The Prudential Insurance Company of America v. Shenzhen Stone Network Information Ltd.

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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 21-1823
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, a New Jersey
Corporation,
Plaintiff - Appellee,
v.
SHENZHEN STONE NETWORK INFORMATION LTD.,
Claimant - Appellant,
and
FRANK ZHANG, a citizen of China; PRU.COM, a domain name,
Defendants.
Appeal from the United States District Court for the Eastern District of Virginia, at
Alexandria. T. S. Ellis, III, Senior District Judge. (1:20-cv-00450-TSE-MSN)
Argued: December 8, 2022 Decided: January 24, 2023
Before DIAZ and THACKER, Circuit Judges, and FLOYD, Senior Circuit Judge.
Affirmed by published opinion. Judge Thacker wrote the opinion in which Judge Diaz and
Judge Floyd joined.
ARGUED: Benjamin S. Barlow, DUNLAP BENNETT & LUDWIG, PLLC, Leesburg,
Virginia, for Appellant. Mark Van Buren Partridge, PARTRIDGE PARTNERS, PC,
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Chicago, Illinois, for Appellee. ON BRIEF: David C. Deal, THE LAW OFFICE OF
DAVID C. DEAL, P.L.C., Crozet, Virginia; David D. Lin, Justin Mercer, LEWIS & LIN
LLC, Brooklyn, New York, for Appellant. Charles G. Giger, CULHANE MEADOWS
PLLC, Dallas, Texas, for Appellee.
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THACKER, Circuit Judge:
Appellant Shenzhen Stone Network Information Ltd. (“SSN”) appeals the district
court’s order granting summary judgment on Appellee Prudential Insurance Company of
America’s (“Prudential”) cybersquatting claim. Prudential owns several registered
trademarks on the term PRU and other PRU-formative marks. Prudential initiated the
underlying action after discovering that SSN had registered the domain name PRU.COM.
Internet users who visited PRU.COM were routed to a page that included advertisements
displaying Prudential’s trademarks and the marks of Prudential’s competitors.
Prudential alleged, inter alia, that SSN violated the Anti-Cybersquatting Consumer
Protection Act (“ACPA”), 15 U.S.C. § 1125, by registering a domain name identical to
Prudential’s distinctive mark with the bad faith intent to profit. Although SSN was not the
initial registrant of the PRU.COM domain name, the district court determined that SSN
could nonetheless be held liable for cybersquatting because the ACPA is not limited to the
initial registration of a domain name but encompasses subsequent re-registrations as well.
Accordingly, after considering the totality of the circumstances, the district court concluded
that SSN possessed the bad faith intent to profit from the disputed domain name and
granted Prudential’s motion for summary judgment. On appeal, SSN contests the district
court’s ruling that SSN acted in bad faith when registering the disputed domain name.
For the reasons set forth below, we conclude that the totality of the circumstances
supports the conclusion that SSN acted in bad faith and that SSN is not entitled to the
benefit of the ACPA’s safe harbor provision. Therefore, we affirm.
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I.
SSN is a Chinese internet company that distributes financial and economic
information to Chinese consumers via various online media outlets, with a focus on the
foreign exchange industry (“forex”). Zhaoyuan “Frank” Zhang (“Zhang”), a citizen of
China, is the CEO of SSN and is responsible for registering and managing the PRU.COM
domain name on SSN’s behalf.
On October 13, 2017, Zhang purchased the PRU.COM domain name at the behest
of SSN through Sedo.com, an online domain name marketplace. The PRU.COM domain
name was previously owned by an unidentified Texas company. Zhang claimed that SSN
paid $100,000 for the domain name. GoDaddy, Inc. (“GoDaddy”), headquartered in
Arizona, is the domain name registrar for PRU.COM, and VeriSign, Inc. (“VeriSign”),
headquartered in Virginia, is the domain name registry. 1 When Zhang registered the
domain name with GoDaddy, he signed a GoDaddy Domain Name Registration Agreement
1
A domain registrar is an accredited organization, like GoDaddy, that sells domain
names and provides registration services to the public. What Is the Difference Between a
Registry, Registrar and Registrant?, GoDaddy, https://www.godaddy.com/help/what-is-
the-difference-between-a-registry-registrar-and-registrant-8039 (last visited Jan. 4, 2023)
(saved as ECF opinion attachment). A domain name registry is an organization that
manages the administrative data for one or more top-level domain names. Id. For example,
VeriSign manages the registration of “.com” domain names. Id. Registries store
registration information and work with registrars to sell domain names to the public. Id.A domain name registrant is the person or company who registers a domain name and has
the exclusive right to use the domain name for the registration period. Id.4
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(“Registration Agreement”), which included a dispute resolution policy that required him
to submit to jurisdiction in Arizona for various types of domain name disputes.
Prudential is a United States insurance and financial services company that operates
worldwide. In November 2002, Prudential trademarked PRU and other PRU-formative
marks in the United States. Prudential has registered the same marks in several other
countries and territories. However, it has yet to register such marks in China because
Prudential plc, an unaffiliated company, uses the PRUDENTIAL trademark in China. By
agreement with Prudential plc, Prudential does not use PRU or PRU-formative trademarks
in mainland China.
In March 2020, Prudential attempted to acquire the internet domain name
PRU.COM but learned that an unknown party already owned the domain name. The record
establishes that on or about March 18, 2020, a GoDaddy domain broker notified SSN about
a request from an anonymous buyer (Prudential) to purchase the disputed domain name.
An email from the broker indicates that SSN rejected the offer and informed the broker by
telephone that it had received a “six figure” offer for the domain name in the past and
wanted to know the buyer’s location and line of business before it would quote a price.
J.A. 387. 2 However, in its discovery responses, SSN stated that there had been no other
offers related to PRU.COM besides those from Prudential or its agents.
On March 25, 2020, Prudential filed an administrative action with the World
Intellectual Property Organization (“WIPO”) pursuant to its Uniform Domain Name
2
Citations to the “J.A.” refer to the Joint Appendix filed by the parties in this appeal.
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Dispute Resolution Policy (“UDRP”). 3 A UDRP proceeding is an administrative
proceeding used to resolve disputes over the abusive registration and use of specific
Internet domain names without filing a lawsuit in court. Trademark owners can use the
UDRP to initiate an action in order to recuperate or suppress a cybersquatted domain name.
In its UDRP complaint, Prudential submitted to the “Mutual Jurisdiction” of the
principal location of the registrar, GoDaddy. J.A. 132. Through the administrative action,
Prudential learned that Zhang registered PRU.COM and the registrant organization was
“Bailun,” another Chinese company owned and controlled by Zhang. Id. at 50. On March
30, 2020, WIPO locked the PRU.COM domain name such that it could not be edited or
revised pending the outcome of the UDRP proceeding. Shortly thereafter, on or around
April 9, 2020, Prudential offered to purchase the domain name for $50,000. SSN, via
Zhang, rejected the offer.
Explaining why it rejected the offer, SSN claimed it planned to develop the
PRU.COM domain name into a website or product covering foreign exchange and
economic news. The parties agree, however, that SSN never uploaded any viewable
content or material to the PRU.COM website. The parties also agree that since SSN’s
3
WIPO is a specialized agency of the United Nations that was created to promote
and protect intellectual property worldwide. Inside WIPO, WIPO,
https://www.wipo.int/about-wipo/en/ (last visited Jan. 4, 2023) (saved as ECF opinion
attachment). The WIPO Arbitration and Mediation Center provides several mechanisms
to resolve internet domain name disputes without judicial litigation, including the UDRP
program. Domain Name Dispute Resolution, WIPO,
https://www.wipo.int/amc/en/domains/ (last visited Jan. 4, 2023) (saved as ECF opinion
attachment).
