Legal News

TechCrunch Article Should Update Characterization of Domain Company

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DomainMarket.comTechCrunch is one of my favorite websites to read, and I have to say, I spend quite a bit of time on the site. I especially enjoy reading articles by Michael Arrington, Robin Wauters, and Erick Schonfeld, two TechCrunch staff journalists. Unfortunately, I disagree with the portrayal of Mike Mann’s Domain Asset Holdings in yesterday’s article about Facebook’s UDRP filing for 21 domain names.

First, let’s start with the case. Facebook filed a UDRP for 21 domain names owned by Domain Asset Holdings that included the term “Facebook” in them. Some of these names include FacebookBabes.com, FacebookCheats.com…etc. Some might think it’s a cut and dry case, but with trademark law, there’s very little that is cut and dry.

When I was in college, there was a freshman facebook distributed to all RAs, administrators, and freshmen. I am sure there are plenty of other colleges that did and still do the same. Facebook the company did not coin the term “facebook” despite making it into a well-known brand. That being said, according to Domain Asset Holdings founder, Mike Mann, “those names were registered by accident and we are trying to give them back to them.”

My biggest issue with the article is Robin’s characterization of Mann’s company. The article stated that these 21 “domain names are all currently owned by a company called Domain Asset Holdings, a  known  domain squatter based in Potomac, Maryland.” The article linked to a legal action for the domain name CustomResins.com, which appears to have settled.

There are two organizations that handle UDRP cases: World Intellectual Property Organization (WIPO) and National Arbitration Forum (NAF). According to the WIPO database, there were no UDRP decisions with Domain Asset Holdings listed as the respondent. The NAF database lists two decisions with Domain Asset Holdings as the respondent. Both of these cases ended with Domain Asset Holdings winning.

In looking at Domain Asset Holdings’ nameservers, the company appears to own over one hundred thousand domain names. Having just two UDRP decisions (not including the recent Facebook filing) is quite remarkable for a company with this many domain names. This surely isn’t the sign of a company that’s a “known domain squatter.”

Furthermore, Mike Mann is the entrepreneur who previously sold BuyDomains to NameMedia. I don’t know the purchase price, but I’ve heard it was many millions of dollars. I’ve seen BuyDomains lose very few UDRP cases. Both of Mann’s companies generally invest in descriptive domain names, not trademarks.

For whatever reason, Domain Asset Holdings “accidentally” registered a group of names with trademarks in them and is trying to give them back to the company (according to Mike Mann). In my opinion, the description of Mann’s company as a known domain squatter is quite inaccurate, and I would hope Robin considers changing it.

***Update***

Mike Mann posted a comment on Robin’s article today stating “we have 150,000 names many of which a machine registered.”

WIPO Results: Typos VS. .CO

I want to point out two UDRP filings that were based on the same primary domain name but had different results. The first case involves a .CO domain name that matches an established .com website, and the second case involves several .com typos of the same .com domain name as the first case.

The former case involves a domain name that was recently registered, while the later involves domain names that were acquired prior to the complainant’s  acquisition. As you can see in the arguments below, the date of registration/acquisition was important in the panels’ findings.

A few weeks ago, a WIPO  UDRP decision awarded PokerStrategy.CO to the owner of PokerStrategy.com. The UDRP was defended by Raj Abhyanker, and    this case was decided by a single panelist. There were a few comments I found interesting in the discussion:

“Previous UDRP panels have found that where a domain name is purely descriptive, even where it is part of a registered trademark, then a respondent will have a right or legitimate interest, unless there is evidence that the respondent is targeting the complainant.”

“In this case the term “poker strategy” is comprised of two common English words and the combined term is purely descriptive and based on the evidence before the Panel is commonly used in the industry. Without more this would be enough to find that the Complainant has not demonstrated that the Respondent has no rights or legitimate interests in the Disputed Domain Name and to deny the Complaint. However as discussed below, there are supervening circumstances in this case which lead the Panel to infer, on the balance of probabilities, that the Respondent has in this case sought to target the Complainant and that therefore the Respondent has not acted in good faith.”

