Hakkasan denied preliminary injunctive relief in cybersquatting case for failure to establish irreparable harm

Trademark attorneys in the Ninth Circuit continue to face the fallout from last year’s Ninth Circuit decision in Herb Reed Enterprises, LLC v. Florida Entertainment Management, Inc., 736 F.3d 1239, 1249 (9th Cir. 2013), cert. denied, 2014 WL 1575656 (Oct. 6, 2014) (“Herb Reed”).  In Herb Reed, the Ninth Circuit, following the Supreme Court’s precedents in eBay Inc. v. MercExchange, 547 U.S. 388 (2006) (which held that the traditional four factor test, including establishing irreparable harm, must be employed in patent cases) and Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008) (which held that parties seeking a preliminary injunction must demonstrate that irreparable harm is likely in the absence of an injunction), rejected the notion that a plaintiff in a trademark infringement lawsuit was entitled to a presumption of irreparable harm upon demonstrating a likelihood of confusion from alleged trademark infringement and held that a plaintiff seeking a preliminary injunction in a trademark infringement case must demonstrate irreparable harm in order to get preliminary injunctive relief:

Gone are the days when “[o]nce the plaintiff in an infringement action has established a likelihood of confusion, it is ordinarily presumed that the plaintiff will suffer irreparable harm if injunctive relief does not issue.” Rodeo Collection, Ltd. v. W. Seventh, 812 F.2d 1215, 1220 (9th Cir. 1987) (citing Apple Computer, Inc. v. Formula International Inc., 725 F.2d 521, 526 (9th Cir.1984)). This approach collapses the likelihood of success and the irreparable harm factors. Those seeking injunctive relief must proffer evidence sufficient to establish a likelihood of irreparable harm.

The Herb Reed case has since left many trademark litigation practitioners (at least those practicing in the Ninth Circuit), after years of being able to obtain preliminary injunctions based on a showing strong showing of likelihood of confusion and the presumption of irreparable harm thereby, now trying to figure out what type of actual “evidence” can be shown to overcome this threshold of demonstrating a likelihood of irreparable harm and having to inform some trademark clients that a preliminary injunction might not be as easily obtainable for trademark infringement as it once was. 

  

The latest example of the struggle to overcome this irreparable harm threshold comes from a court decision by Nevada District Judge Jennifer Dorsey who denied the owner of the Hakkasan nightclub chain preliminary injunctive relief for alleged cybersquatting against an individual who had registered various domain names containing the term “hakkasan.”  See Hakkasan LV, LLC et al v. Eddie Miller, Case No. 2:15-cv-290-JAD-PAL (D. Nev).

Hakkasan had filed a cybersquatting lawsuit against Defendant Miller for his registration of the domain names domain names , , , , and (the “Contested Domain Names”) – one of which was linked to a website offering the domain name for sale for $5000 and the other four linked to a webpage located at (also owned by Miller), which encouraged third parties to “partner” with him. 

Along with the filing of the complaint, Hakkasan also sought an ex parte temporary restraining order and preliminary injunction against Miller.  However, the Court – without receiving any opposition from Miller – denied Hakkasan’s request for preliminary injunctive relief on the grounds that Hakkasan had failed to show any evidence of a likelihood of irreparable harm arising from Miller’s actions.

In rejecting Hakkasan’s arguments of irreparable harm, the Court stated that “there is no evidence that Miller has taken any steps to compete with Hakkasan’s business beyond registering the Contested Domain Names and offering them for sale.”   And while Hakkasan alleged that Miller was using the domain names to “solicit partners to offer counterfeit services to the public,” the Court found

no indication that Miller has sold any of the domain names, partnered with any other person, or constructed a website designed to create confusion with Hakkasan’s business, siphon customers from Hakkasan’s business, or otherwise cause Hakkasan irreparable harm. Speculation of what Miller will do with the domain names is hardly enough to bridge the legal gap between Miller’s actions and Hakkasan’s irreparable injury. Instead, these are the sorts of “platitudes” that the Herb Reed court warned may show harm Hakkasan might suffer, but not harm a party seeking injunctive relief is likely to suffer

Order at p. 4 (emphasis in original).

The Court also rejected as unpersuasive several other cases cited by Hakkasan as support that its evidentiary proffer was sufficient to show irreparable harm.  One case – Starbucks Corp. d/b/a Starbucks Coffee Company v. Heller, 2014 WL 6685662, at *8 (C.D. Cal. Nov. 24, 2014) – involved a case where the court found irreparable harm where the presence of infringing products in the market could damage business goodwill.  However, the Court noted that Hakkasan had not offered any evidence that Miller had “introduced any competing or counterfeit ‘products’ into the marketplace or taken any steps other than to register the domain name and attempt to sell it to third parties.” Order at p. 4. The second case – Kalologie Franchising LLC v. Kalologie Skincare Medical Group of California , 2014 WL 953442, at *5 (C.D. Cal. Mar. 11, 2014) – involved a defendant who was continuing to use the alleged infringing mark at the defendant’s facility through a point of sale system and a website and where the court found irreparable harm from “plaintiff’s loss of control over its business reputation resulting from a defendant’s alleged unauthorized use of its protected mark during the pendency of an infringement action.”  In the case of Hakkasan, however, there was no indication that Hakkasan’s marks were being used by Miller in a manner that was similar to the Kalologie case. 

Finally, Hakkasan made one final “Hail Mary” argument that Herb Reed was a trademark infringement case and that the Ninth Circuit’s decision did not expressly overrule the presumption of irreparable harm in a cybersquatting case.  The Court rejected such argument, especially given the Ninth Circuit past statements that “cybersquatting is a form of trademark infringement.”  The Court further noted two other cybersquatting court decisions issued post-Herb Reed where the plaintiffs were granted preliminary injunctive relief  –  one involving an evidentiary record showing systematic cybersquatting that was intended to deceive customers (Bittorrent, Inc. v. Bittorrent Marketing GMBH, 2014 WL 5773197 (N.D. Cal. Nov. 5, 2014) and another where “loss of control over business reputation” established irreparable harm in circumstances where the domain name owner actually operated a business in the same market as the plaintiff and sold products “slightly dissimilar” from plaintiff’s products (Kreation Juicery, Inc. v. Shekarchi, 2014 WL 7564679, at *12 (C.D. Cal. Sept. 17, 2014)).  The Court found that Hakkasan had failed to show use of the Contested Domain Names by Miller that reached the same levels as those in the Bittorrent and Kreation Juicery cases. 

Accordingly, because Hakkasan had failed to demonstrate a likelihood of irreparable harm, the Court denied both Hakkasan’s Application for Temporary Restraining Order and Motion for Preliminary Injunction.

Marc Lurie/AirFX.com Wins Reverse Domain Name Hijacking Claim Against AirFX, LLC on Summary Judgment

AirFX,LLC (“Defendant”), the owner of the trademark AirFX, suffered a defeat last week in its attempt to “acquire” (or as some might say “hijack”) the domain name www.airfx.com from its current registrant, Marc Lurie (“Lurie” or “Plaintiff” ).   [Note: There were many articles about this dispute last year when the court denied Defendant’s Motion to Dismiss – see here,  here, here, and here for a small sampling].

