The Anticybersquatting Consumer Protection Act: Empowering trademark owners, but not the last...

I. INTRODUCTION .........................................................................................................591

II. WHO ARE "CYBERSQUATTERS? ...................592

III. THE ANTICYBERSQUATTING CONSUMER PROTECTION ACT ................................595

A. Why Congress

B. What Is Not New: The Anticybersquatting Cause of Action and Current Likelihood of Confusion Analysis ................ 596

1. Current Trademark Infringement Law .................596

2. The A CPA's Use of Likelihood of Confusion ............598

C. What Is New ........................................................................................................ 603

1. A Cybersquatter's Registration Alone Can Give Rise to Liability ......................................................................................................... 603

2. Protection of Personal Names ...................................................................... 604

3. In Rem Jurisdiction ..............606

4. Statutory Damages ........................................................................................ 607

D. What Is Left Unresolved ..................................................................................... 607

1. Initial-Interest Confusion .............................................................................. 607

2. Degree of Internet Users' Sophistication .........................609

IV. CONCLUSION ............................................................................................................ 611 I. INTRODUCTION

In some respects, the growth of the Internet has resembled the Wild West: individuals, governments, corporations, and other groups have dashed out to establish a presence on the electronic frontier.1 In some respects, space in this new frontier is limited, and thus can be a precious commodity.2 Not surprisingly, opportunists, legitimate or otherwise, are staking their claims. Some, anticipating another Gold Rush, have seized as much territory (i.e., domain names) as possible, not necessarily to put that territory to productive uses, but instead to profit from the late-comers who might eventually desire the now-occupied space. When a domain name has been reserved by someone with the intent of selling (at a great profit) the right to use that domain name, "cybersquatting" has occurred.3 Some businesses have found that their desired domain names have been occupied already. Thus, one encounters an intersection of the Internet and trademark law. Courts have dealt with numerous cases under the trademark infringement and dilution laws that involved uses of trademarks and service marks within domain names.

In response to the increasing frequency of domain name disputes and the harm that they are perceived to inflict upon the economy, Congress passed legislation designed both to benefit mark owners and to deter various unauthorized uses of protected marks: the Anticybersquatting Consumer Protection Act (ACPA) 4 The ACPA creates a new cause of action against certain unauthorized mark users.s This cause of action is available in addition to existing actions under the trademark infringement and dilution laws.6 This Note will discuss how the ACPA defines "cybersquatting" and how that definition squares with those offered by commentators and the pre-ACPA courts7 After a brief distillation of current trademark protections, this Note will discuss what the ACPA adds to trademark law, beginning with the elements of the ACPA cause of action.8 The next section will provide an analysis of the ACPA's relationship to and effect upon the current state of trademark law, especially trademark infringement law.9 Finally, this Note discusses issues in domain name disputes that have divided the courts, but which the ACPA fails to address.10

II. WHO ARE "CYBERSQUATTERS"?

Naturally, to appreciate the cybersquatter problem, one must understand who cybersquatters are and what they do. One scholar characterized domain names as follows:

What a domain name consists of is various locators: [http://www.] and then a unique alphanumeric reference-the ... URL (Uniform Resource Locator), followed by a top level domain designation, most frequently ".coin[.]" It is the URL portion of the domain name, the second level domain name, that is "customized" and presents trademark issues.11

While the total number of available domain names may be infinite, as a practical matter, a trademark owner will only find a limited number of useful domain names. For example, because of simple marketing considerations, Burger King may only be interested in obtaining the domain names <burgerking.com>, <burger-king.com>, and <bk.com>.12 A cybersquatter who anticipates this finite number of useful domain names might register some of these names in hopes of being bought out at a tidy profit.

Interestingly, the ACPA identifies "cybersquatters" differently than do commentators and the courts in pre-ACPA cases. Most commentators (legal and otherwise) tend to define cybersquatting as an occurrence where a mark owner would like to establish a site on the Internet having the second level domain name consist mostly or entirely of the owner's mark itself, but is unable to do so because someone has already registered that domain name, hoping that the mark owner will succumb to the "hold up" and enrich the domain name owner through a lucrative pay off.13 Courts have viewed cybersquatters in much the same way and also, occasionally, have discussed cybersquatters' transgressions as they relate to core policy issues, like the purpose of trademarks as product identifiers for consumers and embodiments of a business' goodwill. Cybersquatting occurs when people register domain names "not for their own use, but rather to prevent others from using those names without [the cybersquatters'] consent."14

