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Fallos Clásicos |
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E. & J. Gallo Wineri vs. Spider Webs Ltd.
Sumarios:
1.- When a defendant registers a domain name that is identical to someone else's
trademarked name and thereby impacts the trademark owner's business by preventing
internet users from reaching the trademark owner's own web site, this is impacts
the trademark owner's business and is a use "'in connection' with goods
and services.
2.- When a registrant first uses a web site after litigation begins, this undermines
any claim that the use was in good faith or was a fair use under the ACPA.
3.- Although Spider Webs has not offered this domain name for sale, it has registered
other domain names that are identical or similar to the names of well-known
businesses and products, has offered other domain names for sale, and has refused
to accept less than $10,000 per name. These factors all favor a finding of bad
faith. Under factor seven, there is no evidence that Spider Webs provided misleading
contact information.
Ernest & Julio Gallo Winery ("Gallo") registered the trademark
"Ernest & Julio Gallo" on October 20, 1964 with the United States
Patent and Trademark Office, as Registration Number 778,837. Gallo has registered
a number of other trademarks, as well as internet domain names, but had not
registered the domain name at issue here. It is no surprise to us that Gallo
has sold more than four billion bottles of wine and has spent more than $500
million promoting its brands.
On the other hand, the individual defendants, brothers Steve and Pierce Thumann,
and their father, Fred Thumann, trustee, run a family-owned prehanging millwork
business named Doortown, Inc. In June 1999, they created Spider Webs Ltd. as
a limited partnership. According to Steve Thumann, Spider Webs's business plan
is to develop internet address names. It has registered more than 2000 internet
domain names through Network Solutions, Inc., one of the companies responsible
for the registration of internet domain names. Approximately 300 of these contained
names that could be associated with existing businesses, including "ernestandjuliogallo.com,"
"firestonetires.com," "bridgestonetires.com," "bluecross-blueshield.com,"
"oreocookies.com," "avoncosmetics.com," and others. As the
trial court found, because internet domain names cannot contain ampersands or
spaces, and because all internet domain names must end in a top-level domain
such as ".com," ".org," ".net," etc., "ernestandjuliogallo.com"
is effectively the same thing as "Ernest & Julio Gallo." E. &
J. Gallo Winery v. Spider Webs Ltd., 129 F.Supp.2d 1033, 1041 (S.D. Tex. 2001).
Spider Webs sells some of the names it has registered on its web site and on
the internet auction site Ebay (and apparently has refused to accept any bids
of less than $10,000), although it has not yet offered "ernestandjuliogallo.com"
for sale. Steve Thumann admitted in his deposition that "ernestandjuliogallo.com"
is valuable because of the goodwill that Gallo had developed in its name, and
that when they registered this domain name they "hoped that Gallo would
contact us and we could assist them in some way." However, Spider Webs
did not initiate any contact with Gallo, nor did it attempt to sell the domain
name to Gallo.
Approximately six months after Gallo brought this lawsuit, Spider Webs published
a website at "ernestandjuliogallo.com" that discussed the lawsuit,
the risks associated with alcohol use, and alleged misrepresentations by corporations.
It contained a picture of the upper half of a wine bottle with the words "Whiney
Winery" ("the Whiney Winery website"). It had links to a number
of other pages on the site, including: an Alcohol Awareness page that discussed
the dangers of alcohol; an "Our Mission" page that was critical of
corporate America; a "Press Release" about the lawsuit; and a letter
from a Gallo lawyer. Although the first page contained a disclaimer that stated
"This Site Is Not Affiliated With Ernest & Julio Gallo (R) Wineries,"
none of the other linked pages did. As of the date of the trial court's opinion,
typing in "www.ernestandjuliogallo.com" as the address on a web browser
led a user to a website entitled "SpinTopic." Spider Webs states that
the SpinTopic website is owned by it and is a noncommercial, nonprofit, consumer
information site.