The airfx.com domain name was originally registered by Bestinfo on March 21, 2003.  In June 2005, Air Systems Engineering, Inc. ("ASE") filed a trademark registration application for the mark AirFX for “motorcycles, vehicle parts, namely, shock absorbers, and suspension systems for motorcycles, bicycles, automobiles, and powered vehicles.”  The mark registered in March 2007.  In April 2011, ASE assigned its trademark rights to a wholly owned subsidiary, Defendant AirFX,LLC.

Lurie originally was involved in operating skydiving wind tunnel businesses under the name "SkyVenture," but later decided to use the name AIRFX in connection with a new line of wind tunnels (despite having found ASE’s application to register AIRFX after conducting a trademark search).  Lurie acquired the airfx.com from Bestinfo for $2,100 on February 2, 2007, but never posted any content or created a website – and instead has a typical landing page (or “splash page” as defined in the opinion) put up by the registrar, GoDaddy.com.  While the landing page does have links to third party advertisements, Lurie maintained that he drived no revenue from such advertisements (and Defendant never provided any evidence to the contrary).  After leaving SkyVenture, Lurie was bound by a non-compete agreement prohibiting him from developing his own line of wind tunnels until 2010.  However, Lurie never sold any product under the brand AIRFX nor conducted any advertising, marketing, or manufacturing activities.  Lurie also never sold or offered to sell suspension systems for motorcycles, or any other motorcycle-related products.

Defendant contacted Lurie in 2008 regarding the purchase of airfx.com.  While the partie dispute the terms of the offer at that time, no agreement was reached.  In 2011, Defendant filed a domain dispute complaint before the National Arbitration Forum.  On May 16, 2011, the arbitration panel ruled in favor of Defendant and ordered that GoDaddy transfer airfx.com to Defendant.  See AirFX, LLC v. ATTN AIRFX.COM, Claim Number FA1104001384655 (NAF May 16, 2011)).

Lurie sought relief against the ordered transfer by filing a complaint which included a claim for reverse domain name hijacking under 15 U.S.C. § 1114(2)(D)(v).  Defendant counterclaimed with claims of cybersquatting and trademark infringement.  The parties filed cross motions for summary judgment.  On August 23, 2012, the U.S. District Court for the District of Arizona ruled in favor of Lurie by finding as a matter of law that Lurie was not liable for Defendant’s counterclaims of cybersquatting or  trademark infringement, and accordingly, Lurie’s Motion for Summary Judgment on its reverse domain name hijacking claim was granted.  See AIRFX.com et al. v. AirFX LLC, 2012 U.S. Dist. LEXIS 120285   (D. Ariz. August 23, 2012) (order here).

In deciding Defendant’s cybersquatting claim, the issue centered around the meaning of “registration” (ed.-an issue near and dear to my heart).  The court detailed the Ninth Circuit’s recent decision in GoPets Ltd. v. Hise, 657 F.3d 1024, 1030 (9th Cir. 2011) which clarified the meaning of "registration" and found that a party’s re-registration and continued ownership of a domain name that a party had registered long before a trademark owner registered its trademarks does not violate the cybersquatting statute (prior blog post here). 

Defendant attempted to distinguish GoPets because in that case, the original domain name registrant transferred the domain name to an entity that he co-owned.  In contrast, Lurie purchased airfx.com from an unrelated third party.  Defendant argued that the purpose of the ACPA would be undermined if a cybersquatter who purchases a domain name in bad faith is immune from liability simply because the domain name he purchased existed before a mark was  distinctive.

However, the court found otherwise: 

Nothing in the language of GoPets indicates that it should be read as narrowly as defendant suggests. GoPets did not distinguish between transfers of a domain name to related parties and other kinds of domain name transfers. To the contrary, GoPets broadly reasoned that if an original owner's rights associated with a domain name were lost upon transfer to "another owner," the rights to many domain names would become "effectively inalienable," a result the intention of which was not reflected in either the structure or the text of the ACPA.

In short, the court, following GoPets, found that it was undisputed that airfx.com was initially registered on March 21, 2003 by Bestinfo, ASE’s first use in commerce of the AirFX mark was June 2005, and Lurie purchased airfx.com on February 2, 2007 – and thus, Lurie’s registration of airfx.com in February 2007 "was not a registration within the meaning of § 1125(d)(1)” and because Bestinfo registered airfx.com long before ASE registered its mark, Lurie’s  registration and ownership of airfx.com does not violate the cybersquatting statute.  The court granted summary judgment on Defendant’s cybersquatting counterclaim in favor of Lurie. 

As for Defendant’s counterclaim for trademark infringement, the court focused on the fundamental issue of whether Lurie used the mark “in commerce” (noting that “If a person's use of a mark is noncommercial, it does not violate the Lanham Act.”).  Defendant’s sole argument of Lurie’s commercial use centered on particular allegations and admissions.  However, the court found no dispute that Lurie had never sold an AirFX product, have no advertising or marketing activities, have no manufacturing activities, never developed a website for airfx.com, and never sold any AirFX products or services on such website.  The court further found that Lurie’s limited activity of some pre-sales efforts and preliminary research, viewing such facts in the light most favorable to Defendant, was still insufficient to constitute commercial use of a mark.

Although plaintiffs have developed a brand name, registered a domain name, started  researching the design of their wind tunnels and approached potential investors and  customers, plaintiffs have not sold, manufactured, advertised, or marketed any product  bearing the AirFX mark. Defendant points to no other facts to establish plaintiffs'  commercial use of the AirFX mark.

As such, without raising any genuine issue  of material fact as to whether plaintiffs' use of the mark was commercial, the court found as a matter of law that no commercial use existed and therefore, there could be no trademark infringement as a matter of law and granted summary judgment on Defendant’s trademark infringement counterclaim in favor of Lurie. 

Finally, with respect to Lurie’s claim for reverse domain name hijacking, the only issue was whether Lurie’s registration of the airfx.com domain name was “not unlawful."

Because we have concluded that plaintiffs cannot be liable under the ACPA for cybersquatting as a matter of law, and because plaintiffs are entitled to summary judgment on the trademark infringement claim, we conclude that there is no genuine issue of fact as to whether plaintiffs' use of the domain name is lawful.

Defendant tried to argue that Lurie should not be entitled to such equitable relief because Lurie “conducted the litigation in unprecedented, and unprofessional ways.” [ed.—there are two sides to every story, and I’m sure Lurie has some stories about the actions of Defendant’s counsel as well].  However, the court noted the clear mandate of 15 U.S.C. § 1114(2)(D)(v), which allows the court to “grant injunctive relief to the domain name registrant, including the reactivation of the domain name or transfer of the domain name to the domain name registrant."  As such, the court ordered that the airfx.com remain registered with Lurie.

The court’s final words was to note that “[b]oth parties argue that this case is ‘exceptional’ under the Lanham Act, warranting an award of attorneys' fees. We will address a motion for attorneys' fees if and when one is before us.”   Stay tuned . . . 