The ransom element is another common theme in the judicial definitions.15 Unless the mark owner is willing to pay off the cybersquatter, a cybersquatter "prevent[s] others from using the same domain name in any of their accepted meanings."16 That is, the mark suffers a diminishment in its ability to identify the mark owners' goods and services on the Internet;17 thus, the mark owner is unable to capitalize on the substantial effort undertaken to develop the goodwill of the mark.18

The ACPA, however, sets forth a considerably broader definition of cybersquatting. As the legislative history makes clear, the phrase "bad-faith intent to profit" extends the definition of "cybersquatter" far beyond the cybersquatter qua ransomer. The Senate Report on the ACPA identifies five types of people intended to be covered by the Act, and, of these, only the first two groups are included under earlier judicial and commentators' definitions of "cybersquatting."

First, consistent with the descriptions given by commentators and courts, Congress identified as cybersquatters people who "lock up" domain names with the intent to extract ransoms from mark owners.19 Similarly, the second group includes those who register domain names intending to sell the name to the highest bidder, which could be the mark owner, although not necessarily.20 Third are those who "prey on consumer confusion by misusing the domain name to divert customers from the mark owner's site to the cybersquaer's own site. . . ."Zt This group seemingly does not include people who may be thought of as "direct competitors" of the mark owner-the subject of the fourth group. The fourth group identified by Congress as cybersquatters are people who use a domain name that plays off of another's protected mark in order to divert (unsuspecting) consumers' business away from the mark owner's site and instead to the cybersquatter's.22 An illustration given by Congress of these unfair competitors was the business using the domain name <disneytransportation.com>, that, despite its lack of affiliation with the Walt Disney Company, "greets online consumers at its site with a picture of Mickey Mouse and offers shuttle services in the Orlando area and reservations at Disney hotels."23 The final (and, according to Congress, the most important) group of offending cybersquatters are those who "target distinctive marks to defraud consumers, including to engage in counterfeiting activities."24 This type of individual seems far removed from the cybersquatter gua ransomer that courts and most commentators describe.

The ACPA also seems to cover a class of disputes known as "reverse domain name hijacking." "Reverse domain name hijacking" occurs where senior trademark users (that is, the person first to use a mark) protest the registration of <.com> domain names upon discovery that a junior user (a later user of a mark) has already registered the senior user's desired name.25 According to one commentator, many of the junior users in these conflicts, however, "appeared to [use] the [disputed] domain names . . . in areas of use that arguably would not . . . give rise to a likelihood of confusion."26 It seems quite plausible, nevertheless, that in such disputes a senior user might invoke the ACPA by alleging that the junior user registered the contested domain name with a bad-faith intent to profit from the senior's mark.

Congress, therefore, appears to have used the rubric of "cybersquatters" within the ACPA as a means to address a larger area of trademark law involving unauthorized mark users on the Internet.27 Using "Anticybersquatting" in the Act's title seems to be a misnomer, given that the scope of the ACPA actually encompasses far more than the more narrow, commonplace definition of cybersquatting (i.e., a ransoming of the domain name).28 Accordingly, one can infer that Congress, through the ACPA, intended to address domain name trademark disputes more generally and thus needed to fashion a much broader definition of "cybersquatting".

III. THE ANTICYBERSQUATTING CONSUMER PROTECTION ACT

Conscious of the growth (and growing pains) of e-commerce, Congress determined that mark owners needed more protection than that afforded by the trademark infringement and trademark dilution laws. Yet, while the ACPA provides mark owners a new cause of action, it does not reflect a new trademark theory of addressing domain name disputes-in fact, Congress borrowed heavily from trademark infringement analysis.29 The ACPA's importance lies in the mechanics of the cause of action, which provide several practical benefits to mark owners pursuing cybersquatters. Unfortunately, the ACPA does not address some of the key issues affecting domain name disputes (initial-interest confusion and the degree of Internet users' sophistication) and will require the courts to struggle through their resolution.

A. Why Congress Deemed Legislative Action Necessary

Congress expressed a number of reasons for creating the ACPA. An early iteration of the ACPA found that cybersquatting causes several harms, including "consumer fraud and public confusion as to the true source or sponsorship of goods and services,"30 impairment to electronic commerce,31 deprivation of "legitimate trademark owners of substantial revenues and consumer goodwill,"32 and "plac[ing] unreasonable, intolerable, and overwhelming burdens on trademark owners in protecting their valuable trademarks."33 Congress also noted that current law does not expressly prohibit cybersquatting.34 Moreover, while trademark infringement and trademark dilution laws provide a basis to pursue cybersquatters,35 the laws have limitations: litigation is costly,36 winning damage awards (not just injunctions) in these cases is difficult,37 and clever cybersquatters can elude coverage under these laws.38 The ACPA is intended to "fill in the gaps and uncertainties of current trademark law with respect to cybersquatting."39 To see how Congress intends the ACPA to achieve those results thus requires a brief look at the new cause of action.