-II-
After the defendants registered the domain name, Gallo sent a letter to Spider
Webs, requesting that they release or transfer to Gallo the domain name, but
Spider Webs refused to do so.
On February 11, 2000, Gallo filed suit against Spider Webs Ltd., Steve Thumann,
Pierce Thumann,and Fred Thumann, Trustee (collectively, "Spider Webs"),
alleging violations of the Anti-Cybersquatting Consumer Protection Act ("ACPA"),
15 U.S.C. § 1125(d), trademark dilution under federal and Texas law, see
Texas Anti-Dilution Statute, Tex. Bus. & Com. Code § 16.29, trademark
infringement under federal and Texas law, and unfair competition under federal
and Texas law.
Approximately six months later, Spider Webs published the Whiney Winery website
at "ernestandjuliogallo.com." On August 31, 2000, Gallo moved for
partial summary judgment on its claims of violations of the Texas Anti-Dilution
Statute and the ACPA. The magistrate judge granted summary judgment to Gallo
on these claims, holding that under the Texas ADS Gallo owned a distinctive
mark and Spider Webs's actions created a likelihood of dilution of that mark,
thereby violating the ADS. E. & J. Gallo, 129 F.Supp.2d at 1037-42. The
trial court further held that the ACPA was constitutional, that Spider Webs
had registered the domain name in bad faith under the ACPA's standard, that
Spider Webs's use was not a fair use, and therefore Spider Webs had violated
the ACPA. Id. at 1042-48. The court ordered the defendants to transfer the domain
name to Gallo within ten days from the entry of judgment, as allowed by the
ACPA, see 15 U.S.C. § 1125(d)(1)(C), and entered a permanent injunction
under the ADS restraining them "from using the Internet domain name 'ERNESTANDJULIOGALLO.COM,'
registering any domain name that contains the word 'Gallo,' and registering
any Internet domain name that contains the words 'Ernest' and 'Julio' in combination."
Id. at 1048. The court also awarded Gallo $25,000 in statutory damages under
the ACPA, plus post-judgment interest and costs. The court granted Gallo's unopposed
motion to dismiss the rest of its claims, without prejudice. Spider Webs moved
for a new trial, which the magistrate judge denied. Spider Webs then filed this
appeal.
-III-
We review the trial court's grant of summary judgment to Gallo on its ACPA claim
de novo, applying the same standard as the district court. Mississippi River
Basin Alliance v. Westphal, 230 F.3d 170, 174 (5th Cir. 2000). Summary judgment
is appropriate if "there is no genuine issue as to any material fact and
[] the moving party is entitled to a judgment as a matter of law." Fed.
R. Civ. P. 56(c). "This Court will consider the evidence in the light most
favorable to the non-movant . . .. [I]f no reasonable juror could find for the
non-movant, summary judgment will be granted." Mississippi River Basin,
230 F.3d at 174.
Spider Webs does not appeal the holdings that Gallo had a valid registration
in its mark, that the mark is famous and distinctive, and that the domain name
registered by Spider Webs is identical or confusingly similar to Gallo's mark.
