Re-Registration of a Domain is Not Registration Under the ACPA

The Ninth Circuit Court of Appeals has held that re-registration of a domain, from an individual to a company jointly owned by the individual, is not a “registration” under the Anticybersquatting Consumer Protection Act (ACPA), 15 U.S.C. §1125(d)(1), which triggers the bad faith analysis “at the time of registration of the domain name.” ACPA , 15 U.S.C. §1125(d)(1)(A)(ii)(I). GoPets Ltd. v. Hise, Case No 08-56110 (9th Cir. Sept. 22, 2011) (available here). The question answered by the Court was whether the term “registration” applies only to the initial registration of the domain name, or whether it also applies to a re-registration of a currently registered domain name by a new registrant. “We hold that such re-registration is not a ‘registration’ within the meaning of § 1125(d)(1).” GoPets at pg. 18010.

To prevail under the ACPA, plaintiffs must show (1) registration of a domain name by defendant, (2) that was “identical or confusingly similar to” plaintiff’s mark (3) when the mark was distinctive at the time of registration, and (4) “bad faith intent” by defendant at the time of registration. See 15 U.S.C. § 1125(d)(1). The issue in this case was “what is registration.” Id. pg. 18017.

Defendant Hise had registered the gopets.com domain in March, 1999. Plaintiff GoPets Ltd. filed a federal trademark application for “GoPets” on September 30, 2004. The mark was registered in November 2006, and the registration certificate lists the date of first use as August 20, 2004. There is a presumption that the information on the registration certificate is correct. 15 U.S.C. § 1115(a). Further, GoPets Ltd’s federal trademark rights relate back to the filing date of the mark. 15 U.S.C. § 1057(c).

On July 26, 2006, prior to the federal registration of the mark, a WIPO arbitrator in a UDRP action refused to transfer the domain gopats.com, ruling in favor of Defendant Hise. The arbitrator found that (a) the gopets.com domain name was confusingly similar to GoPets Ltd.’s service mark, and (b) he “wishe[d]. . . to make it clear that [he was] unconvinced” that the Hises ever had serious plans to develop a website at gopets.com. The arbitrator held that WIPO rules only compel the transfer of a disputed domain name if the name was initially registered in bad faith. Since Hise had registered gopets.com five years before GoPets Ltd was founded, gopets.com was not registered in bad faith. Pgs. 18012-13.

In December, 2006 GoPets Ltd offered to buy the domain for $40,000. Hise rejected the offer and countered to sell the domain for $5,000,000 in a letter sent to all GoPets Ltd shareholders. Two days later, Hise transferred the registration of gopets.com from himself to Digital Overture, a company jointly owned by Hise and his brother. This re-registration of the disputed domain, from Hise as an individual to a company partly owned by Hise, was a critical event.

After the WIPO UDRP decision, Hise registered numerous other “gopets” domains including gopet.mobi, gopets.mobi, gopets.name, gopetssite.com, goingpets. com, gopet.biz, gopet.org, egopets.com, gopets.bz, gopets.ws, gopet.tv, gopet.ws, gopet.bz, gopet.de, gopet.eu, gopet.name, mygopets.com and igopets.com. Although the Court ruled in favor of Hise on the basic gopets.com domain (finding that the re-registration – transfer of ownership – was not the ACPA bad faith trigger point), the Court did affirm the trial court’s decision that Hise violated the ACPA with respect to these additional, late filed domains.

The ACPA provides that “A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark under this section, if, without regard to the goods or services of the parties, that person (i) has a bad faith intent to profit from that mark, including a personal name which is protected as a mark under this section; and (ii) registers, traffics in, or uses a domain name that — (I) in the case of a mark that is distinctive at the time of registration of the domain name, is identical or confusingly similar to that mark…” ACPA, 15 U.S.C. §1125(d)(1)(A).

“After registering, a registrant can take a variety of actions that modify the registration. For instance, the registrant can update the registration if her contact or billing information changes. She can switch to ‘private’ registration, where a third party’s name is substituted for hers in the public databases of domain registrants. She can switch between registrars, but leave her contact and billing information unchanged. A registrant can change the name of the registrant without changing who pays for the domain, or a registrant can transfer both the domain and payment responsibilities to someone else. Even if the registrant does none of these things, she must still renew the registration periodically. All of these actions could conceivably be described as ‘registrations’ within the meaning of [ACPA] § 1125(d)(1).” GoPets at pg. 18018.

“Looking at ACPA in light of traditional property law, however, we conclude that Congress meant ‘registration’ to refer only to the initial registration. It is undisputed that Edward Hise could have retained all of his rights to gopets.com indefinitely if he had maintained the registration of the domain name in his own name. We see no basis in ACPA to conclude that a right that belongs to an initial registrant of a currently registered domain name is lost when that name is transferred to another owner. The general rule is that a property owner may sell all of the rights he holds in property. GoPets Ltd.’s proposed rule would make rights to many domain names effectively inalienable, whether the alienation is by gift, inheritance, sale, or other form of transfer. Nothing in the text or structure of the statute indicates that Congress intended that rights in domain names should be inalienable.” Id at pg. 18020.

Based on this analysis, the 9th Circuit Court of Appeals reversed the trial court and ruled that Hise did not violate the ACPA with respect to the gopets.com domain. Accordingly, Hise’s company Digital Overture remains the registrant and proper owner of gopets.com.

The Court also elegantly explained the parties involved in registration of domains. “[T]here are three primary actors in the domain name system. First, companies called ‘registries’ operate a database (or ‘registry’) for all domain names within the scope of their authority [e.g., all .com, .net, .gov, etc. domain names]. Second, companies called ‘registrars’ register domain names with registries on behalf of those who own the names. Registrars maintain an ownership record for each domain name they have registered with a registry. Action by a registrar is needed to transfer ownership of a domain name from one registrant to another. Third, individuals and companies called ‘registrants’ own the domain names. Registrants interact with the registrars, who in turn interact with the registries.” Id. at pg. 18018 (citing Office Depot Inc. v. Zuccarini, 596 F.3d 696, 699 (9th Cir. 2010)).

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