Golden Nugget's Cybersquatting Campaign

GNLV, Corp., the company which owns the Golden Nugget Hotel & Casino in downtown Las Vegas (as well as Golden Nuggets in Laughlin and Atlantic City), continues its campaign to go after cybersquatters. After a two year lull of filing any type of cybersquatting lawsuits, GNLV has now filed five since April 27, 2011. [Ed.—Is this perhaps a sign of the improving economy that a gaming company is willing to invest the money to pursue such lawsuits in order to obtain (and/or prevent others from using) domain names of questionable value?]

In late April, GNLV Corp sued German resident Luca Mueller over the domain golddennugget.com (with an extra “d” in the spelling of Golden) which GNLV alleged linked to an online gambling site. See GNLV, Corp. v. Mueller, Case No. 11-cv-00663 (D. Nev. Filed April 27, 2011). (VegasInc article here.) Later in May, GNLV Corp. sued Kanter Associates over the domain name thegoldennuggett.com (with an extra “t” in the spelling of Nugget) which GNLV alleged linked to a travel reservation website. See GNLV, Corp. v. Kanter Associates SA, Case No. 11-cv-00827 (D. Nev. Filed May 20, 2011). (VegasInc article here.)

On May 31, 2011, GNLV filed three more cybersquatting lawsuits. The first lawsuit against Harald Ebert relates to the domain name www.goldennugget.info, which GNLV claims is linked to a website which offers “links to many of the same wagering games that are offered at Plaintiff’s casino resorts, such as Blackjack, Poker and Slots.” See GNLV, Corp. v. Mueller, Case No. 11-cv-00875 (D. Nev.). The second lawsuit against Marco Eckstein relates to the domain name www.golden-nugget-jackpot.com, which GNLV claims is linked to a website which offers “links to many of the same wagering games that are offered at Plaintiff’s casino resorts, such as slots.” See GNLV, Corp. v. Eckstein, Case No. 11-cv-00878 (D. Nev.). The third lawsuit against Hilary Moore involves the domain name www.seventysevengoldennuggets.com. See GNLV, Corp. v. Moore, Case No. 11-cv-00873 (D. Nev.). As for why GNLV can claim that the registration of this last domain name, which would be perceived by almost anybody as “77 Golden Nuggets” and not likely associated with GNLV’s GOLDEN NUGGET mark, constitutes cybersquatting? It would be because, according to the complaint, the domain name is linked to “a site offering a direct link to the Golden Nugget resort-hotel travel and reservation services, including a direct link to Plaintiff’s property located in Las Vegas, Nevada.” [ed.—might’ve been an easier case to defend had Defendant used the website in connection a gold mining business].

Of course, while I didn’t review the particular website printout exhibits attached to each complaint, a quick visit to each of the above domain names shows that they are your typical “landing page” offering various pay-per-click (“PPC”) generated ads (some of which may, as GNLV alleges, go to websites offering “the same wagering games offered by Plaintiff’s casino resorts” or to “resort-hotel travel and reservation services”). Are any of these particular websites truly causing economic harm to GNLV? Highly doubtful. So why is GNLV spending money filing lawsuits to go after domains that don’t really have much direct value for GNLV (and are certainly not diverting any business to GNLV’s own hotel/casino)? Perhaps simply because it can . . . and because it’s not as costly as you might think

When one considers that the minimum cost that a trademark owner would incur to file a domain name arbitration action under the UDRP is around $3000 (including fees paid for the arbitrator) and with an uncertain outcome (as anybody who has been involved in UDRP arbitrations will tell you), these lawsuits are a much much more cost effective way for a company to obtain possession of these domain names ($300 lawsuit filing fee, $100 bond, and maybe around $500-$1000 per case for attorneys fees and costs (assuming great economies of scale), since most of the documents are nearly identical and can be prepared mostly by administrative staff). In addition, unlike in a UDRP action, the lawsuit route allows the complainant to make a claim towards statutory damages for cybersquatting (minimum $1000 up to $100000 per domain name). Given the low likelihood that the Defendants will even respond to the complaints, each lawsuit has the strong potential to garner a $100,000 default judgment (albeit a judgment that is more often than not nearly impossible to collect).

Still, even at a price of about $1000 per domain name, one wonders why GNLV wants to invest even that amount of money for some of the domain names it is seeking. All GNLV is doing is preventing other third parties from obtaining a relatively minuscule amount of PPC revenue from the PPC ads showcased on the landing pages for each of these websites. As for the websites involving typosquatting, I continue to maintain that the vast majority of web users looking for GNLV’s GOLDEN NUGGET are saavy enough with respect to internet browsing that they will not be sidetracked by a landing page that offers links to an online casino or other hotel/casino – and will instead recognize their typo and retype the correct URL address or perform a search using one of the more popular internet search engines (which are certainly not fooled by these websites). When all is said and done, GNLV will be the proud owner of several domain names that will likely do very little in promoting the GOLDEN NUGGET brand and will generate very little additional traffic for GNLV's websites (along with very little additional revenue) beyond what GNLV would’ve already had, but which GNLV now will have to continue to pay annual registration fees in order to maintain these domain names. But I guess GNLV considers that fee (along with the fees paid to its lawyers for these sutis) a small price to pay to prevent domainers from making a single penny (literally) off of the GOLDEN NUGGET mark.

[UPDATE (July 26, 2011) -- Ron Coleman's Likelihood of Confusion® blog provides his response to my query here -- along with a shameless proposal to the people at the Golden Nugget to "handle their cost-effectiveness-be-damned domain trademark enforcement programs."]

Caesars Palace Files Declaratory Judgment Action Over OCTAVIUS TOWER

In so many trademark lawsuit stories that grab the media’s attention, the story is often one of a large corporation enforcing its trademark rights against individuals and small businesses in a manner that is often described as “trademark bullying” (but which, of course, from the corporation’s perspective could be seen as zealous protection of the company’s valuable trademark rights). The story behind this lawsuit is quite the opposite – in this case, it is the large corporation that is being bullied (or more accurately, majorly inconvenienced since a large corporation has sufficient resources to fight a legal battle in court) by an individual that is seeking to enforce highly questionable trademark rights.

On April 8, 2011, Caesars World, Inc. (“Caesars”), the owner of the CAESARS PALACE brand of hotel-casinos (including Caesars Palace in Las Vegas), filed a declaratory judgment action against a German man named Marcel July and his Nevada limited liability company, Octavius Tower LLC, based on the defendants claims to have exclusive ownership rights to the mark OCTAVIUS TOWER and demands that Caesars stop using the name in connection with a hotel tower. See Caesars World, Inc. v. July et al, Case No. 11-cv-00536 (D. Nev. April 8, 2011). A copy of the complaint (with exhibits) can be downloaded here.

Back in 2007, Caesars World’s parent company, Harrah’s Entertainment, Inc. (which has since been renamed Caesars Entertainment Corporation) announced a $1 billion expansion of the Caesars Palace Hotel-Casino in Las Vegas. One of the new hotel towers built as part of the expansion was going to be named the “Octavius Tower” (going along with Caesars “Roman” themed hotel/casino – presumably named after Julius Caesar’s adopted nephew, Gaius Octavius [for you Roman history scholars, feel free to correct me]).