However, Spider Webs argues that they did not act with a "bad faith intent
to profit," as required by the ACPA. The ACPA prohibits "cybersquatting"
by providing that:
A person shall be liable in a civil action by the owner of a mark, including
a personal name which is protected as a mark under this section, if, without
regard to the goods or services of the parties, that person
(i) has a bad faith intent to profit from that mark, including a personal name
which is protected as a mark under this section; and
(ii) registers, traffics in, or uses a domain name that--
(I) in the case of a mark that is distinctive at the time of registration of
the domain name, is identical or confusingly similar to that mark;
(II) in the case of a famous mark that is famous at the time of registration
of the domain name, is identical or confusingly similar to or dilutive of that
mark; or
(III) is a trademark, word, or name protected by reason of section 706 of Title
18 or section 220506 of Title 36.15 U.S.C. § 1125(d)(1)(A). In order to
determine whether someone has acted in bad faith under the ACPA, a court may
consider factors such as, but not limited to
(I) the trademark or other intellectual property rights of the person, if any,
in the domain name;
(II) the extent to which the domain name consists of the legal name of the person
or a name that is otherwise commonly used to identify that person;
(III) the person's prior use, if any, of the domain name in connection with
the bona fide offering of any goods or services;
(IV) the person's bona fide noncommercial or fair use of the mark in a site
accessible under the domain name;
(V) the person's intent to divert consumers from the mark owner's online location
to a site accessible under the domain name that could harm the goodwill represented
by the mark, either for commercial gain or with the intent to tarnish or disparage
the mark, by creating a likelihood of confusion as to the source, sponsorship,
affiliation, or endorsement of the site;
(VI) the person's offer to transfer, sell, or otherwise assign the domain name
to the mark owner or any third party for financial gain without having used,
or having anintent to use, the domain name in the bona fide offering of any
goods or services, or the person's prior conduct indicating a pattern of such
conduct;
(VII) the person's provision of material and misleading false contact information
when applying for the registration of the domain name, the person's intentional
failure to maintain accurate contact information, or the person's prior conduct
indicating a pattern of such conduct;
(VIII) the person's registration or acquisition of multiple domain names which
the person knows are identical or confusingly similar to marks of others that
are distinctive at the time of registration of such domain names, or dilutive
of famous marks of others that are famous at the time of registration of such
domain names ,without regard to the goods or services of the parties; and
(IX) the extent to which the mark incorporated in the person's domain name registration
is or is not distinctive and famous within the meaning of subsection (c)(1)
of this section. 15 U.S.C. § 1125(d)(1)(B)(i). The ACPA also provides a
fair use defense: "Bad faith intent described under subparagraph (A) shall
not be found in any case in which the court determines that the person believed
and had reasonable grounds to believe that the use of the domain name was a
fair use or otherwise lawful." 15 U.S.C. § 1125(d)(1)(B)(ii).(2) If
a court finds a violation of the ACPA, it may order the transfer of the domain
name to the owner of the mark and may award statutory damages. See 15 U.S.C.
§§ 1125(d)(1)(C), 1117(d).
We turn now to consider the listed bad-faith factors as they apply to this case.
Spider Webs has no intellectual property rights or trademark in the name "ernestandjuliogallo,"
aside from its registered domain name. The domain name does not contain the
name of Spider Webs or any of the other defendants. Spider Webs had no "prior
use" (or any current use) of the domain name in connection with the bona
fide offering of goods or services. Under the fourth factor, Spider Webs's use
is commercial, and there is no indication that it is a fair use. Steve Thumann
admitted that the domain name was valuable and that they hoped Gallo would contact
them so that they could "assist" Gallo in some way. Further, at least
two other courts have found that when a defendant registers a domain name that
is identical to someone else's trademarked name and thereby impacts the trademark
owner's business by preventing internet users from reaching the trademark owner's
own web site, this is impacts the trademark owner's business and is a use "'in
connection' with goods and services." People for the Ethical Treatment
of Animals v. Doughney, 113 F.Supp.2d 915, 919 (E.D. Va. 2000) ("PETA")
(citing Planned Parenthood Federation of America, Inc. v. Bucci, 42 U.S.P.Q.2d
1430, 1435 (S.D.N.Y. 1997)) ("'[I]t is likely to prevent Internet users
from reaching [PETA]'s own Internet web site. The prospective users of [PETA]'s
services who mistakenly access Defendant's web site may fail to continue to
search for [PETA]'s own home page, due to anger, frustration, or the belief
that the Plaintiff's home page does not exist.'").
Additionally, there is uncontradicted evidence that Spider Webs was engaged
in commerce in the selling of domain names and that they hoped to sell this
domain name some day. Although Spider Webs did not offer "ernestandjuliogallo.com"
for sale, it has offered for sale other domain names that it has registered.
