The ACPA - A Cyber-landlord Eviction Law
Charles Carreon
That leaves us with the current state of the law, which is controlled by the Anti-Cybersquatting Consumer Protection Act (“ACPA”), a powerful statute that Congress grafted onto the Lanham Act that gives trademark owners the power to obtain injunctions, seizure orders, damages and attorney's fees against trademark counterfeiters. Cybersquatting, Congress apparently concluded, was another form of trademark counterfeiting — the theft of a name for the purposes of redirecting business to the wrongful owner. You can check the law out in the Legal Links.
Lawyers immediately discovered the value of the ACPA. A February, 2001 National Law Journal article entitled “Cybersquatter Litigation Boom,” told lawyers right where they would find the money:
“The Anti-cybersquatting Consumer Protection Act, effective in 1999, has spawned a litigation explosion. More than 700 lawsuits seeking injunctions or damages against suspected cybersquatters were filed in federal courts across the country in just the last six months. Appellate decisions interpreting the new act have also begun to mount. The ACPA helps trademark owners sue those who have registered like-sounding Internet domain names by easing jurisdictional requirements and expediting the litigation timetable. Statutory damages of up to $100,000 may be obtained where personal jurisdiction is established and the domain name was registered in bad faith.”
The ACPA is the equivalent of an eviction law for cyber landlords. In other words, it's a handy tool for a plaintiff, and a serious problem for a defendant. The first thing you want to avoid, unless you are one of the seven million people currently residing in the State of Virginia, is being sued there. And that could happen quite easily if a well-heeled corporate plaintiff decided to file an ACPA lawsuit to repossess one of your domain names and invoke the “in rem” provisions of law, which permit an ACPA plaintiff to file “in the judicial district in which the domain name registry is located.” There is only one “registry,” Verisign in Herndon, Virginia, so a lot of ACPA cases get filed in the Eastern District of Virginia, one of the most conservative and industry-friendly jurisdictions in the United States. Not a place where an average Joe generally finds it easy to retain counsel. You can avoid this whole problem by a simple expedient — keeping your registration information complete and up-to-date, because plaintiffs can only use the “in rem” option if they are unable to communicate with you using the contact information on the registration. After contacting the defendant, an ACPA plaintiff must also exercise “due diligence” to actually serve them with the lawsuit before they can file an “in rem” action directly against the domain name itself in the Eastern District of Virginia.
Regardless of where you are sued under the ACPA, it can be a difficult case to defend. Take the experience of John Zuccarini. He got sued by the registrant of “JoeCartoon.com” for cybersquatting uising names like JoesCartoon.com and other similar names. According to an article in the June, 2001 issue of Business Week, Zuccarini lost bigtime.
“The case was originally filed back in January, 2000, by Joseph Shields [against] John Zuccarini who had registered a bunch of domain names similar to JoeCartoon.com like JoesCartoon.com, JoeCarton.com and CartoonJoe.com. Anyone entering into one of those variations was mousetrapped into a series of click-thru advertisements, which Zuccarini has paid as much as $.25 per click. That may not seem like a lot of money, but Zuccarini had about 3,000 sites and earned between $800,000 and $1,000,000 annually, much of it from typo-squatting. *** [T]he court agreed that the ACPA covered the situation perfectly, and in addition to ordering a permanent injunction against Zuccarini's use of the names, hammered him with a fine of $10,000 per domain name along with an additional $40,000 to pay for Shields' attorney fees.”
Strictly speaking, in order to prevail in an ACPA action, the plaintiff should have to show what was clearly the case with Zuccarini — that the names were registered in “bad faith” in order to take advantage of traffic that would otherwise be directed to the plaintiff's site. If the case were tried before a jury, the results of applying a “bad faith test” would be all over the map. But in the short term, during the months and years between the filing of an ACPA lawsuit and trial, a judge will decide who gets to use the domain name. This is because most hardball ACPA lawyers file a “motion for preliminary injunction” that the judge can grant if the plaintiff is “likely to prevail on the merits at trial.” Experience thus far has shown that judges tend to be very protective of established corporate interests asserting rights to domain names.