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acquisition of the PRU.COM domain name, any internet user who visited PRU.COM was
directed to a GoDaddy parked page. 4 Specifically, an internet user in the United States
who visited PRU.COM between October 2017 (when Zhang purchased the domain name)
and March 2020 (when Prudential filed its UDRP complaint) saw a page that included (1)
pay-per-click hyperlinks displaying Prudential’s marks and the marks of other United
States insurance companies; and (2) the phrase “Would you like to buy this domain?” J.A.
166.
On May 7, 2020, the WIPO proceedings were terminated upon Prudential’s motion.
Instead, on April 22, 2020, Prudential initiated the underlying action against Zhang and the
PRU.COM domain name in the Eastern District of Virginia. Prudential alleged that Zhang
violated the ACPA by purchasing the domain name to prepare for launching the website to
provide forex-related services. Prudential also alleged that Zhang’s purchase and
intentional use of the domain name constituted trademark infringement pursuant to the
Lanham Act, 15 U.S.C. § 1114.
Zhang, individually and on behalf of the subject res (i.e., the PRU.COM domain
name), moved to dismiss the action or transfer it to the District of Arizona for lack of
4
When a domain name is registered with GoDaddy, it appears as a GoDaddy parked
page until the registrant uploads other content. Geoff Scott, What is Domain Parking and
How Can It Make You Money?, GoDaddy: Blog (Dec. 16, 2019),
https://www.godaddy.com/garage/what-is-domain-parking/ (saved as ECF opinion
attachment). Parked websites are completely non-functioning except as landing pages for
advertisements. Id. The owner of a parked page may make money based on how many
users visit the site and click on the advertisements. Id. Zhang claimed SSN was unaware
that the United States version of the website displayed hyperlinked advertisements for
Prudential competitors. Zhang also insisted that SSN made no money from the United
States version of the GoDaddy Parked Page.
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personal jurisdiction over Zhang and an improper exercise of in rem jurisdiction over the
res. 5 Pursuant to the ACPA, a trademark owner may only proceed in rem against a domain
name if the mark owner cannot locate or establish personal jurisdiction over the current
domain name holder. 15 U.S.C. § 1125(d)(2)(A). Accordingly, Zhang argued that
Prudential could establish personal jurisdiction over Zhang in the District of Arizona based
on Zhang’s agreement with the domain registrar GoDaddy and Prudential’s UDRP
stipulations. The district court dismissed Zhang as a defendant for want of personal
jurisdiction but permitted this action to proceed in rem against the PRU.COM domain
name.
Prudential subsequently filed a motion for summary judgment, seeking transfer of
the PRU.COM domain name from SSN to Prudential. SSN filed a cross motion for
summary judgment, seeking dismissal of this action in its entirety. The district court
granted summary judgment to Prudential on its cybersquatting claim, ordered SSN to
transfer PRU.COM to Prudential, and dismissed Prudential’s trademark infringement
claim as moot.
SSN timely appealed. 6
In rem jurisdiction describes the power a court may exercise over property that is
5
the subject of a legal action. See generally Harrods Ltd. v. Sixty Internet Domain Names,
302 F.3d 214, 224 (4th Cir. 2002).
6
SSN and Zhang filed separate notices of appeal, and the appeals were consolidated.
After the parties filed their joint opening brief, we granted Prudential’s motion to dismiss
Zhang from this appeal for lack of standing. Prudential then filed a motion to strike all
portions of the joint opening brief relating to the district court’s exercise of in rem
jurisdiction, arguing that SSN did not raise any objection to the exercise of in rem
(Continued)
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II.
We review a district court’s grant of summary judgment and questions of statutory
interpretation de novo. Cowgill v. First Data Techs., Inc., 41 F.4th 370, 378 (4th Cir. 2022)
(summary judgment); Snyder’s-Lance, Inc. v. Frito-Lay N. Am., Inc., 991 F.3d 512, 516
(4th Cir. 2021) (statutory interpretation).
III.
A.
The Purpose of the ACPA
With the rise of the Internet came new ways in which intellectual property rights
can be infringed upon, and chief among them is cybersquatting. Cybersquatting refers to
the registration, use, or sale of domain names in bad faith. The ACPA was designed to
prevent cybersquatters from registering Internet domain names containing trademarks for
the purpose of selling the domain name back to the trademark owner or a third party. See
Tamara Kurtzman, Cyber Center: The Continued Hijacking and Ransoming of the Domain
Name System by Modern-Day Corporate Privateers, Bus. L. Today, June 20, 2016,
https://www.americanbar.org/groups/business_law/publications/blt/2016/06/cyber_center
_kurtzman/ (saved as ECF opinion attachment).
jurisdiction below as it was not a party to the case at the time the district court ruled on
Zhang’s motion to dismiss. We have considered the parties’ submissions relative to the
motion to strike and conclude that SSN preserved the jurisdictional issue for appeal by
raising it in its answer. Therefore, we deny Prudential’s motion to strike.
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B.
ACPA Jurisdiction
The ACPA creates two distinct avenues by which trademark owners may challenge
the misuse of a domain name. First, a trademark owner can challenge the misuse of a
domain name by bringing an in personam action against a “suitable defendant” who
registers, traffics in, or uses a domain name “identical or confusingly similar to or dilutive
of” a distinctive or famous mark with the “bad faith intent to profit.” 15 U.S.C.
§ 1125(d)(1)(A)(i)–(ii). Per the ACPA, a “suitable defendant” is a person over whom the
court has in personam jurisdiction. Id. § 1125(d)(1)(A). If the mark owner cannot establish
personal jurisdiction over the current holder or cannot locate the current holder, the mark
owner may file an in rem action against a domain name registered with the Patent and
Trademark Office that infringes or dilutes a similar mark. Id. § 1125(d)(2)(A).
Here, SSN challenges the district court’s exercise of in rem jurisdiction over the
domain name and argues that the district court erred in determining that in personam
jurisdiction over a suitable defendant must exist at the time an ACPA complaint is filed.
We address each in turn.
1.
In Rem Jurisdiction
SSN argues that Zhang was a suitable defendant under the ACPA because Zhang
was the listed registrant of PRU.COM, Zhang submitted to personal jurisdiction in Arizona
when he signed the GoDaddy’s Registration Agreement, and both Zhang and Prudential
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submitted to the mutual jurisdiction of Arizona during the WIPO proceedings. We address
each argument in turn.
First, the district court properly had in rem jurisdiction over the defendant domain
name because Zhang, the listed registrant of PRU.COM, was not a suitable defendant under
the ACPA. The record is clear that Zhang, in his individual capacity, was not the actual
registrant of the disputed domain name. Both Zhang and SSN repeatedly claimed
throughout this litigation that SSN owned PRU.COM. For example, in its discovery
responses, SSN stated, “[SSN] owns the domain name pru.com. Zhang Zhaoyuan a/k/a
‘Frank Zhang’ is aware of [SSN]’s ownership therein, insofar as he was entrusted to
register and manage the domain name pru.com for [SSN]’s use.” J.A. 314–15. Zhang also
admits in his sworn declaration that as the CEO of SSN, he was “entrusted . . .to register
and manage” PRU.COM on SSN’s behalf. Id. at 830. Moreover, during the hearing on
Zhang’s motion to dismiss, his counsel represented that Zhang registered the domain name
at the behest of his employer, SSN. Notably, Zhang was also dismissed from the suit at
his own request. Corporate officers like Zhang generally lack standing to defend their
corporation’s property interests. See Smith Setzer & Sons, Inc. v. S.C. Procurement Rev.