B. What Is Not New: The Anticybersquatting Cause ofAction and Current Likelihood of Confusion Analysis

The ACPA creates a new cause of action for domain name disputes. To understand the changes made by the ACPA, one must review the ACPA cause of action alongside the current trademark infringement laws. Although an ACPA plaintiff may proceed under a theory of trademark infringement, a theory of trademark dilution, or both theories,40 the structure of the ACPA triggers a trademark infringement analysis even if the plaintiff chooses to proceed under the dilution theory.

1. Current Trademark Infringement Law

Before addressing the relationship between the ACPA and the current trademark regime, the essential elements of a trademark infringement action should be brought to light. To assert a claim for trademark infringement, mark owners must show that they have legally-protectable rights to assert and that those rights have been violated.41 Marks fall into one of four categories: (1) generic,42 (2) descriptive,43 (3) suggestive,44 or (4) fanciful or arbitrary 45 Marks in the last two categories are protectable 46 Descriptive marks are also protectable so long as the mark owners can establish that the marks carry a "secondary meaning."47 The term "distinctive mark" is also used to indicate a protectable mark. A protectable mark may be registered with the U.S. Patent and Trademark Office.48

Under section 32 of the Lanham Act, a person commits trademark infringement when using another's registered mark without that mark owner's consent "in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion. . . ."49 This likelihood of confusion represents the potential harm suffered by the rightful user of the mark. To determine whether a defendant's use of an allegedly infringed-upon mark is likely to cause confusion as to the true origin of the good or service, courts typically employ a multi-factor test.so Factors taken into consideration include: the similarity of the parties' marks, the similarity of the parties' goods or services, the strength of the plaintiff's mark, the likelihood of expansion in product lines (also known as "bridging the gap between markets"), the marketing channels used by the parties, the degree of care exercised by purchasers in selecting the good or service, the defendant's intent or good faith in selecting the mark, and the existence of actual confusion.51 Upon proving a likelihood of confusion, plaintiffs may enjoin the defendants' use of the mark.52 Furthermore, if plaintiffs can prove that actual confusion took place, they are entitled to damages in addition to the injunction.53 With this structure of trademark infringement law in mind, the effects of the ACPA will be clear.

2. The ACPA's Use of Likelihood of Confusion

Courts will undertake a likelihood of confusion analysis not only in trademark infringement claims, but in ACPA actions as well. Before discussing how the ACPA and the likelihood of confusion test are intertwined, this section will lay out the ACPA cause of action and the bad-faith factors that are weighed in an ACPA action. The ACPA affords protection to owners of both registered and unregistered marks.54 The ACPA provides:

A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark under this section, if, without regard to the goods or services of the parties, that person

(i) has a bad faith intent to profit from that mark, including a personal name which is a protected mark under this section; and

(ii) registers, traffics in, or uses a domain name that

(I) in the case of a mark that is distinctive at the time of registration of the domain name, is identical or confusingly similar to such mark;

(II) in the case of a famous mark that is famous at the time of registration of the domain name, is identical or confusingly similar to or dilutive of such mark; or

(III) is a trademark, word, or name protected by 706 of title 18, United States Code, or section 220506 of title 36, United States Code.55

To assist the courts in determining whether a person has such a bad-faith intent, Congress provided a non-exclusive List of factors for courts to consider. The nine factors included are:

(I) the trademark or other intellectual property rights of the person, if any, in the domain name;

(II) the extent to which the domain name consists of the legal name of the person or a name that is otherwise commonly used to identify that person;

(III) the person's prior use, if any, of the domain name in connection with the bona fide offering of any goods or services;

(IV) the person's bona fide noncommercial or fair use of the mark in a site accessible under the domain name;

(V) the person's intent to divert consumers from the mark owner's online location to a site accessible under the domain name that could harm the goodwill represented by the mark, either for commercial gain or with the intent to tarnish or disparage the mark, by creating a likelihood of confusion as to the source, sponsorship, affiliation, or endorsement of the site;

