Lucas Nursery v. Grosse

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206 2 Lucas Nursery and No. 02-1668
ELECTRONIC CITATION: 2004 FED App. 0071P (6th Cir.) Landscaping v. Grosse
File Name: 04a0071p.06
_________________
UNITED STATES COURT OF APPEALS COUNSEL
FOR THE SIXTH CIRCUIT ARGUED: Kevin L. Bennett, HEMMING, POLACZYK,
_________________ CRONIN, SMITH & WITTHOFF, Plymouth, Michigan, for
Appellant. Jeffrey D. Wilson, RAYMOND & PROKOP,
LUCAS NURSERY AND X Southfield, Michigan, for Appellee. ON BRIEF: Kevin L.
LANDSCAPING , INC., - Bennett, HEMMING, POLACZYK, CRONIN, SMITH &
Plaintiff-Appellant, - WITTHOFF, Plymouth, Michigan, for Appellant. Jeffrey D.
- No. 02-1668 Wilson, RAYMOND & PROKOP, Southfield, Michigan, for
- Appellee.
v. >
, _________________
-
MICHELLE GROSSE , - OPINION
Defendant-Appellee. - _________________
-
N R. GUY COLE, JR., Circuit Judge. Plaintiff-Appellant
Appeal from the United States District Court Lucas Nursery and Landscaping, Inc. (“Lucas Nursery”)
for the Eastern District of Michigan at Detroit. appeals the district court’s grant of summary judgment for
No. 01-73291—Bernard A. Friedman, District Judge. Defendant-Appellee Michelle Grosse in this action alleging
that Grosse violated the Anticybersquatting Consumer
Argued: October 31, 2003 Protection Act, 15 U.S.C. § 1125(d)(1)(A) (2000) (“the
ACPA”), by registering the domain name “lucasnursery.com”
Decided and Filed: March 5, 2004 and creating a web site on which she detailed her complaints
against Lucas for its allegedly bad service in landscaping her
Before: BATCHELDER and COLE, Circuit Judges; front yard. The central issue on appeal is whether the district
HOOD, District Judge.* court erred in granting summary judgment in favor of Grosse
based upon its conclusion that the she did not act in bad faith
within the meaning of the ACPA. For the reasons that follow,
we AFFIRM the judgment of the district court.
I. BACKGROUND
This case arises from a dispute related to landscaping work
*
that was performed by Lucas Nursery at the residence of
The Honorable Joseph M. Hood, United States District Judge for the Michelle Grosse. In March 2000, Grosse hired Lucas
Eastern District of Kentucky, sitting by designation.
1
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Nursery to correct a dip in the soil (known as a swale) that ran on the web site, again describing her experience with Lucas
horizontally through the center of her front yard. Lucas Nursery.
Nursery’s representative, Bob Lucas, Jr., stated that the swale
could be corrected by using five large loads of topsoil. Lucas Lucas Nursery filed suit against Grosse on August 17,
Nursery performed the work on May 16, 2000. 2001. Thereafter, each party moved for summary judgment.
On April 23, 2002, the district court denied Lucas Nursery’s
Grosse contends that the work was performed inadequately. motion for summary judgment and granted Grosse’s motion
After allegedly contacting Lucas Nursery on numerous for summary judgment.
occasions to express her displeasure with the work and to
seek some repair, Grosse filed a complaint with the Better II. ANALYSIS
Business Bureau (“the BBB”). After the BBB ended its
investigation without making a recommendation, Grosse A. Standard of Review
remained dissatisfied by what she felt had been poor service
by Lucas Nursery, and decided to inform others about her We review a district court’s decision to grant summary
experience with the company. judgment de novo. Stephenson v. AllState Ins. Co., 328 F.3d
822, 826 (6th Cir. 2003). Summary judgment is proper if “the
On August 12, 2000, Grosse registered the domain name pleadings, depositions, answers to interrogatories, and
“lucasnursery.com.” She then posted a web page for the sole admissions on file, together with the affidavits, if any, show
purpose of relaying her story to the public. The web page was that there is no genuine issue of material fact and that the
titled, “My Lucas Landscaping Experience.” The web page moving party is entitled to a judgment as a matter of law.”
included complaints regarding the poor preparation of the soil Fed. R. Civ. P. 56(c). When reviewing a motion for summary
prior to Lucas Nursery’s laying of the sod, the hasty nature of judgment, the evidence, all facts, and any inferences that may
Lucas Nursery’s work, the ineffectiveness of the BBB in be drawn from the facts must be viewed in the light most
addressing her complaint, and the fact that she had to pay an favorable to the nonmoving party. Matshusita Elec. Indus.