“Based on the Respondent’s own acknowledgement of the success of the Complainant’s website at “www.pokerstrategy.com” and that the site had been in operation for a number of years prior to the Respondent’s registration of the Disputed Domain Name, the Panel infers that the Complainant’s domain name has most likely developed some degree of source identifying significance, at least amongst the Internet based poker playing community.”

The second UDRP filing involves a number of domain names that would appear to be typos of PokerStrategy.com. The owner of PokerStrategy.com filed a UDRP for:  pokersrategy.com,  pokerstategy.com,  pokerstratgy.com,  pokerstrtegy.com, and  pokrstrategy.com. This UDRP was defended by John Berryhill, and there were three panelists who agreed on the findings.

There was some interesting discussion in this decision as well, and it seems that the date of the domain registration was critically important to this particular decision. Here are some findings and discussion:

“It may well be that in non-English speaking jurisdictions the relevant authorities were unaware that the term “Poker Strategy” was an unregistrable descriptive term referring, flatly, to poker strategy, but the United States Trademark Office had no such language difficulty.”

“UDRP Panels have repeatedly found that the use of common words and phrases utilized as domain names to advertise relevant subject matter is legitimate.”

“Here, the Complainant has taken the unusual approach of simply “wishing the facts away” by stating that it “assumes that Respondent has acquired the disputed domains well after the Complainant’s trademarks have been applied for.” This statement is false and is readily and demonstrably false, and was explained to the Complainant’s agents prior to this dispute, upon their attempt to acquire the disputed domain names on behalf of the Complainant. A printout of the WHOIS data for  as of the stated “Cache Date” of November 6, 2005 clearly demonstrates that the Respondent had been the identified registrant thereof well prior to the Complainant’s later purchase of the domain name.”

Congratulations are in order for John Berryhill, who was also able to get a reverse domain name hijacking decision since the complainant gave statements that:

were clearly designed to convey the impression that the Complainant itself had been using  for a website from 2002, before registration of the disputed domain names. Whereas the Complainant could hardly have been unaware of the fact that it had only acquired  in 2006.

One thing I learned from the first decision is that if you own .CO domain names, you need to use them if the .com is already established. Descriptive domain names are generally protected when it comes to UDRP, but if a panel thinks you registered a name to capitalize on an established website, you had better be using the domain name as it should be used based on its descriptive nature.

Guest Post: Litigation Fall Out From Playboy Mansion Illness at DOMAINfest 2011

This is a guest post written by attorney Enrico Schaefer of Traverse Legal. Schaefer is an experienced IP lawyer whose firm handles cases in a variety of practice areas, including litigation. I have been told that a complaint in the matter below may be filed today or tomorrow.  For more information, contact Mark Clark.

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What started out as a simple post on German domainer Nico Zeifang’s Facebook page two days after the Playboy Mansion Party at DOMAINfest turned into something much bigger. Under the title “Domainerflu count: Who else caught the disease at DFG?” the post generated over 200 comments. Within hours, it was clear that at dozens of Playboy Mansion party attendees were sick, with the same upper respiratory symptoms. Within days, the number of reported illness had climbed to over 150 Playboy Mansion party attendees (no doubt more by now), with many moving into pneumonia.

Ironically, it was the nationalized Health Care providers in Switzerland who did early testing, with one Swiss party attendee reporting positive for Legionellosis with multiple levels of testing. Ron Jackson, whose wife Diana became pretty sick as well, started tracking the illness and reported the matter to the CDC who then involved the L.A. County Board of Health for a coordinated investigation including detailed questionnaires and requests for those who could afford it (or who were in LA and could get the test performed for free) to go through a battery of tests.

As of today, the L.A. Department of Health has confirmed the presence of the Legionella bacteria at the Playboy Mansion, although it has not issued its final findings.

The Los Angeles Department of Health remains circumspect about exact location of the bacteria at the Mansion and is waiting for other positive test results for Legionella bacteria in the samples taken from attendees before issuing a final report. Those of us who went through the testing are being requested to get more tests for comparison in the coming weeks. However, there is little doubt that “it is more probable than not” that the vast majority of Playboy Mansion attendees got sick from a bacterial strain of Legionella as a result of exposure at the Playboy Mansion. The common symptoms, consistency of symptoms with Legionella, timing, prior diagnosis of Legionella in at least one sick attendee and the curious revelation of finding Legionella bacteria at the Playboy Mansion well before the investigation was concluded make this pretty obvious.