The Octavius Tower at Caesars Palace in Las Vegas

Two days after Caesars’ announcement regarding its plans to build Octavius Tower, Mr. July, being the enterprising fellow that he appears to be, decided to registered several domain names such as octaviustowercom; octaviustowers.com; octaviustowerlasvegas.com; and octaviustowerslasvegas.com. The same day, July also registered the domain namescaesarstower.com; caesarstowers.com; caesarspalacetower.com; caesarspalacetowers.com; and caesarspalacetowerslasvegas.com. The websites at those domain names promoted that “The new Caesars Palace Towers are Coming Soon” and that the domain names were for sale (see Exhibit B of the Complaint). Caesars filed domain name arbitration actions against July under the UDRP with respect to those domain names that incorporated the mark Caesars Palace (but chose not to go after the Octavius Tower domain names without any trademark registration). The domain names were transferred to Caesars after the arbitrator determined that the domain names had been registered in bad faith. See Caesars World, Inc. v Marcel July Ra Christian Kaldenhoff, Nat'l Arb. Forum, FA 0801001126341 (March 3, 2008).

On July 20, 2007, Caesars filed its own intent-to-use application for the mark OCTAVIUS TOWER for “hotel services.” The application was allowed by the PTO on January 29, 2008; however, because of well-publicized construction delays due to lack of funding after the major downturn in the economy (see news articles here and here), Caesars was not able to provide a Statement of Use before the January 29, 2011 deadline and the application went abandoned (although Caesars, anticipating that its original application would go abandon, filed a new application on December 10, 2010).

Of course, what happened during the interim? Mr. July filed his own trademark registration applications with the PTO for the mark Octavius Tower in connection with entertainment services – specifically on May 7, 2008, July filed for the mark OCTAVIUS TOWER for “Entertainment services, namely, providing a web site featuring musical performances, musical videos, related film clips and photographs”. A registration was issued September 1, 2009. [Query—given that Caesars was already aware of Mr. July propensity for opportunism as illustrated by his domain name registrations and the fact that the marks were identical, why didn’t Caesar file an Opposition against Mr. July’s applications when it had the chance?] On July 23, 2009, July filed a second application for OCTAVIUS TOWER for “Entertainment in the nature of visual and audio performances, and musical, variety, news and comedy shows; Presentation of live show performances; Theatrical and musical floor shows provided at discotheques and nightclubs; Theatrical and musical floor shows provided at performance venues.” A registration for this second application issued on January 12, 2010. In addition to these federal registrations, July also filed three Nevada state trademark registrations for the mark OCTAVIUS TOWER in connection with entertainment services (here, here, and here) as well as a Florida trademark registration. Caesars alleges in its complaint that July has not used the mark in connection with any of the entertainment services identified in the registration (while I have not reviewed the specimens of use submitted by July in order to get his marks registered, I would not be surprised if they are questionable on their face).

Given that the PTO allowed Mr. July’s applications to register despite Caesars pending application for OCTAVIUS TOWER for hotel services, one would naturally not expect Caesars second application for OCTAVIUS TOWER to encounter any objections from the PTO, right? Wrong. On February 24, 2011, the PTO issued a non-final office action rejecting Caesars new application on the basis of a likelihood of confusion with Mr. July’s registration. So what did Mr. July do once he learned of the rejection? He got an attorney to send a cease and desist letter to Caesars (see Exhibit D of the Complaint) demanding that Caesars stop using Mr. July’s “trademarked name” Octavius Tower in any manner and threatening to pursue “all legal remedies available to him.” Caesars counsel wrote back on March 21, 2011, arguing no likelihood of confusion and offering to enter into a coexistence agreement. On March 23, 2011, July’s attorney later wrote back rejecting the coexistence agreement and reiterating the threat to take legal action. Subsequently, July purportedly modified his website at http://www.octaviustower.com/ to add a page that includes Caesars' 2007 announcement of its plan to launch Octavius Tower and includes copies of the correspondence July’s counsel sent to Caesars along with the message to the public about Caesars “infringement” of July’s trademark rights:

Public awareness of this unacceptable corporate behavior is crucial to eradicating it and we are asking you to take a stand and make a difference on this issue. Your collective voice is more compelling than the lobbying power of corporate giants and it is a voice that cannot be ignored. Together we can make a difference and help keep our freedom intact, for us, for our children, and for our grandchildren.

Caesars, recognizing its opportunity to file a declaratory judgment action against Mr. July in order to redress this mess, filed the instant action. In addition to seeking declarations of non-infringement of Mr. July’s trademark rights, Caesars also seeks to cancel July’s federal and state trademark registrations on the basis of non-use and fraud.

So with all of Mr. July’s talk about enforcing his trademark rights, we shall see how important those marks truly are to him and how strongly he feels about his trademark rights (and the strenghth of such rights). Too many individuals seem to have this impression that registration of a particular mark is the end-all-be-all for solidifying exclusive rights to a particular term. But registration is merely prima facie evidence of trademark rights. If you don't actually have any underlying trademark rights to a mark (i.e., some associated goodwill that the consuming public associates with your mark and thegoods/serivces sold using the mark), then you will not be entitled to make a claim of exclusive rights to a term (especially against a third party using the mark in connection with a substantially differnet good or service).

And while I suspect that Mr. July may try to turn this dispute into a "David vs. Goliath" battle (as reflected by his website) of a large corporation using its corporate power and the legal system to steal his valuable trademark, this is one time where I side with the big company.

Don’t Believe Everything You Read

Just because a court of law issues an order making findings of fact and conclusions of law does not mean that those facts and conclusions reflect the real truth. It only reflects a decision by the court based on the evidence and arguments presented to the court. Thus, a court decision may reflect the truth or may simply reflect the only factual conclusion that the court could reach based on the incomplete picture presented to it by the parties.

Such is the case with the cybersquatting and trademark infringement lawsuit brought by New York-New York Hotel & Casino, LLC (“NY-NY”), the company which owns the New York New York Hotel & Casino in Las Vegas (pictured above), against California resident Ronnie Katzin and his wholly-owned corporation, NewYorkNewYork.com, Inc., over the domain name newyorknewyork.com (the “Domain Name”). See New York-New York Hotel & Casino, LLC v. Katzin et al, Case No.09-cv-02139 (D. Nev.). On October 28, 2010, the Nevada district court issued an order (link here) granting NY-NY’s Motion for Summary Judgment against Defendant Defendant Katzin and finding as a matter of law that Katzin was liable for cybersquatting and trademark infringement with respect to his use of the Domain Name.

But as mentioned in the title above, don’t believe everything you read. For reasons detailed in my previous blog post regarding this case (link here), I believe the court’s decision is wrong. But as this case demonstrates, it’s often not enough that the defendant be in the right – a defendant has to be able to present factual evidence and make effective arguments to the court supporting its position that it is right in the face of accusations (however baseless) to the contrary by another party. And when you have to hire attorneys to help you do this in court, establishing that you are in the right suddenly becomes an expensive proposition.

In this case, Katzin, apparently not in a financial position to hire an attorney to fight NY-NY’s highly questionable allegations, decided to fight NY-NY pro se. But like many pro se litigants, he didn’t have the legal background and experience to put together factual evidence arguments in a way that would have been receptive to the court (and of course, with respect to NewYorkNewYork.com, Inc., because only lawyers can represent corporate entities in federal court and Katzin is not a lawyer, he was prohibited from filing any papers on behalf of his corporation).