Panel, 20 F.3d 1311, 1316–17 (4th Cir. 1994). Therefore, the district court did not err by
finding that Zhang, in his individual capacity, was not a proper defendant in this action.
Further, SSN’s claim that Zhang was required to submit to personal jurisdiction in
Arizona when he registered the domain name is without merit. GoDaddy’s Registration
Agreement does not require the registrant to submit to jurisdiction in Arizona for all legal
disputes. Instead, it allows the registrant to challenge an adverse UDRP decision in the
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location of the registrar (i.e., Arizona) if the dispute is brought pursuant to GoDaddy’s
mandatory administrative proceedings provision. 7 But an ACPA claim is wholly separate
from any administrative proceedings contemplated by the Registration Agreement. 8
Similarly, the mutual jurisdiction provision of the UDRP complaint relates solely to
the registrant’s challenge of an adverse UDRP decision. It does not require the registrant
to submit to personal jurisdiction until the registrant decides to challenge an adverse UDRP
decision and is only effective in the event of an adverse UDRP decision. There has been
no adverse UDRP decision here because Prudential voluntarily terminated the WIPO
proceedings. Thus, the provisions relied upon by Zhang and SSN do not constitute consent
to personal jurisdiction in Arizona in connection with this ACPA case.
Notably, Zhang, initially appearing in his individual capacity, did consent to
personal jurisdiction in Arizona in his May 28, 2020 declaration -- over a month after
7
GoDaddy’s Registration Agreement requires the registrant to submit to “the
jurisdiction of the courts (1) of your domicile, (2) where registrar is located, or (3) where
the registry operator is located.” J.A. 181. Thus, even if we were to determine that Zhang
submitted to personal jurisdiction on behalf of SSN when he registered the domain name,
it follows that the district court had personal jurisdiction over SSN since the registry
operator, Verisign, is located in Virginia.
8
“[D]omain names are issued pursuant to contractual arrangements under which the
registrant agrees to a dispute resolution process, the UDRP, designed to resolve a large
number of disputes involving domain names, but this process is not intended to interfere
with or modify any ‘independent resolution’ by a court of competent
jurisdiction. Moreover, the UDRP makes no effort at unifying the law of trademarks
among the nations served by the Internet. Rather, it forms part of a contractual policy
developed by [the Internet Corporation for Assigned Names and Numbers] for use by
registrars in administering the issuance and transfer of domain names. Indeed, it explicitly
anticipates that judicial proceedings will continue under various nations’ laws applicable
to the parties.” Barcelona.com, Inc. v. Excelentisimo Ayuntamiento de Barcelona, 330
F.3d 617, 625 (4th Cir. 2003).
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Prudential filed suit in federal court in Virginia. However, SSN has appeared in this lawsuit
only on behalf of the subject res and has not expressly consented to personal jurisdiction
anywhere in the United States. And nothing in the record to suggests that Prudential could
have obtained personal jurisdiction in the United States over SSN, a Chinese company that
operates almost exclusively in China. Therefore, because in personam jurisdiction could
not be established over a suitable defendant, Prudential satisfied the requirements to
proceed in rem in the Eastern District of Virginia because Verisign, the domain name
registry, is located there. See 15 U.S.C. § 1125(d)(2)(A) (“The owner of a mark may file
an in rem civil action against a domain name in the judicial district in which the . . . domain
name registry . . . is located.”).
2.
In Personam Jurisdiction Must Exist at the Time of Filing
The ACPA provides that a trademark owner “may file” an in rem action in the
jurisdiction where the domain name registry is located if the court finds the owner cannot
obtain in personam jurisdiction over a suitable defendant. See 15 U.S.C. § 1125(d)(2)(ii)
(emphasis supplied). In enacting the in rem provision of the ACPA, Congress recognized,
“In an effort to avoid being held accountable for their infringement or dilution of famous
trademarks, cyberpirates often have registered domain names under fictitious names and
addresses or have used offshore addresses or companies to register domain names.” H.R.
Rep. No. 106-464, at 114 (1999).
We have previously held that “not all of the conditions that create in rem jurisdiction
must persist throughout the life of the case.” Porsche Cars N. Am., Inc. v. Porsche.net,
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302 F.3d 248, 256 (4th Cir. 2002). In the federal diversity jurisdiction context, it is well
settled that a court determines the existence of diversity jurisdiction “at the time the action
is filed.” Freeport McMoRan, Inc. v. K N Energy, Inc., 498 U.S. 426, 428 (1991). Thus,
it follows that whether an ACPA plaintiff can obtain personal jurisdiction over a suitable
defendant should also be determined at the time of filing. As the district court reasoned,
“to conclude otherwise would allow any foreign defendant to choose their desired forum
for litigation after being sued in an ACPA action.” Prudential Ins. Co. of Am. v.
PRU.COM, No. 1:20-cv-450, 2020 WL 4208447, at *4 (E.D. Va. July 22, 2020). Foreign-
based domain name registrants with no ties to the United States would be able to
manipulate ACPA proceedings by simply consenting to personal jurisdiction in a forum of
their choice after the action is initiated. Accordingly, we hold that the district court did not
err in determining that the relevant time for considering an ACPA plaintiff’s ability to
obtain personal jurisdiction over the would-be defendant is at the time of filing.
C.
The Meaning of “Registration”
Pursuant to the ACPA, a cybersquatter who “registers” a domain identical or
confusingly similar to a distinctive trademark or famous mark with a “bad faith intent to
profit” from the domain is liable to the trademark owner. 15 U.S.C. § 1125(d)(1)(A).
However, the statute does not define the term “registers.” Id. SSN argues that there can
be no ACPA cybersquatting liability where the initial domain name registration is done in
good faith. Specifically, SSN contends that its re-registration of the PRU.COM domain
name in 2017 is not a qualifying “registration” within the meaning of the ACPA because
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an unaffiliated Texas company initially registered the PRU.COM domain name before
Prudential trademarked the term PRU in the United States.
This is an issue of first impression for our court. Several of our sister circuits, the
Third, Ninth, and Eleventh Circuits, have considered the issue and split on the meaning of
the term “registers” and its derivatives.
In Schmidheiny v. Weber, the Third Circuit held that the term “registration” is not
limited to the initial registration but encompasses subsequent re-registrations as well. 319
F.3d 581, 582 (3d Cir. 2003). There, Stephan Schmidheiny, one of the wealthiest
individuals in the world, sued Steven Weber for registering the domain name
“schmidheiny.com.” Id. at 581. Weber first registered schmidheiny.com with Network
Solutions under the name Weber Net in 1999, prior to the enactment of the ACPA. Id. In
June 2000, after the ACPA was enacted, the domain name was transferred from Network
Solutions to a new registrar, Internet Names Worldwide. Id. at 583. The named registrant
was also changed from Weber Net to Famology.com, of which Weber was the President.