I was put in an unusual situation as a result of the illness. I got very sick on Sunday after returning from DOMAINfest, with days of being in bed, long periods were I could barely speak because my voice was just about shut down, fever, wicked pain in my lower back, exhaustion, cough and related problems. My wife, who also became sick but not as severely, was leaving on vacation shortly after I became ill leaving me at home with three young boys trying to get my energy, voice and health back. For the last two years, I had been planning a backcountry hut trip in Colorado at high altitude. It can be a dangerous trip in good health. I had to cancel given the problems with my lungs and breathing. I struggled at home and at work for weeks. I continued to hear about people who were stuck in L.A. because they were too sick to travel, and others whose infection turned to pneumonia.

I asked one of the attorneys in my office to start doing an independent investigation, reviewing expert data on Legionaires, its causes and prevention. How would a place like the Playboy Mansion end up exposing guests to Legionella bacteria? It turns out that the issue really comes down to cleanliness. A little chlorine goes a long way. All of the information suggests that the Playboy Mansion failed to keep their facility clean.

I decided to retain my law firm to represent my wife and I in investigating the matter and, if appropriate, filing a lawsuit against responsible parties. There is information about obtaining legal representation and the anticipated lawsuit to be filed here. I had gone from being a lawyer to a client and this is why I made the decision to hire an attorney to protect my interest.

I see a lot of things as an attorney. A portion of my career was devoted to representing injured people in mass accidents, including class action asbestos cases. Our firm recently handled the largest number of victims from the Crown Princess Cruise ship accident in the Los Angeles, California complex litigation court. “Personal responsibility” is a common theme in tort cases these days. But typically people are referring to the ‘responsibility’ of the person who was hurt.

I know based on my experience that most people who are negligent are quick to point at the victim, without taking any ‘personal responsibility’ for their own actions. Our justice system helps hold people accountable. The “Playboy Plague” was not an accident or act of God. By all appearances, it was an easily preventable exposure at a location, which is paid significant sums to host such events. The effects were much more than a minor inconvenience for me and many fared much worse than me.

So what good can come from all this? I would hope that the Playboy Mansion would clean up its act as appropriate and take the measures necessary to make sure its guests are safe in the future. But the real effect is more likely the other large-scale event locations who see what happened here and find information which causes them to upgrade their efforts to provide a clean environment for their guests. It often turns out that publicity about these types of occurrences can have as much prophylactic effect as courtroom litigation. The Internet is a wonderful thing. It helps people make smarter decisions about many things, including safety. The Internet makes accountability permanent.

There are several other attendees who became ill who have contacted my law firm, and are seeking representation as well. I expect more will join in as more information is publicized about the event. In many cases, the damages for Plaintiffs won’t be unduly large, or have impacted them in a significant manner. Nevertheless, victims will have a shot at ‘fair compensation’ for having the very unpleasant experience of contracting this illness and the knowledge that others may not have to go through the same experience.

And there are questions that still need answers? Has this happened at the Playboy Mansion before? Are there instances where people got sick there but there was no Ron Jackson to step in, coordinate information and contact the CDC?

This has been unfortunate for DOMAINfest which put on the best domain conference ever, and DomainSponsor who shelled out a lot of money to sponsor the party at the Playboy Mansion. Both brands were impacted by the incident, although probably not within the community of people who know them well. Regardless, they deserved better for their A+ effort. Seems like the folks at Playboy may owe them more than an apology before the dust has settled on this one.

Paypal Limitations in India Could Pose Problems for Domain Investors

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I read the TechCrunch article  yesterday about Paypal limiting payments to merchants in India to $500 beginning March 1st, and I think it will make an impact on the domain business. If merchants need to accept a higher payment amount, they need to look elsewhere.  The restrictions have been put in place by the Reserve Bank of India rather than Paypal, and it was announced on the official Paypal blog yesterday.

In my opinion, this news could be very bad news for  Indian domain investors and could also be a big annoyance to others who live outside of India but who do business with Indian companies.