The only positive thing about this order is that the court, recognizing the circumstances of the case, exercised its discretion and only awarded NY-NY $1,000 in statutory damages (the minimum amount of statutory damages for cybersquatting) – along with another “nominal” award of $1,000 for “corrective advertising” [ed.—correcting what?]. This is probably the best the court could do under the circumstances to send the message that while the court may have found Katzin liable for cybersquatting (and trademark infringement), he is not really a cybersquatter and did not really cause any significant harm to NY-NY’s precious trademarks.

The court’s awarding of $1,000 in statutory damages is a far more reasonable determination than the court’s previous awarding of the maximum statutory damages of $100,000 against NewYorkNewYork.com, Inc., as part of the default judgment entered by the court after no attorney made an appearance on behalf of the corporation to answer NY-NY’s allegations (and Katzin’s Answer filed on behalf of the corporation was struck since, as previously mentioned, Katzin is not a lawyer who could file an Answer on behalf of a corporate entity).

Having previously granted a default judgment against Defendant NewYorkNewYork.com, Inc., which resulted in the transfer to NY-NY of what NY-NY was really after in the first – the extremely valuable domain name newyorknewyork.com, the court’s decision (assuming no appeals are filed) effectively brings this example of injustice to an end.

New York New York Hotel/Casino Successfully Hijacks NewYorkNewYork.com

This is the sad (but probably all too common) story of one individual’s attempt to seek justice in our courts only to be smacked in the face with the reality of how our legal system really works. In this case, Goliath not only defeated David, but also obtained possession of a valuable internet domain name in the process leaving David with nothing.

The David in this case is California resident Ronnie Katzin (“Katzin”) and the Goliath in this case is New York-New York Hotel & Casino, LLC (“NY-NY”), the company which owns the New York New York Hotel & Casino in Las Vegas.

Not the real "New York New York" (but thanks to a default judgment, now the proud owner of http://www.newyorknewyork.com/)

On November 6, 2009, NY-NY filed a cybersquatting and trademark infringement lawsuit against Katzin and his wholly-owned corporation, NewYorkNewYork.com, Inc., regarding the domain name newyorknewyork.com (the “Domain Name”). See New York-New York Hotel & Casino, LLC v. Katzin et al, Case No. 09-cv-02139 (D. Nev. November 6, 2009). Complaint here (via Las Vegas Sun).

I previously blogged about this lawsuit here. I think it’s clear from the tone of my original post that I believed this lawsuit to be a clear cut case of NY-NY overreaching and using weak claims of trademark infringement and cybersquatting in order to reverse hijack the very valuable domain name newyorknewyork.com for NY-NY’s own business purposes.

While the allegations in the complaint sounded pretty egregious and straightforward, one must always keep in mind that almost anything can be stated in allegations set forth in a legal complaint – it does not mean that such allegations are automatically true (and indeed that’s what trials are all about – a jury or judge determining what are the true facts of a case based on evidence).

On the face of the complaint, NY-NY based its cybersquatting claim on the fact that its predecessor in interest, MGM Grand, Inc, announced the hotel-casino in 1994, and then on September 13, 1995 (three months prior to the date that NY-NY acknowledges in its complaint that Katzin registered the domain), NY-NY filed two trademark applications for NEW YORK NEW YORK (one for hotel services and one for casino services), which registered in September 1998

Of course, what the complaint never revealed was that NY-NY’s trademark applications were initially denied registration on the basis of descriptiveness (or possibly genericness -- the file wrapper is not available online so I’m not certain the basis for the refusal). NY-NY obtained these trademark registrations only after making a claim of “acquired distinctiveness” under Section 2(f). NY-NY acknowledges that it did not start actually using the mark until January 1997 when the hotel-casino opened – over a year after the Domain Name had been registered. So how could the mark “NEW YORK NEW YORK” have been distinctive at the time of the Domain Name was registered if the only basis for NY-NY’s own claim for registration on the Principal Register is NY-NY’s claim of acquire distinctiveness which it could not have achieved until it began using the mark in commerce in January 1997? And if the mark “NEW YORK NEW YORK” was not distinctive at the time Katzin registered the Domain Name, how could such registration be deemed cybersquatting under the Anticybersquatting Consumer Protection Act (“ACPA”) (setting aside the fact that a registration dating back to 1995 was pre-ACPA)? [Of course, some would argue that subsequent re-registrations of the Domain Name – even if occurring by Katzin himself – constitute new registrations and restart the date for determining distinctiveness and cybersquatting -- a position I strongly disagree with (and I believe this case demonstrates why), but which the courts seem to be embracing nonetheless despite the unfair consequences that can arise to domain name owners.]

What’s even more unbelievable is the single event that seemed to give NY-NY the “hook” for making its claims against Katzin after all this time. The website that Katzin was running at the Domain Name was a basic travel-type site that allowed visitors to make reservations to various hotels, restaurants, entertainment attractions located, where else, in New York, New York. Unfortunately, as part of that website, Katzin put up a banner ad which displayed “New York-New York Hotel & Casino” and which visitors to the Domain Name could click on and make reservations to that hotel or possibly other hotels in the Las Vegas. According to Katzin (in a statement he made to the Las Vegas Sun), this image linked to a room-booking website operated by Expedia's Interactive Affiliate Network, which has a deal to sell MGM Mirage rooms (NY-NY is part of MGM Mirage). This single banner ad (pictured below) that probably only ran for a short period of time gave NY-NY the hook that it had probably been looking for to file a cybersquatting complaint against Katzin and his corporation.

A screenshot of the so-called “infringing” website captured just before the lawsuit

Is this trademark infringement? Maybe, but only for minor damages and nothing that can’t be remedied through a court injunction and certainly not deserving of a court order turning over such a valuable domain name. Is this cybersquatting? Only if you believe that Katzin registered the Domain Name all those many years ago before New York-New York Hotel & Casino had even opened (and could make any claim for acquired distinctiveness), waited nearly 15 years, and then through the posting of a single banner ad in a larger website that had nothing to do with New York-New York Hotel & Casino is engaging in bad faith use of the Domain Name such that Katzin should be labeled as a cybersquatter.

Unfortunately for Katzin, the WHOIS registration information for the Domain Name reflected that the corporation was the registrant of the Domain Name, which is why the corporation was named as a co-Defendant in the case. While some of the filings show that Katzin represented himself in this case, he could not represent the corporation before the court since Katzin is not a licensed attorney. Without legal representation, NY-NY was able to obtain a default against the corporation and requested a default judgment against the corporation.

A review of some documents filed by Katzin in the case do raise some questions regarding ownership of the Domain Name (issues of fact that should’ve been decided by a factfinder). While the corporation may have been listed as the registrant on the WHOIS database, I would argue (and indeed I have argued albeit somewhat unsuccessfully) that WHOIS cannot be relied upon for determining ownership to a particular domain name. There was also some evidence that Mr. Katzin may have even had a written license agreement with the corporation for the corporation to use the domain name – which would suggest that Katzin was indeed the true owner of the Domain Name despite what was reflected in WHOIS.

