Virginia Court Gives Cybersquatter “The Maximum”

Apparently there are still some people who think they are being clever by registering domain names confusingly similar to trademarks or domains used by existing companies, hoping to capitalize on the confusion.  And what better target than Citibank, a giant company with an easily misspelled name!  Judge Hilton of the Eastern District of Virginia, who is well versed in intellectual property issues, decided to teach a lesson to such a schemer in the case of Citigroup, Inc. v. Shui, Civil Action No. 08-0727, on February 24, 2009.

The Defendant, Chen Bao Shui, thought it would be a good idea to register CITYBANK.ORG and use it to market financial services.  When visitors would go to his site, they would see links to, among other things, “Citibank Student” and “Citibank Visa.”  Clicking on such an option would not take the visitor to Citigroup, of course, but to another page or to a third-party vendor who would pay the Defendant for each click-through.  In other words, the Defendant’s plan was to earn money by confusing customers into believing they were dealing with Citigroup when they were dealing with an unrelated, unaffiliated entity.

This is exactly the sort of activity prohibited by the Anticybersquatting Consumer Protection Act, found at 15 U.S.C. 1125(d) (the “ACPA”).  A violation of the ACPA exists where (1) a49702_holding_a_dot_com_iii.jpg defendant has a “bad-faith intent” to profit from using the domain name; and (2) the domain name at issue is identical or confusingly similar to the plaintiff’s distinctive or famous trademark.

Judge Hilton had no trouble finding that Mr. Shui (or is it Mr. Chen?) violated the ACPA.  Granting summary judgment for Citigroup, he found that there was no genuine dispute as to any material fact and that Citigroup was entitled to judgment as a matter of law (i.e., without having to conduct a trial).  Because it was such a clear case, the court awarded $100,000 in statutory damages, plus reimbursement of attorneys’ fees.

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