Id. The Third Circuit reasoned that if the ACPA were limited to initial registrations, it
would permit “the domain names of living persons to be sold and purchased without the
living persons’ consent, ad infinitum, so long as the name was first registered before the
effective date of the [ACPA].” Id. Thus, the Third Circuit held that the term “registration,”
as used in the ACPA, includes the initial registration and subsequent re-registrations
because a “registration” is the creation of a “new contract at a different registrar and to a
different registrant.” Id.15
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The Eleventh Circuit followed suit in Jysk Bed’N Linen v. Dutta-Roy, holding that
the term “registration” in the ACPA was not limited to the initial registration. 810 F.3d
767, 777 (11th Cir. 2015). There, the plaintiff contracted with the defendant to create an
online shopping website for the plaintiff’s home furniture products. Id. at 771. When the
defendant registered the domain name “bydesignfurniture.com,” he was instructed to list
the plaintiff as the owner, but the defendant listed himself instead. Id. at 771–72. Several
years later, when the registration expired, the plaintiff discovered that it did not own the
registration and again asked the defendant to register bydesignfurniture.com in the
plaintiff’s name. Id. The defendant refused and re-registered the domain name and other
similar domain names in his own name. Id.Because the ACPA did not qualify the term “registration” with a word like “initial”
or “creation,” the Eleventh Circuit applied the “plain and unambiguous” meaning of the
word and reasoned, “a re-registration is, by definition, a registration.” Id. at 777 (internal
quotation marks omitted). The Eleventh Circuit also looked to Congress’s intent in
enacting the ACPA and determined, “It would be nonsensical to exempt the bad-faith re-
registration of a domain name simply because the bad-faith behavior occurred during a
subsequent registration.” Id. at 778. Therefore, the court held that a re-registration
constituted a registration pursuant to the ACPA. Id. at 774.
But the Ninth Circuit reached the opposite conclusion in GoPets Ltd. v. Hise,
holding that the re-registration of an existing domain name is not the type of “registration”
contemplated by the ACPA. 657 F.3d 1024, 1026 (9th Cir. 2011). There, the defendant
first registered the domain name “gopets.com” in his name. Id. at 1027. After failed
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negotiation attempts to sell the domain name to the plaintiff, GoPets, Ltd., the defendant
transferred the registration of gopets.com from himself to a corporation he owned with his
brother. Id. at 1027–28.
In reaching its decision, the Ninth Circuit first noted that the ACPA does not define
the term “registration” and that “under any reasonable definition, the initial contract with
the registrar constitutes a ‘registration.’” Id. at 1030. However, the court continued:
It is less obvious which later actions, if any, are also
“registrations.” [For example,] [a]fter registering . . . the
registrant can update the registration if her contact or billing
information changes. She can switch to “private” registration,
where a third party’s name is substituted for hers in the public
databases of domain registrants. She can switch between
registrars, but leave her contact and billing information
unchanged. A registrant can change the name of the registrant
without changing who pays for the domain, or a registrant can
transfer both the domain and payment responsibilities to
someone else. Even if the registrant does none of these things,
she must still renew the registration periodically. All of these
actions could conceivably be described as “registrations”
within the meaning of § 1125(d)(1).
Id. at 1030–31. The Ninth Circuit concluded that the defendant was not a cybersquatter,
given the minor, nominal change in ownership, because the defendant effectively
controlled the subject website both before and after the change in the registration. Id. The
court reasoned that the domain name holder has the right to transfer the domain to another
owner because “[t]he general rule is that a property owner may sell all of the rights he holds
in property.” Id. at 1032. Thus, because including subsequent re-registrations within the
meaning of “registration” would make domain names “effectively inalienable,” the Ninth
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Circuit held that the term registration, as used in the ACPA, “refer[s] only to the initial
registration.” Id. at 1031–32.
In cases involving statutory interpretation, we “begin our analysis with the text of
the governing statute.” Snyder’s-Lance, Inc. v. Frito-Lay N. Am., Inc., 991 F.3d 512, 516
(4th Cir. 2021). “Only when statutory text is ambiguous do we consider other indicia of
congressional intent such as the legislative history.” Id. Here, the ACPA does not define
the term “register.” Thus, “we give the term its ordinary, everyday meaning.” United
States v. Mills, 850 F.3d 693, 697 (4th Cir. 2017).
The Merriam-Webster Dictionary defines “registration” as “the act of registering.”
Registration, Merriam-Webster Dictionary (11th ed. 2022). To “re-register” simply means
“to register again.” Re-register, Merriam-Webster Dictionary (11th ed. 2022). Therefore,
the ordinary meaning of the word “registers” necessarily includes both the first registration
and any subsequent re-registrations. And because the ACPA does not expressly limit the
term registers to only the initial or creation registration, we conclude that the re-registration
of a domain name is a registration for purposes of the ACPA.
SSN places considerable reliance on the Ninth Circuit’s GoPets decision to support
its argument that ACPA liability based on a “re-registration” is improper because
“[n]othing in the text or structure of the statute indicates that Congress intended that rights
in domain names should be inalienable.” Appellant’s Opening Br. at 20 (quoting GoPets,
657 F.3d at 1032). But we find SSN’s reliance on GoPets unavailing for a number of
reasons.
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To begin, the Ninth Circuit’s GoPets decision is contrary to the statutory purpose of
the ACPA, which is to curtail cyberpirates and cybersquatting. H.R. Rep. No. 106–464, at
108 (1999). Courts must interpret a given statute in accord with Congress’s purposes and
intent in enacting it. See, e.g., United States v. Torrez, 869 F.3d 291, 316–17 (4th Cir.
2017). And Congress’s express intent in enacting the ACPA was to curtail abusive bad
faith registrations that harm commerce, business, and consumers. See S. Rep. No. 106-
140, at 4–6 (1999) (stating that online consumers have a difficult time distinguishing
between authentic sites and pirate sites, which can result in brand abuse and consumer
confusion); H.R. Rep. No. 106-412, at 6–7 (1999) (explaining that cyberpiracy harms
businesses by causing loss of business opportunities by diverting customers from a
trademark owner’s website, blurring the distinctive quality of the domain name or
tarnishing the domain name, and by requiring businesses to police and enforce their
trademarks rights). By including the opportunity to pursue an in rem cause of action within
the ACPA, Congress considered domain name holders to have a property-like interest in
their domain names.
Because property interests are generally freely alienable, the Ninth Circuit declined
to read the term “registration” to include re-registrations because such an interpretation
could frustrate the alienability of domain names. GoPets, 657 F.3d at 1032. While this
concern is well-taken, it would be “nonsensical” to not include re-registrations within the
purview of the ACPA as it would allow for “the exact behavior that Congress sought to
prevent.” Jysk, 810 F.3d at 778. For example, if the ACPA were limited to initial
registrations, a mark owner would not have a cause of action where, following the
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withdrawal of a partner who was the initial registrant of a domain name, the departing
partner is instructed by the remaining partners to re-register the domain name in the
partnership’s name but, in an attempt to extort the partnership, does not. Cf. Xereas v.
Heiss, 933 F. Supp. 2d 1, 17 (D.D.C. 2013) (holding that plaintiff successfully stated a
claim for cybersquatting pursuant to the ACPA against the defendant corporation by
alleging that the company revised a domain name’s registration information without
permission after removing plaintiff, the original domain name registrant and mark owner,
from his management role). Therefore, because of the unique nature of the domain name
system, the term “registers” and its derivatives must encompass both initial registrations
and re-registrations.
Additionally, we agree with the district court that “[t]he underlying rationale for the
Ninth Circuit’s decision—a public policy concern that innocent persons would be subject
to ACPA liability for minor, periodic re-registrations of domain names—is best addressed
through the bad faith intent to profit inquiry.” Prudential Ins. Co. of Am. v. PRU.COM,
546 F. Supp. 3d 476, 492 (E.D. Va. 2021). As the Ninth Circuit correctly noted,
registration, in the domain name context, may include a multitude of actions, including
where a domain name holder switches between registrars, changes the name of the
registrant or transfers both the domain and payment responsibilities to someone else.
