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The Anticybersquatting Consumer Protection Act: A New Cause of Action Against Bad Faith Misappropriation of Domain Names

Date: Jan 10, 2000


On November 29, 1999, the President signed the Anti-Cybersquatting Consumer Protection Act ("the Act"), creating a new cause of action against "cybersquatters." What follows is a brief overview of this new law which, in addition to providing protection against the unauthorized registration of personal names as domain names, adds a new Section 43(d) to the Lanham Act, 15 U.S.C. Section 1125(d).

  1. The Act provides for civil action against anyone who, with a bad faith intent to profit, registers, traffics or uses a domain name that is:
    • Identical or confusingly similar to a mark that was distinctive when the domain name was registered;

    • Identical, confusingly similar, or dilutive of a mark that was famous when the domain name was registered;

    • Infringes marks and names protected by statute
  1. The standard applied is a non-exclusive list of factors that may evidence the existence or non-existence of bad faith

    A. Factors evidencing bad faith include:

    • Registrant’s intent to divert customers;

    • Registrant’s offer to sell domain name(s);

    • Registrant’s warehousing of multiple domain names comprised of the trademarks of others;

    • Intent to tarnish or disparage a brand.

    B. Factors evidencing a lack of bad faith include:

    • Registrant’s genuine prior use of the domain name;

    • Any trademark or other intellectual property rights in the domain name;

    • Whether the domain name is the legal name or commonly known name of the registrant;

    • Registrant’s valid non-commercial or fair use of the domain name.
  1. Causes of action available:
    • Additional cause of action under Section 43(d) of the Lanham Act;

    • In rem against the domain name after exercising due diligence to locate the owner of the domain name.

  1. Jurisdiction/Venue
    • U.S. Federal Civil Procedure rules applied to determine jurisdiction;

    • For in rem actions:
      • where the domain name registrar, registry or other domain name authority is located;

        or
      • where documents sufficient to establish control and authority regarding disposition of the registration and use of the domain name are deposited with the court.
  1. Remedies
    • Actual damages and costs or statutory damages from $1,000 to $100,000 per infringing domain name, attorney’s fees and costs, recovery of the domain name, injunctive relief, defendant’s profits;

    • In rem actions: forfeiture, cancellation or transfer of domain name;

    • Reduced relief available for "in rem" and retroactive actions (domain names registered/misappropriated prior to effective date of the act).

For more information on cybersquatting or other Internet related issues, please contact Sheila A. Millar at (202) 434-4143 or by e-mail at millar@khlaw.com