acpa – Attorney Evan Brown

January 1, 2025 Cybersquatting, Unfair Competition

Cybersquatting claims involving unregistered trademark survive motion to dismiss

Impulse Communications sued defendants claiming unfair competition and cybersquatting. Plaintiff alleged that defendants’ use of the mark ADOPT ME! for a virtual pet game on the Roblox platform caused confusion and harmed its brand. Defendants moved to dismiss these claims. The court denied the motion.

Plaintiff’s longstanding use of its mark

Plaintiff argued that it had been using the mark ADOPT ME since 2000, investing over $200,000 to build a distinct and reputable brand. The game, originally hosted on a website, expanded into the physical toy market through partnerships and later became an iOS app. Plaintiff alleged that millions of users adopted virtual pets through the game and that the mark earned a reputation for family-friendly entertainment.

According to plaintiff, defendants launched their game ADOPT ME! in 2017 and registered domain names such as <playadopt.me>. Despite adding an exclamation mark to the branding, defendants allegedly created confusion by using names and marketing strategies that allegedly infringed on plaintiff’s mark. Plaintiff claimed this confusion damaged its reputation, especially as defendants’ game grew in popularity and entered markets such as plush toys and fast-food promotions.

Defendants’ motions

Defendants moved to dismiss plaintiff’s claims of cybersquatting and unfair competition, arguing that the mark ADOPT ME was not distinctive or famous enough for legal protection. They denied acting in bad faith when registering the disputed domain names and asserted that any similarity between the marks was unintentional. Defendants also filed a motion to strike parts of the complaint, which referenced criminal activity and speculative harms allegedly associated with defendants’ game.

The court’s decision

The court denied defendants’ motion to dismiss, ruling that plaintiff plausibly alleged distinctiveness in the mark ADOPT ME through longstanding use and national recognition. The court found sufficient allegations of consumer confusion, including misdirected communications, legal filings naming plaintiff in error, and public comments mistaking defendants’ game for plaintiff’s.

The court partially granted the motion to strike, removing allegations that were speculative or lacked a clear connection to defendants’ actions. However, the court upheld allegations related to consumer confusion and reputational harm, as they directly supported plaintiff’s claims.

Why this case matters

Consumer Confusion Risks: This case emphasizes the need for clear brand distinctions to avoid misleading customers.
Trademark Protection: It highlights the strength of common-law trademarks built on longstanding use, even without formal registration.
Digital Branding Challenges: The dispute shows the difficulties of trademark enforcement in online gaming and domain name conflicts.

Impulse Communications, Inc. v. Uplift Games, LLC, 2024 WL 5202077 (D.R.I. Dec. 23, 2024).

December 22, 2024 Cybersquatting, Trademarks

Cybersquatting claim failed where there was a weak mark and no evidence of bad faith intent

acpa

Aspire Health Partners sued Aspire MGT under the Anticybersquatting Consumer Protection Act, 15 U.S.C. §1125(d) (“ACPA”) over defendant’s registration and use of the domain name <aspirehealthgrp.com>. Plaintiff sought a preliminary injunction to stop defendant from using the disputed domain name, but the court denied the request. The court held that plaintiff failed to show that defendant acted with a bad-faith intent to profit from the use of the domain name, a key element of a cybersquatting claim under the ACPA.

To prevail on a cybersquatting claim under the ACPA, a plaintiff must demonstrate that (1) its trademark in the disputed domain name was distinctive when the domain name was registered, (2) the disputed domain name is identical or confusingly similar to that trademark, and (3) the defendant registered the disputed domain name with a bad-faith intent to profit. In this case, the court found plaintiff would not likely succeed on its cybersquatting claim because of deficiencies under the first and third element.

The court found that plaintiff’s mark was not distinctive but instead was descriptive as a “self-laudatory” type of mark. Citing to the well-known McCarthy treatise on trademark law, the court determined that the word “aspire” when applied to healthcare services was of the same sort of use as the word “best” or “super” that extolls some feature or attribute of services and thereby becomes descriptive in nature and likely too weak to be subject to trademark protection.

As for the lack of bad faith, the court found that plaintiff had only made a conclusory allegation on the topic. Looking at various factors that courts apply to determine bad faith under the ACPA, the court noted in particular, among other things, that defendant had used the domain name in connection with a bona fide offering of its goods and services, and had not been shown to possess any intent to divert customers form plaintiff’s website or any intent to transfer or sell the domain name for financial gain.

