Opinion ID: 170772
Heading Depth: 2
Heading Rank: 3

Heading: Anti-Cybersquatting Protection Act

Text: Congress enacted the Anti-Cybersquatting Protection Act (ACPA), 15 U.S.C. § 1125(d), to address a new form of piracy on the Internet caused by acts of `cybersquatting,' which refers to the deliberate, bad-faith, and abusive registration of Internet domain names in violation of the rights of trademark owners. S.Rep. No. 106-140, at 4 (1999). The ACPA provides for liability if a person registers, traffics in, or uses a domain name that is identical or confusingly similar to a distinctive mark, with a bad faith intent to profit from that mark. 15 U.S.C. § 1125(d)(1)(A). To prevail on the cybersquatting claim, UTLM must show (1) that its trademark, UTAH LIGHTHOUSE, was distinctive at the time of registration of the domain name, (2) that the domain names registered by Wyatt, including utahlighthouse.com and utahlighthouse.org, are identical or confusingly similar to the trademark, and (3) that Wyatt used or registered the domain names with a bad faith intent to profit. The district court ruled that Defendants' conduct did not involve a bad faith intent to profit and on that ground granted Defendants' motion for summary judgment on UTLM's cybersquatting claim. We review this ruling de novo. As discussed in the trademark infringement section above, UTLM did not meet its burden of showing that UTAH LIGHTHOUSE is distinctive. Moreover, UTLM did not submit any evidence to the district court of the distinctiveness of the mark at the time that Wyatt registered the domain names, as required by 15 U.S.C. § 1125(d)(1)(A)(ii)(I). Hence, UTLM failed to meet its burden on the first element. However, the second element of the cybersquatting claim is easily satisfied, as the domain names utahlighthouse.com and utahlighthouse.org are virtually identical to the trademark with the minor exceptions of spacing between Utah and Lighthouse, and the addition of .comand.org. As to the third element, UTLM did not demonstrate that Defendants used the domain names with a bad faith intent to profit. The ACPA enumerates nine nonexclusive factors to assist the court in determining whether the use of a trademark involves a bad faith intent to profit. See 15 U.S.C. § 1125(d)(1)(B)(i). It is not necessary to evaluate all of the factors because several of the factors readily defeat an inference that the Defendants intended to profit by using domain names similar to UTLM's trademark. The quintessential example of a bad faith intent to profit is when a defendant purchases a domain name very similar to the trademark and then offers to sell the name to the trademark owner at an extortionate price. A defendant could also intend to profit by diverting customers from the website of the trademark owner to the defendant's own website, where those consumers would purchase the defendant's products or services instead of the trademark owner's. Neither of these purposes is evident here. [10] One factor is the domain name registrant's bona fide noncommercial or fair use of the mark in a site accessible under the domain name. 15 U.S.C. § 1125(d)(1)(B)(i)(IV). The district court determined that Defendants' use was entirely noncommercial, and a fair use parody, and therefore found that Defendants did not use the mark in bad faith. This is consistent with the reasoning of several other courts that a website that critiques a product and uses the product's trademark as the website's domain name may be a fair use. See Lucas Nursery & Landscaping, Inc. v. Grosse, 359 F.3d 806, 809 (6th Cir.2004) (consumer registering domain name lucasnursery.com and complaining about nursery's work was not liable under ACPA); TMI, Inc. v. Maxwell, 368 F.3d 433 (5th Cir.2004) (holding that a website with the purpose of informing other consumers did not create the harm the ACPA intended to eliminate); Mayflower Transit, L.L.C. v. Prince, 314 F.Supp.2d 362 (D.N.J.2004) (finding no ACPA liability where Defendant registered mayflowervanline.com, since the totality of circumstances demonstrated that registrant's motive was to express dissatisfaction in doing business with the mark's owner). Because Wyatt's parody offers an indirect critique and lacks an overt commercial purpose, it is similar to these consumer commentaries, and under the circumstances of this case, constitutes fair use. Another critical factor is the defendant's intent to divert consumers to a website 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. 15 U.S.C. § 1125(d)(1)(B)(i)(V). The district court concluded, and we agree, that the Wyatt website created no likelihood of confusion as to its source, or whether it was affiliated with or endorsed by UTLM. In the trademark infringement context, the plaintiff has the burden of proving likelihood of confusion. Australian Gold, 436 F.3d at 1238-39. Applying this same burden of proof to the likelihood of confusion in the context of cybersquatting, we conclude that UTLM failed to raise a genuine issue of material fact as to Defendants' intent to cause confusion about the source of the Wyatt website as a means of harming the goodwill of the UTAH LIGHTHOUSE mark. Our evaluation of the nine statutory factors along with other evidence submitted by UTLM [11] leads us to conclude that Defendants lacked a bad faith intent to profit from the use of UTLM's trademark in several domain names linked with the Wyatt website. In addition, the ACPA contains a safe harbor provision, which precludes a finding of bad faith intent if the court determines that the person believed and had reasonable grounds to believe that the use of the domain name was a fair use or otherwise lawful. 15 U.S.C. § 1125(d)(1)(B)(ii). The district court reasoned that because the Wyatt website was a parody, Defendants could have reasonably believed that use of the domain names was legal. UTLM contends that Defendants lacked such a reasonable belief because they did not contact an attorney to verify the legality of the Wyatt parody. UTLM cites to no authority that an attorney's opinion is necessary to forming a good faith, reasonable belief in this context. We conclude upon de novo review that the safe harbor provision applies to Defendants' use. The district court properly granted summary judgment on UTLM's cybersquatting claim.