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Summary Judgment Denied in a Case of Creative Typosquatting

Evan D. Brown

In the case of Lands' End, Inc. v. Remy, the defendant website owners were accused of crafting a clever scheme to get some extra commissions from their affiliate relationship with landsend.com. It looks like the scheme has backfired, however, as Lands' End's claim against the defendants under the Anticybersquatting Consumer Protection Act, [15 U.S.C. §1125(d)] ("ACPA") has survived a summary judgment motion and the case is heading for trial.

Lands' End operates an affiliate program that allows owners of approved websites to put up links to landsend.com. If a visitor to one of those approved websites clicks on the link and ends up buying something at the Lands' End site, the affiliate website owner gets a 5% commission. The defendants in this case signed their websites up to be affiliates, and were approved.

In the process of signing up to become affiliates, however, the defendants only disclosed the URLs of their legitimate websites, e.g., savingsfinder.com. They did not tell Lands' End that they also owned other domains like lnadsend.com and landswnd.com.

The defendants set up these other domain names so that if an Internet user accidentally typed one of them into a web browser, he or she would be automatically and invisibly redirected to the Lands' End site. If one of those typosquatting victims purchased something at landsend.com, the defendants would pick up a commission.

The redirect only worked the first time a user would mistype the domain name. Perhaps to avoid detection, the defendants set up the redirect so that if a user typed the wrong domain name again, a 404 error would appear. ("Oh, I guess it was just a fluke.")

After it noticed the defendants' setup, Lands' End filed suit alleging, among other things, violation of the ACPA. The defendants moved for summary judgment, arguing that there was no showing of bad faith. After all, the defendants argued, their scheme had sent visitors to the Lands' End site, not diverted them away.

The court rejected the defendants' argument and denied the motion for summary judgment as to the ACPA claim. It held that Lands' End adduced substantial evidence to show that the defendants exploited the Lands' End trademark to get commissions to which they were not entitled. Accordingly, the question of bad faith should ultimately be left up to the finder of fact.

Lands' End, Inc. v. Remy, --- F.Supp.2d ----, 2006 WL 2521321 (W.D. Wis., September 1, 2006).

By Evan D. Brown, Attorney. Evan focuses on technology and intellectual property law. He maintains a law & technology focused blog called Internet Cases as well as a blog called UDRP Tracker which focuses on domain name disputes.

Related topics: Cybercrime, Cybersquatting, DNS, Domain Names, Law

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Comments

Re: Summary Judgment Denied in a Case of Creative Typosquatting George Kirikos  –  Sep 06, 2006 10:57 AM PDT

Nice find. Although, perhaps Lands' End should not be the only corporation concerned. If one uses the Reverse IP feature of DomainTools.com to see which other domains are hosted at the same IP address as landswnd.com:

http://www.domaintools.com/reverse-ip/?hostname=landswnd.com

one finds:

969 Results for 64.85.13.200 (Landswnd.com)

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Re: Summary Judgment Denied in a Case of Creative Typosquatting George Kirikos  –  Sep 06, 2006 10:58 AM PDT

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Re: Summary Judgment Denied in a Case of Creative Typosquatting George Kirikos  –  Sep 06, 2006 10:58 AM PDT

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Re: Summary Judgment Denied in a Case of Creative Typosquatting George Kirikos  –  Sep 06, 2006 10:59 AM PDT

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755.roamana.com
756.roamins.com
757.roammans.com
758.romanas.com
759.roomans.com
760.rtavelocity.com
761.rucial.com
762.searchaol.com
763.sehpora.com
764.sephroa.com
765.sepohra.com
766.servicemerchandice.com
767.shelplers.com
768.shoopnbc.com
769.shop-microsoft.com
770.shop-nbc.com
771.shopbs.org
772.shopenbc.com
773.shopnbd.com
774.shoppnbc.com
775.shopsnbc.com
776.sierratradingposty.com
777.siilhouettes.com
778.silhhouettes.com
779.silhoouettes.com
780.silhoueetes.com
781.silhouesttes.com
782.silhouetees.com
783.silhouett.com
784.silhouetttes.com
785.silhouhettes.com
786.silhourttes.com
787.silhousettes.com
788.silhoutes.com
789.siljouettes.com
790.siluettes.com
791.sinystyle.com
792.sipegel.com
793.sjopnbc.com
794.slhouettes.com
795.slibris.com
796.slihouettes.com
797.slutionscatalog.com
798.smoothfitnesss.com
799.snoystyle.com
800.soiegel.com

