name is located if (1) the do-main name violates any right of the trademark owner and(2) the court finds that the owner (a) is not able to ob-tain in personam jurisdiction over the person who would

have been a defendant under 15 U.S.C. § 1125(d)(1);or (b) through due diligence was not able to find a per-son who would have been a defendant under 15 U.S.C.§ 1125(d)(1) by sending a notice of the alleged violationand publishing notice of the action.[20] This provision israrely used, however, because many trademark ownerscan achieve the same results through a Uniform DomainName Dispute Resolution Policy (UDRP) proceeding.

3 ACPA v. UDRP

Instead of suing in federal court under the ACPA, a trade-mark owner can choose to pursue an administrative pro-ceeding under ICANN’s Uniform Domain Name DisputeResolution Policy (UDRP). The UDRP allows a trade-mark owner to challenge domain name registrations inexpedited administrative proceedings.[3]

A UDRP proceeding can be faster and cheaper for trade-mark owners than an ACPA lawsuit.[3] Also, UDRP out-comes tend to be pro-plaintiff because many UDRP ar-bitrators are trademark lawyers.[3] However, some trade-mark owners prefer to bring ACPA claims because theyoffer more remedies than the cancellation or transferof the domain name (the only remedies available underUDRP proceedings)[3] and a court ruling can lead to afinal resolution of the matter.[3] Also, a suit under theACPA may deter future cybersquatters more effectivelythan a UDRP proceeding.[3]

4 Domaining and the ACPA

While the ACPA contemplated the purchase of domainnames for resale to trademark owners, it did not con-template the more modern practice of domaining. Do-maining is the business of registering a domain name andparking it or placing pay-per-click ads on it. Domainersrely on type-in traffic, which is when Internet surfers typein the domain name rather than using a search engine.[21]Domainers can make a lot of money by buying and sellingdomain names.[21]

Some domainers relied on domain tasting, which in-volves placing pay-per-click ads on the domain for fivedays (or less) to determine whether the ads will makemore than the annual cost of the domain.[22] If the do-main is dropped within the five-day grace period, nofee is incurred.[22] An industry has grown up out ofthis business with domainers taking part in these massregistrations.[22] This practice was largely eliminated by2009, when ICANN began raising fees to registrars withexcessive domain tasting.[23]

InVerizon California, Inc. v. Navigation Catalyst Systems,568 F. Supp. 2d 1088 (C.D. Cal. 2008), the domainerlost under the ACPA.[24] One of the defendants, BasicFusion, Inc. argued that they were not cybersquatters, but

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as an Internet registrar accredited by ICANN they couldregister domain names on behalf of its customers andit specialized in “bulk registration”.[25] Navigation Cata-lyst Systems, another defendant and a customer of BasicFusion, used their “proprietary automated tool” to finddomain names that were not already registered and thenregistered them using Basic Fusion.[25] Navigation usedthe five days following the registration (the “add graceperiod”) to put advertisements on the websites makingmoney from the advertisements even when they droppedthe domain name registration before the five-day windowclosed.[26] Plaintiff Verizon argued that defendants “reg-istered” 1,392 domain names that were confusingly simi-lar to plaintiff’s trademarks.[25] The Court found that de-fendants used the confusingly similar domain names witha bad faith intent to profit.[27]

5 See also

• Microsoft v. Shah

6 References[1] JaneC.Ginsberg, Trademark andUnfair Competition Law

748 (Robert C. Clark et al. eds., Foundation Press 4th ed.2007)(2001)

[2] Cybertelecom :: Anticybersquatting Consumer ProtectionAct Providing Legislative History, Caselaw, and Refer-ences

[3] 2-7A Gilson on Trademarks §7A.06, Trademark Cyber-piracy and Cybersquatting (Matthew Bender & Co. 2009)

[4] Serena C. Hunn, Anticybersquatting Consumer ProtectionAct: A Powerful Remedy in Domain Name Disputes? Or aThreat to Electronic Commerce?, http://www.fmew.com/archive/cybersquat/index.html

[5] Panavision Int’l L.P. v. Toeppen, 141 F.3d 1316, 1326(9th Cir. 1998)

