Factual Background Edit
Plaintiff, through one of its subsidiaries, operated a website at "cosmos.com" that facilitated the global marketing of various products and services by third parties, including various companies in the travel industry. Defendant owned registrations for the domain names COSMOS and COSMOS TOURAMA for selling and conducting travel tours in several countries, and promoted its travel services at "cosmostours.com" and "globusandcosmos.com." During 2001, plaintiff unsuccessfully tried to establish a business relationship with a subsidiary of defendant. Defendant's subsidiary offered to buy the "cosmos.com" domain name, but plaintiff declined. Defendant then filed a UDRP complaint asserting, among other things, that plaintiff offered to sell the "cosmos.com" domain name. After plaintiff filed its response denying that it offered to sell the name, defendant was allowed to amend its UDRP complaint to correct this inaccurate allegation. The UDRP panel, which did not permit plaintiff to respond to the amended complaint, ruled that the "cosmos.com" domain name should be transferred to defendant.
Trial Court Proceedings Edit
Plaintiff brought this action to stay the UDRP order. In addition to a declaratory relief claim regarding the "cosmos.com" domain name, plaintiff asserted claims for abuse of process and tortious interference with prospective economic advantage, both based on defendant's filing and maintenance of the UDRP proceeding.
The court granted defendant's motion to dismiss plaintiff's latter two claims. Plaintiff's tortious-interference claim failed because the mere filing of a UDRP complaint did not satisfy the requirement of showing that defendant intended to injure plaintiff's business. Nor did plaintiff identify any specific business relationships with which defendant interfered.
The court dismissed plaintiff's abuse-of-process claim because plaintiff could not prove that defendant had an ulterior motive in bringing the UDRP proceeding, finding that "the manifestly legitimate purpose of the [[[UDRP]]] claim was to assert trademark rights." And the UDRP panel's decision not to permit plaintiff to respond to defendant's amended complaint did not constitute abuse of process because it had nothing to do with defendant's purpose in initiating and maintaining the UDRP action.
The inaccurate factual allegation made by defendant in its UDRP complaint was simply "too thin a need to support an abuse of process claim." Finally, both claims failed because the Noerr-Pennington doctrine protected from tort claims trademark owners who seek redress through the UDRP process. Moreover, the "sham litigation" exception to the Noerr-Pennington doctrine did not apply here because defendant's UDRP complaint was based on identical and similar registered trademarks. Nor did the "fraudulent litigation" exception to the Noerr-Pennington doctrine apply because it comes into play only when it deprives the litigation of its legitimacy. Here, defendant's inaccurate allegation in its UDRP complaint did not "infect the core" of the case because defendant amended its UDRP complaint to remove the incorrect allegation. And it was clear that the UDRP panel did not base its decision on the inaccurate allegation. Finally, both claims failed because plaintiff agreed to submit to UDRP arbitration when it registered the "cosmos.com" domain name.
The court rejected plaintiff's argument that the Noerr-Pennington immunity should not apply here because WIPO, the dispute-resolution service provider handling the UDRP action, was a private entity, finding WIPO to be a quasipublic body.
After completion of discovery, the parties filed cross-motions for summary judgment. On July 24, 2002, the court ruled in favor of defendant on its claims for infringement, cybersquatting, and unfair competition, and against plaintiff on its request for declaratory relief. As to defendant's trademark infringement claim, the court found that defendant's trademark COSMOS was strong and that plaintiff's use of "cosmos.com" for related travel services was likely to cause confusion. Indeed, plaintiff's use of "cosmos.com" caused actual confusion as evidenced by plaintiff's efforts to entice defendant into a business relationship in return for "forwarding scores of e-mail messages or web hits from confused customers who mistakenly thought they were communicating with defendant."
Regarding defendant's ACPA claim, the court held that plaintiff had a bad-faith intent to profit from use of defendant's trademark COSMOS, applying the criteria listed in the ACPA. Throughout its discussion of the ACPA claim, the court placed great weight on plaintiff's failure to perform a trademark search before using the COSMOS trademark in its domain name. According to the court, this was not a situation where "an ongoing business entity . . . , prior to purchasing a domain name, made a reasonable investigation to ensure that the name was non-infringing and then purchased a relatively obscure name." Accordingly, the court ordered transfer of the "cosmos.com" domain name to defendant and enjoined plaintiff from using "cosmos.com" or any confusingly similar term.
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