London-based department store Harrods sued sixty domain names. Under the US Anticybersquatting Consumer Protection Act of 1999, trade mark owners are allowed to sue domain names, as opposed to suing the registered owners of the names.
The registered owner of the names was Harrods (Buenos Aires) Ltd., which opened a department store in Argentina in 1914. At the time, it was an affiliate of the more famous English company. The businesses severed all connections in 1963, although the Argentinian company still holds valid South American trade mark registrations.
The UK company owns US-registered trade marks in the Harrods brand. It accused Harrods BA of infringing and diluting these marks by its domain registrations which, it argued, were made in bad faith.
The collection of 60 domain names, registered with Virginia-based Network Solutions (now VeriSign), included variations on the brand, such as harrodsshopping.com and harrodsbank.org. The court overruled a lower court’s finding that the 1999 law did not allow the UK company to bring trade mark infringement and dilution claims.
According to The National Law Journal, the 1999 legislation’s provisions on taking action against a domain name, rather than its owner, only applied in cases of bad faith registration. The new decision, passed 23rd August 2002, appears to extend these provisions to trade mark infringement and dilution claims.
The ruling could be of concern to any business that does not have a US-registered trade mark for its brand but that uses the brand in a .com, .net or .org domain name. If a US business has an identical or confusingly similar mark, it could sue the non-US business in a Virginia court, arguing that there is infringement of its US mark, even if the use of the mark outside the US was in good faith.
The decision backs the long-held perception that US courts consider .com, .net and .org domain names to be for use by US businesses only.
According to the decision: “...Virginia’s interest in not permitting foreign companies to use rights emanating from, and facilities located in, its territory, to infringe US trade marks, also supports the exercise of [an action against the domain names]”.