What a cybersquatting! Ford wins back its domain

Cybersquatting trend is growth with each year. Matthew Lasar, 2010 was a bumper year for cybersquatting cases, Arshtechnica, April 5, 2011, referred to the jump “of 28% over 2009 and 16% more than 2008, which was itself a record year”[i].
Meanwhile, the companies in the U.S. have an effective tool to prevent the misuse of their trademarks in another’s domain: Anticybersquatting Consumer Protection Act, 15 U.S.C.A. 1125(d) (Supp. 2000), or the “ACPA”. Effective as of November 29, 1999, ACPA “was intended to prevent ‘cybersquatting’, an expression that has come to mean the bad faith, with the intent to profit from the goodwill associated with those trademarks”, Shields v. Zuccarini, 254 F3rd 476 (3rd Cir.2001).
The ACPA renders one liable to the owner of a brand who, in desire to gain money from a registered mark registers, traffics in or uses a domain name identical or similar to a distinctive mark or a registered mark. The ACPA applies to all domain names, regardless of whether registered before or after its enactment, however, actual and statutory damages are unavailable for violations prior its enactment. In brief, if you establish these elements – registering, trafficking in and using a mark identical or confusingly similar to a distinctive or a famous mark with a bad faith intent to profit therefrom – you can use ACPA to prevent misuse of your brand in another’s domain.
Major corporate names were involved and are involved in these cybersquatting fights and successfully used Id., including, but not limited to Ford. In its case, Ford Motor Co. v. Catalanotte, 2003 U.S. App. LEXIS 17960 (6th Cir. 2003), the Sixth Cicuit Court of Appeals affirmed a decision by the US. District Court, Eastern District of Michigan, upholding an award of damages in favor of Ford Motors Company against its employee. The latter registered the domain name “fordworld.com” and then tried to sell it to Ford. It was proved that employee’s action violated ACPA. Per the court, see Id. at +4: “Registering a famous trademark as a domain name and then offering it for sale to the trademark owner is exactly the wrong Congress intended to remedy when it passed the ACPA.”
The appellate Catalanotte registered the domain in January 1997, when he knew Ford published an employee newspaper called “Ford World”, [which is prior to ACPA enactment]. Catalanotte sent an email to two Ford officials in October of 2000 stating, Id. at +4:

“The domain name fordworld.com will be available for a short period of time… I have been receiving offers from various sources, including the competition. I have indicated to the other interested parties that I am extending this opportunity to you first before any decisions are to be made.”

In rejecting the defenses asserted based upon the fact that Catalanotte had registered the domain name prior to enaction of the ACPA, the court held that “registering,” “trafficking” and “using” a domain name are each separate offenses. Thus, the fact that the domain name was registered before the passage of the statute did not serve as a defense to a claim for liability for subsequent trafficking or use.

Similarly, from the angle of bad faith (or willful intent), in People for the Ethical Treatment of Animals v. Doughney, 263 F.3d 359, (4th Cir. 2001): because the appellate Doughney made statements suggesting that the appellant PETA should "settle" with him and "make him an offer" [to purchase peta.org registered under the appellate’s name], its was seen by the court as the attempt to profit from the peta.org domain. Due to this and the fact that the domain name is identical to the distinctive PETA trademark, the court ruled that Doughney violated the ACPA. However, the court further held that PETA was not entitled to damages because Doughney registered and used the domain prior to ACPA's enactment. Instead Doughney was merely required to surrender the domain as an appropriate remedy.
FOOTNOTES
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[i] The World Intellectual Property Organization, Cybersquatting Report, 2010