Citation[]
Land's End, Inc. v. Remy, 447 F.Supp.2d 941 (W.D. Wis. 2006) (full-text).
Factual Background[]
Plaintiff sold apparel and home goods under the LANDS' END mark through its "landsend.com" website. Defendants operated several comparative shopping websites and participated in plaintiff's affiliate program. When an affiliate linked shoppers to plaintiff's website, plaintiff paid that affiliate a 5% commission on all purchases made at the website.
Unbeknownst to plaintiff, defendants owned numerous domain names that differed from plaintiff's "landsend.com" website by one or two letters, including "lnadsend.com," "landsende.com," "landdend.com," "landswnd," "landsene.com," "landsennd.com," and "landwend.com." Internet users entering these domain names were redirected to plaintiff's website, but only after the users' web browser "invisibly" linked the users to a URL associated with defendant. It thus appeared to plaintiff that Internet users accessed the landsend.com website from defendants' authorized affiliate websites so defendants would receive a 5% commission for any purchases.
Plaintiff eventually noticed the "unusual referral patterns and payments" surrounding defendants and sued defendants for, inter alia, cybersquatting and false advertising under the Lanham Act.
Trial Court Proceedings[]
Defendants moved for summary judgment on all of plaintiff's claims. Regarding cybersquatting, the court held that the well-established LANDS' END mark and the clearly "confusingly similar" nature of defendants' domain names satisfied the first two prongs of the ACPA. Plaintiff claimed that defendants "hijacked Lands' End's own customers, sold them back to Lands' End, and collected a ransom for doing so." Defendants argued that they did not act in bad faith because "their typosquatting scheme directed traffic to plaintiff's website, rather than away from it." The court stated that just because "defendants' conduct was not cybersquatting in its most "classic" form does not mean that it was not prohibited by the ACPA." Moreover, how defendants actually profited "matters less than the underlying bad faith."
The court found it "noteworthy" that defendants actively concealed their typosquatting scheme from plaintiff and failed to disclose their "look alike" domain names when applying for plaintiff's affiliate program. Moreover, plaintiff "adduced substantial evidence from which it inferred that defendants exploited plaintiff's mark for their own commercial gain by using the typosquatting domain names to obtain 5% commissions on sales for which plaintiff would otherwise have received 100% profit." Because a fact finder could reasonably infer from this evidence that defendants acted in bad faith, the court denied defendants' motion on the ACPA claim.
The court did grant defendants' motion for summary judgment on plaintiff's false advertising claim because defendants made no statements to consumers and did not publicize themselves or their actions.
At the end of its opinion, and not in the context of any specific claim, the court addressed defendants' argument that plaintiff could not prove any damages because defendants directed "lost" Internet shoppers to plaintiff's website. Defendant argued that many of these shoppers could have given up or turned to a competitor without defendants' redirection. The court, however, found this argument "specious, at best." It was not unreasonable to assume that most, if not all, of the customers would have realized their typographical error once they encountered an error message and retyped the correct address. If that happened, plaintiff would have reaped 100% of the profit from these shoppers instead of having to pay commissions to defendants. Although plaintiff's damages may have been "minimal," the court could not say that they were "nonexistent as a matter of law."
Source[]
- This page uses content from Finnegan’s Internet Trademark Case Summaries. This entry is available under the Creative Commons Attribution-Share Alike License 3.0 (Unported) (CC-BY-SA).