(VI) the person's offer to transfer, sell, or otherwise assign the domain name to the mark owner or any third party for financial gain without having used, or having an intent to use, the domain name in the bona fide offering of any goods or services, or the person's prior conduct indicating a pattern of such conduct;

(VII) the person's provision of material and misleading false contact information when applying for the registration of the domain name, the person's intentional failure to maintain accurate contact information, or the person's prior conduct indicating a pattern of such conduct; and

(VIII) the person's registration or acquisition of multiple domain names which the person knows are identical or confusingly similar to marks of others that are distinctive at the time of registration of such domain names, or dilutive of famous marks of others that are famous at the time of registration of such domain names, without regard to the goods or services of the parties; and

(IX) the extent to which the mark incorporated in the person's domain name registration is or is not distinctive and famous within the meaning of subsection (c)(1) of section 43.56

Trademark infringement analysis pervades the ACPA. When ACPA plaintiffs base their claim on an infringement theory, the ACPA requires a likelihood of confusion analysis standard identical to that of a trademark infringement claim.57 ACPA plaintiffs may also base their cybersquatter claims on a theory of trademark dilution.sg The ACPA bad-faith inquiry is required regardless of whether plaintiffs allege that cybersquatters are infringing or diluting the mark.59 As will be seen, the ACPA bad-faith inquiry is tantamount to a likelihood of confusion analysis under an infringement action. Accordingly, ACPA plaintiffs must establish a likelihood of confusion even if bringing a claim based solely on a trademark dilution theory.

The first bad-faith factor (consideration of the domain name registrant's trademark rights in the domain name) merely codifies the trademark principle that "there may be concurring uses of the same name that are [non-infringing]."61 Similarly, the second badfaith factor, whether the domain name is the registrant's legal name or nickname, is already reflected in trademark doctrine.62 Thus, making such inquiries will not be a new task for courts, as it seems likely that the courts will already have to make such an inquiry, given that a plaintiff suffering an ACPA injury probably will not bring an ACPA cause of action alone, but will simultaneously bring actions for trademark infringement and trademark dilution.63

Congress' discussion of the application of the third factor, the registrant's prior use of the domain name to make bona fide offers for goods or services, reveals a potential paradox involved in an ACPA bad-faith inquiry. According to Congress, the use of a domain name without creating a likelihood of confusion as to the goods' or services' origin may indicate the registrant's lack of bad faith.64 However, courts routinely look to a registrant's bad-faith intent to establish a fording of likelihood of confusion.65 Thus, use of this factor may require circular logic: registering a domain name with bad faith indicates a likelihood of confusion, which in turn indicates the registrant's bad faith for purposes of the ACPA. Given its silence on this matter, Congress likely did not recognize the Mobius strip in logic created by application of the third factor. In sum, while Congress intended to assist a court's inquiry into bad faith, this factor does not achieve that end and seems to offer courts little substantive guidance.

The fourth bad-faith factor, the existence of noncommercial or fair use of the mark,66 is also perfectly in line with current trademark doctrine. A trademark infringement or trademark dilution claim requires that the allegedly infringing use be made in commerce.67 Furthermore, an alleged trademark infringer can also raise the "fair use" defense 68 The fourth factor reflects these principles. Again, courts already apply these considerations, and accordingly, this factor does not further illuminate what constitutes bad-faith intent.69

Of all the factors, the fifth-a cybersquatter's intent to divert consumers from the mark owner's website to their own,O--may frequently be the dispositive one. Many domain name trademark infringement decisions turn on this finding7l (and, again, ACPA analyses will parallel those in infringement cases). For instance, in Washington Speakers Bureau, Inc. v. Leading Authorities, Inc.,72 the cybersquatter's intent in adopting the mark was the "crucial" factor.73 Leading Authorities, Inc., which represented or cobrokered various personalities for speaking events,74 was sued by Washington Speakers Bureau (WSB), a renowned lecture agency,75 for registering the domain name <www.washingtonspeakers.com> and variants thereof.76 The court found a likelihood of confusion because Leading Authority's employees were "aware of WSB and its prominent place in the market at the time they chose the domain names"77 and "the washingtonspeakers names were more likely than not chosen in part because of their similarity to [WSB's name] in a bad faith attempt to attract business that might otherwise have gone to WSB and to place barriers in the path of WSB's use of the Internet to attract customers."gig