But none of that mattered unfortunately because Katzin apparently could not afford to hire legal counsel to represent the corporation in this matter. And last week, U.S. District Court Judge Lloyd George awarded NYNY the Domain Name by virtue of a default judgment against the corporation – the purported owner of the domain name. A copy of the court’s order is available here. The Domain Name was apparently transferred the very day the court entered its order (an order that was drafted by NY-NY and merely signed off on by the court).

The end result is that NY-NY, by pursuing a case through the legal system against a party that it probably knew would not have the financial wherewithal to mount a defense against a big-time hotel/casino company like NY-NY, was able to lawfully take from Katzin an extremely valuable domain name for its own use. The newyorknewyork.com domain name was probably worth upwards of $100,000 – and rather than buying it from Katzin for a fair market price, NY-NY obtained it for the costs of filing a district court action and its attorneys fees. And not only did NY-NY get the Domain Name, but the court awarded NY-NY the maximum statutory damages allowed under the ACPA for cybersquatting ($100,000). So not only did NY-NY obtain a domain name worth $100,000, but also got a default judgment against Katzin’s corporation for $100,000. [ed--talk about the “house” winning.]

The cybersquatting statute was meant to stop bad faith registration of domain names and bad faith use of a domain – it was not mean to be used as a tool by large businesses to obtain possession of domain names that they feel rightfully belong to them from someone who was lucky enough to buy a valuable domain name during the infancy of the internet and who had been holding onto such domain name and making actual good faith use of the name separate and apart from its meaning as a designator of a Las Vegas hotel and casino [that’s right – New York New York does have another highly recognized meaning out there that has nothing to do with NY-NY's hotel/casino]. Instead, the ACPA has become a tool to allow trademark owners like NY-NY to hijack domain names that they would like to have as part of their asset portfolio under the guise of cybersquatting and trademark infringement claims.

Based on what I saw from court filings, there was no evidence in the case that the Domain Name had ever once relied upon the goodwill of NY-NY other than the aforementioned banner ad – an action that could’ve easily been redressed with a cease and desist letter. [There were some other interesting facts in this case involving the Domain Name also being hijacked from Katzin in 2004 (during which time it may have been improperly used, but not by Katzin) – only to be returned in 2006 after the FBI discovered the large scale theft of domain names by a company named True Magic – but that’s outside the scope of this post (and touched upon briefly in my prior blog posting).] Of course, NY-NY didn’t want Katzin to cease and desist from using the banner ad on the website – NY-NY wanted the Domain Name, plain and simple. While NY-NY may have had a real cause for complaint regarding trademark infringement because of this banner ad , this was not cybersquatting and did not merit the handing over to NY-NY of the Domain Name. This was a successful domain name hijacking, plain and simple. And all because a business entity must be represented in court by legal counsel and legal complaints that go unanswered are deemed true regardless of what kind of fatuous allegations are stated therein and despite the existence of other evidence that raises serious issues of fact regarding such factual allegations.

While the case technically moves on because NY-NY sued both the corporation and Katzin personally, and the default judgment was only against the corporation and not Katzin, now that NY-NY has what it really wanted all along (along with a $100,000 cherry on top), I would suspect that NY-NY might simply voluntarily dismiss its claims against Katzin individually so that the judgment against the corporation can be made final.

Owner of Petronas Twin Towers Files In Rem Cybersquatting Action Against PetronasTowers.Net

Petroliam Nasional Berhad (“Petronas”), the owner of the Petronas Twin Towers in Kuala Lumpur, Malaysia, filed an in rem cybersquatting lawsuit in the U.S. District Court for the Northern District of California against the domain name petronastowers.net. See Petroliam Nasional Berhad v. Petronastowers.net, Case No. 10-cv-03052 (N.D. Cal. July 12, 2010). Complaint here (via courthousenews.com).

The Petronas Twin Towers in Kuala Lumpur, Malaysia

(Wikimedia Commons)

Petronas is wholly-owned by the Government of Malayasia and was established to develop Malaysia’s petroleum resources. With all of the money it brought in as a successful worldwide oil and gas company, in 1996, Petronas built the Petronas Twin Towers, the tallest buildings in the world until 2004 when Taipei 101 was completed (and both of which have since been overshadowed by the Burj Khalifa in Dubai). The towers still hold the title of largest free standing towers in the world. (Of course, how many of you remember the Petronas Towers more for their featured prominence in the plot to the Sean Connery-Catherine Zeta Jones heist film Entrapment?)

Petronas promotes its business on the website www.petronas.com.my and also owns the mirror domain names www.petronas.com, www.petronas.org, and www.petronas.my. The official Petronas website promoting the Petronas Twin Towers is www.petronastwintowers.com.my. And Petronas also holds a trademark registration for the design mark PETRONAS in connection with, among other goods, chemicals and oil.

At issue in the complaint is the domain name www.petronastowers.net, which was registered in May 2003 (currently registered with GoDaddy) and, as a .NET domain name, the registry is with Verisign. WHOIS records reflect the owner of the domain name as an individual in London. The domain name currently hosts an adult website offering live adult videocam shows, adult photos, etc. -- a different type of “twin towers” for certain (but I can’t say that I saw anyone named Petronas).

Petronas requests the court issue an order to GoDaddy to transfer the domain name immediate to Petronas or alternatively, “forever cancelling the domain name” (an unusual alternative request for relief if it’s meant to be just to GoDaddy given that the order would be to a single registrar and would not impact any other registrars who, at the request of a registrant, might register petronastowers.net again – perhaps such an order would be better directed to the registry, Verisign. Anybody out there ever obtain such an order?).

UFC files In Rem Cybersquatting Action Against theultimatefighter.com

Las Vegas-based Zuffa LLC (“Zuffa”), the company which owns the marks THE ULTIMATE FIGHTING CHAMPIONSHIP and UFC in connection with mixed-martial arts competitions, filed an in rem lawsuit in the U.S. District Court for District of Nevada against the domain name theultimatefighter.com. See Zuffa, LLC v. theultimatefighter.com, Case No. 10-cv-00582 (D. Nev. File April 21, 2010). A copy of the complaint can be downloaded here (HT: Steve Green).

In addition to its more widely known UFC and ULTIMATE FIGHTING CHAMPIONSHIP marks, Zuffa has also registered the mark THE ULTIMATE FIGHTER in connection with the following goods/services (the applications of which were all filed June 2004 on the basis of intent to use):

• laser video discs, digital video discs, digital versatile discs and CD-ROM discs, all featuring sports events and mixed martial arts (link here) – claimed date of first use November 2005;
• tee-shirts; team uniform reproductions, namely jerseys featuring reproductions of professional athletic team logos; hats; caps; and for entertainment in the nature of an on-going television program in the field of sports and mixed martial arts (link here) – claimed date of first use January 2005; and
• tank tops; shorts, headwear; workout and sports apparel, namely shorts and shirts (link here) – claimed date of first use January 2005.

According to the complaint, Zuffa (and its predecessors-in-interest) began using THE ULTIMATE FIGHTER in 2003 in connection with a reality show named “The Ultimate Fighter” - although the complaint later acknowledges that the show has been broadcast on the Spike television network since as early as 2005. There is also a vague mention of some common law rights resulting from use of the name in connection with a Las Vegas gym where the reality show was filmed.

