Designer Skin LLC v. S & L Vitamins, Inc., et al.
America Online, Inc., et al. v. Chih-Hsien Huang, et al.
2000 U.S. Dist. Lexis 10232, 106 F. Supp. 2d 848 (E.D. Va., July 13, 2000)
Court holds that act of registering an allegedly infringing domain name with NSI, which has its headquarters in Virginia, is insufficient by itself to permit the Virginia federal court to assert in personam personal jurisdiction over the registrant in a suit brought by the holder of the mark allegedly infringed.
Plaintiffs America Online ("AOL") and ICQ, Inc. ("ICQ"), a wholly-owned subsidiary of AOL, are the owners of a common law trademark in the mark "ICQ." Plaintiffs use this mark in promoting an Internet service which alerts users that other designated individuals are online, and facilitates communications between those users, via e-mail and real-time chat.
Defendant eAsia, Inc. ("eAsia") is a California corporation with its principal place of business in Taiwan. Defendant "through its subsidiaries, develops Internet related software and provides Internet related services for customers in Taiwan and other parts of Asia." Defendant's products and services are aimed at, and marketed exclusively in, Asia. This is evidenced, in part, by the fact that defendant's web pages are written in Chinese.
Among the services defendant offers is a "communications protocol" it refers to as "ICQ". It is unclear from the court's decision precisely what this service is, or if it is similar to that offered by the plaintiffs. To assist in marketing these services, eAsia registered the domain names picq.com and picq.net with Network Solutions, Inc. ("NSI"). This registration was performed entirely online. As part of this registration, eAsia entered into a contract with NSI. Pursuant to this contract, for an annual fee of $35 dollars, NSI agreed to maintain an entry in the DNS database directing inquiries concerning eAsia's domain names to eAsia's name servers. eAsia completed this registration agreement from a computer located either in California or Taiwan. NSI is headquartered in Virginia. Defendant had no other contacts with Virginia.
Plaintiff commenced suit in Virginia, advancing a variety of claims arising out of defendant's use of plaintiff's mark in the domain names referenced above and on their web pages, including violation of the Anticybersquatting Consumer Protection Act and trademark infringement under the Lanham Act. Defendant eAsia moved to dismiss on the ground that the court lacked personal jurisdiction over it. The district court agreed, and dismissed the suit.
Plaintiffs made two arguments in support of their contention that the court could properly exercise jurisdiction over eAsia. First, plaintiff argued that such jurisdiction was proper because defendant had registered the domain names at issue pursuant to a contract it had entered into with NSI, a company headquartered in Virginia. While the court held that such registration may constitute transacting business sufficient to permit the assertion of jurisdiction over defendant under Virginia's long-arm statute, it further held that this contact was insufficient to permit the assertion of jurisdiction over the defendant consistent with the Due Process clause of the United States Constitution. Said the court:
[T]he registration agreements are not substantially related to this forum, and eAsia's limited Internet contacts with NSI may not otherwise form the basis for personal jurisdiction in this case. For these reasons, by registering the two domain names at issue here, eAsia did not purposefully direct its activities at this forum, and due process would be offended were personal jurisdiction granted based on those contacts.
In reaching this conclusion, the court declined to follow the court's decision in Lucent Technologies, Inc. v. lucentsucks.com, 95 F. Supp.2d 528 (E.D. Va. 2000) where the court, in dicta, suggested that such contact would be a sufficient basis for establishing personal jurisdiction.
Plaintiffs also argued that the court could assert jurisdiction over the defendant because defendant's act of infringement caused plaintiffs injury in Virginia, where plaintiff AOL is headquartered. The court rejected this argument as well. According to the court "where personal jurisdiction is based on the place at which the 'plaintiff feels the alleged injury' the plaintiff must also show that its injury is 'accompanied by the defendant's own contacts with the state.'"
Finding that defendants did not direct their activities toward Virginia, the court held such basis insufficient to permit assertion of personal jurisdiction over the defendant. In reaching this result, the court relied on its determination that eAsia marketed its services in Asia, and not Virginia, as evidenced by its Chinese language site, and that there was no evidence that defendant had sold services to Virginians.
The court also noted that:
a claim of trademark infringement or dilution arises from the commercial use of a domain name that is similar or identical to a person's trademark, and not from the mere registration of the domain name. Thus, for domain name disputes based on federal or common law trademark infringement or dilution, the relevant tortious act is the use of the domain name, and not the act of registration. The ACPA, however, provides a cause of action against a domain name registration based on the bad faith registration of a domain name that is identical or confusingly similar to, or in the vase of a famous mark, dilutive of, the trademark owner's mark or marks.