Re: Summary Judgment Denied in a Case of Creative Typosquatting George Kirikos  –  Sep 06, 2006 11:02 AM PDT

801.soldwatercreek.com
802.solhouettes.com
803.soluionscatalog.com
804.solurionscatalog.com
805.solutiomscatalog.com
806.solutionsatalog.com
807.solutionscaalog.com
808.solutionscaralog.com
809.solutionscatalogs.com
810.solutionscataolog.com
811.solutionscatolag.com
812.solutioscatalog.com
813.sompusa.com
814.soneystyle.com
815.sonistyle.com
816.sonustyle.com
817.sonyatyle.com
818.sonystule.com
819.sonysty.com
820.sonystylestore.com
821.sonystylle.com
822.sonystylr.com
823.sonystyly.com
824.sonysyyle.com
825.soonystyle.com
826.sortsmansguide.com
827.soultionscatalog.com
828.spegle.com
829.spieggel.com
830.spiegil.com
831.spiegol.com
832.spiehel.com
833.spiergel.com
834.spiewgel.com
835.spiigel.com
836.spirgel.com
837.sportshalet.com
838.sportsmandsguide.com
839.sportsmansguid.com
840.sportsmansguise.com
841.sportsmansguode.com
842.spotchalet.com
843.spotrsmansguide.com
844.spottsmansguide.com
845.sprotmart.com
846.sshopnbc.com
847.sspiegel.com
848.stonewallkichen.com
849.storepalmone.com
850.storephilips.com
851.streamlaod.com
852.sunglassesshut.com
853.suralatable.com
854.surlatabel.com
855.surlatalbe.com
856.symmantec.com
857.targety.com
858.tasrget.com
859.taxbrian.com
860.techno-scout.com
861.technoscount.com
862.tehpopcornfactory.com
863.territoryahea.com
864.thecompany-store.com
865.thepopocornfactory.com
866.things-remembered.com
867.tiferdirect.com
868.traacfone.com
869.tracffone.com
870.tracfoen.com
871.tracfrone.com
872.trafficshepherd.com
873.tramadal.com
874.tramdol.com
875.tramidol.com
876.tramodal.com
877.tramodol.com
878.travealocity.com
879.travelaocity.com
880.travelocuity.com
881.travelocyty.com
882.traveloecity.com
883.traveloty.com
884.traveloverstock.com
885.trecfone.com
886.trelocity.com
887.tremadol.com
888.trianglecitysearch.com
889.trivelocity.com
890.tshritking.com
891.tsirtking.com
892.tupperweare.com
893.tuppware.com
894.uharmony.com
895.ukmcafee.com
896.ullapapken.com
897.ullapipken.com
898.ullapoepken.com
899.ullapokpen.com
900.ullapopkein.com
901.ullapopkens.com
902.ullapopkien.com
903.ullapoplen.com
904.ullapoppken.com
905.ullappken.com
906.ullepopken.com
907.ureck.com
908.us-cav.com
909.usastoday.com
910.vemontteddybear.com
911.vermontcountry-store.com
912.vermontteaddybear.com
913.vermonttedddybear.com
914.vermontteddibear.com
915.vermontteddiebear.com
916.vermontteddybeear.com
917.vermotteddybear.com
918.vhadwicks.com
919.vhone.com
920.virgingalactics.com
921.virgingallactic.com
922.virgingallactics.com
923.vompusa.com
924.vwerizon.com
925.vyesrocher.com
926.waerguard.com
927.walerdrake.com
928.walmarte.com
929.walmoart.com
930.walomart.com
931.walterdarke.com
932.waolmart.com
933.warguard.com
934.waslmart.com
935.watchezone.com
936.waterdrake.com
937.wealmart.com
938.wear-guard.com
939.weareguard.com
940.weargurd.com
941.weraguard.com
942.werguard.com
943.westerwearhouse.com
944.wilhouettes.com
945.winapm.com
946.wineentheusiast.com
947.wineenthuiast.com
948.wineenthusiaist.com
949.wineenthusiat.com
950.wineenthusiats.com
951.wineentusiast.com
952.wineethusiast.com
953.xioxide.com
954.xixide.com
955.xocide.com
956.xoixide.com
957.xoxcide.com
958.xoxdide.com
959.xoxiode.com
960.xoxoide.com
961.xoxside.com
962.zappas.com
963.zirhs.com
964.zirth.com
965.zrytec.com
966.zytrec.com
967.aabebooks.com
968.abbebooks.com
969.abeboos.com

