Default denied in cybersquatting suit

The Eastern District of Virginia refused to grant default judgment in a cybersquatting case where the plaintiff failed to sufficiently allege that website registrants had a bad faith intent to profit when they misused the plaintiff’s trademarks to attack its business.

The infringing websites criticized the plaintiff’s delivery business as dangerous for its couriers and flyers were distributed that directed people to the websites. The plaintiff contended that those circumstances indicated a sophisticated attack by a competitor.

A magistrate judge recommended that the court deny the motion for default judgment based on its finding that there was no bad faith intent to profit.

Judge Rossie D. Alston Jr. agreed with the magistrate judge.

“[The plaintiff] has pointed to nothing in the websites themselves or in the registrants’ efforts to divert consumers to those websites that shows an intent to profit,” Alston wrote. “That critical failure is exacerbated by the fact that there are no evident commercial aspects to the alternate website.”

The opinion is Getir U.S. Inc. v. Doe (VLW 023-3-322).

Cybersquatting

Getir U.S. Inc. and Getir Perakende Lojistik A.S. operate a mobile app by which customers in several European countries can order groceries or restaurant food to be delivered by couriers using e-bikes or scooters.

In late 2021, Getir discovered that a website, www.getir190.com, was using its name and logos — all registered trademarks — to make allegedly false statements about the business. The website altered Getir’s logo to depict an individual crashing and flying off a bike.

The website alleged that more than 190 Getir couriers died on the job in Turkey since 2020. Asserting that Getir couriers lacked rights and insurance in Turkey, the website warned that a Getir order could result in death and a broken family.

Getir sued the website in rem for defamation and cybersquatting and obtained a preliminary injunction. Two days later, another website, www.190getir.com, surfaced with similar allegations against Getir, as well as a notice that “Getir190 is under attack.”

After dismissing its defamation claims, Getir requested entry of default and moved for judgment on the cybersquatting claim.

U.S. Magistrate Judge William E. Fitzpatrick of the Eastern District of Virginia issued a report that recommended the court refuse Getir’s request for default judgment.

Getir objected to the magistrate’s finding that it didn’t sufficiently allege a “bad faith intent to profit” from Getir’s mark.

Intent to profit

According to the cybersquatting statute, a plaintiff can only get relief if the defendant has “a bad faith intent to profit” from the plaintiff’s mark, Alston said, adding that courts generally weigh nine factors to make that determination.

Each of these factors are relevant, but the 4th U.S. Circuit Court of Appeals has instructed that they aren’t prescriptive, the judge said. Instead, the statute allows courts to “view the totality of the circumstances in viewing the bad faith determination.”

Alston agreed with the magistrate judge that the nine factors “cut both ways” with some weighing in favor of each party.

“However, the fact that those nine factors do not counsel in favor of one finding over the other does not make this Court’s task difficult, as ‘the most important grounds … “are the unique circumstances of the case, which do not fit neatly into the specific factors enumerated by Congress but nevertheless must be considered under the statute,”’” Alston wrote.

Getir claimed the circumstances here evinced a “bad faith intent to profit” and pointed to the “sophisticated nature of the campaign and apparent coordination” as indicative of control by a competitor.

“Getir has not offered any allegations that create a reasonable inference that the registrants are competitors or associated with a competitor. Without such an allegation, the fact that the registrants intended to harm Getir’s business prospects does not establish an ‘intent to profit.”

— U.S. District Judge Rossie D. Alston Jr.

Getir relied on the effect that the alternative websites may have on consumers, such as confusion and diversion of customers, solicitation of influencers to join a sophisticated campaign and distribution of flyers about the websites.

“But those allegations, by themselves, do not reveal an intent to profit. Rather, they reveal an intent to direct Getir users to a particular website,” Alston said. “And that website — as alleged in plaintiff’s amended complaint — does not contain information indicating that the registrants intended to profit from consumers visiting it. Instead, it only contains statements about purported safety issues with Getir.”

The judge noted that Getir’s “critical failure” to point out how the websites or diversion of customers showed an intent to profit was “exacerbated by the fact that there are no evident commercial aspects to the alternate website.”

Alston wasn’t impressed by Getir’s reliance on a declaration which, “[s]tripped to its core … states that the registrants of the allegedly infringing websites conducted a ‘sophisticated attack campaign’” designed to impact Getir’s business, reputation and goodwill.

“Taken as true, that assertion does not mean that the registrants intended to profit themselves; it only speaks to their intent to harm Getir’s ability to profit,” the judge asserted. “Getir has not offered any allegations that create a reasonable inference that the registrants are competitors or associated with a competitor. Without such an allegation, the fact that the registrants intended to harm Getir’s business prospects does not establish an ‘intent to profit.’”

Bad faith

Alston next found that the circumstances “instruct against a finding of bad faith intent” and agreed with the magistrate judge that the “websites here are ‘gripe site[s]’ that ‘criticiz[e] [Getir]’ and as a result do not ‘constitute cybersquatting.’”

The judge explained that Congress’s purpose in passing the cybersquatting statute included preventing the registration of multiple marks to sell to the highest bidder and eliminating confusion caused by misusing domain names to divert consumers.

Nothing in the record indicated that the registrants either hoped to sell the domain names to the highest bidder or divert individuals from Getir’s site to their own.

“The facts alleged show that the registrants’ attempts to ‘attract previous and potential [Getir] customers to [their] websites to inform them about’ purported safety issues with Getir was motivated by the registrants’ desire to ‘voice [their] strong criticisms about [Getir], provide a forum for others to voice criticisms, and, if possible, prevent others from ending up in [their] situation,’” Alston wrote.

The judge adopted the magistrate’s report, denied Getir’s motion for default judgment and dissolved the preliminary injunction.