That leaves us with the current state of the law, which is controlled by the Anti-Cybersquatting Consumer Protection Act (“ACPA”), a powerful statute that Congress grafted onto the Lanham Act that gives trademark owners the power to obtain injunctions, seizure orders, damages and attorney's fees against trademark counterfeiters. Cybersquatting, Congress apparently concluded, was another form of trademark counterfeiting — the theft of a name for the purposes of redirecting business to the wrongful owner. You can check the law out in the Legal Links.
Lawyers immediately discovered the value of the ACPA. A February, 2001 National Law Journal article entitled “Cybersquatter Litigation Boom,” told lawyers right where they would find the money:
“The Anti-cybersquatting Consumer Protection Act, effective in 1999, has spawned a litigation explosion. More than 700 lawsuits seeking injunctions or damages against suspected cybersquatters were filed in federal courts across the country in just the last six months. Appellate decisions interpreting the new act have also begun to mount. The ACPA helps trademark owners sue those who have registered like-sounding Internet domain names by easing jurisdictional requirements and expediting the litigation timetable. Statutory damages of up to $100,000 may be obtained where personal jurisdiction is established and the domain name was registered in bad faith.”
The ACPA is the equivalent of an eviction law for cyber landlords. In other words, it's a handy tool for a plaintiff, and a serious problem for a defendant. The first thing you want to avoid, unless you are one of the seven million people currently residing in the State of Virginia, is being sued there. And that could happen quite easily if a well-heeled corporate plaintiff decided to file an ACPA lawsuit to repossess one of your domain names and invoke the “in rem” provisions of law, which permit an ACPA plaintiff to file “in the judicial district in which the domain name registry is located.” There is only one “registry,” Verisign in Herndon, Virginia, so a lot of ACPA cases get filed in the Eastern District of Virginia, one of the most conservative and industry-friendly jurisdictions in the United States. Not a place where an average Joe generally finds it easy to retain counsel. You can avoid this whole problem by a simple expedient — keeping your registration information complete and up-to-date, because plaintiffs can only use the “in rem” option if they are unable to communicate with you using the contact information on the registration. After contacting the defendant, an ACPA plaintiff must also exercise “due diligence” to actually serve them with the lawsuit before they can file an “in rem” action directly against the domain name itself in the Eastern District of Virginia.
Regardless of where you are sued under the ACPA, it can be a difficult case to defend. Take the experience of John Zuccarini. He got sued by the registrant of “JoeCartoon.com” for cybersquatting uising names like JoesCartoon.com and other similar names. According to an article in the June, 2001 issue of Business Week, Zuccarini lost bigtime.
“The case was originally filed back in January, 2000, by Joseph Shields [against] John Zuccarini who had registered a bunch of domain names similar to JoeCartoon.com like JoesCartoon.com, JoeCarton.com and CartoonJoe.com. Anyone entering into one of those variations was mousetrapped into a series of click-thru advertisements, which Zuccarini has paid as much as $.25 per click. That may not seem like a lot of money, but Zuccarini had about 3,000 sites and earned between $800,000 and $1,000,000 annually, much of it from typo-squatting. *** [T]he court agreed that the ACPA covered the situation perfectly, and in addition to ordering a permanent injunction against Zuccarini's use of the names, hammered him with a fine of $10,000 per domain name along with an additional $40,000 to pay for Shields' attorney fees.”
Strictly speaking, in order to prevail in an ACPA action, the plaintiff should have to show what was clearly the case with Zuccarini — that the names were registered in “bad faith” in order to take advantage of traffic that would otherwise be directed to the plaintiff's site. If the case were tried before a jury, the results of applying a “bad faith test” would be all over the map. But in the short term, during the months and years between the filing of an ACPA lawsuit and trial, a judge will decide who gets to use the domain name. This is because most hardball ACPA lawyers file a “motion for preliminary injunction” that the judge can grant if the plaintiff is “likely to prevail on the merits at trial.” Experience thus far has shown that judges tend to be very protective of established corporate interests asserting rights to domain names.