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ACPA Held to Grant In Rem Jurisdiction Only Where Domain Name Registrar or Registry is Located

12.10.02
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The U.S. Court of Appeals for the 2nd Circuit (“2nd Circuit”) has ruled that in rem lawsuits under the Anti-Cybersquatting Consumer Protection Act (“ACPA”) can be filed only in the federal judicial district where the registrar, registry or other domain name authority for the domain name at issue is located. Mattel v. Barbie-Club.com, Docket No. 01-7680 (2nd Cir. Nov. 7, 2002). The court dismissed for lack of jurisdiction Mattel’s in rem action filed in New York federal court, seeking cancellation or transfer of 57 domain names alleged to violate various marks owned by Mattel.

ACPA’s in rem provision, 15 U.S.C. §1125(d)(2), allows trademark owners to file suit against domain names themselves, instead of domain name owners, in cases where personal jurisdiction over the owners cannot be established or where the owners cannot be located. Mattel contended it could not obtain personal jurisdiction over the individuals and entities that registered the allegedly infringing domain names, which included princessbarbie.com, hotwheelsusa.com, matchboxonline.com and mattels.com.

This case centered around the meaning of two subsections of 15 U.S.C. § 1125(d)(2). Subsection (d)(2)(A) provides that an in rem civil action may be filed “in the judicial district in which the domain name registrar, domain name registry, or other domain name authority that registered or assigned the domain name is located….” Subsection (d)(2)(C) states: “[i]n an in rem action under this paragraph, a domain name shall be deemed to have its situs in the judicial district in which i) the domain name registrar, registry or other domain name authority that registered or assigned the domain name is located; or ii) documents sufficient to establish control and authority regarding the disposition of the registration and use of the domain name are transmitted with the court.” (emphasis added) Mattel argued that the latter subsection supplements and effectively expands the jurisdictional grant contained in subsection (d)(2)(A) by permitting an in rem action to be brought in any judicial district in which documents evidencing the disputed domain name are deposited with the district court.

The court held, however, that subsection (d)(2)(A) provides the sole basis for in rem jurisdiction under ACPA, and subsection (d)(2)(C) simply describes the legal situs of the domain name once an in rem action has been properly filed. The Second Circuit noted that, while subsection (d)(2)(A) speaks of “filing an in rem civil action,” subsection (d)(2)(C), which begins with “in an in rem action under this paragraph,” plainly presumes that such an action has been properly filed pursuant to subsection (d)(2)(A). If the registrar moves out of the judicial district where the suit was commenced, goes out of business or sells its interest to another company during the time between the filing of the complaint and the deposit with the court of the domain name registration certificates, the domain name’s legal situs may differ from the jurisdiction where the registrar or other domain name authority is presently located.

The court also considered ACPA’s legislative history, which indicates Congress’ intention that the presence of the domain name itself in the judicial district in which the registry or registrar is located would provide the “nexus” necessary to satisfy due process and international comity concerns. Under Mattel’s theory, an in rem complainant could bring suit anywhere and create jurisdiction merely by having the domain name deposited with the court in that “situs.”

Please contact us if you have any questions or if you would like a copy of this decision.

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