CYBER-SQUATTING CONTINUED

In perhaps an aggressive application of the Anti-Cyber Piracy Act, the U.S. District Court for the Eastern District of Virginia ruled the company Virtual Works, Inc., violated the Act by registering the Internet domain name “VW.net.” The basis of the decision was the finding that Virtual Works had offered to sell the domain name, which the court found to have been derived from the trademark of Volkswagen of America, Inc., to Volkswagen after receiving warnings of claimed trademark infringement.

Although the company was incorporated under the name Virtual Works (and for which VW obviously comprises the company’s initials), the court found it determinative that Virtual Works never conducted business under the initials “VW”. Further, Virtual Works had not trademarked the initials or registered “VW” as an assumed name for the purpose of transacting business. The corporation also had not incorporated any subsidiary division with the “VW” name. The court also found that there was a likelihood of confusion in the public, not withstanding the fact that there was no similarity in the goods or services of Virtual Works and Volkswagen.

In a very interesting statement, the court decided that “holder of a domain name should give up that domain name when it is an intuitive domain name that belongs to another.” (Emphasis added) The court resolved that a domain name is more than a mere Internet address. It also identifies the Internet site to those who reach it, much like a company’s name identifies the company.

If this rationale is to be widely adopted, it may be a wise strategy to offer a link (for a reasonable price) to a non-competitor that also has a public identity, trademark or service mark that is similar to the domain name. It will also be wise to trademark the domain name whenever possible or otherwise be able to show use of the exact name in the business of the domain name owner. This will be problematic due to the special rules of the US PTO regarding the trademarking of domain names. The USPTO will not allow a domain name to be trademarked if it only an Internet address. The USPTO obviously does not share the court’s view that a domain name is more than a domain name. (Note that this rule is published on the USPTO web site, www.uspto.gov.)