Trademarks

• Author: International Law Group

Porsche Cars North America, Inc., a subsidiary of the German automobile maker, brought the following in rem action against Porsche.net and 127 others in a Virginia district court. It claimed that all of the listed internet domain names, e.g., porschedealer.com, porschagirls.com, and porscheowners.com, not only violated its rights under the Anticybersquatting Consumer Protection Act (ACPA) (15 U.S.C. Section 1125(d)(1)) but also diluted its trademark. Relying on in rem jurisdiction, Porsche sought judicial confirmation of its rights to those domain names. Many defendants did not put up a defense so the district court entered default judgments against them. Porsche voluntarily dropped its claims against several others. In the end, only five domain names remained in the action, two of them owned by a British citizen, and three of them owned by a resident of Georgia.

The district court ruled that the British registrant's internet domain names did not violate Porsche's rights under the ACPA. It also held that none of the defendants had diluted Porsche's trademark in violation of 15 U.S.C. Section 1125(c). Porsche appealed.

The U.S. Court of Appeals for the Fourth Circuit affirms the dismissal of the trademark dilution claim. The Court, however, vacates and remands the district court's order dismissing the "anticybersquatting" claims against the British domain names. The ACPA authorizes in rem jurisdiction over a domain name if personal jurisdiction over the registrant of the domain is unavailable. Three days before the scheduled trial in Virginia, the British domain names notified the court that their registrant had decided to submit to personal jurisdiction in California. The British domain names argued, and the district court agreed, that the existence of in personam jurisdiction precludes an in rem action no matter where the in personam jurisdiction arose.

The appellate Court, however, disagrees with this conclusion. "We recognize at the outset that the structure of the ACPA undoubtedly expresses...