I didn't check the WHOIS of every single domain, but all the ones for the handful I did check were registered to ThinkSpin of Las Vegas:

Registrant:
ThinkSpin (ORBITAZ-COM-DOM)
3838 Raymert Dr. #132
Las Vegas, NV 89121
US
+1.8775546515

I'm surprised Lands' End doesn't go to the other obvious trademark holders above, if they are indeed being infringed upon by "Remy" (is Remy = ThinkSpin??), and go for massive damages. At up to $100K per domain name, it could really begin to add up.

Re: Summary Judgment Denied in a Case of Creative Typosquatting Konstantinos Komaitis  –  Sep 07, 2006 2:53 AM PDT

Logic judgement and well reasoned. Cybersquatting is now outdated and typosquatting is becoming more popular. If only the UDRP decisions were as reasoned as ACPA ones.

Re: Summary Judgment Denied in a Case of Creative Typosquatting John Berryhill  –  Sep 07, 2006 6:45 AM PDT

If only the UDRP decisions were as reasoned as ACPA ones.

What Mr. Brown neglects to explain is that no judgment has been reached in this case.  This was a ruling denying an early motion brought by the defendant.  The decision here amounts to stating that the case should proceed to trial.  Of course, now that George has rendered the comments here unreadable…

Re: Summary Judgment Denied in a Case of Creative Typosquatting Evan D. Brown  –  Sep 07, 2006 7:05 AM PDT

Mr. Berryhill, I fail to see how titling the post "Summary Judgment Denied in a Case of Creative Typosquatting" and ending the first paragraph with the statement "...and the case is heading for trial" is an example of "neglect" to "explain ... that no judgment has been reached in this case." Perhaps you neglected to actually read the title and the post.

Re: Summary Judgment Denied in a Case of Creative Typosquatting John Berryhill  –  Sep 07, 2006 7:46 AM PDT

I read it perfectly well, Mr. Brown.  However I doubt most non-lawyers understand what is meant by what you wrote, as the comment to which I was responding indicated that he believed this was a final disposition rather than a judgment on a pre-trial motion that there is a triable issue of fact.  It remains a case of alleged typosquatting, as it has not been proven either way, and I would readily take odds that most non-attorneys would not understand that, as indicated by the comment to which I was responding.  If your note was primarily written for attorneys, I agree it is perfectly clear.  Know your audience.

On the substance of the matter, affiliate agreement disputes are normally governed by the terms of the affiliate contract with which you note the defendant may not have complied.

Re: Summary Judgment Denied in a Case of Creative Typosquatting John Berryhill  –  Sep 07, 2006 8:10 AM PDT

The full decision for anyone not having a Westlaw subscription who might care to read it, btw, is here:

http://www.wiwd.uscourts.gov/bcgi-bin/opinions/district_opinions/C/05/05-C-368-C-09-01-06.PDF

The story could just as easily be "Cybersquatting defendants prevail on Lanham Act and Wisconsin State Law Claims", as the opinion is a mixed bag.


By that time, plaintiff had made $190,000 in sales to customers directed to www.landsend.com through defendants’ websites. On those sales, defendant Thinkspin received $6,698 in commissions, defendant Braderax received $500 and defendant Seale received $26.