Steve Thumann stated that Spider Webs intended to wait until the ACPA is declared
unconstitutional before selling the domain name here. E. &. J. Gallo, 129
F.Supp.2d at 1046. Spider Webs admitted that Gallo had a valuable trademark,
and that when they registered the domain name they hoped Gallo would contact
them so they could "assist" Gallo.
Indeed, the Ninth Circuit had found that one can be in the "business"
of "register[ing] trademarks as domain names and then sell[ing] them to
the rightful trademark owners." Panavision Intern., L.P. v. Toeppen, 141
F.3d 1316, 1325 (9th Cir. 1998). The ACPA was passed to address situations just
like this one: "For example, many cybersquatters are now careful to no
longer offer the domain name for sale in any manner that could implicate liability
under existing trademark dilution law. And, in cases of warehousing and trafficking
in domain names, courts have sometimes declined to provide assistance to trademark
holders, leaving them without adequate and effective judicial remedies."
Sporty's Farm L.L.C. v. Sportsman's Market, Inc., 202 F.3d 489, 495-96 (2d Cir.
2000) (quoting S. Rep. No. 106-140, at 7 (1999), on the ACPA).
Additionally, there is no evidence that Spider Webs actually used the domain
name until after the lawsuit began. The Second and Third Circuits have indicated
that when a registrant first uses a web site after litigation begins, this undermines
any claim that the use was in good faith or was a fair use under the ACPA. See
Sporty's Farm L.L.C., 202 F.3d at 499 (considering bad faith factors and finding
bad faith); Shields v. Zuccarini, 254 F.3d 476, 485-86 (3d Cir. 2001) (same).
Under the fifth bad faith factor, the fact that Spider Webs hosted a website
using Gallo's trademarked name, at which it disparaged the instant litigation
and alcohol, is evidence of intent to harm Gallo's goodwill and to tarnish its
mark. See, e.g., PETA, 113 F.Supp.2d at 920 ("Defendant clearly intended
to confuse, mislead and divert internet users into accessing his web site which
contained information antithetical and therefore harmful to the goodwill represented
by the PETA mark.")
Under the sixth and eighth factors, although Spider Webs has not offered this
domain name for sale, it has registered other domain names that are identical
or similar to the names of well-known businesses and products, has offered other
domain names for sale, and has refused to accept less than $10,000 per name.
These factors all favor a finding of bad faith. Under factor seven, there is
no evidence that Spider Webs provided misleading contact information.
Finally, as to the last factor, there was evidence presented that Gallo's mark
is distinctive and famous. See 15 U.S.C. § 1125(c)(1) (listing factors
to consider). Further, Gallo registered the mark, which is a family name, thirty-eight
years ago, and other courts have found that "'Gallo' has clearly become
associated with wine in the United States such that its evolution to 'secondary
meaning' status may not be seriously questioned." E. & J. Gallo Winery
v. Consorzio del Gallo Nero, 782
F.Supp. 457, 462 (N.D. Cal. 1991). In sum, seven of the nine statutory factors
strongly support a finding of bad faith.
Additionally, this court is not limited to the consideration of the listed statutory
factors, but can consider other factors as well. See 15 U.S.C. § 1125(d)(1)(A)(i)
(court can consider factors "such as, but not limited to" the listed
statutory factors). For example, "[w]hen the senior user's trademark is
famous in the marketplace and where the junior user was aware of the trademark
and of its fame, a presumption of bad faith arises from the choice of the same
name because it is inferrable that the junior user adopted the mark for the
purpose of profiting from the aura of goodwill surrounding the senior user's
mark." E. & J. Gallo Winery v. Gallo Cattle Co., 12 U.S.P.Q.2d 1657,
1675 (E.D. Cal. 1989), aff'd, 967 F.2d 1280 (9th Cir. 1992). The circumstances
of this case all indicate that Spider Webs knew Gallo had a famous mark in which
Gallo had built up goodwill, and that they hoped to profit from this by registering
"ernestandjuliogallo.com" and waiting for Gallo to contact them so
they could "assist" Gallo.
