Typo-Squatting Infringes the Anti-Cybersquatting Protection

TrafficProducer · #1 (**permalink**) 11-15-2006, 10:31 AM

Typo-Squatting Infringes the Anti-Cybersquatting Protection Act

On September 1, 2006, a U.S. District Court in Wisconsin, decided that the Defendants, a group of the Plaintiff’s affiliates, acted in bad faith when they used typo-squatting to generate revenue on the Plaintiff’s sales by linking to their commercial website. In the case of Lands' End, Inc. v. Remy, the Defendants were accused of acting in bad faith when they attempted to gain extra commissions from the Plaintiff’s affiliate program via its website, www.landsend.com. Lands' End sued under the Anti-Cybersquatting Consumer Protection Act, [15 U.S.C. §1125(d)] ("ACPA"). The Defendants argued that they did not act in bad faith, however, the court did not agree.

Lands' End maintains an affiliate program whereby links to their website were provided through pre-approved “affiliate” websites. Each referring affiliate would receive a commission on sales made on landsend.com in return for the referral. The Defendants were four separate affiliates, all pre-approved by the Plaintiff. In addition to the other domain names that were approved and listed as affiliates, the Defendants further registered domain names similar to landsend.com without the Plaintiff’s knowledge or permission. Allegedly, the defendants created a system that would automatically and invisibly redirect Internet uses to the official Lands' End site, generating a commission for their pre-approved domain and additional commission from the other misspelled domains. When the Plaintiffs became aware of this situation, they sued the Defendants for false advertising, breach of contract, fraud, and violations of the Anti-Cybersquatting Consumer Protection Act.

Although the Defendants claimed that they did not act in bad faith because they did not divert customers but had actually generated more sales for the Plaintiff, the court rejected the Defendants' contentions, stating that the Plaintiffs supplied the court with enough evidence to prove that the Defendants impermissibly used the Plaintiffs trademark by registering misspells of the “LANDS END” trademark to then gain additional referral commissions.

REF: Sedo News letter:
Monthly Update on Domain-Related Legal News
By Sheri Archidiacono, Esq, L.L.M Legal Counsel

MaxPowers · #2 (**permalink**) 11-15-2006, 03:49 PM

wow, a legal precedent for the guy using a different tld as my affiliate program that he is a member of... same story, different details..

wonder if I'll go "Gertie" on him :)

Andy Beard · #3 (**permalink**) 11-15-2006, 06:03 PM

I always ask the program owners permission, and they very rarely refuse.

They sometimes request to be kept informed about how a domain name will be used.

The stupid thing is, at the end of the day, the owner of the compnay will get less traffic.

If they could effectively gain the traffic the affiliate was getting, they wouldn't need the affiliate program.

Also the report is misleading, and suggests the affiliate was being paid twice for a single sale. IANAL but that would be fraud, and nothing to do with a domain dispute.

RegDCP · #4 (**permalink**) 11-16-2006, 02:00 AM

Quote:

The stupid thing is, at the end of the day, the owner of the compnay will get less traffic.

If they could effectively gain the traffic the affiliate was getting, they wouldn't need the affiliate program.

Also the report is misleading, and suggests the affiliate was being paid twice for a single sale. IANAL but that would be fraud, and nothing to do with a domain dispute.

Exactly.
It is called cutting off your nose to spite your face.
I was constantly getting top 3 listings for one of my affiliate program pages, well above the originator of the software.
This caused enough bad feelings betwween the owner and myself that I stopped promoting the program.

This kind of attitude is everywhere.
I once had a boss get upset at the amount of commissions I was making in his retail establishment.

Reg

TrafficProducer · #5 (**permalink**) 11-16-2006, 04:24 AM

Quote:

It is called cutting off your nose to spite your face.

It could be that it's too much work to check the types of sites and how sites link to them.

They are paying cash, (PPC), for thoses Keywords and don't want to be out-bid.

They'er scared that others could do better SEO than them. The story could read "10 year old kid does better than XYZ in SEO,".

As you say:-

Quote:

I once had a boss get upset at the amount of commissions I was making in his retail establishment.

Maybe this is why Google only allow 3 adsence blocks per page. :-)

DrTandem1 · #6 (**permalink**) 11-16-2006, 08:55 AM

I think the issue before the court wasn't the sales generated, it was the trademark infringement. Lands' End is a registered trademark. It is incumbent upon the trademark's owner to defend the trademark against infringement. Not to do so, the company could lose their trademark.

Furthermore, although these affiliates were making sales for Lands' End, if Lands' End didn't challenge this, there would be a precedent set and other such sites could infringe on the trademark and not divert to the Lands' End official site.

Lastly, the affiliates' agreements with Lands' End apparently forbid unauthorized/unapproved sites from associating themselves with Lands' End.

The affiliates should have gotten approval from Lands' End.

nottheusual1 · #7 (**permalink**) 11-16-2006, 10:23 AM

I've got to agree with Dr.T. on this one - dilution is such a serious issue for TM holders that they really have to defend the mark or risk losing its strength and becoming generic.

We are in a similar situation with The Evil Giraffe, even though we've been in business for over 5 years. Beat them in a UDRP/WIPO arbitration action, but are still tied-up in the USPTO TTAB.

Other thing might be that it isn't really Land's End going after the typo-squatters - it's the law firm(s) they hire that are tasked to do these things. They lay out a plan with the corporate counsel (some senior VP) and act on the plan - better than good chance the Land's End marketing types may not even be involved.

With diversion - it isn't a case that the potential customer eventually ended up at the Land's End site, it is the fact that they had to get there via the offending site - like, why should they pay for the visitor via the affiliate when they would have eventually ended up there anyway.

All the courts find it quite reasonable to expect that a customer who "typo's" a domain name will realize that and then correct the spelling once they don't arrive where they want to be. I'd have to agree. Typo-squatting sucks.

DrTandem1 · #8 (**permalink**) 11-17-2006, 08:38 AM

Yes, typo-squatting does suck. Usually, it is just an annoyance and you have to wonder why any idiot would bother to make a site by misspelling "Google." These affiliates of Lands' End were using them as a redirect to make money.

My concern is when I'm visiting a site such as a banking site, I always double check the page before I enter the log-in information. Some have an extra layer of security. They present an image that the customer selected at sign-up to be shown before the customer enters a password. That way, if the customer doesn't recognize the image or there isn't one, they are alerted that they are not at the real site.

Andy Beard · #9 (**permalink**) 11-17-2006, 05:12 PM

There is a similar situation being discussed over on the Warrior Forum today.

A member had a web page which included a trademark.

Not a domain name, not a subdomain, but just a webpage

Thus

www.topleveldomain(dot)com / subdirectory / nodebt.html

It seems "NoDebt" is a registered trademark

It is quite a generic term for anything to do with finance industry

He was sent a C&D

Things like this imho and ianal are just going to extremes, where trademark holders can sue their way to the top of the search engines.

I suppose next we will have people being issued C&D for using a trademark in link text.

"Review of XYZ Trademark" as link text will get you in a $100,000 lawsuit

DrTandem1 · #10 (**permalink**) 11-18-2006, 09:26 AM

Simply using the words that make up a trademark is not necessarily an infringement. If it is determined that the use of another's trademarked words may reasonably cause confusion regarding the trademarked product or service, then it is an infringement.

So, while I may trademark "McDonald's" for my chimney sweeping business, I will not be able to use the symbol of golden arches with it. However, even if my name is McDonald and I invent a great new hamburger, I may not call it "McDonald's."