Similarly, in Jews for Jesus v. Brodsky,79 a strong factor in finding trademark infringement was the cybersquatter's intent to use a website "to intercept potential converts to the beliefs of [Jews for Jesus]."80 The cybersquatter had a fervent theological opposition to the teachings of Jews for Jesus and used <jewsforjesus.org> to criticize the organization.gl The use of the domain name was found to be "wilful and undertaken in bad faith, with full knowledge of and the intent to cause confusion and to infringe on the rights of (Jews for Jesus]."82

The sixth factor, a person's offer to transfer the domain name to the mark owner for financial gain or a pattern thereof,83 is simply a codification of the Panavision teachings.84 The seventh factor, however, calls for an uncommon inquiry. The court should consider whether a domain name applicant intentionally provided false contact information.85 To this author's knowledge, this issue has not arisen in any judicial discussion of domain name disputes. Additionally, a court may take into account whether a domain name registrant has "warehoused" multiple domain names that infringe or dilute another's mark,86 which has also previously factored into infringement and dilution inquiries.87 Finally, the ACPA directs courts to use as a measure of bad faith the factors investigated in trademark dilution actions.88

While courts will not fmd the ACPA difficult to analyze and apply, plaintiffs, from a doctrinal standpoint, may not find the ACPA much more useful than current trademark remedies.89 Many of the ACPA's suggested bad-faith factors parallel the inquiries made in a trademark infringement action, and the ACPA requires a showing of bad faith whether plaintiffs bring suit under a theory of infringement or dilution. However, in an ordinary trademark dilution action, plaintiffs are not required to establish a likelihood of confusion. In a statute designed to ease mark owners' abilities to pursue cybersquatters, it is odd to encounter a provision that runs somewhat counter to that theme. It seems possible that Congress did not recognize the full effect of the ACPA's bad-faith requirement.

C What Is New

The ACPA does more than codify existing trademark law. Its provision regarding domain name registration by cybersquatters lowers the threshold for conduct giving rise to liability under the current trademark regime.90 Additionally, the ACPA articulates clear terms under which victims of cybersquatting may establish in rem jurisdiction over the contested domain names themselves.91 Finally, ACPA plaintiffs may seek statutory damages, a form of relief unavailable in trademark infringement and trademark dilution actions.92 1. A Cybersquatter's Registration Alone Can Give Rise to Liability

The ACPA's treatment of domain name registration may represent the most significant expansion of protection afforded to mark owners. The ACPA lowers the conduct that may give rise to cybersquatter liability vis a vis that provided for under the trademark infringement and trademark dilution laws. Several courts have stated that the mere registration of a domain name cannot fulfill the "use in commerce" requirement of trademark infringement and trademark dilution actions.93 Indeed, one commentator labeled this "[o)ne of the few issues that actually appears to be resolved"94 amongst the plethora of trademark issues raised in domain name disputes. Under the ACPA cause of action, however, liability can attach to a cybersquatter upon mere registration of a domain name that infringes or dilutes another's mark.95 This expansion of protection is a significant one.

The expansion is important notwithstanding that courts can find creative ways so that the necessary "use in commerce" requirement is met. For example, in Panavision, the cybersquatter had not used the contested domain names to sell a good or service.96 The Ninth Circuit, nevertheless, found the cybersquatter's attempt to sell the domain names sufficient to establish the `use in commerce" requirement.97 Doubtless, though, other cybersquatters have learned from this mistake. Any cybersquatter worth his or her salt would not contact the mark owner about a potential sale. The cybersquatter would wait for the mark owner to initiate negotiations. Such a course of action seems less likely to trigger the "use in commerce" requirement than the aggressive approach taken by the Panavision cybersquatter.98 Congress had this concern in mind when formulating the ACPA.99

Considering that Congress elaborately explained other expanded protections,loo one might have expected Congress to discuss in some detail why such a departure from the "use in commerce" requirement was necessary. Interestingly, few remarks on this count seem to have been made.lol Ultimately, it is sufficient to note that the ACPA significantly expands the gamut of actionable conduct by domain name registrants, and accordingly, the number of defendants reachable by a trademark or service mark owner.

2. Protection of Personal Names

Under the ACPA, personal names are protected in two contexts. Section 3002(a) outlines the ACPA's first provision for personal names. 102 The bounds of its protections, however, are not entirely clear. The ACPA protects "a personal name which is protected as a mark under this section."103 At first blush, this phrase seems superfluous. That is, if one's name constitutes a mark, it would already be protected by the ACPA. On the other hand, the inclusion of the "personal name" clause might be read as the creation of a federal right of publicity (although a right limited to domain names).104 Even if the text of section 3002(a) does not clearly require a personal name to constitute a mark, the ACPA's legislative history reveals that no such result was intended.105 On the whole, it therefore seems unlikely that courts would read into this subsection of the ACPA a limited federal right of publicity.