Considering the statutory factors and all the circumstances of this case, the
trial court's conclusion that Spider Webs acted with a bad faith intent to profit
and its grant of summary judgment to Gallo on this issue were appropriate.(4)
-IV-
Spider Webs also argues that the trial court should not have awarded Gallo $25,000
in statutory damages under the ACPA because Gallo did not suffer any actual
injury. We review a trial court's award of damages for clear error. St. Martin
v. Mobil Exploration & Producing U.S. Inc., 224 F.3d 402, 410 (5th Cir.
2000).
The United States trademark laws provide that:In a case involving a violation
of section 1125(d)(1) of this title [the ACPA], the plaintiff may elect, at
any time before final judgment is rendered by the trial court, to recover, instead
of actual damages and profits, an award of statutory damages in the amount of
not less than $1,000 and not more than $100,000 per domain name, as the court
considers just. 15 U.S.C. § 1117(d). Spider Webs notes that under the ACPA
and applicable portions of § 1117,damages "shall not be available
with respect to the registration, trafficking, or use of the domain name that
occurs before the date of the enactment of this Act [November 29, 1999]."
1999 Acts, P.L. 106-113, § 3010, 113 Stat. 1536. They argue that because
they registered the domain name prior to enactment of the ACPA, they cannot
be liable. However, the evidence before the trial court demonstrated that Spider
Webs "used" the domain name at least since August 15, 2000, when it
hosted the "Whiney Winery" website at the domain name. See, e.g.,
Shields, 254 F.3d at 486-87 (continued use of domain name confusingly similar
to a trademarked name after the ACPA's effective date entitled the trademark
owner to statutory damages). Therefore, although Spider Webs registered the
domain name before the effective date of the ACPA, because they used the domain
name after this date, they can be held liable for statutory damages for this
use.
In Shields, the Third Circuit affirmed an award of statutory damages of $10,000
per infringing domain name for the five infringing domain names in that case.
Id. The defendant in Shields stated that he only used the infringing names for
sixty days, but the Third Circuit noted that there was no requirement that the
court consider the duration of the infringement when calculating statutory damages,
and that the court could award damages as it considered "just" under
the statute. Id. at 487. These considerations indicate that the award of damages
here was not in clear error.
The statutory damages provisions in the ACPA, which is relatively new, are akin
to the statutory damages provisions of the copyright laws.
In copyright law, the Supreme Court has said that the "statutory [damages]
rule, formulated after long experience, not merely compels restitution of profit
and reparation for injury but also is designed to discourage wrongful conduct."
F.W. Woolworth Co. v. Contemporary Arts, Inc., 344 U.S. 228, 233 (1952). In
this case, although Gallo did not present evidence that it actually lost any
business due to Spider Webs's actions, the trial court found that Spider Webs's
actions put Gallo "at risk of losing business and of having its business
reputation tarnished." E. & J. Gallo Winery, 129 F.Supp.2d at 1048.
The award of $25,000 in statutory damages in response to the defendants' conduct
is not clear error.
-V-
The trial judge also found that the Texas Anti-Dilution Statute ("ADS")
applies to non-commercial activities, and that Spider Webs's conduct violated
the ADS. The trial court issued an injunction against Spider Webs, as allowed
by the Texas ADS. See Tex. Bus. & Comm. Code. 16.29. We review the trial
court's grant of summary judgment on this issue de novo. See Mississippi River
Basin, 230 F.3d at 174. Because we have found that Spider Webs's use was commercial,
we need not decide whether the ADS applies to non-commercial activities. We
agree with the trial court, however, that Spider Webs's use violated the ADS.The
Texas ADS provides that:
A person may bring an action to enjoin an act likely to injure a business reputation
or to dilute the distinctive quality of a mark registered under this chapter
or Title 15, U.S.C., or a mark or trade name valid at common law, regardless
of whether there is competition between the parties or confusion as to the source
of goods or services.