[6] Panavision Int’l L.P. v. Toeppen, 141 F.3d 1316, 1326(9th Cir. 1998); TeleTech Customer Care Mgmt., Inc.v. Tele-Tech Co., 977 F. Supp. 1407, 1413 (C.D. Cal.1997)

[7] 15 U.S.C. § 1125(d)(1)(A)

[8] 15 U.S.C. § 1125(c)(2)(A)

[9] 15 U.S.C. § 1125(d)(1)(E)

[10] 15 U.S.C. § 1125(d)(1)(A)(ii)

[11] 15 U.S.C. § 1125(d)(1)(B)

[12] 15 U.S.C. § 1125(d)(1)(B)(ii)

[13] Mayflower Transit, L.L.C. v. Prince, 314 F. Supp. 2d362, 367 (D.N.J 2004)

[14] Mayflower Transit, L.L.C. v. Prince, 314 F. Supp. 2d362, 367, 369 (D.N.J 2004)

[15] Mayflower Transit, L.L.C. v. Prince, 314 F. Supp. 2d362, 369 (D.N.J 2004)

[16] 15 U.S.C. § 1125(d)(2)(D)(ii)

[17] 15 U.S.C. § 1129(1)(A) (transferred to 15 U.S.C. § 8131)

[18] “Ninth Circuit Holds There is No Cause of Ac-tion for Contributory Cybersquatting”. http://www.secondarytrademarkinfringement.com/''. Retrieved Oct 1,2014.

[19] “How the 9th Circuit Veered Off Course in Petroliam Na-sional Berhad (Petronas) v. GoDaddy.com: The Misap-plication of Central Bank of Denver, N.A. v. First Inter-state Bank of Denver, N.A. (Central Bank)". http://www.secondarytrademarkinfringement.com/''. Retrieved Oct 1,2014.

[20] 15 U.S.C. § 1125(d)(2)(A)

[21] Paul Sloan, Masters of their Domains, http://money.cnn.com/magazines/business2/business2_archive/2005/12/01/8364591/

[22] ICANN Issues: Domain name tasting, http://public.icann.org/issues/domain-name-tasting

[23] “The End of Domain Tasting | AGP Deletes Decrease99.7%". ICANN. 2009-08-12. Retrieved 2013-09-22.

[24] Verizon California, Inc. v. Navigation Catalyst Systems,Inc., 568 F. Supp. 2d 1088 (C.D. Cal. 2008)

[25] Verizon California, Inc. v. Navigation Catalyst Systems,Inc., 568 F. Supp. 2d 1088, 1092 (C.D. Cal. 2008)

[26] Verizon California, Inc. v. Navigation Catalyst Systems,Inc., 568 F. Supp. 2d 1088, 1092-93 (C.D. Cal. 2008)

[27] Verizon California, Inc. v. Navigation Catalyst Systems,Inc., 568 F. Supp. 2d 1088, 1094-97 (C.D. Cal. 2008)

4 7 TEXT AND IMAGE SOURCES, CONTRIBUTORS, AND LICENSES

7 Text and image sources, contributors, and licenses

7.1 Text• Anticybersquatting Consumer Protection Act Source: http://en.wikipedia.org/wiki/Anticybersquatting%20Consumer%20Protection%20Act?oldid=651156457 Contributors: The Anome, SimonP, Lquilter, Neilc, The Inedible Bulk, Seth Finkelstein, Alansohn, Gary, Paul-Hanson, EsonLinji, PullUpYourSocks, Bookandcoffee, Brianwc, Uncle G, GoldRingChip, BD2412, FlaBot, Trademarx, Juanpdp, Abuerer,SmackBot, Stifle, KD5TVI, Mike hayes, Cybercobra, GavinOB, Ckatz, Rcannon100, Ankon Ray, Skapur, Radiant chains, Cydebot,Ntsimp, Jneuenhaus, Crana, Yale s, Oven, Flowanda, CliffC, Insinuendo, Sherdor, Nick Levinson, Kbrose, Lightmouse, Maitreg, XLinkBot,Imagine Reason, Addbot, Ronhjones, The Earwig, Jeremyleader, Ericgoldman, Haeinous, CliffordHyra, Jel78, EmausBot, Angrytoast,Checkingfax, BattyBot, Soni, KH-1 and Anonymous: 42

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