One interesting comment is here:


It is undisputed that, had defendants not operated their typosquatting websites, customers would have seen an error message in their Web browsers displaying the mistyped Web address www.lnadsend.com, www.klandsend.com, www.landsende.com, www.landdend.com, www.landswnd.com, www.landrnd.com, www.landsene.com, www.landsenc.com, www.landsennd.com, www.landse.com, www.landind.com, www.landswend.com or www.landwend.com.

Of course, what "normally happens" when you type in a non-existent URL depends on one's browser configuration and one's DNS service.  A typical Internet Explorer configuration would not take one to an error page, but to MSN search, through which Microsoft would collect pay-per-click revenue.  Similarly, our friends at Verisign or at OpenDNS would prefer that a user receive their PPC pages.

Although plaintiff’s damages may have been minimal with respect to the defendants remaining in this lawsuit, it would be incorrect to say they were nonexistent as a matter of law. At trial, plaintiff will be free to prove that they lost money they would otherwise have earned had defendants not operated their typosquatting domain names in the manner they did.

I absolutely agree.  If Land's End doesn't get every penny of Seale's $26, then they should take this all the way to the Supreme Court.

What is being litigated here are about $7500 in commissions paid on $190,00 in sales.

It is facts like those that make me happy to be in the legal racket^H^H^H^H^H^H profession.

Re: Summary Judgment Denied in a Case of Creative Typosquatting John Berryhill  –  Sep 08, 2006 6:59 AM PDT

What is being litigated here are about $7500 in commissions paid on $190,00 in sales.

That figure is really worth reflecting on.

First, if the affiliate contract forbids what the defendants did, which is likely, then of course the defendants were in breach and the contract should govern the outcome.  There is no question about that.

What makes me scratch my head in wonder is the logic of spending several tens of thousands of dollars, at least, to put an end to a situation that is generating 190K in sales.  The defendants are, in all likelihood, judgment proof (as cybersquatting defendants often are).  So an award of triple damages and attorney's fees is usually pretty empty. 

The notion of "if the names weren't registered, users would get an error page" is somewhat quaint.  As we know from another thread, that notion is not true for an Earthlink user.  It is also not true for various users of Internet Explorer or Firefox with any number of browser plug-ins and auto searh settings.  By and large "unregistered domain traffic" goes *somewhere*.  In that environment, you are better off as a retailer having that traffic go to *you* via your affiliates who are only paid on actual sales, rather than sending a fat check to any one of the outfits which purport to "protect your mark online" by overcharging for domain registrations which may, or may not, actually return you revenue.  You are going to pay someone one way or another. Either you are going to pay the likes of Verisign Brand Management, Markmonitor, CPA Global, to register and maintain domain names for you, or you are going to pay your in-house IT people to take care of it.  Even if the domain names are not registered, then it is a certainty that a fair amount of that traffic is going to be lost to mechanisms you cannot control, because a lot of trademark attorneys' thinking is stuck somewhere in 1992, and they do not understand the present reality of "how things really work".

Affiliate abuse (and make no mistake, I fully agree it is abusive under most affiliate agreements) is generally cast in the terms stated in this decision - the affiliates are "ransoming customers" back to the retailer.  As a question of right and wrong, it is a wrong thing to do.  If your business is to promote good behavior, go get 'em.

If your business is primarily interested in profit, as some businesses are, then you might ask yourself a few questions:

1.  How much did I spend last year on newspaper advertising based on circulation figures which include complimentary copies delivered to hotel room doors, and then delivered to the trash?  Personally, I have never done anything else with a copy of USA Today which is invariably outside of my hotel door as some sort of greyish welcome mat.

2.  How much did I spend last year on printing and mailing catalogues which did not produce a sale?  There are innumerable "catalogue squatters" - people who receive catalogues and don't buy anything from them.

3.  How much did I spend last year on television advertising based on TV ratings figures which are based on a set of assumptions which exclude TiVo users and people who leave the TV on to entertain their dog, etc.?  If people want to watch TV, then they should sign a contract stating that they will not go to the refrigerator or the bathroom during the airtime for which I spent good money.  Radios and televisions need to be configured to prevent channel-hopping during the commercials.  Broadcast advertising is the greatest rip-off of our time.