Three Reasons Why This Case Matters:

Legitimacy in Business Use: Using a domain name for legitimate business purposes can protect defendants against cybersquatting claims.
Trademark Strength: Descriptive trademarks often face greater challenges in cybersquatting cases without strong evidence of distinctiveness.
Evidence of Intent: Courts require clear proof of bad-faith intent to profit, not just similarity between domain names, to uphold a cybersquatting claim.

Aspire Health Partners, Inc. v. Aspire MGT LLC, 2024 WL 5169936 (M.D. Fla., Dec. 19, 2024)

April 15, 2024 Cybersquatting

Does renewing a domain name count as “registering” a domain name under the ACPA?

ACPA

The Anticybersquatting Consumer Protection Act (“ACPA”) is a federal law – part of the Lanham Act that deals with trademarks and unfair competition. It says that a person can be liable if he or she registers a domain name that contains another’s distinctive trademark with a bad faith intent to profit from that mark.

One issue that has arisen over the years is whether registration that can give rise to liability means only the first time the domain name is registered, or whether it applies to the re-registration, e.g., each year when the registration is up for renewal with the registrar. See this case from earlier this year where the court held that renewal was not registration.

The various federal circuits are split over the issue. At least the the Third, Fourth, and Eleventh Circuits have all concluded that the ordinary meaning of the word “registers” necessarily includes both the first registration and any subsequent re-registrations. The Ninth Circuit has held that Congress meant “registration” to refer only to the initial registration.

The Second Circuit does not appear to have weighed in on the question. But a recent district court sitting in the Second Circuit sided with the “re-registration is registration” take from the Third, Fourth and Eleventh Circuits.

In the case of We the Protesters, Inc. v. Sinyangwe, 2024 WL 1195417 (S.D.N.Y., March 20, 2024), counter-defendant registered the disputed domain name in 2015. The issue was whether the re-registration of the disputed domain name in 2023 was a registration of a distinctive mark done in bad faith. This passage of time was important because it gave the arguably descriptive mark MAPPING POLICE VIOLENCE enough time to become distinctive.

Concerning the word “registers” in the ACPA, the court applied its ordinary meaning, noting that it was not the province of the court to add words to statutes that Congress enacts. “Had Congress wished to restrict the word ‘registration’ as used in the ACPA to initial registrations, it surely knew how to do so.”

We the Protesters, Inc. v. Sinyangwe, 2024 WL 1195417 (S.D.N.Y., March 20, 2024)

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January 10, 2024 Cybersquatting, Trademarks

No ACPA injunction because mark was not distinctive when domain name first registered

ACPA

This case had a bit of a weird result – even though the brand owner had a mark that was 20 years old, and the alleged cybersquatter in the meantime acquired a domain name on the open market identical to that mark, because the domain name was first registered (by an unrelated party) before the brand owner’s trademark rights arose, there was no relief under federal trademark law. One may question whether such a result creates a loophole for bad faith actors.

History of registration and rights

Someone – no one seems to know who – first registered the disputed domain name <trx.com> back in 1999. In 2003, plaintiff’s successor in interest (via bankruptcy) began using the trademark TRX, thereby acquiring rights in the mark. Defendant bought the domain name in 2022.

Plaintiff sued defendant under the Anticybersquatting Consumer Protection Act (ACPA), a part of U.S. trademark law that deals with bad faith domain name registration. Plaintiff sought a preliminary injunction ordering the transfer of the disputed domain name pending resolution of the lawsuit. The court denied the motion because it found that plaintiff had not established that plaintiff would likely succeed on the merits of the cybersquatting claim.

Outcome up for critique

The legal holding is potentially problematic, however, and represents a point on which different federal courts sitting in different parts of the country handle cybersquatting claims differently under the ACPA.

In this case, the court held that plaintiff’s cybersquatting claim depended on when the disputed domain name was first registered. Citing to a 2023 case from the same district, Blair v. Automobili Lamborghini SpA, which in turn relied on the Ninth Circuit’s opinion in GoPets Ltd. v. Hise, 657 F.3d 1024 (9th Cir. 2011), the court explained that liability for cybersquatting is possible “only when a person other than the trademark owner registers a domain name that is confusingly similar to a trademark that is distinctive at the time of the domain name’s registration.” It went on to note that “[i]n other words, if a domain name is registered before a particular trademark exists, the trademark owner cannot assert a viable cybersquatting claim against the domain name owner.”

So under this logic, because the domain name was registered prior to 2003 (when the rights in the TRX mark came into existence), there is no way plaintiff’s TRX mark could have been distinctive at the time of the domain name’s registration. The court came to this conclusion even though the record demonstrated that some unknown person, other than defendant, first registered the disputed domain name, and that defendant first acquired the domain name on the market many years after the TRX mark had become distinctive.