additional $5,400 to a second contractor to repair the work Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
originally performed by Lucas Nursery. However, a “mere scintilla” of evidence is insufficient; the
evidence must be such that a reasonable jury could find in
On September 27, 2000, Grosse received a letter from favor of the plaintiff. Anderson v. Liberty Lobby, Inc., 477
Lucas Nursery’s attorney demanding that she cease operating U.S. 242, 252 (1986).
the web site. On October 2, 2000, Grosse removed the
web site’s content. However, after removing the web site’s B. The ACPA
content, Grosse contacted the Michigan Bureau of
Commercial Services Licensing Division and the U.S. Patent “The ACPA was enacted in 1999 in response to concerns
& Trademark Office to determine whether there was a over the proliferation of cybersquatting – the Internet version
registered trademark for Lucas Nursery. After learning that of a land grab.” Virtual Works, Inc. v. Volkswagen of
no trademark registration existed, Grosse concluded that America, Inc., 238 F.3d 264, 267 (4th Cir. 2001). It was
Lucas Nursery could not prevent her from retaining the enacted because then-existing law did not expressly prohibit
web site. On April 13, 2001, Grosse posted a new narrative the practice of cybersquatting, and cybersquatters had begun
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to insulate themselves from liability under the Federal 2. Bad Faith Analysis
Trademark Dilution Act, 15 U.S.C. § 1125. Id.
In order for liability to attach under the ACPA a court must
In the Senate Report accompanying the ACPA, conclude that the defendant’s actions constitute “bad faith.”
cybersquatters are defined as those who: (1) “register well- ACPA § 3002 (codified at 15 U.S.C. § 1125(d)(1)(A)-(B)).
known brand names as Internet domain names in order to An analysis of whether a defendant’s actions constitute bad
extract payment from the rightful owners of the marks;” faith within the meaning of the ACPA usually begins with
(2) “register well-known marks as domain names and consideration of several factors, nine of which are listed in the
warehouse those marks with the hope of selling them to the ACPA. See Sporty’s Farm v. Sportman’s Market, Inc., 202
highest bidder;” (3) “register well-known marks to prey on F.3d 489, 498 (2d Cir. 2000). The first four factors are those
consumer confusion by misusing the domain name to divert that militate against a finding of bad faith by providing some
customers from the mark owner’s site to the cybersquatter’s reasonable basis for why a defendant might have registered
own site;” (4) “target distinctive marks to defraud consumers, the domain name of another mark holder. These factors focus
including to engage in counterfeiting activities.” S. REP. NO . on: whether the defendant has trademark or other rights in the
106-140 at 5-6. domain name; the extent to which the domain name consists
of the defendant’s legal name or other common name; any
Pursuant to the ACPA, a cybersquatter is potentially liable prior use of the domain name for the offering of goods and
to the owner of a protected mark if that person: services; and the bona fide noncommercial use of the site.
(i) has a bad faith intent to profit from the mark . . . ; and Each of the first three factors cuts against Grosse. She does
(ii) registers, traffics in, or uses a domain name that -- not hold a trademark or other intellectual property rights to
(I) in the case of a mark that is distinctive . . . , is the domain name or names included in the registered domain
identical or confusingly similar to that mark; name. The domain name neither consists of her legal name
(II) in the case of a famous mark . . . , is identical or or any name used to refer to her. Grosse has also not used the
confusingly similar to or dilutive of that mark; or domain name in connection with any offering of goods or
(III) is a trademark, word, or name protected by reason of services. The fourth factor cuts in Grosse’s favor because the
section 706 of Title18 or section 220506 of Title 36. site was used for noncommercial purposes.
15 U.S.C. § 1125(d)(1)(A). Factors five through eight are indicative of the presence of
bad faith on the part of the defendant. These factors focus on:
1. Non-Commercial Activity and the ACPA whether the defendant seeks to divert consumers from the
mark holder’s online location either in a way that could harm
Although there is some dispute between the parties as to good will or tarnish or disparage the mark by creating a
whether the ACPA covers non-commercial activity, we see no confusion regarding the sponsorship of the site; whether there
reason to consider these arguments, as the statute directs a has been an offer to transfer or sell the site for financial gain;
reviewing court to consider only a defendant’s “bad faith whether the defendant provided misleading contact
intent to profit” from the use of a mark held by another party. information when registering the domain name; and whether
We, therefore, turn to this consideration.
