Under the Anticybersquatting Consumer Protection Act (ACPA), 15 U.S.C. § 1125(d), a defendant is liable for cybersquatting if it registers, traffics in, or uses a domain name that is confusingly similar to a third party’s trademark with “bad faith intent to profit from that mark.”
A successful claim under the ACPA requires that three elements be satisfied: (1) the plaintiff’s mark is famous or distinctive; (2) the domain name at issue is “identical or confusingly similar” to the plaintiff’s mark; and (3) the individual or entity who registered the domain name “had a bad faith intent to profit from the domain name.”
Trademark registrations can play a key role with regard to satisfying the first element. Courts have determined that owning a federal registration to a trademark creates a presumption that the mark is distinctive. A defendant still has the ability to rebut the presumption by attempting to persuade a court that the trademark is actually generic or descriptive, but it is not a simple task to defeat such a presumption of validity.
The second element in establishing a successful claim under the ACPA is actually similar to what forms the foundation for a trademark infringement action. The question is whether the defendant’s use of the mark creates a likelihood of confusion in the minds of potential customers as to the source, affiliation, or sponsorship of the product or service at issue. A plaintiff has the burden of demonstrating that confusion is probably.
A recent opinion in the U.S. District Court for the Northern District of Texas case of Mercury Luggage Manufacturing Company v. Domain Protection, LLC provides an example of when such confusing similarity has been held to be established. In that case, the court determined that SEWARD TRUNK and sewardtrunk.com are confusingly similar. The court noted that, like an apostrophe, a space cannot be placed in a domain name. Thus, the lack of a space in the URL did not serve to create a distinction between the mark and the website.
Many ACPA cases are determined one way or the other based on an analysis of the final element — whether the individual or entity who registered the domain name “had a bad faith intent to profit from the domain name.” The analysis in determining bad faith intent to profit includes a review of nine non-exhaustive factors. Those factors are as follows:
(I) the trademark or other intellectual property rights of the person, if any, in the domain name;
(II) the extent to which the domain name consists of the legal name of the person or a name that is otherwise commonly used to identify that person;
(III) the person’s prior use, if any, of the domain name in connection with the bona fide offering of any goods or services;
(IV) the person’s bona fide noncommercial or fair use of the mark in a site accessible under the domain name;
(V) the person’s intent to divert consumers from the mark owner’s online location to a site accessible under the domain name that could harm the goodwill represented by the mark, either for commercial gain or with the intent to tarnish or disparage the mark, by creating a likelihood of confusion as to the source, sponsorship, affiliation, or endorsement of the site;
(VI) the person’s offer to transfer, sell, or otherwise assign the domain name to the mark owner or any third party for financial gain without having used, or having an intent to use, the domain name in the bona fide offering of any goods or services, or the person’s prior conduct indicating a pattern of such conduct;
(VII) the person’s provision of material and misleading false contact information when applying for the registration of the domain name, the person’s intentional failure to maintain accurate contact information, or the person’s prior conduct indicating a pattern of such conduct;
(VIII) the person’s registration or acquisition of multiple domain names which the person knows are identical or confusingly similar to marks of others that are distinctive at the time of registration of such domain names, or dilutive of famous marks of others that are famous at the time of registration of such domain names, without regard to the goods or services of the parties; and
(IX) the extent to which the mark incorporated in the person’s domain name registration is or is not distinctive and famous.
A court does not need to consider each of the nine factors in making a determination of bad faith. Typically, the most significant factor in a bad faith analysis is that the domain registrant purposefully created a confusingly similar domain name to generate advertising revenue or to sell the domain name without having used or intended to use the domain name in a bona fide offering of goods or services.
Have more questions about the ACPA or cybersquatting? Contact us.