Those aren't legal questions, they are business questions and I have about zero business sense (if I did, I wouldn't be posting here).  But I really have to wonder, in a situation where someone is easily spending $75K over $7500 in commissions paid on $190K in actual, countable, measurable sales - who is minding the store here, and are my IP attorneys looking out for my bottom line… or theirs.

What makes "click fraud", affiliate abuse, or other areas of online advertising cost interesting, is that these things are measurable, and appropriate coutermeasures can be taken.  Compared to the utter voodoo, number cooking, and audience inflation that goes on in print and broadcast advertising, the business proposition is whether you want to spend your ad budget on something that is 20% fraudulent, or something for which you have no earthly way to measure your return in sales?

Re: Summary Judgment Denied in a Case of Creative Typosquatting Marc Trachtenberg  –  Sep 12, 2006 9:41 AM PDT

I would say that the logic of spending several tens of thousands of dollars, at least, to put an end to a situation that is generating 190K in sales is to demonstrate that Land's End polices their brand and to put other potential typosquatters on notice that they will enforce their rights online.  Microsoft and many other companies are pursuing similar actions to let existing and potential typosquatters know that there is a cost to infringing their rights online.  While this may not curb the amount of typosquatting overall, it will likely (among other things) increase capitulation to cease and desist letters sent by these companies (if not all legitimate right holders) and lower the total overall cost of enforcement.  I have witnessed this effect.

Additionally, the fact that Land's End may only recover $26 is immaterial.  Trademark owners file suit in many cases where it is clear that they will not be able to recover from the defendant.  This is because the purpose of these actions is often not merely to recover money from the defendant, but rather to stop the infringing activity which causes damage to the trademark holder in the form of lost business and weakening of brand power.

Further, it seems to me that it was NOT the typosquatted registrations that generated the $190k in sales but rather Land's End investment in creating good will over the last 40 years.  The web surfers who directly navigated to lwndsed.com or whatever and made these purchases would in all likelihood have retyped landsend.com into their browser when they got the 404 error or the MSN search page as they were clearly seeking out Land's End's website to make a purchase in the first place.  Thus, these typosquatted domains, as is the case in most typosquatted domains, have added no value and generated no business for the legitimate brand owner.  Rather, at best they simply add unnecessary costs to the brand owner's already high cost of doing business by obviously and intentionally infringing the brand owner's trademarks. You make the point that if the user lands on the MSN search page, then the Brand owner must pay anyway, so what does it matter who they pay.  The difference is that the brand owner does not have control over what the browser manufacturer does when a nonexistent domain is typed in. An argument can be made that the MSN search page that results is infringement of some sort.  However, at best it is passive infringement.  The typosquatter registrants on the other hand are participating in active infringement, intentionally targeting well known brands and profiting from the brand owner's good will.  Additionally, while these domains currently redirect to landsend.com, there is no guarantee that they will continue to.  If a more lucrative opportunity presents itself, such as porn for example, it is likely that the registrant will redirect these domains elsewhere.  Should Land's End bear the burden and cost of having to constantly monitor all the typosquatting domains?

To make an analogy, I highly doubt that you would let someone whom you had no control over acquire every possible mistyping of your business phone number even if the person forwarded all inquiries to you and you ended up getting some business.  This person would not be adding any value to you or generating any business because potential clients who ended up connecting to him would simply have redialed when they got a wrong number message since they clearly intended to reach you in the first place.  Further, if your relationship with this person soured or he found a more profitable opportunity connecting your potential clients to phone sex or redirecting them to Ari Goldberger (I am not implying any relationship between phone sex and Ari Goldberger, merely using a porn/competitor analogy), who knows what type of damage he might wreak on your business.  Should it be your responsibility and cost to constantly monitor this unauthorized person, who is clearly getting phone and email traffic by use of your name and goodwill, to ensure that he wasn't damaging that good will and costing you business?

Re: Summary Judgment Denied in a Case of Creative Typosquatting Jennifer Boland  –  Sep 14, 2006 7:47 PM PDT

This case is just another example of copyright exploitation.  In the print or other traditional media the judge would certainly rule for Lands End based on copyright infringement.  Even if Lands End only sees $26, precedent will be set and typosquatters had better beware.

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