It is interesting to note that this outcome conflicts with decisions in other circuits that hold “re-registration” by a new owner counts as the time for evaluating whether a mark with which a domain name may be confusingly similar, is distinctive. See, e.g., Instructure, Inc. v. Canvas Technologies, Inc., 2022 WL 43829 (D. Utah, January 5, 2022). One could argue it is bad policy for the ACPA system to essentially absolve a bad faith actor who acquires a domain name that contains a protectible mark but was first registered by someone else not acting in bad faith, prior to the time the mark became strong.

JFXD TRX ACQ LLC, v. trx.com, 2024 WL 98424 (D. Ariz., January 9, 2023)

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February 2, 2022 Cybersquatting

Strip club operator wins motion in domain name dispute against GoDaddy company

NameFind is a GoDaddy company that holds registrations of domain names and seeks to make money off of them by placing pay-per-click ads on parked pages found at the domain names. Global Licensing owns the DEJA VU trademark that is used in connection with strip clubs and other adult-related services. When NameFind used the domain name dejavushowgirls.com to set up a page of pay-per-click ads, Global Licensing sued, raising claims under the federal Anticybersquatting Consumer Protection Act (ACPA), 15 U.S.C. 1125(d).

cybersquatting domain name dispute

Arguing that the cybersquatting claim had been insufficiently pled, NameFind moved to dismiss. The court denied the motion.

To establish a “cybersquatting” claim under the ACPA, a plaintiff must establish that: (1) it has a valid trademark entitled to protection; (2) its mark is distinctive or famous; (3) the defendant’s domain name is identical or confusingly similar to, or in the case of famous marks, dilutive of, plaintiff’s mark; and (4) defendant used, registered, or trafficked in the domain name (5) with a bad faith intent to profit. DaimlerChrysler v. The Net Inc., 388 F.3d 201 (6th Cir. 2004) (citing Ford Motor Co. v. Catalanotte, 342 F.3d 543, 546 (6th Cir. 2003)).

Identical or confusingly similar

NameFind first argued that the court should dismiss the ACPA claim because there were no “non-conclusory” allegations explaining how the content on its website could be confusingly similar to plaintiff’s entertainment services. The court found this argument unpersuasive, however, because the content of the website was not important in evaluating this element. Instead, the court was to make a direct comparison between the protected mark and the domain name itself, rather than an assessment of the context in which each is used or the content of the offending website. It found the disputed domain name and plaintiff’s mark to be identical or confusingly similar because the disputed domain name incorporated plaintiff’s mark, and there were no words or letters added to plaintiff’s mark that clearly distinguished it from plaintiff’s usage.

Bad faith intent to profit

The court likewise rejected NameFind’s second argument, which was that plaintiff had not sufficiently pled NameFind’s bad faith intent to profit. The main point of the argument was that most of plaintiff’s allegations were made “on information and belief”. (That phrase is used in lawsuits when the plaintiff does not know for sure whether a fact is true, so it hedges a bit.) The court observed that allegations made on information and belief are not per se insufficient.

In this case, the court stated that the “on information and belief” allegations should not be considered in isolation, but should be considered in the context of the entire Complaint, including the factual allegations that: (1) NameFind had no intellectual property rights in or to the DEJA VU mark; (2) the disputed domain name was essentially identical to plaintiff’s mark and did not contain defendant’s legal name; (3) plaintiff did not authorize or consent to such use; (4) the domain name was configured to display pay-per-click advertisements to visitors, which provided links to adult-related entertainment sites; (5) as such, the disputed domain name was likely to be confused with plaintiff’s legitimate online location and other domain names, and deceive the public; and, (6) defendant’s website harmed plaintiff’s reputation and the goodwill associated with its marks by causing customers to associate plaintiff with the negative qualities of defendant’s website.

Global Licensing, Inc. v. NameFind LLC, 2022 WL 274104 (E.D. Michigan, January 28, 2022)

January 11, 2022 Cybersquatting

ACPA claim survives because mark was distinctive when domain name was re-registered

ACPA distinctive re-regiistered

Federal law has a statute that prohibits abusive domain name registration. The Anticybersquatting Consumer Protection Act, 15 U.S.C. 1125(d) (ACPA) provides, among other things, that one is prohibited from registering, trafficking in or using, with a bad faith intent to profit, a domain name that is confusingly similar to another’s trademark that was distinctive when the domain name was registered.

In the recent case of Instructure, Inc. v. Canvas Technologies, the court considered whether the ACPA requires the mark to have been distinctive when the domain name was first registered, or whether it can still be protected by being distinctive when the domain name was re-registered. It held that the statute applies to distinctiveness at re-registration.

