March 2012 Issue

Civil Cases

Petroliam Nasional Berhad v. GoDaddy.com, Inc.,
2012 WL 10532 (N.D. Cal. Jan. 3, 2012)

CASE SUMMARY

FACTS
Petroliam Nasional Berhad (“PNB”) is the national oil company of Malaysia, which operates websites at “petronas.com.my” and “petronastowers.com.my.”  In 2003, a third party registered the domain names “petronastower.net” and “petronastowers.net,” and forwarded those names to pornographic websites.  In 2007, the registrant changed registrars to GoDaddy.com, Inc. (“GoDaddy”) and continued to forward the domain names to pornographic websites using GoDaddy’s free forwarding service.  In 2009, PNB requested that GoDaddy cease its “direct and contributory infringement” of PNB’s mark.  GoDaddy responded that while it would not tolerate illegal content on its customers’ websites, any disputes regarding the domain names had to be resolved with the registrant directly through arbitration at the WIPO or the local courts.  After PNB brought two successful in rem actions for cybersquatting against the registrant of the domain names, it sued GoDaddy for both direct and contributory cybersquatting under the Anticybersquatting Consumer Protection Act (“ACPA”).  Both parties moved for summary judgment.

ANALYSIS
Regarding direct infringement, the court held that PNB did not provide evidence sufficient to raise a triable issue as to elements of that claim, namely, that (1) GoDaddy registered, trafficked in, or used a domain name (2) that is identical or confusingly similar to the plaintiff’s protected mark, and (3) with a bad-faith intent to profit from PNB’s mark.  The court held that GoDaddy did not “use” the domain name for purposes of the first element because it did not charge for its domain-name-forwarding service and did not control where or when the customer forwarded the domain.  Rather, GoDaddy “simply provided the infrastructure to the registrant to route the . . . [d]omains to the website of his choosing.”  Nor was there any evidence that GoDaddy had a license from the registrant to use the domain names.  According to the court, GoDaddy’s contractual right to alter or terminate services to the registrant did not equate to a license for GoDaddy to “use” the registrant’s domain names.  Finally, the court found no evidence that GoDaddy had a bad-faith intent to profit from PNB’s mark.  Although GoDaddy’s forwarding service was valuable to its customers, GoDaddy neither charged nor profited from this service.

Turning to contributory liability, the court held that “because the ACPA was enacted against the settled common-law theories of contributory liability in the trademark context, a judicially-created claim of contributory cybersquatting would be valid,” i.e., it is a “cognizable claim.”  PNB, however, failed to show that GoDaddy exercised the type of “direct control” required for contributory liability.  Specifically, GoDaddy’s domain-name-forwarding service was a type of routing, and a “company providing [an] Internet routing service does not exercise the type of direct control and monitoring that would justify recognition” of the claim.  Furthermore, the court held that direct cybersquatting was a necessary element of contributory cybersquatting, but PNB failed to prove the registrant’s bad-faith intent to profit from PNB’s mark required to establish cybersquatting.

CONCLUSION
This case is of interest because it appears to be the first time a court in the Ninth Circuit has recognized the viability of a contributory cybersquatting claim under the ACPA.