GoPets, 657 F.3d at 1030–31. However, a registrant will only lose their rights to a domain
name at one of the aforementioned junctures if they act in bad faith. Cybersquatting is, by
definition, a bad faith registration of another’s trademark in a domain name. Jysk, 810
F.3d at 775 (“Cybersquatting is essentially extortion.”). When a person re-registers a
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domain name because of a periodic re-registration requirement, they do not act with a bad
faith intent to profit. The ACPA does not take away the initial registrant’s right to sell or
transfer all of her rights in a domain name to any other party. Rather, the statute simply
prohibits a domain name registrant from registering a domain name with a bad faith intent
to profit. Thus, where there is no bad faith, there is no liability for cybersquatting.
Accordingly, we join the Third and Eleventh Circuits in holding that the term
“registers” and its derivatives extend to each registration of a domain name, including the
initial registration and any subsequent re-registrations. Where a successive registration of
a disputed domain name postdates the trademark registration of the corresponding mark,
the mark owner may show that the successive registration was done in bad faith. This
interpretation furthers the ACPA’s purpose of eliminating cybersquatting and protecting
American businesses, consumers, and online commerce.
D.
Bad Faith
We now turn to the merits of Prudential’s underlying ACPA claim. To prevail on a
cybersquatting claim, a plaintiff must show that (1) the party using the domain name “had
a bad faith intent to profit from using the . . .domain name”; and (2) the domain name “is
identical or confusingly similar to, or dilutive of [a] distinctive and famous . . . [m]ark.”
Newport News Holdings Corp. v. Virtual City Vinson, Inc., 650 F.3d 423, 434 (4th Cir.
2011). Cybersquatting claims may be decided on summary judgment where there are no
genuine disputes of material fact. Id. at 434–35 (determining the issue of bad faith on
summary judgment); see also Lamparello v. Falwell, 420 F.3d 309, 322 (4th Cir. 2005)
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(same); Virtual Works, Inc. v. Volkswagen of Am., Inc., 238 F.3d 264, 270 (4th Cir. 2001)
(same).
Here, there is no dispute that PRU.COM is confusingly similar to Prudential’s
trademarked PRU because the parties agree that the domain name PRU.COM is identical
to the trademarked term PRU. Thus, the sole and dispositive issue on summary judgment
is whether SSN had a bad faith intent to profit from using the PRU.COM domain name.
Subsection B of the ACPA’s cybersquatting provision provides nine non-exclusive factors
a court “may consider” when determining bad faith:
(1) the trademark or other intellectual property rights of the
[alleged cybersquatter], if any, in the domain name;
(2) the extent to which the domain name consists of the legal
name of the [alleged cybersquatter] or a name that is
otherwise commonly used to identify [the alleged
cybersquatter];
(3) the [alleged cybersquatter’s] prior use, if any, of the
domain name in connection with the bona fide offering of
any goods or services;
(4) the [alleged cybersquatter’s] bona fide noncommercial or
fair use of the mark in a site accessible under the domain
name;
(5) the [alleged cybersquatter’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;
(6) the [alleged cybersquatter’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
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having an intent to use, the domain name in the bona fide
offering of any goods or services, or the [alleged
cybersquatter’s] prior conduct indicating a pattern of such
conduct;
(7) the [alleged cybersquatter’s] provision of material and
misleading false contact information when applying for the
registration of the domain name, the [alleged
cybersquatter’s] intentional failure to maintain accurate
contact information, or the [alleged cybersquatter’s] prior
conduct indicating a pattern of such conduct;
(8) the [alleged cybersquatter’s] registration or acquisition of
multiple domain names which the [alleged cybersquatter]
knows are identical or confusingly similar to marks of
others that are distinctive at the time of the 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
(9) the extent to which the mark incorporated in the [alleged
cybersquatter’s] domain name registration is or is not
distinctive and famous within the meaning of [15 U.S.C.
§ 1125(c)(1)].
15 U.S.C. § 1125(d)(1)(B)(i). None of the factors is individually dispositive, and they
should not be added up against one another (i.e., a party “winning” five factors does not
win the argument per se). Lamparello, 420 F.3d at 320 (“[T]here is no simple formula for
evaluating and weighing these factors.”). Instead, “[t]he ACPA allows a court to view the
totality of the circumstances in making the bad faith determination.” Virtual Works, 238
F.3d at 270.
Below, the district court found that all nine factors pointed to the conclusion that
SSN purchased and registered the PRU.COM domain name in bad faith with the intent to
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profit. Although a court need not “march through the nine factors seriatim,” Virtual Works,
238 F.3d at 269, we do so here for completeness.
1.
Factor One: SSN Has No Trademark or Intellectual Property Rights in PRU.COM
The first factor strongly favors Prudential. Neither SSN nor Zhang had a trademark
or intellectual property right in the domain name at the time of the registration. The record
is also clear that neither SSN nor Zhang had any legal right in the term PRU. The mere
fact that SSN owned the PRU.COM domain name is irrelevant because if registration of a
domain name itself established a qualifying right, then factor one would favor the
cybersquatter in every case.
2.
Factor Two: SSN is Not Known as PRU
The second factor also strongly favors Prudential because SSN is not legally
registered or commonly known as PRU.
3.
Factor Three: SSN Has Not Previously Used PRU.COM for Any Bona Fide Commercial
Offering of Goods or Services
The third factor also favors Prudential because SSN has failed to present any
evidence demonstrating that it used PRU.COM for any bona fide commercial offering of
goods or services. The plain language of the statute indicates that only “prior use” of a
domain name is relevant to the bad faith inquiry. 15 U.S.C. § 1125(d)(1)(B)(i)(III). As we
have previously recognized, “Congress did not list the proposed future use of a domain
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name as a factor, presumably because it would be too easy for cybersquatters to claim an
intent to use a disputed name to provide goods or services in the future.” Harrods Ltd. v.
Sixty Internet Domain Names, 302 F.3d 214, 234 (4th Cir. 2002). While “there are cases
in which a person registers a name in anticipation of a business venture that simply never
pans out,” a registrant’s proposed future use of a domain name should be disregarded unless
the registrant has a “longstanding history of using a trademark to provide goods and
services” and “legitimate plans to offer such goods and services online in the future.” Id.
at 235 (alterations and internal quotation marks omitted).
Here, it is undisputed that since SSN’s acquisition of the PRU.COM domain in
2017, the website only resolved to a GoDaddy parked page. Citing to several lower court
decisions which determined that pay-per-click advertising was not a bona fide commercial
use, the district court concluded that a GoDaddy parked page did not constitute a bona fide
commercial offering of goods or services. Prudential Ins. Co. of Am., 546 F. Supp. 3d at
486 (first citing Purtetalk Holdings, Inc. v. Puretalk.com, No. 1:19-cv-1532, 2020 WL
6922651, at *4 (E.D. Va. Sept. 18, 2020) (pay-per-click advertising is not bona fide
commercial use); and then citing Opt Out Serv., LLC v. optoutprescreened.com, No. 1:19-
cv-6076, 2019 WL 7340748, at *3 (E.D. Va. Oct. 4, 2019) (same)).
SSN does not challenge the district court’s conclusion that pay-per-click advertising
is not a bona fide commercial offering of goods or services. Instead, SSN argues that the
plain language of factor three makes clear that it is not the “offering of” goods and services
via the website but the “use in connection with” such an offering that must be “prior.”
