Big names may not prevail in domain disputes

Trademark holders face unaccustomed opposition in the escalating dispute over domain names, attorney Eric J. Sinrod says.

There was a time when it seemed that powerful trademark holders generally prevailed when they sought the transfer of Internet domain names that contained their trademarks.

But recent decisions show that domain name registrants have a fighting chance under certain circumstances.

Rather than go to federal court, many trademark holders proceed with arbitration in their efforts to seek the transfer of domain names. While they cannot obtain damages and attorney's fees in arbitration, as they could in federal court, a final decision can be obtained in a matter of just a few months, rather than years for final court resolution.

It is common for such arbitrations to be decided by arbitrators in accordance with the Uniform Domain Name Dispute Resolution Policy of the Internet Corporation for Assigned Names and Numbers (ICANN).

In essence, for a trademark holder to prevail and thus to obtain the transfer of a domain name, the trademark holder must show that: (a) the holder has a valid trademark rights and that the domain name is confusingly similar to its trademark; (b) the domain name registrant has no legitimate interest in the domain name; and (c) the domain name was registered in bad faith.

Rather than go to federal court, many trademark holders proceed with arbitration in their efforts to seek the transfer of domain names.

A recent arbitration involving the domain name MagicJohnsonTravelGroup.com is typical of the general trend of domain name arbitrations, in that the trademark holder prevailed in obtaining the transfer of the subject domain name.

In this instance, the domain name MagicJohnsonTravelGroup.com was being used by Myspecialprice.com to display links to Magic Johnson and Los Angeles Lakers apparel and travel agency services.

The arbitrator found that this domain name was confusingly similar to the "Magic Johnson" and "Magic Johnson Travel Group" trademarks held by June Bug Enterprises on behalf of Magic Johnson and his recent venture Magic Johnson Travel Group.

The arbitrator also found that the registrant had no legitimate interest in the domain name. Furthermore, the arbitrator concluded that the registrant had acted in bad faith, as it registered the domain name only a couple of days after the public announcement of the Magic Johnson Travel Group.

Accordingly, all three elements of the ICANN policy were deemed satisfied, and the domain name was transferred to the trademark holder. As mentioned, this has been the general result when trademark holders have sought the transfer of domain names that incorporate their marks.

However, two very recent arbitration results buck this trend.

In the first such arbitration, Metro-Goldwyn-Mayer Studios, which produced the 1983 movie WarGames, filed an arbitration seeking the transfer of the domain name WarGames.com.

The three-member arbitration panel agreed that the domain name was identical to the MGM Studios registered trademark WarGames.

The panel also found that the registrant used the domain name for pay-per-click advertising for the first eight years he had the domain name. However, the panel found that in 2006 he began using the domain name as an online store to sell military simulation war games.

This, according to the panel, showed there was a bona fide offering of goods. Accordingly, the registrant proved legitimate rights to the domain name WarGames.com. As such, not all three elements of the ICANN policy had been satisfied, and the domain name was not transferred.

In the next such arbitration, New Pig sought the transfer of the domain name Pig.com. The three-member arbitration panel agreed that the Pig.com domain name was identical to the trademark "pig" of New Pig.

However, the panel did not find that the domain name was registered to take advantage of New Pig's mark. Instead, it was used to display pay-per-click links related to the generic term "pig." The panel found that Pig.com was registered in good faith based on the dictionary meaning of the word "pig."

Thus, all three elements of the ICANN policy were not satisfied, and the domain was not transferred.

The foregoing does not mean that trademark holders will not succeed when they seek the transfer of domain names that incorporate their marks under appropriate circumstances--far from it. However, the WarGames.com and Pig.com arbitration results stand for the recent proposition that domain registrants can try to fight off trademark holders when they can show legitimate uses for their domain names and lack of bad faith.

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