Internet Trademark Case Summaries
Anlin Industries, Inc. v. Burgess
2007 U.S Dist. LEXIS 20516 (E.D. Cal. Mar. 5, 2007)
Plaintiff manufactured vinyl replacement doors and windows under the registered marks ANLIN WINDOWS and ANLIN WINDOW SYSTEMS. In 1998, plaintiff registered the domain name “anlin.com” and used it to educate the public and dealers about its products, but not for direct sales. Defendant, doing business as Ultimate Home Windows, registered the domain name “anlinwindows.com” shortly after receiving a promotional visit from one of plaintiff’s salesman in 2001. Defendant was aware that plaintiff had already registered “anlin.com” when it registered “anlinwindows.com.” In 2003, defendant began using the “anlinwindows.com” website to attract potential customers and develop leads as an independent Anlin dealer. Defendant also used “Anlin” as a metatag for its website, and the website included a “disclaimer” at the top of the page and a link to plaintiff’s “anlin.com” website. Defendant later registered “anlinwindows.net,” “anlinwindows.org,” “anlin-windows.com,” and “anlin-windows.net,” but did not use them. Reacting to complaints from other dealers that defendant’s use of his “anlinwindows.com” website diverted business from their own efforts to develop leads, plaintiff contacted defendant and objected to his use of the website. During discussions, defendant offered to sell the domain names to plaintiff for $100,000, which plaintiff refused. Defendant continued to use the website and plaintiff sued for cybersquatting, trademark infringement, and unfair competition. Plaintiff moved for summary judgment on its ACPA claim. Defendant argued that he did not use the mark in bad faith because plaintiff authorized him to sell ANLIN products and his website linked to Anlin’s site and contained a disclaimer. The court initially noted, however, that the focus of a cybersquatting claim is on the use of plaintiff’s mark in his domain name, not on his website. In this regard, the court agreed with other courts holding that use of a disclaimer does not preclude liability under the ACPA because Internet users must access the site before seeing the disclaimer, i.e., initial-interest confusion. Turning to the elements of the ACPA claim, the court found that defendant’s domain names were identical or similar to plaintiff’s mark and that plaintiff’s mark was distinctive before defendant registered his domain names. Regarding bad faith, the court analyzed defendant’s conduct over three periods of time: (1) the date defendant registered “anlinwindows.com” until plaintiff discovered the website, (2) plaintiff’s first contact with defendant regarding the site until plaintiff sent its demand letter, and (3) the time after plaintiff sent its demand letter. The court found summary judgment improper during the first two time periods because there were genuine issues of fact as to whether plaintiff consented to defendant’s use of the domain name and whether defendant had reasonable grounds to believe that his use of the domain name was a fair use or otherwise lawful under ACPA’s “safe harbor” provision. Defendant’s intent to divert customers was also questionable because plaintiff did not sell its products over the Internet and because defendant was authorized to sell plaintiff’s products. However, as to the third time period, the court held that defendant’s continued use of the “anlinwindows.com” website after receiving plaintiff’s demand letter evinced a bad-faith intent to profit and supported summary judgment in favor of plaintiff. Although the court did not discuss defendant’s offer to sell the domain names in its discussion of bad faith, it noted in a footnote in the “Undisputed Facts” section of its opinion that this offer to sell should not be excluded under FRE Rule 408 because it was offered to prove an element of bad faith and not the validity or amount of the claim. Plaintiff asked for $10,000 per domain name in statutory damages plus attorney’s fees. The court instead awarded statutory damages of only $2,500 per domain name for a total of $12,500, because there were no allegations that plaintiff lost any sales or dealers and no proof of “actual diversion,” and defendant’s intent was to continue to sell plaintiff’s windows rather than profiting from the website. In short, “[plaintiff] has made no showing that Defendant interfered with its business in any meaningful way, or was anything other than a nuisance.” The court declined to award attorney’s fees because the case was still proceeding on other claims; this case was not “exceptional” because there was no evidence of willful, deliberate, or malicious intent on defendant’s part; and defendant was proceeding pro se. The court also issued an injunction against defendant’s use of plaintiff’s marks and any other “substantially similar” marks or domain names, and ordered the transfer of the five domain names to plaintiff. The court denied defendant’s cross-motion for summary judgment on plaintiff’s federal and state infringement claims, finding sufficient evidence that defendant’s website could cause customer confusion.