Appellant’s Reply Br. at 22. Accordingly, SSN claims that its work to develop and prepare
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the PRU.COM website for future business is a prior use of the website in connection with
SSN’s anticipated offering of services.
To support this claim, SSN offered several documents that allegedly showcase
SSN’s efforts to develop the PRU.COM domain name for launch on March 30, 2020.
These documents include: (1) a purported three-page contract between SSN and a Chinese
company, Wuhan Hezhou Network Technology Co. Ltd., to develop videos for
PRU.COM 9; (2) a receipt indicating that SSN bought virtual server coverage for the
PRU.COM domain name; (3) a purported one-page advertisement for the PRU.COM
domain name 10; (4) a purported mock-up of the PRU.COM website dated March 30,
9
The purported contract appears to be a copy and not the original. It is unclear
whether the original contract was written in English, Chinese, or both. SSN has provided
no evidence authenticating this purported contract. For example, the contract contains
provisions relating to payment for the alleged video dubbing performed by Wuhan Hezhou.
However, SSN has not submitted the actual videos or any record of a payment made to
Wuhan Hezhou for those services.
10
The screenshot of the purported advertisement is dated April 19, 2020, and was
posted on SSN’s website, fx110.com. SSN claimed the advertisement was posted on
March 2, 2020, but no evidence establishes that the advertisement was created and posted
before this dispute arose. Moreover, the purported advertisement is for “Prune, the
master,” the meaning of which has not been explained at any point in this litigation. J.A.
638.
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2020 11; and (5) three pages of thumbnail sketches of financial symbols and cartoon
characters, which SSN claims represent proof of the videos to be uploaded to PRU.COM. 12
Although these materials may offer some support 13 for SSN’s argument that it was
preparing to launch PRU.COM, none of these documents negate the fact that, while
registered to SSN, the disputed domain had no identifiable purpose other than as a landing
page for advertisements. It is undisputed that SSN never uploaded any of the
aforementioned materials to PRU.COM in a manner accessible to the public.
Moreover, the record is devoid of any evidence that SSN had a “longstanding
history of using [PRU] to provide goods and services.” Harrods, 302 F.3d at 235. SSN
asserts that the Chinese name for its alleged financial news product is 普魯社 and that 普
魯社 is Simplified Chinese for Pǔ Lǔ Shè, which means Prussian “news agency” or
11
The record suggests that this mock-up is internal, as the IP address that allowed
access to this mockup was not created until March 31, 2020, after Prudential initiated the
UDRP action.
12
Below, SSN claimed that the 20 video tutorials depicted in the screenshot were
first launched online March 2, 2020. However, below the thumbnail sketches is a “Notice
of Non-Affiliation” stating, “pru.com is not affiliated, associated, authorized, or endorsed
by or in any way officially connected with The Prudential Insurance Company of America
or any of its subsidiaries or affiliates.” J.A. 606. If these tutorials were, in fact, launched
online on March 2, 2020, then this statement directly contradicts SSN’s claims that it did
not have knowledge of Prudential or Prudential’s trademarks prior to Prudential filing its
UDRP action on March 25, 2020.
13
These materials were authenticated through the declaration of SSN’s counsel,
who lacks personal knowledge of the substance of the documents and the date of creation.
See Bias v. Moynihan, 508 F.3d 1212, 1224–25 (9th Cir. 2007) (explaining that a witness
with personal knowledge, not counsel, should typically authenticate documents).
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“organization” in English. J.A. 384. SSN also asserts that the short form for Pǔ Lǔ Shè is
“P,” “R,” “U,” and thus 普魯社, or “PRU,” is an appropriate name for its proposed forex
news product. Besides its claim that an “easy-to-remember domain name was critical to
the success of its product,” J.A. 396, SSN has not proffered any reasonable explanation for
acquiring the PRU.COM domain name. There is nothing special about the name “Prussian
News Organization” that would lead consumers to believe they were interacting with an
SSN product or that they would find forex news on such a site. Thus, while SSN passively
held onto the domain name -- simultaneously preventing others from making use of it --
SSN never actively used PRU.COM in connection with any offer of goods or services. As
the Sixth Circuit explained:
It is irrelevant that [the alleged cybersquatter] states that he
intends to add bona fide goods or services to the site eventually
since . . . factor [three] asks whether the domain name holder
has actually used the site in connection with the offer of goods
or services, not whether the domain holder intends to do so.
DaimlerChrysler v. Net Inc., 388 F.3d 201, 207 n.3 (6th Cir. 2004).
4.
Factor Four: SSN Has Not Previously Used PRU.COM for Any Non-Commercial or Fair
Use Purpose
The fourth factor also strongly favors Prudential because it is undisputed that SSN
has never used PRU.COM for any non-commercial or fair use purpose.
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5.
Factor Five: SSN’s Intent in Registering PRU.COM was to Divert Customers Away from
Prudential
Factor five “is rarely discernable directly” and “must typically be inferred from the
pertinent facts and circumstances.’” Audi AG v. D’Amato, 469 F.3d 534, 549 (6th Cir.
2006). Here, we conclude that the fifth factor favors Prudential for three reasons.
First, PRU.COM is identical to Prudential’s PRU mark, which itself provides a basis
from which a court can infer SSN intended to divert consumers away from Prudential. See
DaimlerChrysler, 388 F.3d at 207 (concluding that an intent to divert can be inferred from
the use of a domain name that is phonetically identical to the mark owner’s trademark).
Second, SSN lacks any meaningful or persuasive explanation for acquiring PRU.COM. As
discussed above, besides its claim that it wanted an easy to remember domain name, SSN
failed to offer any explanation for why PRU.COM is an appropriate name for the
company’s alleged forex news product. Per SSN’s reasoning, any three-letter domain
name would have worked because three-letter names are “easy-to-remember.” J.A. 396.
If there is some reason why the term “PRU” or “Prussia” would lead Chinese consumers
to believe that a product branded as such would have some relation to the forex market,
SSN has not provided it. See Domain Name Clearing Co. v. F.C.F., Inc., 16 F. App’x 108,
110 (4th Cir. 2001) (per curiam) (emphasizing that the alleged cybersquatter “did not offer
any evidence of why it selected [the domain] name or what it intended to do with [it]”).
Third, SSN permitted PRU.COM to resolve to a GoDaddy parked page, which
displayed advertisements for Prudential’s competitors. SSN claims that it “had no control
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over what was in the hyperlinks,” which “were created entirely by GoDaddy, Inc. to
provide income to GoDaddy, without any benefit whatsoever to [SSN].” Appellant’s
Reply Br. at 20. SSN also maintains that it did not know about the advertisements because
the Chinese version of PRU.COM resolved to a GoDaddy parked page without
advertisements. 14 But the facts belie this claim. SSN began purchasing domain names in
2009 and has been a GoDaddy customer since March 20, 2012. To date, SSN has over 100
domain names in its GoDaddy account and has presumably completed a Registration
Agreement for each. So, while it is true that GoDaddy selected all “in-house and third-
party advertising,” per the registration agreement, SSN was aware that: (1) a parked page
was the default setting; (2) a parked page would display advertisements; and (3) SSN could
choose, at any time, whether PRU.COM would resolve to a parked page or another website.
Thus, SSN had the power to direct PRU.COM away from the GoDaddy parked page but
chose not to.