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the defendant has acquired multiple domain names which Lucas Nusery contends that the Fourth Circuit’s decision in
may be duplicative of the marks of others. People for the Ethical Treatment of Animals (PETA) v.
Doughney, 263 F.3d 359 (4th Cir. 2001), is applicable to the
The paradigmatic harm that the ACPA was enacted to instant action. Although the defendant in Doughney did not
eradicate – the practice of cybersquatters registering several make commercial use of his web site, the court concluded that
hundred domain names in an effort to sell them to the he had, nonetheless, acted with a bad faith intent to profit.
legitimate owners of the mark – is simply not present in any Doughney had “made statements on his website and in the
of Grosse’s actions. In its report on the ACPA, the Senate press recommending that PETA attempt to ‘settle’ with him
Judiciary Committee distilled the crucial elements of bad faith and ‘make him an offer’” and that he had “registered other
to mean an “intent to trade on the goodwill of another’s domain names that [were] identical or similar to the marks or
mark.” S. REP. NO . 106-140, at 9. See also Ford Motor Co. names of other famous people and organizations.” Id. at 369.
v. Catalanotte, 342 F.3d 543, 549 (6th Cir. 2003) Here, Grosse has engaged in no such offensive conduct.
(“Registering a famous trademark as a domain name and then
offering it for sale to the trademark owner is exactly the Lucas Nursery seeks to buttress its argument with Toronto-
wrong Congress intended to remedy when it passed the Dominion Bank v. Karpachev, 188 F. Supp. 2d 110 (D. Mass.
ACPA.”). There is no evidence that this was Grosse’s 2002). There, the district court granted Toronto-Dominion’s
intention when she registered the Lucas Nursery domain motion for summary judgment against the defendant,
name and created her web site. It would therefore stretch the concluding that there was sufficient evidence to show that the
ACPA beyond the letter of the law and Congress’s intention defendant had acted in bad faith under the ACPA. The
to declare anything to the contrary. defendant, a disgruntled customer, registered sixteen domain
names composed of various misspellings of the name
None of these factors militates against Grosse. There is no tdwaterhouse.com. Id. at 111. On the web sites associated
dispute that Lucas Nursery did not have an online location, with these names, the defendant attacked Toronto-Dominion
and hence Grosse’s creation of a web site to complain about for “webfacism” and involvement with white collar crime,
Lucas Nursery’s services could not have been intended “to among other things. Id. at 112. The court concluded that the
divert consumers from the mark owners’s online location.” defendant had acted in bad faith, citing four factors: (1) his
Nor is there any evidence that Grosse ever sought to mislead intention to divert customers from the “tdwaterhouse”
consumers with regard to the site’s sponsorship. The web site web site by creating confusion as to its source or sponsorship;
explicitly stated that the site was established by Grosse for (2) the fact that he had registered sixteen domain names; (3)
the purposes of relaying her experience with Lucas Nursery. the fact that he offered no goods or services on the site; and
Moreover, Grosse never offered to sell the site to Lucas (4) the fact that he had no intellectual property rights in the
Nursery. She also did not provide misleading contact site. See id. at 114.
information when she registered the domain name. Finally,
she has not acquired any additional domain names, which Although Grosse’s actions would arguably satisfy three of
would be indicative of either an intent to sell such names to the four aforementioned factors, she does not fall within the
those entities whose trademarks were identical or similar, or factor that we consider central to a finding of bad faith. She
exploit them for other uses. did not register multiple web sites; she only registered one.
Further, it is not clear to this Court that the presence of simply
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one factor that indicates a bad faith intent to profit, without
more, can satisfy an imposition of liability within the
meaning of the ACPA. The role of the reviewing court is not
simply to add factors and place them in particular categories,
without making some sense of what motivates the conduct at
issue. The factors are given to courts as a guide, not as a
substitute for careful thinking about whether the conduct at
issue is motivated by a bad faith intent to profit. Perhaps
most important to our conclusion are, Grosse’s actions, which
seem to have been undertaken in the spirit of informing
fellow consumers about the practices of a landscaping
company that she believed had performed inferior work on
her yard. One of the ACPA’s main objectives is the
protection of consumers from slick internet peddlers who
trade on the names and reputations of established brands. The
practice of informing fellow consumers of one’s experience
with a particular service provider is surely not inconsistent
with this ideal.
CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s
grant of summary judgment in favor of Grosse.