Of course, the date when the mark became distinctive is relevant because it is only cybersquatting if the domain name was confusingly similar to a mark that was distinctive on the date of registration. The domain name in dispute was purportedly registered by Anton Resnick with the registrar eNom on January 22, 2004 (long before Zuffa’s aforementioned trademark applications). The domain name http://www.theultimatefighter.com/ currently is redirected to a Yahoo page dedicated to mixed martial arts.

Zuffa argues that Resnick’s registration of the domain name http://www.theultimatefighter.com/ was a bad faith intent to profit from Zuffa’s trademark rights in THE ULTIMATE FIGHTER (i.e., cybersquatting). It is puzzling, however, why Zuffa waited over six years to go after Resnick for this so-called bad faith cybersquatting for a domain name registered six months before Zuffa had even filed the aforementioned intent-to-use trademark applications. Also interesting is that Zuffa owns the domain name http://www.ultimatefighter.com/, but WHOIS records suggest it was created only recently in January 2010. [DotWeekly ran an article in late March about the domain name acquisition by Zuffa from Marchex -- a company known for buying and selling domain names].

As for why Zuffa chose to bring this in rem action in a jurisdiction where neither the domain name registrant, the domain name registrar, or the domain name registry is located, the following is the jurisdictional statement:

This Court has in rem jurisdiction over pursuant to 15 U.S.C. § 1125(d) and 28 U.S.C. § 1655 and interpretive case law. Upon information and belief, this Court cannot exercise personal jurisdiction over the registrant of, as the registrant is located outside of the State of Nevada and/or website is not interactive. As a separate and independent basis for in rem jurisdiction, upon service of this Complaint upon the registrar of , the registrar will deposit domain name into the registry of the Court. In addition, the situs of domain name is, or will be, in this judicial district where the owner of the trademark contained in domain name is located.

Of course, see my previous blog post here regarding another in rem cybersquatting lawsuit filed in the District of Nevada (by the same law firm) citing the same jurisdictional argument as a basis for in rem jurisdiction. In that particular case, the plaintiff brought a Motion for Temporary Restraining Order, which was not only denied by the court, but which prompted the court sua sponte to dismiss the entire in rem action outright the very next day due to lack of jurisdiction under 15 U.S.C. § 1125(d)(2)(A). A copy of the court’s order in that case, which details the relevant "interpretive case law" quite nicely, can be found here.

Nonetheless, by searching the domain names at issue in that case, it appears that just filing the complaint was enough to get the domains at issue transferred. And more than likely, that is the strategy being pursued here by Zuffa.

District Court finds that Casino De Monte Carlo owner has no enforceable trademark rights to CASINO DE MONACO

The Casino de Monte Carlo in Monaco

A New York District Court has determined that the owner of the Casino De Monte Carlo does not have enforceable trademark rights in the mark CASINO DE MONACO and has granted summary judgment in favor of a UK company that had been sued for trademark infringement and cybersquatting over its use of the name GRAND MONACO CASINO in connection with an online casino. See In re. Casino de Monaco Trademark Litigation, 2010 U.S. Dist. LEXIS 33950 (S.D.N.Y. March 31, 2010).

Societe des Bains de Mer et du Cercle des Etrangers a Monaco’s (“SBM”) is the operator of all casino properties in the Principality of Monaco, most notably the Casino De Monte Carlo. Playshare PLC (“Playshare”) is a UK company that acquired an online casino that has used or is using various online designations including GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL and GRAND MONDIAL CASINO and related domain names.

SBM holds a U.S. trademark registration for the mark CASINO DE MONACO for “providing casino services within a hotel resort environment” which issued on December 20, 2005, under Section 44(e) of the Lanham Act based on SBM’s registration of the mark in Monaco but also with a claim of acquired distinctiveness based on Section 2(f) of the Lanham Act. SBM also has a second application pending for CASINO DE MONACO for “casino services” but that application (filed in the midst of the dispute at issue) has been opposed by Playshare. See Societe Anonyme Des Bains De Mer Et Du Cercle Des Etrangers v. PlayShare PLC, Opposition No. 91188636 (T.T.A.B. Filed Jan. 30, 2009).

On March 21, 2007, SBM filed a Uniform Domain Name Dispute Resolution Policy (“UDRP”) complaint with the World Intellectual Property Organization (“WIPO”) against the approximately 65 domain names that Playshare acquired as part of the online casino it acquired which included the words “grand” and/or “monaco” with “casino” as part of a URL that led to Playshare’s online casino. In response to SBM’s UDRP complaint, Playshare made a decision to change the name of its online casino to GRAND MONDIAL and even registered the name as a trademark (although the opinion is not clear where the mark was registered and no records appear with the PTO). Despite the name change, SBM continued forward with its claims regarding the “monaco casino” domain names. On May 25, 2007, the WIPO arbitration panel decided in favor of SBM finding Playshare’s domain names confusingly similar to SBM’s trademark and ordered Playshare’s domain names transferred to SBM. See Société des Bains de Mer et du Cercle des Etrangers à Monaco v. Lucan Toh and Max Wright, Case No. D2007-0249 (WIPO May 25, 2007).

On June 6, 2007, SBM sued Playshare alleging that Playshare’s use of the aforementioned names and domain names infringed its trademark rights to the mark CASINO DE MONACO, including even Playshare’s new name GRAND MONDIAL. On June 19, 2007, Playshare filed its own declaratory judgment action against SBM in Arizona district court seeking a declaratory judgment that its use of the domain names did not violate the Anticybersquatting Consumer Protection Act (“ACPA”) and that SBM’s registered mark for CASINO DE MONACO is invalid and unenforceable. The Arizona action was consolidated with the New York action and Playshare’s declaratory judgment causes of actions were treated as counterclaims.

Both sides filed cross motions for summary judgment. The Court denied SBM’s motion and granted Playshare’s motion with respect to SBM’s claims and Playshare’s counterclaims related to CASINO DE MONACO.

The court first addressed the validity of SBM’s CASINO DE MONACO mark. Playshare argued that despite SBM’s registration of CASINO DE MONACO, SBM has no protectable rights under the Lanham Act in its mark since it does not provide any goods or services using the mark in the U.S. SBM does not operate an on-line gaming business, does not operate any casinos in the U.S and has no casino by the name of Casino de Monaco

Nonetheless, SBM argued that it did use the mark as a service mark in the U.S. in connection with an established business or trade.SBM focused on its New York subsidiary that engages in “sales offerings” to U.S. residents of casino services at SBM’s casinos in Monaco. SBM also contended that the name CASINO DE MONACO is an umbrella term for all its Monaco-based casinos, that the mark is used on SBM’s website and verbally when promoting its casino and casino-related services, and that CASINO DE MONACO is a nickname for the Casino de Monte-Carlo, and many people, including Americans, use the name CASINO DE MONACO to refer to the Casino de Monte-Carlo “which embodies tremendous goodwill, glamour, elegance and style in the gaming industry.”