However, the second context in which the ACPA protects personal names represents a tremendous departure from prior domain name trademark law. Section 3002(b) seeks to prevent any cybersquatter from intentionally ransoming to a person a domain name consisting of that person's name, regardless of whether that name is actually used as a mark.106 Despite Congress' claim to the contrary, section 3002(b) creates an action that resembles a right of publicity claim. A common law right of publicity cause of action may be pleaded by alleging (1) the defendant's use of the plaintiff's identity; (2) the appropriation of the plaintiff's name or likeness to the defendant's advantage, commercially or otherwise; (3) lack of consent; and (4) resulting injury.107 The elements of section 3002(b) are similar to this common law action. Yet, by requiring a defendant's specific intent to appropriate a plaintiff's name for financial gain,108 the ACPA is more demanding than the common law right of publicity action. The remedy available to these ACPA plaintiffs is limited to injunctive relief,109 by contrast to other ACPA plaintiffs' ability to collect statutory damages,110 perhaps to reflect that this protected class is so far removed from the traditional domain name trademark plaintiff. Arguably then, section 3002(b) of the ACPA does in fact create a limited federal right of publicity.

3. In Rem Jurisdiction

Congress allowed, under limited circumstances, an ACPA plaintiff to file an in rem action111 against the domain name itself. 112 This provision seems to confront directly concerns raised in Porsche Cars North America, Inc. v. Porsch.comI13 about the constitutionality of pursuing in rem proceedings under the Trademark Dilution Act. Porsche had registered the domain names <porsche.corn> and <porsche-usa.com>, but found that 128 arguably dilutive domain names (e.g., <porsch.corn>) had been registered by others. 114 None of these domain names channeled consumers to Porsche's website. 115 In response, Porsche filed an in rem proceeding-as opposed to an in personam action116-alleging trademark dilution. 117 Porsche's in rem action failed. The court noted that "Rule 4(n) of the Federal Rules of Civil Procedure authorizes federal courts to exercise in rem jurisdiction over property within their domain. . . if a federal statute so provides,"118 which required the court to determine whether the Trademark Dilution Act119 allowed such an action.120 The court then held that, "even though the [Trademark Dilution Act] does not expressly preclude in rem lawsuits, its language speaks strongly in favor of allowing in personam actions alone" because the Act remedies only another "person's"121 use of the mark, assesses damages against a "person"122 (because the mark itself cannot pay damages), and Congress could have easily drafted the statute to allow in rem proceedings against marks.123 The court expressed concerns about the constitutionality of such a statutory interpretation, as well. Stating that "courts generally cannot exercise in rem jurisdiction to adjudicate the status of property unless the Due Process Clause would have permitted in personam jurisdiction over those who have an interest in the res,"124 the court dismissed Porsche's complaint.125 While some of the domain name registrants' identities and addresses were unknown (such that an in personam action would be futile), most were known.126 Because "[t]he Due Process Clause requires at least some appreciation of [these] differences, and [because] Porsche's pursuit of an in rem remedy . . . fails to differentiate between them at all,"127 Porsche's complaint had to be dismissed as to all of the parties.128

The ACPA's provision of in rem proceedings does not seem to raise the same constitutional concerns. The ACPA allows an in rem action against a domain name only if the court determines that the ACPA plaintiff, using due diligence, was unable to find a person who qualified as a defendant.129 Moreover, the remedy provided by the ACPA is limited to forfeiture or cancellation of the domain name, or its transfer to the ACPA plaintiff.130 Given its narrow application and narrow remedy, the ACPA does not seem to run afoul of "traditional notions of fair play and substantial justice."131

4. Statutory Damages

The ACPA provides traditional trademark remedies: injunctions and actual damages.132 However, it also gives the ACPA plaintiff the option to elect for statutory damages (of an amount within the trial court's discretion between $1000 and $100,000) in lieu of actual damages and profits.133 While Congress did not seem to offer any explanation as to why it arrived at those figures, the statutory damages provision seems to have been designed simply with deterrence in mind. 134 The provision of statutory damages alleviates the plaintiffs' burden of proving the amount of damage they suffered at the hands of the cybersquatter. ACPA plaintiffs may attempt to prove the extent of damages, but, if they fear that they will not succeed, they may opt for statutory damages at any time before the rendering of a final judgment. 135

D. What Is Left Unresolved

The ACPA leaves muddled some issues that have divided courts or that at least have been left unharmonized by them. One such issue regards how to treat "initial-interest confusion," also called "initial confusion," on the Internet. Another point left in dispute is the degree of sophistication of Internet users.

