Procedures for Protecting Entertainment Domain Names Against Cybersquatters

A entertainment trademark owner can use a sunrise period to purchase a domain before it is available on a “first come, first served” basis, which can serve as a useful marketing tool for gTLDs geared toward specific industries, and to protect a trademark owner from discovering a competition-driven site bearing its trademark in the “.sucks” gTLD. The Trademark Clearinghouse also provides notifications to registered trademark owners whenever a domain matching their trademark in a new gTLD is activated. This gives trademark owners a way to actively police their marks and determine if legal action must be taken against a cybersquatter.

When a cybersquatter is discovered, a trademark owner has a variety of options that it can use to challenge the infringement, depending upon the strength of the trademark owner's mark and the ultimate outcome desired. Litigation may be commenced under the federal Anti-Cybersquatting Prevention Act (ACPA), an amendment to the Lanham Act that provides a cause of action against the owner of an infringing domain — that is, a domain name that is identical or similar to a protected trademark — if that domain was registered in bad faith. 15 U.S.C. §1125(d)(1)(A). The ACPA lists nine non-exhaustive factors that may lead to a finding of bad faith, including attempts made by an allegedly cybersquatting domain owner to sell the domain for financial gain and if the domain owner has purchased other domains that infringe upon other trademarks. §1125(d)(1)(B). A court may award monetary damages from $1,000 to $100,000 per infringing domain under ACPA, as well as order the transfer of the domain to the trademark owner. §§1117(d), 1125(d)(1)(C).

The ACPA applies to websites registered after Nov. 29, 1999, the date that the federal statute took effect. The U.S. Court of Appeals for the Third Circuit has held that “reregistration” of a domain registered before Nov. 29, 1999 — such as a change in domain registrar or registrant — is enough to cause a domain to fall within the ACPA's purview. See, Schmidheiny v. Weber, 319 F.3d 581 (3d Cir. 2003). Along with a claim under the ACPA, a trademark owner might also elect to set forth causes of action under state law, such as fair trade statutes, and common law tort claims like unjust enrichment.

Like any lawsuit, an ACPA litigation can become lengthy and expensive. In the same year the ACPA became effective, ICANN also adopted the Uniform Domain Resolution Policy (UDRP), aimed at providing a faster, less costly method of challenging domain name infringement. In a UDRP proceeding, a trademark owner submits a complaint to one of five approved UDRP providers and the provider must in turn notify the infringing domain's registrar to lock the domain. The registrar must then notify the domain owner, who has 20 days to answer the complaint. A panel consisting of one or three individuals (depending on the parties' choice) then renders a decision.

To prevail in an UDRP proceeding, an entertainment trademark owner must prove by a preponderance of the evidence that: 1) the domain name is identical or confusingly similar to the trademark in which the complainant has rights; 2) the domain owner does not have any right or legitimate interest in the domain name; and 3) the domain has been registered in bad faith. Evidence of bad faith may include the purchase of the domain solely for resale or intent to drive business away from the trademark owner. The UDRP process takes roughly 45 days to complete and the domain will be transferred to the trademark owner if successful.

Another similar dispute resolution mechanism was adopted by ICANN in the wake of the approval of the many new gTLDs known as the Uniform Rapid Suspension (URS) proceeding. A complainant in a URS proceeding must be the owner of a federally registered trademark, or one that is either court-validated or protected by a statute or treaty, whereas in a UDRP proceeding, a complainant can proceed even if it has only acquired common law rights in the mark.

The procedure for commencing a URS is similar to a UDRP, in that a trademark owner must submit a complaint to one of three approved URS providers; however, a URS complaint is limited to only 500 words. ICANN, Uniform Rapid Suspension Rules, ¶ 1.2.7. (Mar. 1, 2013). A domain registrar must lock the domain upon notification of the complaint and the domain owner must be notified. Upon notification, the domain owner must respond in 14 days and within five days a single member panel will render a decision. Filing fees for a URS proceeding begin at around $375, while a UDRP proceeding can cost thousands depending on the number of challenged domains.

In a URS proceeding, a complainant must present clear and convincing evidence of essentially the same elements as in a UDRP proceeding. This higher burden means that, to be successful in a URS proceeding, a complainant must have strong evidence of infringement. If the complainant meets this burden, the domain will be suspended but not transferred as in the case of a UDRP. The high standard of proof, coupled with the fact that the domain will merely be suspended — meaning the owner cannot transfer it for the pendency of the registration — is likely behind the low popularity of the URS in comparison to UDRP proceedings.

In the case of domain name infringement, when it comes to pursuing legal action, the best course of action depends on the goal and resources of the trademark owner. If a trademark owner seeks money damages, an ACPA claim is appropriate. However, if the owner needs a lower cost solution to a case of obvious infringement, a URS may be the best option.

The rise of social media has also created a new world for intellectual property theft from entertainment companies. But social media users posting content are potentially subject to a copyright or trademark because doing so could form the basis of an infringement action. See, e.g., Malibu Media v. Rahusen, 14-6976 (D.N.J. 2015).

Trademark and copyright owners who discover infringing content on social media can start by contacting the company hosting the content. See, e.g., Facebook, Reporting Copyright Infringements. And the Digital Millennium Copyright Act (DMCA), which sets forth a procedure by which online service providers can avoid liability for infringement by removing content upon receiving notification of potential infringement, is applicable to social media sites. Thus, the DMCA can be an important tool for the removal of infringing content on sites like Facebook and Twitter. The owner of intellectual property being illegally shared on social media may also pursue an infringement suit.

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Karen Levin is a partner in the Corporate and Intellectual Property groups in the law firm Cullen and Dykman. Ariel Ronneburger is an associate in the firm's Commercial Litigation and Intellectual Property groups. Damias Wilson is an associate in the firm's Corporate and Intellectual Property groups. This article also appeared in the New Jersey Law Journal, an ALM sibling of Entertainment Law & Finance.