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People for the Ethical Treatment of Animals v. Doughney

The Fourth Circuit, affirming the decision of the district court below, held that defendant was guilty of service mark infringement and unfair competition, and had violated the Anticybersquatting Consumer Protection Act ("ACPA"), as a result of his creation and operation of a web site at the domain www.peta.org, which contained plaintiff's federally registered service mark "peta." In reaching this conclusion, the Fourth Circuit rejected defendant's defense that his site, titled "People Eating Tasty Animals," was a parody of plaintiff's "People for the Ethical Treatment of Animals" organization because the domain name containing plaintiff's mark did not appear simultaneously with that aspect of the web site containing the parody of plaintiff's organization.

Plaintiff People for the Ethical Treatment of Animals ("PETA") is an animal rights organization that "opposes the exploitation of animals for food, clothing, entertainment and vivisection." Plaintiff is the owner of the federal service mark "Peta." Defendant Doughney is an individual who registered the domain name "www.peta.org." Defendant also registered a number of other domain names relating to other people and organizations. At the time of the lower court's ruling, Doughney owned between 50 and 60 domain names.

Doughney created a web site at "www.peta.org" which he contended was a parody of plaintiff's organization. The site, titled "People Eating Tasty Animals" (Peta), claimed it was a "resource for those who enjoy eating meat, wearing fur and leather, hunting, and the fruits of scientific research." The site contained links to a number of organizations which held views generally antithetical to those of Peta, such as various meat, fur, leather and hunting organizations. The site also contained the following statement: "Feeling lost? Offended? Perhaps you should, like, exit immediately." The last two words of this statement constituted a link that took a user to PETA's official web site. No goods were offered for sale on the site.

On two occasions, Doughney suggested that if PETA wanted one of his domains, or objected to his registration, it could "make me an offer" or "negotiate a settlement."

Objecting to defendant's conduct, PETA commenced this suit, charging defendant, inter alia, with service mark infringement, unfair competition, dilution and cyber squatting. The lower court agreed, and granted plaintiff's motion for summary judgment. The district court declined to award plaintiff its attorney's fees, however, holding that this case was not "exceptional" under 15 U.S.C. Section 1117, and thus did not warrant an award of attorney's fees.

On appeal, the Fourth Circuit affirmed.

To establish a claim for trademark infringement and unfair competition, the plaintiff must prove (1) that it possess a mark; (2) that the defendant used the mark; (3) that the defendant's use of the mark occurred "in commerce;" (4) that the defendant used the mark "in connection with the sale, offering for sale, distribution, or advertising" of goods or services; and (5) that the defendant used the mark in a manner likely to confuse consumers."

Doughney argued that, because he did not offer to sell goods or services on his site, his use was not "in connection with the sale ..." of goods or services, and thus did not constitute trademark infringement. The Fourth Circuit rejected this contention, holding that:

To use PETA's mark 'in connection with' goods or services, Doughney need not have actually sold or advertised goods or services on the www.peta.org website. Rather, Doughney need only have prevented users from obtaining or using PETA's goods or services or need only have connected the website to other's goods or services.

The court went on to hold that "Doughney's use of PETA's mark in the domain name of his website 'is likely to prevent Internet users from reaching PETA's own Internet web site. The prospective users of PETA's services who mistakenly access Defendant's web site may fail to continue to search for PETA's own home page, due to anger, frustration or the belief that PETA's home page does not exist." This, held the court, constitutes a use "in connection with goods or services" for the purpose of establishing a trademark infringement claim.

The court further held that such a use was also established by virtue of the links from defendant's site to commercial operations offering goods or services.

Defendant also argued that his use of the mark was not an infringement because it was used in connection with a parody, and thus not likely to confuse the public as to the source of his site, or its affiliation with plaintiff.

The Court rejected this defense. "A parody must 'convey two simultaneous - and contradictory - messages: that it is the original but also that it is not the original and is instead a parody." (Emphasis added). Finding that the requirement of "simultaneous" messages was not met, the Court held defendant liable for trademark infringement. Said the court:

Looking at Doughney's domain name alone, there is no suggestion of a parody. … Doughney claims that this second message [that his site is a parody] can be found in the content of his website. Indeed, the website's content makes it clear that it is not related to PETA. However, this second message is not conveyed simultaneously with the first message, as required to be considered a parody. The domain name conveys the first message; the second message is conveyed only when the viewer reads the content of the website. As the district court explained, "an internet user would not realize that they were not on an official PETA web site until after they had used PETA's mark to access the web page …. Thus the messages are not conveyed simultaneously and do not constitute a parody."

The Fourth Circuit also affirmed the district court's determination that defendant had violated the ACPA. In reaching this conclusion, the court rejected defendant's claim that he did not seek to profit from the operation of his web site, a prerequisite to an ACPA claim, because he had recommended that PETA attempt to settle with him, or make him an offer for the domain name.

The court also rejected defendant's safe harbor defense. Under 15 USC section 1125(d)(1)(B)(i), bad faith intent (another prerequisite to an ACPA claim) "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 fair use or otherwise lawful." Defendant sought refuge in this safe harbor, arguing that his belief that his site was a fair use parody protected him against a finding of bad faith. In rejecting this argument, the court stated:

A defendant 'who acts even partially in bad faith in registering a domain name is not, as a matter of law, entitled to benefit from the ACPA's safe harbor provision.' Doughney knowingly provided false information to NSI upon registering the domain name, knew he was registering a domain name identical to PETA's mark, and clearly intended to confuse Internet users into accessing his website, instead of PETA's official web site.

Lastly, the Fourth Circuit affirmed the district court's denial of plaintiff's application for attorney's fees under 15 USC section 1117(a). In a trademark infringement case, a court may award attorney's fees in exceptional cases. Under Section 1117(a), a case is "exceptional" if the defendant's conduct is 'malicious, fraudulent, willful or deliberate in nature.' The court held while defendant acted in bad faith for the purposes of the ACPA, his conduct was not sufficiently malicious, fraudulent, etc. to warrant an award of attorney's fees. Said the court:

A bad faith finding under the ACPA does not compel a finding of malicious, fraudulent, willful or deliberate behavior under Section 1117. The district court was within its discretion to find that, even though Doughney violated the ACPA (and thus acted in bad faith), he did not act with the level of malicious, fraudulent, willful or deliberate behavior necessary for an award of attorney's fees.