For just about all transactions that are under a few thousand dollars, I use Paypal. From my perspective, this limitation would pose a problem for me if I am buying a relatively low value domain name for a domain investor in India. The cost of using a service like Escrow.com might be prohibitive on a low value deal (but above $500), yet the seller wouldn’t be able to accept a Paypal payment.

Similarly, for web development projects, it doesn’t appear to be possible to pay Indian merchants more than $500 via Paypal. I’ve worked with companies in India (found on Elance), and this would impact them, and consequently, it would impact my business.

Unless I was buying a domain name or working on a significant project that was critical to my business, it would be highly unlikely that I would opt to use another payment service like Western Union or something else.

Last night, I spoke  about the Paypal situation with Andrew Allemann, who works for Indian-based Directi, the company that operates Skenzo, Big Jumbo, DomainAdvertising.com, and others. According to Andrew, his companies “use  a payment processor for all of our payments, and this payment processor won’t be affected by any of the changes.” That’s a bit of good news.

If you are doing business with merchants or domain investors in India, you need to be aware of these Paypal restrictions that are coming soon and make sure you and they are covered.

Why I Think Groupon Needs Its Domain Names NOW

GrouponYou may have read that Groupon is fighting to get its Australian ccTLD domain name. It had offered to pay over a quarter of a million dollars for the domain name and a similar trademark filing. It seems a bit odd that a company would seemingly reward an alleged cybersquatter for this much money, but Groupon needs this (and similar) domain names ASAP.

Groupon is a rapidly growing company in a vertical that has very few barriers to entry. Local companies with the manpower and desire to pound the pavement can work with local businesses and start their own entities. As businesses go, this one is not too difficult to duplicate, although it isn’t easy to scale.

Groupon is in the phase where they are quickly growing around the world, be it with acquisitions of large enough competitors that they can enter markets rapidly, or by entering the market and becoming the dominant presence. Groupon is fast becoming known throughout the world as THE company that offers group deals.

In addition to using a universal .com domain name (Groupon.com), the company is embracing local ccTLDs. The company operates sites like Groupon.ca, Groupon.de, Groupon.com.mx, Groupon.co.uk, Groupon.es, Groupon.fr, Groupon.co.il, Groupon.jp, Groupon.cn, and many others, which are highly targeted.

With its rapid growth, the company probably doesn’t have the time to wait for the settlement of lawsuits or determination of UDRPs to get the domain names it wants to operate. Instead, the money is less important to this well funded company than the time it will take to get the domain name via UDRP and/or lawsuit.

It’s interesting to watch Groupon seemingly reward others for grabbing Groupon ccTLDs, but domain investors should note that this is an isolated situation, and doing so with other trademarks can be very risky and expensive to defend.

Verizon iPhone Domain Name Suffers Same Fate as WikiLeaks.com at Go Daddy

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Page Not Available

As news spreads of a presumed iPhone announcement from Verizon Wireless tomorrow, commentators have been discussing some related domain names that are now owned by Verizon. For instance, iPhoneForVerizon.com now appears to be owned by Verizon. The company  fiercely  defends it’s trademarks, so this is no surprise to me.

Perhaps the best iPhone / Verizon domain name would be VerizoniPhone.com, which does not appear to be owned by either Apple or Verizon Wireless. Instead, it appears to be registered to a California resident and registered with Go Daddy.

According to a historical snapshot available on DomainTools, the domain name appears to have previously had a standard Godaddy landing page, which generally contains pay per click links.

However, the landing page seems to have suffered the same fate as that of the WikiLeaks.com domain name. Instead of a PPC-filed lander, there is a graphic that says, “Sorry! This site is not currently available.” I don’t know if there is a way to tell if Go Daddy intentionally isn’t monetizing it or if the customer changed the landing page, but it seems to be a smart move to avoid litigation for monetizing this domain name.

A big question I have though is if Go Daddy is responsible for removing the PPC landing page on this domain name, does it put the company at risk with other potential trademark names that are being monetized by them on their coming soon pages?

Could other trademark holders argue that if Go Daddy is willing and able to change the landing page for a name like VerizoniPhone.com, they should be doing it for all trademark names?  I have no legal expertise but think it’s interesting.

Oh… and I am very eager to hear the news… You can be sure my Blackberry will become a relic once the iPhone is available on the Verizon network.

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