In this case, the disputed domain name was first registered in 1997, several years before plaintiff obtained trademark rights in its CANVAS mark. Defendant moved to dismiss plaintiff’s cybersquatting claim, arguing that the plaintiff did not have rights to a distinctive mark when the domain name was first registered, and that therefore the statute’s requirement was not met. Plaintiff showed, however, that the ownership of the domain name changed sometime in 2021 (i.e., it was re-registered).

Looking to the statute’s plain language, Congressional intent, public policy, and the trending weight of authority in other federal circuits, the court held that re-registration, or “registration again” is contemplated under the ACPA’s language. It denied defendant’s motion to dismiss the ACPA claim.

Instructure, Inc. v. Canvas Technologies, Inc., 2022 WL 43829 (D.Utah, January 5, 2022)

October 23, 2017 Cybersquatting, Litigation, Trademarks

Court orders transfer of domain name at preliminary injunction stage of trademark case

Plaintiff sued a competitor under the Anticybersquatting Consumer Protection Act (15 U.S.C. 1125(d) (“ACPA”)) and brought other trademark-related claims concerning the competitor’s alleged online scam of selling infringing nutritional supplement products. Plaintiff also sued the domain name privacy protection service Namecheap, which the competitor had used to register the domain name. As part of the order granting plaintiff’s motion for preliminary injunction, the court ordered Namecheap to transfer the domain name to plaintiff.

The court noted that a preliminary injunction “is an extraordinary remedy never awarded as of right,” and that the “traditional purpose of a preliminary injunction is to protect the status quo and to prevent irreparable harm during the pendency of the lawsuit.” Given these parameters, one may be reasonably surprised that the court went so far as to transfer the domain name before the case could be taken all the way through trial. Usually the transfer of the domain name is part of the final remedy awarded in a cybersquatting case, whether under the ACPA or the Uniform Domain Name Dispute Resolution Policy.

The opinion did not address the issue of whether the domain name transfer prior to trial might go further than to “protect the status quo”. It would seem the court could have just as easily protected the status quo by ordering the domain name not be used. The court apparently found the evidence to be drastically in favor of plaintiff. And since the defendant-competitor did not show up for the hearing, plaintiff’s evidence went unrebutted.

Nutramax Laboratories, Inc. v. Nutra Max Labs, Inc., 2017 WL 4707447 (D.S.C. October 20, 2017)

Court stops former dealer and company spokesperson from using trademark in domain name

Plaintiff likely to succeed on merits of claim under Anticybersquatting Consumer Protection Act (ACPA).

Defendant worked as a dealer, spokesperson and consultant to plaintiff. About the time she ended her relationship with plaintiff, defendant and another woman formed a competing business and registered several domain names comprised of plaintiff’s trademark or otherwise mimicking the domain name of plaintiff’s legitimate site. They used those domain names to redirect web users to the new company’s website.

Plaintiff sued under the ACPA and sought a temporary restraining order against the use of the domain names. In entering the TRO, the court found plaintiff was likely to succeed on the merits of its ACPA claim.

The court easily found the domain names were confusingly similar to plaintiff’s registered trademarks.

On the issue of bad faith use or registration, the court looked to the prior relationship between the parties, the electronic mail correspondence between them, and the undisputed fact that the parties were competitors. The court concluded that common sense suggested that the direction of traffic with the use of the disputed domain names to defendants’ website was for the purpose of commercial gain. Therefore, the court concluded that plaintiff had established a likelihood of success on the merits as to the cybersquatting claim.

Ball Dynamics Int’l LLC v. Saunders, 2016 WL 7034974 (D. Colo. December 1, 2016)

October 28, 2016 Cybersquatting, Trademarks

Court keeps door open on cabinet retailer’s domain name lawsuit

acpa

A guy named Plaza worked for defendant cabinet retailer for a few years and then left to start a competing business called 411 Kitchen Cabinets. Defendant seems to have not liked the new competition and registered the domain name <411kitchencabinet.com>. This allegedly caused confusion among consumers and negatively impacted the new business.

So the new company sued in federal court alleging claims under the Anticybersquatting Consumer Protection (15 U.S.C. § 1125(d)) (“ACPA”) and for trademark dilution. Defendant moved to dismiss. The court dismissed the dilution claim but allowed the ACPA claim to move forward.

Not like “Budweiser, Camel and Barbie”

To properly plead dilution, plaintiff was required to allege, among other things, that its mark was “famous”. Under the federal trademark law – the Lanham Act – a mark is “famous” when “it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.” 15 U.S.C. § 1125(c)(2)(A).