An injunction sought under this section shall be obtained pursuant to Rule 680
et seq. of the Texas Rules of Civil Procedure.Tex. Bus. & Comm. Code §
16.29 ("Injury to Business Reputation or Trade Name or Mark"). In
order to succeed on a dilution claim, Gallo must show that it owns a distinctive
mark and that there is a likelihood of dilution. Pebble Beach Co. v. Tour 18
I, Ltd., 942 F.Supp. 1513, 1564 (S.D. Tex. 1996), aff'd as modified, 155 F.3d
526 (5th Cir. 1998) (citing Hormel Foods Corp. v. Jim Henson Productions, Inc.,
73 F.3d 497, 506 (2nd Cir. 1996)). As discussed previously Gallo has validly
registered "Ernest & Julio Gallo," and there is no serious dispute
that the mark is distinctive and has acquired a secondary meaning. However,
Gallo must also show a likelihood of dilution. There are not many cases interpreting
the Texas Anti-Dilution statute, so this court has previously looked to "the
general law of dilution . . . in construing the Texas Statute." Exxon Corp.
v. Oxxford Clothes, Inc., 109 F.3d 1070, 1081 (5th Cir. 1997). A likelihood
of dilution can be caused by either "1) 'blurring,' a diminution in the
uniqueness or individuality of the mark, or 2) 'tarnishment,' an injury resulting
from another's use of the mark in a manner that tarnishes or appropriates the
goodwill and reputation associated with the plaintiff's mark." Id. (citations
omitted). Other courts have found that when a defendant prevents a plaintiff
from identifying its goods and services on the internet, this constitutes dilution.
See, e.g., Sporty's Farm, 202 F.3d at 495; Panavision Intern., 141 F.3d at 984;
Intermatic, Inc. v. Toeppen, 947 F.Supp 1227, 1240 (N.D. Ill. 1996). Spider
Webs's use of Gallo's mark as an internet domain name did just that.
The evidence here showed that the "Whiney Winery" website posted by
Spider Webs at the domain name was critical of the instant litigation and of
alcohol consumption, contained crude formatting and misspellings, and only contained
a disclaimer that the web page was not associated with Gallo on the opening
page, but not on other pages. Spider Webs asserts that this page was only available
for forty-eight hours, but, as the trial court found, there is no evidence in
the record tosupport this. Gallo does not complain because Spider Webs was critical
of Gallo, but rather because Spider Webs sought to associate the Gallo trademark
with the contents of its web site and because Spider Webs prevented Gallo from
using its mark to identify its goods and services on the internet.
These acts, if associated with Gallo due to Spider Webs's use of Gallo's trademarked
name, could harm Gallo's reputation and goodwill. Although Spider Webs alleges
that Gallo has not shown any actual injury, under the ADS all that Gallo must
show is a likelihood of dilution, and Gallo has done so. Summary judgment for
Gallo on this issue was proper as well.
-VI-
Finally, Spider Webs argues that the injunction the trial court issued against
them is overly broad. We review the trial court's grant of a permanent injunction
for abuse of discretion. Cox v. City of Dallas, Tex., 256 F.3d 281, 289 (5th
Cir. 2001) (citing Hopwood v. Texas, 236 F.3d 256, 276 (5th Cir. 2000)).
As noted previously, the trial court permanently enjoined the defendants under
the Texas ADS "from using the Internet domain name 'ERNESTANDJULIOGALLO.COM,'
registering any domain name that contains the word 'Gallo,' and registering
any Internet domain name that contains the words 'Ernest' and 'Julio' in combination."
E. & J. Gallo, 129 F.Supp.2d at 1048. The Texas Anti-Dilution Statute allows
for injunctions. See Tex. Bus. & Com. Code § 16.29. Under Texas law,
injunctive relief is appropriate where the applicant demonstrates: "1)
the existence of a wrongful act; 2) the existence of imminent harm; 3) the existence
of irreparable injury; and 4) the absence of an adequate remedy at law."