In the end, however, the court rejected SBM’s arguments and concluded that SBM’s activities in the United States relating to SBM’s mark CASINO DE MONACO did not constitute “services” within the meaning of the Lanham Act (services that are not “solely for the benefit of the performer” but rather services “rendered to others”). The court also rejected SBM’s attempt to conflate its CASINO DE MONACO mark with its more established CASINO DE MONTE-CARLO service mark. CASINO DE MONACO is not an actual casino unlike Casino de Monte-Carlo. The court also noted that “any secondary meaning that the mark CASINO DE MONACO can acquire vis-a-vis the use of the mark CASINO DE MONTE-CARLO is limited by the fact that SBM is in an on-going dispute with U.S.-based Victoria Partners over the Monte-Carlo designation when used with the casino business. Without some resolution, the mark CASINO DE MONTE-CARLO can be reasonably construed as not “identifying a single source of origin.” (italics in original). [For prior blog posts on this ongoing dispute, click here and here].

The court noted that SBM’s Section 44(e) based registration only required it to affirm that it had a bona fide intent to use its foreign registered mark. The court went on the state:

However, regardless of SBM’s intent, which is disputed, SBM has not used the mark in any meaningful way anywhere. And SBM has not shown that it has used the mark in the United States at all. SBM argues that its “U.S. based direct sales activities represent ‘material aspects’ of SBM’s casino business...and thus are properly considered ‘services...rendered in commerce.” for SBM’s mark CASINO DE MONACO. However, the record is devoid of evidence that would create a genuine issue of material fact that SBM uses the mark CASINO DE MONACO to identify its services, anywhere, but particularly in the United States. First, there does not exist in Monaco, or anywhere else, a casino identified by the name Casino de Monaco. Nevertheless, SBM asserts that the mark CASINO DE MONACO is: (1) used as a nickname or moniker for Casino de Monte-Carlo; (2) employed on casino website(s); and (3) an umbrella term/brand to refer to SBM’s five casinos in Monaco. However, all that SBM can show to support these representations are self-serving affidavits. Even if this claimed use of the mark CASINO DE MONACO was not insignificant on this record, which it is, all of its use of the mark occurs outside of the United States. There is no real evidence that the claimed nickname/moniker/umbrella term that signifies CASINO DE MONACO has ever existed in the United States.

(internal citations omitted) (emphasis in original).

Furthermore, regarding the one example that SBM could show of use in the United States of the mark CASINO DE MONACO on SBM’s own website, it turns out that such webpages were created on or after April 14, 2008 (almost a year after the lawsuit was filed) and SBM did not show any evidence that anyone in the U.S. ever viewed the pages. The court added that “[i]t does not bolster SMB’s [sic] position that all activity SBM engages in the United States amounts to nothing more than advertising and promotion of SBM’s operations outside the U.S., i.e., in Monaco. What is clear is that there is no evidence on the record that this limited activity ever implicated the mark CASINO DE MONACO.” (emphasis in original).

The court decided that SBM’s “utter lack of use of the mark CASINO DE MONACO anywhere, let alone in the United States,” required it to refuse to enforce any purported trademarks rights by SBM in the mark. Accordingly, the court did not have to engage in any likelihood of confusion analysis. The court did find enough limited activity to protect SBM’s purported right to the unregistered mark CASINO DE MONTE-CARLO because SBM actually utilizes that mark in the United States – but since SBM’s complaint did not allege any infringement of this mark, such rights were irrelevant for purposes of deciding the motions.

Based on its determination that SBM held no enforceable trademark rights to the mark CASINO DE MONACO, the court granted summary judgment on Playshare’s declaratory judgment causes of actions direct to SBM’s CASINO DE MONACO mark. The court found SBM’s trademark registration for CASINO DE MONACO invalid and unenforceable and ordered it to be canceled. The court further granted Playshare’s Motion for Summary Judgment on all of SBM’s federal claims based on the CASINO DE MONACO mark (and choosing to dismiss all state claims by declining to exercise supplemental jurisdiction). Moreover, the court declared that Playshare’s use of the designations GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL CASINO and GRAND MONDIAL does not infringe on SBM’s (now cancelled) mark CASINO DE MONACO. Finally, because SBM’s entire basis for its cybersquatting claim was based on rights to the mark CASINO DE MONACO and since the mark was found invalid and unenforceable, then, as a matter of law, Playshare cannot be in violation of the ACPA with respect to its domain names. The court vacated the WIPO decision and ordered the domain names to remain with Playshare.

Planet Hollywood Resort & Casino Gets TRO Against Domain Name

(Photo credit: Freelasvegasphotos.com)

Another week, another Las Vegas resort and casino cybersquatting case.

This week, it is OpBiz, LLC (“OpBiz”) – the owner of the Planet Hollywood Resort & Casino in Las Vegas – going after Unister GmbH (“Unister”), an company whose domicile is unknown but believed to be in Germany. See OpBiz, LLC v. Unister GmbH, Case No. 09-cv-02192 (D. Nev.). A copy of the complaint can be downloaded here. The Las Vegas Sun reports on the lawsuit here.

But unlike last week’s cybersquatting case pitting New York New York Hotel and Casino against the owner of newyorknewyork.com (blogged here), this lawsuit is a little more clear cut, as evidenced by the fact that the court has already issued a temporary restraining order in the case ordering the domain registrar to lock the domain and have it transferred to OpBiz pending the outcome of the litigation (copy of the order here).

According to the complaint, Unister registered the domain name http://www.planet-hollywood-resort.com/ with the domain name registrar Domain Robot on July 18, 2009, and soonafter, began linking the domain name to a “hotel reservation website offering links to services provided by Plaintiffs competitors.” OpBiz alleges that the website offers vacation and flight packages at the Planet Hollywood resort and casino, but when website visitors attempt to purchase such packages, they are informed that no rooms are available and instead offered to book rooms at other competing hotels, from which OpBiz believes Unister will obtain pay-per-click referral revenue. The website is already down but Google’s cache still has a snapshot of the website here.

This case is a much clearer illustration of the type of activity that the Anti-Cybersquatting Protection Act was designed to address. And yet, in the end, what does OpBiz get out of the lawsuit except possession of a fairly worthless domain name that was probably not getting much traffic in the first place (nor was it probably diverting a lot of customers away from Planet Hollywood, but this point is certainly up for debate). After all, how many web users will type in planethollywoodresort.com into a web browser with dashes between each word (OpBiz already owns the same domain name without dashes)? It’s not the type of domain name that internet users would just stumble across. Moreover, Unister’s website doesn’t appear anywhere among top search results for the terms Planet Hollywood Resort.

And while OpBiz, upon obtaining a default judgment when Unister undoubtedly fails to respond to the complaint, might be able to obtain the maximum statutory damages award of $100,000 for Unister’s infringing domain name (see 15 U.S.C. §1117(d)), is OpBiz really going to go through the steps to try and collect such a judgment? Then again, in these tough economic times with the Planet Hollywood Resort & Casino teetering on the verge of bankruptcy (news story here), maybe they will. And with federal courts possibly starting to come around towards accepting that domain names can be property subject to creditor claims (see court order in Bosh v. Zavala; see also comments by Venkat and Digital Media Lawyer Blog), perhaps there might be some property for OpBiz to attach after all.