SSN also maintains that it did not know that the “American companies named in the
hyperlinks included [Prudential’s] competitors” but, tellingly, does not cite to any evidence
beyond Zhang’s declaration to support this argument. Appellant’s Reply Br. at 20 (citing
14
The evidence SSN relies upon for its assertion that the Chinese version of
PRU.COM resolved to a GoDaddy parked page without advertisements is a screenshot of
what the PRU.COM website looked like when Zhang was logged in to his GoDaddy
account. SSN has not explained or provided any evidence demonstrating how the exact
same domain name could lead visitors to two different landing pages, given that “.com”
domain names can be used anywhere in the world.
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J.A. 834). “[A]bsent objective corroboration,” a self-serving opinion cannot defeat
summary judgment, Williams v. Giant Food, Inc., 370 F.3d 423, 433 (4th Cir. 2004), and
a nonmovant cannot create a genuine dispute of material fact by relying on “conclusory
allegations or bare denials,” Erwin v. United States, 591 F.3d 313, 319 (4th Cir. 2010).
Accordingly, it can be readily inferred from the undisputed circumstantial evidence that
SSN intended to divert consumers away from Prudential.
6.
Factor Six: SSN’s Offers to Sell PRU.COM
Although it is ultimately inconsequential to the disposition of this case, we conclude
that the district court erred in determining that the sixth factor “clearly favor[ed]
Prudential.” Prudential Ins. Co. of Am., 546 F. Supp. 3d at 490. “[A] mere offer to sell a
domain name is not itself evidence of unlawful trafficking.” Virtual Works, 238 F.3d at
270. However, there is no requirement under factor six that the cybersquatter make a
formal offer to sell the domain name. See E. & J. Gallo Winery v. Spider Webs Ltd., 286
F.3d 270, 276 (5th Cir. 2002) (“Many cybersquatters are now careful to no longer offer the
domain name for sale in any matter that could implicate liability.”).
Here, the record includes a screenshot of the United States version of the PRU.COM
domain name as it appeared when registered to SSN. At the time, the phrase “Would you
like to buy this domain name?” appeared on the site next to a box that read “Learn More.”
J.A. 166. However, it is unclear whether all GoDaddy parked pages automatically included
the statement “Would you like to buy this domain name?” or whether this feature was
something SSN had to opt into. It is also unclear what exactly a visitor to the site would
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find were she to “click” on the “Learn More” box. It could be that the link took visitors to
a page that indicated that the domain name was, in fact, not for sale. Thus, whether this
statement alone could be considered an “offer to transfer, sell, or otherwise assign the
domain name” is in dispute. 15 U.S.C. § 1125(d)(1)(B)(i)(VI).
Moreover, the record establishes that on or around March 18, 2020, SSN engaged
in negotiations with Prudential’s investigator via a GoDaddy intermediary about the
possible sale of the PRU.COM domain name. Refusing to communicate with GoDaddy
brokers via email, someone at SSN (it is unclear who) instead spoke directly with a
GoDaddy representative over the phone. The GoDaddy representative indicated in an
email sent to other GoDaddy officials that SSN had rejected a five-figure offer from the
anonymous buyer (later identified as Prudential), claiming that it had received a six-figure
offer in the past from Sedo.com, and indicated that it would give a price only after the
interested buyer disclosed what type of business it was in. However, Zhang claims that
SSN “rejected both offers because [SSN] had no intention of selling the domain name,
preferring to use it for . . . services in China,” not because it wanted to secure a six-figure
sum. J.A. 115. SSN also contends that it “never listed nor offered to sell . . . the domain
name to any party.” Id. at 387. Therefore, there is a genuine dispute of fact concerning
whether SSN actually offered to sell the PRU.COM domain name for a six-figure sum or
only rejected offers to buy it.
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7.
Factor Seven: SSN’s Use of False or Misleading Contact Information When Registering
or Maintaining PRU.COM
The “provision of false contact information to a registrar is a hallmark of the
cybersquatter, who wants to profit without being easily identifiable and served with
process.” J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition
§ 25A:60 (5th ed. 2019). But a “mere honest mistake in identification has no such
import.” Id.
In its briefing, SSN does not address the district court’s conclusion as to factor seven
beyond its bare assertion that it “did not use false or misleading information when
registering and maintaining the domain.” Appellant’s Reply Br. at 22; see also Appellant’s
Opening Br. at 28. Nonetheless, the WIPO records establish that Zhang listed Bailun as
the registrant organization for the PRU.COM domain name, not SSN, the company for
whom Zhang claims he purchased the disputed domain name. At the time Zhang filed his
motion to dismiss, it was not clear who “the registrant of the Domain Name” was, but the
district court noted, “defendant’s counsel represented that Zhang registered the Domain
Name at the behest of his employer, Shenzhen Stone.” Prudential Ins. Co. of Am., 2020
WL 4208447, at *6. However, SSN failed to file an answer on behalf of the subject res,
PRU.COM, even after the district court denied Zhang’s motion to dismiss. It was not
discovered until Zhang’s deposition on March 18, 2021 that Zhang actually owns and
controls both SSN and Bailun, operates them as one entity, and is the one who decides to
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purchase and register domain names. Thus, listing Bailun as the registrant organization
instead of SSN was false and misleading.
Additionally, SSN changed the contact information for its GoDaddy account
associated with PRU.COM twice after Prudential filed its initial UDRP action -- once on
March 30, 2020, and again on April 9, 2020. It is undisputed that from 2017 until March
27, 2020, SSN used a proxy service to hide its registrant contact information for
PRU.COM. However, the proxy service was terminated, per WIPO’s policy, 15 when
Prudential filed a UDRP complaint. The WIPO case administrator provided Prudential
with the disputed domain name’s registrant information on March 27, 2020. On March 30,
2020, Zhang changed the registrant’s name from “shi wan” to “zhaoyuan.” “Wan shi” is
Chinese for “stone” and “Shenzhen Stone” is also known as “Shenzhen Wanshi.” Then,
on April 9, 2020, Zhang changed the registrant’s last name to “zhang,” resulting in
15
WIPO’s policy provides the following:
In order to give effect to the UDRP, providers have a
reasonable and legitimate purpose to relay registrar-provided
WhoIs data to complainants in pending UDRP proceedings so
as to provide an opportunity for complainants to make
substantive and/or procedural amendments as appropriate (an
accepted practice today concerning privacy/proxy services
named as respondents).
Impact of Changes to Availability of WhoIs Data on the UDRP, WIPO,
https://www.wipo.int/amc/en/domains/gdpr/ (choose “Will WIPO Provide the Registrar-
Confirmed WhoIs Data to UDRP Complainants?” from dropdown) (last visited Jan. 4,
2023) (saved as ECF opinion attachment).
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“zhaoyuan zhang.” Thus, Zhang changed the registrant’s name from a name identifying
SSN as the registrant to his own name.
SSN does not dispute that these changes were made, but Zhang states in his
August 31, 2020 sworn declaration, “Notably, my name is listed as the ‘Full Name’ of the
account holder.” J.A. 1053. This statement is misleading at best given that Zhang made
multiple changes to the registrant GoDaddy account after receiving notice of the UDRP
complaint.
SSN’s initial concealment of both Zhang’s and SSN’s names, coupled with Zhang’s
later modification of the GoDaddy contact information, suggests an intent to conceal SSN’s
true identity. Thus, factor seven favors Prudential and a finding of bad faith.
8.