Hues v. Warren Petroleum Co., 814 S.W.2d 526, 529 (Tex.App.--Houston [14th Dist.]
1991, writ denied) (citing Priest v. Texas Animal Health Comm'n, 780 S.W.2d
874, 875 (Tex.App.--Dallas 1990, no writ)). Spider Webs's actions are wrongful
under the Texas ADS, as discussed previously. At least one other federal court
has found that a defendant's unauthorized use of a plaintiff's trademark on
the internet to disseminate views contrary to the plaintiff's would result in
imminent irreparable harm without an injunction:
The use of the Mark and the Name of the Plaintiff Organization by the Defendant
has interfered with the ability of the Plaintiff to control the Mark and the
Name of the Plaintiff Organization. This in turn creates the potential for damage
to the reputation of the Plaintiff Organization, especially in light of the
disparaging comments the Defendant and the Outreach Judaism Organization have
made. The Plaintiff Organization should not be required to leave its reputation
in the hands of the Defendant, especially when the Defendant intends to destroy
the reputation of the Plaintiff Organization.
Jews for Jesus v. Brodsky, 993 F.Supp. 282, 311-13 (D. N.J. 1998) (citations
omitted). A similar potential for damage exists here. A remedy at law alone
would not help to protect Gallo's reputation, if Spider Webs can continue to
use Gallo's trademarked name. Therefore, we find that it was not an abuse of
discretion to enter an injunction in this case.
However, Spider Webs argues that the injunction issued by the trial court is
overbroad. The only case to which Spider Webs points is Bally Total Fitness
Corp. v. Faber, 29 F.Supp.2d 1161 (C.D. Cal. 1998). In that case, the defendant
Faber had registered the domain name "www.compupix.com" and posted
a web page at this address. This web page contained links to a number of other
internal web pages created by Faber, including www.compupix.com/ballysucks,
which was dedicated to complaints about Bally's health club business. This linked
web page contained an image of the Bally trademark with the word "sucks"
printed across it. Id. at 1162. Although the court found that Faber had not
infringed or diluted Bally's mark, it expressly distinguished the case before
it from cases in which the defendant used the plaintiff's registered mark in
the defendant's actual internet domain name, which could constitute infringement
or dilution. Id. at 1165. However, the court stated in dicta that "even
if Faber did use the mark as part of a larger domain name, such as 'ballysucks.com,'
this would not necessarily be a violation as a matter of law." Id. The
court distinguished this hypothetical from "cases like Panavision[, 141
F.3d at 1324] where an individual appropriates another's registered trademark
as its domain name. In the 'cybersquatter' cases like Panavision, there is a
high likelihood of consumer confusion--reasonably prudent consumers would believe
that the site using the appropriated name is the trademark owner's official
site. Here, however, no reasonably prudent Internet user would believe that
'Ballysucks.com' is the official site or is sponsored by Bally." Id. at
1165 n.2. This case therefore is unlike Bally, and Bally does not support Spider
Webs's position.
In the case today, it was appropriate for the trial court to prevent Spider
Webs from registering or using an internet domain name containing the words
"Gallo" or "Ernest" and "Julio" in combination,
and we affirm the trial court's injunction as issued. However, it is conceivable
that the defendants could have a legitimate use for an internet domain name
containing these words. If the defendants have such a specific, legitimate need
in mind, they may return to the trial court and ask for a modification of the
injunction to allow for that need.
-VII-
For the reasons set forth above, the trial court correctly entered an injunction
under the Texas ADS, ordered Spider Webs to transfer the domain name to Gallo
under the ACPA, and awarded Gallo statutory damages under the ACPA, as well
as post-judgment interest and costs. Accordingly, the judgment of the district
court is AFFIRMED.-
