Playboy Enters. Inc. v. AsiaFocus Int'l, Inc., 1998 WL 724000, 1998 US Dist. LEXIS 10359 (E.D. Va. Feb. 2, 1998) (magistrate's report and recommendation on liability and damages); 1998 U.S. Dist. LEXIS 10459 (E.D. Va. Apr. 10, 1998) (court adoption of magistrate's recommendation on liability and damages); 1998 U.S. Dist. LEXIS 10460 (E.D. Va. June 16, 1998) (magistrate's report and recommendation on attorney’s fees).
Factual Background Edit
Playboy Enterprises Inc. ("PEI"), owner of the PLAYMATE and PLAYBOY trademarks, sued two Hong Kong-based companies, AsiaFocus and Internet Promotions, and their owners, in Virginia for trademark infringement, dilution, counterfeiting, false designation of origin, and unfair competition arising from defendants' unauthorized use of PEI's PLAYMATE and PLAYBOY trademarks on the Internet to identify adult-entertainment websites featuring pictures of naked women located at the domain names "asian‑playmates.com" and "playmates-asian.com."
Trial Court Proceedings Edit
The court emphasized the following factors in support of its finding of likely confusion: PEI's trademarks were strong and entitled to a high degree of protection; the goods and services offered by defendants were the same as those provided by PEI; the marketing channels used by both parties, namely the Internet, were identical; and at least one consumer had actually been confused and contacted PEI thinking that it sponsored defendants' websites.
As to dilution, the court found that PEI's marks were undisputably famous and that defendants' activities, which included embedding PEI's marks in the metatags of their websites, using PEI's PLAYMATE mark as part of their e-mail address "email@example.com," displaying PEI's marks on the pages of their websites in the slogan "ASIAN-PLAYMATES FOR THE PLAYBOY IN ALL OF US," paying other website owners to place click-through banner advertisements on their websites for defendants' "asian-playmates.com" site, and promoting the sale of collateral merchandise such as playing cards, calendars, and key chains, all of which could be ordered via e-mail, clearly diminished the capacity of PEI's marks to identify its goods and services.
Examining relevant decisions reached by other courts, the court held that the exercise of personal jurisdiction over the foreign defendants in Virginia was clearly appropriate under the causing-tortious-injury provisions of Virginia's long-arm statute. The court, however, doubted that defendants' registration of the domain names with NSI, the Virginia-based domain-name registrar, constituted transacting business within the meaning of the relevant Virginia long-arm statute provision, because such a holding would mean that each domain-name registrant could be subject to personal jurisdiction in Virginia merely because the federal government chose to vest a Virginia company with control over the registration of domain names.
The court additionally found that defendants' infringement and dilution were willful, emphasizing in particular defendants' purposeful embedding of PEI's marks in the metatags of their websites to attract visitors as an act which "epitomizes the blurring of PEI's trademarks." The court awarded PEI costs, attorney’s fees, and $3,000,000 in statutory damages for trademark counterfeiting pursuant to 15 U.S.C. §1117(c). The magistrate judge recommended an award of attorney’s fees of $35,000.
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