Factor Eight: SSN’s Registration of Other Domain Names
The eighth factor likewise favors Prudential because SSN has registered over 100
domain names, including domain names that match the registered marks of others, like
“yelp,” “quora,” and “chrome.” As the district court noted, “It is widely known that Yelp
is a popular restaurant review service, that Quora is a popular internet question-and-answer
service, and that Chrome is the popular web browser built by Google.” Prudential Ins. Co.
of Am., 546 F. Supp. 3d at 491. SSN’s decision to register these domain names as well as
100 others evinces a desire to squat on domain names rather than use them. See Harrods,
302 F.3d at 239 n.13 (emphasizing that factor eight favors the mark owner where the
alleged cybersquatter has “registered hundreds of [unrelated] domain names, such as names
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incorporating marks like Bloomingdale’s or Saks Fifth Avenue”). Accordingly, factor
eight favors a finding of bad faith.
9.
Factor Nine: Prudential’s PRU and PRU-Formative Marks are Distinctive and Famous
Finally, the ninth factor also favors Prudential because Prudential has long held a
trademark in the term “PRU,” both domestically and abroad. A mark is famous if it is
“widely recognized by the general consuming public of the United States as a designation
of source of the goods or services of the mark’s owner.” 15 U.S.C. § 1125(c)(2)(A). In
determining whether a mark is famous, a court may consider all relevant factors including
the: (1) duration, extent, and geographic extent of advertising and publicity of the mark;
(2) amount, volume, and geographic extent of sales of goods or services offered under the
mark; and (3) extent of actual recognition of the mark. Id. The registration of a distinctive
mark may itself satisfy factor nine. Retail Servs. Inc. v. Freebies Publ’g, 364 F.3d 535,
542 (4th Cir. 2002) (Because a generic mark cannot be registered, “the fact that a mark is
registered is strong evidence that the mark satisfies the statutory requirements for the
distinctiveness necessary for trademark protection.”), abrogated on other grounds
by Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545 (2014).
Here, Prudential’s products and services include investments and products
involving foreign exchange hedging, foreign exchange contracts, and investment funds.
Prudential has been using PRUDENTIAL, PRU, and PRU-formative marks, both in the
United States and internationally (including in Taiwan where SSN claims to have an
office), in connection with the promotion and advertisement of its products since at least
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2001. In fact, Prudential’s New York Stock Exchange (“NYSE”) ticker symbol is “PRU”
and has been since December 13, 2001.
SSN argues, “the district court erred by . . . confusing the foreign exchange market
with the stock market.” Appellant’s Reply Br. at 16. We find this argument unavailing
because the NYSE has a major influence upon the global economy and currency exchange
rates. Forex and stocks are two of the most traded financial markets in the world, and there
are often correlations between the two. SSN’s forex data is also sourced from Bloomberg,
an American company, and Reuters, a global news agency. Thus, “a leading company in
the [forex] information industry in China” sourcing its data from an American financial
institution should know about the NYSE. J.A. 396.
Prudential has been in business as PRUDENTIAL for over 145 years and has held
a trademark in the term “PRU” in some countries as early as 1974. While it is true that
Prudential plc, an unaffiliated company, uses the PRUDENTIAL and PRU trademarks in
China, Prudential still does business in China through publicly disclosed joint venture
arrangements with local partners and through its subsidiaries, including Everbright PGIM
Fund Management Co., Ltd. and Pramerica Fuson. The use of Prudential’s well-known
logo, “THE ROCK,” plainly links these entities back to Prudential.
Moreover, SSN does not use the PRU mark to advertise its organization, nor has it
ever actively used PRU.COM. It is undisputed that while registered to SSN, PRU.COM
resolved to a parked page accessible in the United States, where Prudential uses the PRU
and PRU-formative marks. And SSN does not have any valid property rights in the PRU
mark in any country, and thus, is not a legitimate concurrent user. See Harrods, 302 F.3d
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at 233, 234 n.9 (“The use of an identical mark by two different companies is sometimes
allowed in trademark law under the concept of ‘concurrent use.’”). Accordingly, it is clear
that the PRU mark enjoys widespread recognition, particularly in the United States where
SSN has chosen to register a number of different domain names with Verisign and
GoDaddy. Therefore, factor nine favors Prudential.
Accordingly, for the foregoing reasons, we agree with the district court’s conclusion
that SSN acted with the bad faith intent to profit from using the PRU.COM domain name.
E.
The ACPA’s Safe Harbor
The ACPA contains a “safe harbor” provision that states, “bad faith intent . . . shall
not be found in any case in which the court determines that the person believed and had
reasonable grounds to believe that the use of the domain name was a fair use or otherwise
lawful.” 15 U.S.C. § 1125(d)(1)(B)(ii). Because the ACPA was designed to thwart
cybersquatters, it does not extend to innocent domain name registrations by those who are
unaware of another’s use of the name. H.R. Rep. No. 106–464, at 109 (1999). However,
as a matter of law, “[a] defendant who acts even partially in bad faith in registering a
domain name is not . . . entitled to benefit from the [ACPA]’s safe harbor provision.”
Virtual Works, 238 F.3d at 270. Thus, we construe the ACPA’s safe harbor provision in a
manner that does not “undermine the rest of statute” because “[a]ll but the most blatant
cybersquatters will be able to put forth at least some lawful motives for their behavior.”
Id.38
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Here, SSN failed to satisfy the statute’s safe harbor provision. First, SSN’s self-
serving denials of subjective belief that its use of the PRU.COM domain name was lawful
are insufficient to defeat summary judgment absent objective corroboration. See Williams,
370 F.3d at 432. The district court was not required to accept SSN’s “bare denials” of its
knowledge of Prudential’s trademark, Erwin, 591 F.3d at 319, particularly where SSN
admittedly formed a plan to submit trademark applications for PRU.COM in 2019 and, in
fact, did submit such applications in New Zealand, Australia, the United Kingdom, and the
United States in June 2020. And notably, at the bottom of the document SSN submitted as
evidence of the purported tutorial videos it launched online at PRU.COM in early March
2020, there is a “Notice of Non-Affiliation” stating, “pru.com is not . . . in any way
officially connected with [Prudential].” J.A. 606. This statement directly contradicts
SSN’s claims that it did not have knowledge of Prudential or Prudential’s trademarks prior
to March 2020. Because SSN failed to adduce sufficient evidence to defeat summary
judgment on the subjective component of the ACPA’s safe harbor, the district court
properly concluded that the safe harbor did not apply.
Second, SSN did not have reasonable grounds to believe that its registration of the
PRU.COM domain name was otherwise lawful. A company specializing in foreign
exchange trading could not reasonably believe that a domain name identical to a stock
ticker and a term trademarked in over 20 countries by a major financial services institution
was lawful. SSN’s purported ignorance of American businesses and trademarks is belied
by uncontroverted evidence demonstrating that PRU.COM was accessible to consumers in
the United States during the time it was registered to SSN, a majority of SSN’s registered
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domain names are in English, several of SSN’s domain names include the names of popular
American companies, and SSN attempted to obtain a trademark for “PRU” in the United
States.
Pursuant to 15 U.S.C. § 1072, the “registration of a mark on the principal register . . .
shall be constructive notice of the registrant’s claim of ownership.” An entity that has
registered several hundred domain names with the American company GoDaddy is subject
to constructive notice of American trademarks given that the GoDaddy registration
agreement requires registrants to confirm that the registration of a domain name does not
interfere with another’s intellectual property rights. Thus, because SSN failed to establish
the objective element of the ACPA’s safe harbor, the district court did not err in rejecting
the defense. See Domain Name Clearing Co., 16 F. App’x at 111 (concluding that
cybersquatter had a bad faith intent to profit even where cybersquatter allegedly was not
aware of the mark at the time of registration).
IV.
For the foregoing reasons, the district court’s order granting summary judgment to
Prudential is
AFFIRMED.
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