1. Initial-Interest Confusion

Courts are divided over how to treat the initial confusion experienced by consumers when, in search of a mark owner's website, the intuitive domain name leads them instead to the website of another. Under one judicial approach, "initial confusion on the part of [Web] browsers . . . is not cognizable under trademark law."136 Along these lines, the court in Hasbro, Inc. v. Clue Computing, Inc. 137 has stated that "consumers will realize they are at the wrong site and go to an Internet search engine to ford the right one"138 and that this initial confusion "may rise to the level of inconvenience,"139 but "is not substantial enough to be legally significant."140 These statements are wholly at odds with other "initial-interest confusion" analyses.

The Ninth Circuit, for instance, "recognize[s] a brand of confusion called `initial interest' confusion, which permits a finding of a likelihood of confusion [in a trademark infringement action] although the consumer quickly becomes aware of the source's actual identity and no purchase is made as a result of the confusion."141 When a cybersquatter's tactic to create initial confusion succeeds in achieving a sale for the cybersquatter, the justification for this approach seems clear: the cybersquatter has gained a customer by appropriating the (rival) mark owner's goodwill.142 Thus, the Ninth Circuit appears to have the superior approach. Contrary to the Hasbro assertion above that a consumer reaching a wrong website will automatically turn to a search engine to ford the correct one, it seems equally plausible that the consumer will not make that choice. Indeed, when providing a similar good or service, an effective cybersquatter has given the consumer a reason not to turn around. The consumer may be content with the cybersquatter's good or service.143 The fact is irrelevant that the consumer ceased to be confused upon recognizing that the cybersquatter was not the mark owner-the initial misdirection caused by the cybersquatter resulted in a misappropriation of the mark owner's goodwill.144

Even when that misdirection does not lead to a sale for the cybersquatter, the Ninth Circuit takes the better approach. Through use of another's mark, a cybersquatter could increase its exposure to the consumer, or it may result in a consumer's first exposure to the cybersquatter's good or service. This exposure would seem to increase the possibility that, in the future, the consumer will seek out the cybersquatter rather than the mark owner. Without a doubt, this posited future injury is speculative. However, attempting to prevent this potential injury does not seem objectionable. The fact remains that the cybersquatter used another's registered mark. Unless a "fair use" reason for using that mark exists (e.g., to compare true facts about the cybersquatter's and mark owner's products), the cybersquatter has no legitimate need to use that mark. No good to the mark owner could come of it but harm might. One of two possibilities exist: (1) the cybersquatter gains sales in the future because of its use of another's mark, or (2) the cybersquatter fails to gain future sales. In the former case, the cybersquatter has successfully misappropriated another's goodwill and should not have been allowed use of that mark in the first place. In the latter, the cybersquatter has not benefited from another's mark, but allowing a court to enjoin the cybersquatter's use of that mark would not cause harm to the cybersquatter.145 Thus, a court may justifiably enjoin any use of another's mark by a cybersquatter, absent a "fair use" defense.

Having used the ACPA to address a broad range of trademark issues involving domain name disputes,146 Congress might have taken this opportunity to clarify the conflicting approaches to initial interest confusion. In fact, one might have expected Congress to resolve the dispute, given its concern about <dosney.com>, <whitehouse.com>, and other pornographic sites that Internet users (particularly the young) might stumble upon. This problem could easily be viewed in terms of initialinterest confusion. In contrast to one of its stated goals, Congress' silence on this issue has left a particularly large gap unfilled in trademark law.147

2. Degree of Internet Users' Sophistication

The sophistication of Internet users is an important factor in resolving domain name disputes. Sophisticated users are less likely to fall prey to confusion caused by cybersquatters. Yet, courts have not provided a definitive approach to determining Internet users' sophistication. To some extent, ACPA weighs in on the issus. Neither Congress nor the courts seem to have addressed the issue fully, however, failing to discuss the growing gap between the computer literati and those without access to the Internet.

