Court Refuses to Dismiss “Cybersquatting” Trademark Lawsuit

Court Refuses to Dismiss “Cybersquatting” Trademark Lawsuit

When I first heard about this case I thought of the Nissan.com domain case where the owner of Nissan.com has been fighting the Nissan Corporation for many years over the domain name he registered and used for his own business.

It is really an interesting read I would check out Nissan.com for more details about that case.

What are your thoughts on this domain case?

A New Jersey judge recently refused to dismiss a trademark infringement lawsuit involving cybersquatting. The case arose after two rival car dealerships sought to become the new official Nissan dealership of Edison, New Jersey.

Defendant Dibre Auto Group registered two domain names — www.edisonnissan.com and www.nissanofedison.com — in connection with its application to acquire the new dealership. However, the dealership was ultimately awarded to plaintiff Edison Motor Sales, which subsequently adopted the trade name “Edison Nissan.”

New Jersey Court Refuses to Dismiss
“Cybersquatting” Trademark Lawsuit by Christine M. Vanek on November 2, 2012
A New Jersey judge recently refused to dismiss a trademark infringement lawsuit
involving cybersquatting. The case arose after two rival car dealerships sought to become
the new official Nissan dealership of Edison, New Jersey.
Defendant Dibre Auto Group registered two domain names — www.edisonnissan.com
and www.nissanofedison.com — in connection with its application to acquire the new
dealership. However, the dealership was ultimately awarded to plaintiff Edison Motor
Sales, which subsequently adopted the trade name “Edison Nissan.”
After Dibre refused to stop using the domain names, Edison Motor Sales filed suit,
alleging a number of claims, including false advertising, unfair competition,
cybersquatting, violation of New Jersey Fair Trade Act, and unjust enrichment. It alleged
that the trademark rights granted by its dealer agreement with Nissan precludes the use of
“Edison Nissan” or the variant “Nissan of Edison” as a trade name or domain name by
other Nissan dealers, including Dibre Auto Group.
According to the complaint, “Defendants divert prospective customers to their website
via the domain names ‘edisonnissan.com’ and ‘nissanofedison.com,’ and unfairly create
the likelihood of confusion and mistake with Plaintiff’s trade name and service mark,
‘Edison Nissan.’ Edison Motor Sales further contends that given Dibre’s knowledge of
the practice of using geographic terms in Nissan dealer trade names and domain names,
“Defendants’ use of the domain names is in bad faith and in retaliation for not having
been awarded the dealership.”
In refusing to grant a motion to dismiss, U.S. District Judge Dennis Cavanaugh rejected
Dibre’s argument that registering the domain names gave it priority over its rival. In his
decision, Cavanaugh repeatedly emphasized that the registration dates alone “fail to
establish the Defendants’ use of the domain names in commerce.”
With respect to the cybersquatting claim, Dibre argued that Edison Motor Sales failed to
allege bad faith or that its “mark” was distinctive at the time Dibre registered the domain
names. However, Cavanaugh again disagreed.
He concluded that while it is possible that Dibre registered the domain names with the
bona fide intent to use them in commerce, it failed to use them until after the Edison
dealership had been awarded to its competitor. Accordingly, he held that it appears that
Dibre acted with the intent to profit from the mark’s reputation and refused to dismiss the
claim.
If you have any questions about this case or would like to discuss the legal issues
surrounding cybersquatting, please contact me or the Scarinci Hollenbeck attorney with
whom you work.

I love domaining and support the domain industry