Police line do not cross

Trademark holders have to police their trademarks to keep them.

In mid-2015, the Academy of Motion Picture Arts and Sciences (AMPAS) brought to trial a lawsuit against GoDaddy.com to stopped its “parked pages” program. I blogged previously about this lawsuit and what it means for business owners.

Before this lawsuit, there was no legal findings about whether or not parked pages were even legal. The verdict in GoDaddy’s favor changes that and has important implications for trademark holders nationwide.

The GoDaddy verdict is a stark reminder to all trademark holders that not diligently policing your mark online could cost you thousands. Worse, if you fail to police your mark, you may lose your rights to protect it altogether.

Parked pages usually occur when valuable domains are bought and then “parked” with ads to obtain revenue while the domain waits to be sold. This is abused by cybersquatters who buy domains with names similar to the trademarked names of a business before the business can buy it.

For example, as of this writing, coke.co is a parked page whereas coke.com goes to coca-cola’s website. The individuals who do run these pages create them on the hopes that web surfers will accidentally go to one of these pages and click on an advertisement. Or, they hope that the trademark holder will buy the domain name for a handsome mark-up.

When a page is parked, the domain registar and host (a company like GoDaddy) gets a portion of the advertisement revenue.

In its lawsuit, AMPAS argued that there were 56 Oscar-related domain names at issue. These domain names include the domains 2011Oscars.com, Oscar4re.com and Oscarcam.com. AMPAS also estimated that GoDaddy.com generated revenues of at least 8 million dollars from internet goers clicking on advertising links associated with these domains.

It is important to note that AMPAS did not contend that GoDaddy owned any of the domains mentioned in its lawsuit. Instead, AMPAS argued that the trademark violators were aided and abetted by GoDaddy who profited from the parked pages. AMPAS complained that GoDaddy allowed infringers to purchase the domain names and failed to police the sites to ensure legal compliance.

The judge didn’t agree. He decided that there was not enough evidence that GoDaddy intended to traffic in trademark violations in its parked pages. In other words, the judge decided that GoDaddy did not deliberately violate AMPAS’s trademarks.

GoDaddy really scored big when the court went a step further. The judge said that GoDaddy also provided enough evidence to prove that the domain was use fairly or otherwise lawfully, which is a defense to trademark claims.

GoDaddy proved this by showing that each time AMPAS sent a complaint to GoDaddy, it took the parked page down, usually within hours.

Domain purchasers also swear to legal compliance with trademark laws as part of their purchase of a GoDaddy automated domain registration. So the court decided that the blame lays on the trademark infringers, and not on GoDaddy.

The court said that all trademark holders must diligently police their own trademarks.

“[AMPAS] confuses GoDaddy’s technical capacity to filter for trademarks with AMPAS’s legal duty to police its own trademarks. At its core, AMPAS’s [] claim would impose upon GoDaddy (and presumably any other company offering parking, hosting, or other basic internet services) the unprecedented duty to act as the internet’s trademark police. The [law] did not impose such sweeping obligations.”

This lawsuit has an important lesson for trademark holders. Trademark holders who believer that their trademarks are being infringed have limited options. They may complain to the domain holder. They may register the page with an organization that seeks to block parked pages. They may try to purchase all domain names that are similar to their trademark before cybersquatters do. Or, they can try suing the domain owner for trademark violations.

The most important lesson is that the trademark holder has the responsibility to monitor their trademark at all times. Not ensuring that others are misusing your mark can cost you millions! It is a daily requirement of any trademark holder. Failure to do so may cost you rights to your own trademark.

How do you police and protect your trademarks?

  • Monitor the internet for use of your trademark or similar words and domains
  • Monitor press sources
  • Monitor public records for infringing filings in any of the state or local governments (not just the USPTO)
  • Monitor domain registrars
  • Monitor search traffic patterns for your domain and similar words, phrases or domains
  • Send cease and desist letters to any potential infringers, and follow up with legal action

If you want to learn more about trademarks, attend one of our webinars for entrepreneurs. Sign up for our next webinar at http://trademarkswebinar.com.