The court found that plaintiff had not alleged enough facts to show fame. In the court’s view, at most, plaintiff had alleged that its mark “ha[d] enjoyed a good name and reputation in the cabinets, countertops, vanities and granite industry.” That allegation did not establish the requisite fame required for a dilution claim and fell “well-short of alleging that Plaintiff’s mark [was] on the same scale as marks like Budweiser, Camel, and Barbie,” citing Brain Pharma, LLC v. Scalini, 858 F. Supp. 2d 1349, 1357 (S.D. Fla. 2012)

Yes on the cybersquatting claim

But the ACPA claim fared better. The court found plaintiff’s complaint sufficient to allege that plaintiff had sufficiently alleged that its use of its mark in commerce prior to the registration of the disputed domain name made the mark distinctive and entitled to protection. It also successfully pled that defendant’s domain name was confusingly similar to plaintiff’s mark. And the court also found that plaintiff successfully alleged that defendant had a bad faith to intent in registering and using the domain name. Key to this last portion was the fact that plaintiff alleged that defendant used the domain name to divert customers to its main website for commercial gain.

411 Kitchen Cabinets LLC v. King of Kitchen and Granite Inc., 2016 WL 7335840 (S.D. Fla. October 25, 2016)

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September 16, 2016 Cybersquatting, Trademarks

When can you use a competitor’s trademark in a domain name?

The recent case of XPO CNW, Inc. v. R+L Carriers, Inc. coming out of a federal court in Michigan tells the interesting story of one company opportunistically using its competitor’s trademark in a domain name to set up an employee recruiting website. The decision sketches out certain circumstances when this practice passes legal muster.

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The parties to the dispute are major trucking lines. If you have driven on any highways in the United States, you have no doubt seen 18-wheelers bearing the trademarks of the parties involved in this case. In late 2015, plaintiff XPO acquired Con-Way Freight. Shortly thereafter, defendant R+L launched a website targeting Con-Way’s employees using the domain name conwaylayoff.com. The website included the following statement:

Were you laid off from Con-way? Don’t worry about the XPO Logistics acquisition, when one door closes another opens. R+L Carriers is hiring today….Turn your valuable years of knowledge and experience into a new career with R+L Carriers, which was named a Top National/Multiregional LRL Carrier in Logistics Management magazine’s 2015 Quest for Quality Awards. R+L Carriers launched Conwaylayoff.com to inform those employees that may have been affected by the recent acquisition of Con-way Freight, of similar opportunities that we have where they may be able to put their skills to work.

Plaintiff sued for trademark infringement and for cybersquatting under the Anti-Cybersquatting Consumer Protection Act (“ACPA”). Defendant moved for judgment on the pleadings. The court granted the motion.

The court found there to be no sufficient allegations of trademark infringement because the documents before the court showed there was no likelihood of confusion as to the origin of defendant’s services. The language on the website (quoted above) contradicted plaintiff’s assertions of likely confusion.

On the ACPA claim, the court found there was no evidence that defendant used the domain name with a bad faith intent to profit.

The court compared this situation with the one in the case of Lucas Nursery and Landscaping, Inc. v. Grosse, 359 F.3d 806 (6th Cir. 2004). In Lucas Nursery, there was no evidence that defendant intended to divert consumers from the plaintiff’s online location. Nor was there evidence that defendant ever sought to mislead consumers with regard to the site’s sponsorship. The site explicitly stated that it was established for the purposes of relaying defendant’s experience with the plaintiff’s nursery. Moreover, there was no offer to sell the site to plaintiff, and no other indicators of bad faith existed, such as providing misleading contact information or acquiring batches of additional domain names.

In this case, it was undisputed that defendant set up a web site and used plaintiff’s trademark in the domain name. But this was insufficient to establish that defendant operated in bad faith. Plaintiff did not allege that defendant ever offered to sell the domain name to plaintiff. Nor did it allege that defendant acquired other suspect domain names. Instead, plaintiff offered the court a barebones recital of the statutory language, stating that defendant registered and has used the domain name without plaintiff’s authorization and with bad faith, to profit from plaintiff’s trademark, and that the infringing domain name directed or redirected to a website controlled by defendant, who profited from its use. The court found this to be insufficient to survive the relevant pleading standard. Accordingly the court granted the motion for partial judgment on the pleadings concerning this claim.

XPO CNW, Inc. v. R+L Carriers, Inc., No. 16-10391, 2016 WL 4801283 (E.D. Mich. September 14, 2016)

Photo courtesy of Flickr user Jean-Pierre Magnan under this Creative Commons license.