IT Milk: entry

I’ve been receiving a lot of legal notices as of late, but it must be something that comes along with trying to succeed on the internet. Two issues in the past couple of months have been being threatened by the US Military at West Point for copyright infringement and receiving legal notices for collegiate trademark logos. Then yesterday I received a 7-page cease-and-desist letter from a large international production company regarding a trademarked domain name that I registered earlier this summer.

Are aggressive cease-and-desist letters how companies “ask nicely” first before they beat the shit (and money) out of you in court? The letter from this company’s lawyer is very straightforward details all of the laws that I’ve violated, which could be brought up in court against me. Some points made by the lawyer are:

1. The trademark in question is a “famous” mark, as used in section 1125(c) of the federal Lanham Act, 15 U.S.C. sections 1051, which protects this company’s proprietary rights. This company has worked hard to build up the name recognition for its trademark, and my infringement to profit off of its hard work is illegal.
2. My registration of the trademarked domain name and the display of that trademark on the website violates Section 1114 of the Lanham Act and cyberpiracy under Section 1225(d) of that act.
3. I was running some affiliate offers on this website, and it turns out that merchant are liable for the actions of affiliates under Lockheed Martin Corp. v. Network Solutions, Inc., 194 F.3d 980, 984 (9th Cir. 1999), and if the merchant profits from an affiliate’s infringements they are also liable under Symantec Corp. v. CD Micro, Inc., 286 F. Supp. 2d 1265, 1275 (D. Or. 2003)
4. The use of the trademark on my website is misleading to the visitor, and therefore it constitutes unfair competition and violates Section 1125(a) of the Lanham Act.
5. Even if you put at the footer of the site that “This site is not affiliated with XXX company,” this language is void because it is ineffective to dispel confusion under Toho Co., Ltd. v. William Morrow & Co., Inc., 33 F. Supp. 2d 1206, 1212-1213 (C.D. Cal. 1998). Also, this “initial interest confusion” violates the Lanham Act, Brookfield Communications Inc. v. West Coast Entertainment Corp. , 174 F.3d 1036, 1062-1064 and this cannot be negated by any disclaimer.

I complied with the urgent demands of this lawyer to shut down the website in question and give up ownership of the domain name. Even so, this lawyer succeeded in scaring me shitless and forcing me to take quick action to do as he says. I would love to have a lawyer like that on my side in the future when I am working on a big project.

To avoid being put in a situation like this, I recommend that you read Aviva’s article titled “10 US Laws Every Domainer Needs to Read.” The following is an excerpt from Section 2 on Trademark Laws.

People who have never traded in domains before instinctually think that one of the best domaining strategies is simply to buy up trademarked names and then hold out for a big payday when the company who owns the trademark wants to use it. Experienced domainers are not so naive as to think that buying Starbucks.com or Comcast.net before the actual company gets it is a viable business strategy. That said, there is a lot of gray area when it comes to domain name trademark issues, and knowing what the law is can help save you some money.

What is the Law?

The Anticybersquatting Consumer Protection Act, passed in November of 1999, made it easier for individuals and companies to take over domain names that are confusingly similar to their names or trademarks. But because trademark infringement cases were long, drawn out, and prohibitively expensive, few cases ever made it all the way to trial. As a result, the Internet Corporation for Assigned Names and Numbers (ICANN) decided to streamline the process by creating the Uniform Domain Name Dispute Resolution Policy (UDRP). In theory, the UDRP was a big improvement, since it made domain name disputes faster and cheaper, and also created a single three-prong rule for all domain name trademark disputes. In a UDRP case, the party seeking control of the domain need only prove three things:

1. The trademark owner owns the trademark,
2. The party that registered the domain name has no legitimate right or interest in the name, and
3. The domain name was registered and used in bad faith.

While the three prong rule is succinct on paper, in practice, it is far from straightforward. In particular, there is no clear definition of “no legitimate interest” nor “bad faith.” Blatant cybersquatting or typosquatting is clearly illegal under the three part test; such as buying “www.Gooogle.com” and sending Google an email saying that you’re going to put up porn on the site if they don’t buy it from you for $10,000,000. But for less clear cases, such as whether holding “www.Googles.eu” is a violation of Google’s trademark, the UDRP three-prong test provides little guidance.

It’s also important to keep in mind that just because a trademark isn’t formally registered doesn’t mean it doesn’t exist. Trademarks can arise both through registration and through use. Trademarks that arise through use can equally be enforced in the US and in most countries (though not China) against people trying to cash in by using a confusingly similar name.

How to Stay Out of Trouble?

Never register a domain in the name of a known existing trademark. The days when cybersquatting was a viable business plan are long gone, and attempting to do so now is just going to cost you time and money. Make sure to check online for public trademarks, but know that any search you make is likely to provide you with only a partial view of the existing trademarks.

Always remember that just because a company’s trademark is a part of your domain name does not mean you are necessarily in violation of that company’s trademark rights. There are a number of exceptions including fair use, parody, non-commercial use, and non-competing use that may apply. In addition, trademarks are not universal, so the fact that the company holds a trademark in one area does not mean that their trademark necessarily applies to your domain.

Consider that many large companies overstate their trademark claims as a matter of policy. If you are a domainer with a lot of holdings, be prepared for overzealous C&D letters claiming that anything remotely close to their trademark is in violation of the law.