Summary Judgment Granted for Defendant in Domain Name Lawsuit

The Court of Appeals for the Sixth Circuit recently upheld a district court’s grant of summary judgment in favor of defendant Michelle Grosse in an Anti-Cybersquatting Consumer Protection Act (ACPA) suit brought against her by Lucas Nursery and Landscaping, the company she hired to repair a dip in her front yard. Discontented with the service provided by Lucas, and after an adverse result in a Better Business Bureau investigation, Grosse posted a website under “lucasnursery.com”, wherein she published criticisms of Lucas’s service. Lucas responded with a cease and desist letter claiming infringement of Lucas Nursery’s trademark. However, after her research concluded that no trademark registration existed for Lucas Nursery, Grosse resumed the operation of the website. Lucas brought this suit in 2001. Both parties moved for summary judgment; Lucas’s motion was denied and Grosse’s was granted.

The ACPA sets out a number of factors to be weighed in considering whether a defendant’s registration of a domain name has been in bad faith and is therefore actionable. Those factors are: (i) whether the defendant has trademark or other rights in the domain name; (ii) the extent to which the domain name consists of the defendant’s legal name or other common name; (iii) any prior use of the domain name for the offering of goods and services; (iv) whether defendant has made a bona fide noncommercial use of the site; (v) whether the defendant seeks to divert consumers from the mark holder’s online location either in a way that could harm good will or tarnish or disparage the mark by creating a confusion regarding the sponsorship of the site; (vi) whether there has been an offer to transfer or sell the site for financial gain; (vii) whether the defendant provided misleading contact information when registering the domain name; and (viii) whether the defendant has acquired multiple domain names which may be duplicative of the marks of others.

Despite the fact that the first three factors cut against Grosse, the court of appeals agreed with the district court that factor (iv), Grosse’s bona fide noncommercial use of the site for the sole purpose of conveying her experience with Lucas, worked to her favor as did factors (v) through (viii), for Lucas had no web site which traffic was diverted and Grosse had not registered multiple domains nor provided false information when registering the disputed domain or offered to transfer it to Lucas for a financial gain. Balancing these factors, the court of appeals upheld the grant of summary judgment for Grosse.

Ultimately, the decision is based in the court’s opinion that the intent of Congress in passing the ACPA was aimed at preventing the “land grabs” that result from warehousing multiple domain names and attempting to deal in them, as distinguished from the capture of a single domain name, which the Court concluded Congress was not intending to regulate, no matter how valuable a specific domain name may be to a particular ACPA plaintiff.