Courts deciding the first domain name disputes did not expect users to navigate the new internet medium with care. One court found that "ordinary [I]nternet users do not undergo a highly sophisticated analysis when searching for domain names."148 Another court stated that "considering the vastness of the Internet and its relatively recent availability to the general public, many Internet users are not sophisticated enough to distinguish between the subtle difference in the domain names of the parties."149

More recently, courts have treated Internet users' sophistication, in part, as a function of the parties' goods and services. in Interstellar Starship Services, Ltd. v. Epix Inc.,150 Epix manufactured, sold, and provided consulting services for video-imaging hardware and software.151 interstellar offered consulting services on "design for test" circuit analysis.152 The court'sfindings that Epix's goods were expensive both cut against the likelihood of confusion necessary to sustain Epix's infringement claim.153 Similarly, in a dispute over the domain name <clue.com>, a court found that Hasbro's prospective customers for its murder-mystery game, Clue, were "plainly sophisticated enough" to distinguish it from the defendant's computer consulting service and thus unlikely to be confused by the defendant's use of that website.154 The ACPA, however, did not adopt this approach to the degree of care exercised by Internet users.

The ACPA did not formally adopt a position on this issue, but Congress discussed it in the legislative history. In a statement wholly at odds with the recent judicial approach, Congress claimed:

[o]nline consumers have a difficult time distinguishing a genuine [web]site from a pirate site, given that often the only indications of source and identity of the site, or the goods and services made available thereon, are the graphical interface on the site itself and the Internet address at which it resides. As a result, consumers have come to rely heavily on familiar brand names when engaging in online commerce. But if someone is operating a [web]site under another brand owner's trademark, such as a site called "cocacola.com" or "levis.com," consumers bear a significant risk of being deceived and defrauded, or at a minimum, confused. The costs associated with these risks are increasingly burdensome as more people begin selling pharmaceuticals, financial services, and even groceries over the Internet.155

The courts, as seen in the discussion above, have found that consumers can often easily distinguish between websites. In the case of pharmaceuticals and financial services, the courts may not find a risk of confusion because of the complex nature of those product offerings.

Neither Congress nor the courts have discussed the ever-widening gap between people proficient in using the Internet and the people without those skills. People with Internet access become increasingly sophisticated in their Web dealings, but a significant segment of the populace currently lacks Internet access.156 However, the opportunity to use the Internet is growing as society realizes its importance. When new users arrive on the Internet, what degree of care should the courts attribute to them? Should new users be presumed to possess the savvy of long-time Internet users? Should new-user care be the standard for all Internet users? Both options have problems. New users are likely to be the users most susceptible to cybersquatter-caused misdirection and thus need greater protection than the average user. On the other hand, given the sophistication of many Internet users, applying a "lowest-common denominator" standard seems unfair to mark users (both legitimate and illegitimate) on the Internet. Although courts may need to strike a middle ground, an optimal standard does not seem obvious. For the time being, an ad hoc approach may be best.

IV. CONCLUSION

As the Internet has grown, trademark law has been forced to grow along with it. Domain names have become precious commodities, which, naturally, has led to ownership disputes. While mark owners have had some degree of success in protecting the value of their marks under the existing trademark infringement and trademark dilution regime, Congress has decided that the laws did not go far enough to protect mark owners and, in turn, Web-surfing consumers. Thus, Congress has proffered the Anticybersquatting Consumer Protection Act. On the whole, however, it does not seem as though Congress has met its stated goal of filling the gaps and clarifying the uncertainties of trademark infringement and dilution law as applied to the Internet. Crucial issues still must be resolved in order to achieve a uniform application of trademark law to Internet mark users.

Where Congress chose to act, it acted boldly. The ACPA's broad definition of "cybersquatting" allows plaintiffs to reach several types of domain-name abusers, not only the traditional cybersquatter qua ransomer. Most importantly, the ACPA allows liability to flow from the mere registration of a domain name by a cybersquatter, whereas the federal infringement and dilution laws require that the domain name be "used in commerce." The ACPA also permits in rem actions against domain names themselves, but only in limited circumstances, so as not to run afoul of constitutional due process requirements.

Yet, even though the ACPA is intended to fill gaps in trademark infringement and dilution law, the ACPA left some gaps unfilled. The ACPA did not resolve the courts' ongoing disagreement about Internet users' sophistication and the degree of care they exercise, nor did the ACPA settle the matter of "initial interest confusion." Apparently, the courts will need to clarify these issues on their own. In the end, the ACPA will enhance mark owners' ability to protect their marks, but it hardly provides the final word on resolving domain name disputes.