Scarinci Hollenbeck, LLC
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201-896-4100 info@sh-law.comFirm Insights
Author: Scarinci Hollenbeck, LLC
Date: October 29, 2018
The Firm
201-896-4100 info@sh-law.comCybersquatting — the practice of registering or using a domain name to profit from the goodwill of someone else’s trademark— is increasingly common. For example, the estate of the late singer Prince recently filed a lawsuit alleging that a New Jersey business is cybersquatting through its use of Prince.com. The suit alleges that Domain Capital is infringing on the estate’s “PRINCE” trademark and seeks permanent injunctive relief, transfer of the domain, damages, and attorneys’ fees under the Anticybersquatting Consumer Protection Act (“ACPA”).
If a domain name uses a company’s trademark without authorization, there are a number of legal remedies, including the (ACPA) the Uniform Domain Name Dispute-Resolution Policy (“UDRP”). Both legal tools have their advantages and disadvantages, which are described in greater detail below.
The UDRP, which is administered by the Internet Corporation for Assigned Names and Numbers (ICANN), requires trademark-based domain-name disputes to be arbitrated and establishes procedures for quickly resolving disputes. Trademark holders can pursue expedited administrative proceedings in cybersquatting cases by filing a complaint with an approved dispute-resolution service provider, such as the National Arbitration Forum (NAF) or the World Intellectual Property Association (WIPO).
When deciding cases, arbitrators must take the following criteria into consideration:
If the complainant is successful, the domain name will be canceled or transferred to the complainant.
The UDRP is quicker and less expensive than filing a lawsuit, which makes it an attractive option for many businesses. Trademark owners also retain the right to file suit at a later date. The primary disadvantage is that damages are not available. However, for trademark owners who are only seeking to have the domain name transferred or canceled, the UDRP makes the most sense.
Under the ACPA, trademark holders can file federal lawsuits against cybersquatters. To prevail in an ACPA suit, a plaintiff must show that (1) the defendant registered, trafficked in, or used a domain name; (2) the domain name is identical or confusingly similar to a protected mark owned by the plaintiff; and (3) the defendant acted with “bad faith intent to profit from that mark.” In determining if the defendant has bad faith, the court may consider the following non-exclusive factors:
The ACPA authorizes a court to order the forfeiture or cancellation of a domain name or the transfer of the domain name to the owner of the mark. In lieu of actual damages, plaintiffs may pursue statutory damages ranging from $1,000 to $100,000 per domain name. Where multiple infringing marks are at issue, the ACPA become an increasingly attractive option.
If you have any questions or if you would like to discuss the matter further, please contact me, David Einhorn, or the Scarinci Hollenbeck attorney with whom you work, at 201-806-3364.
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