Internet Library of Law
and Court Decisions

Cardservice International Inc. v. McGee.

In Cardservice, the court issued a permanent injunction, enjoining the defendant from using "cardservice" in its domain name. The court found such use to constitute infringement of plaintiff's trademark in the mark "cardservice international." The court further awarded plaintiff attorneys fees under the Lanham Act to compensate plaintiff for its efforts in stopping defendant from continuing this conduct.

Plaintiff was the owner of a federal trademark in the mark "Cardservice International." Plaintiff was in the business of credit and debit card processing. Defendant, in a competing business, registered the domain name "cardservice.com" with NSI without plaintiff's permission. The user who accessed this URL was taken to defendant's website, which advertised merchant card services through a company called "EMS-Card Service on the Caprock."

After defendant refused to discontinue this conduct despite notification of plaintiff's mark, plaintiff commenced this action, seeking a permanent injunction and other relief. Plaintiff alleged that defendant's conduct constituted trademark infringement, unfair competition, misappropriation and unjust enrichment. The court agreed, and issued a permanent injunction, enjoining defendant from further use of "cardservice" in its domain name or site.

Of interest is the court's discussion of the requirement that plaintiff prove not only that defendant had infringed its mark, but also that such use "is likely to cause confusion among consumers." Effectively, the court held that because the defendant engaged in a competing business, its mere use of the mark in its domain name was sufficient evidence to establish the requisite likelihood of consumer confusion, because people surfing the net and looking for plaintiff on the Internet and not being aware of its address, would be likely to do so by inserting plaintiff's mark in a domain name, and, upon arriving at defendant's site (instead of plaintiff's) would assume it was indeed plaintiff's site. Said the court:

Domain names present a unique circumstance when determining the likelihood of confusion caused by possible trademark violations. ... With regard to domain names, however, only one party can hold any particular domain name. Who has access to that domain name is made even more important by the fact that there is nothing on the Internet equivalent of a phone book or directory assistance. A customer who is unsure about a company's domain name will often guess that the domain name is also the company's name. ,,, Thus, a domain name is more that a mere Internet address. It also identifies the Internet site to those who reach it, much like a person's name identifies a particular person, or, more relevant to trademark disputes, a company's name identifies a specific company. .... Cardservice International's customers who wish to take advantage of its Internet services but do not know its domain name are likely to assume that "cardservice.com" belongs to Cardservice International. These customers would instead reach McGee and see a home page for "Card Service." They would find that McGee's Internet site offers advertisements for and provides access to the same services as Cardservice International - credit and debit card processing. Many would assume that they have reached Cardservice International or, even if they realize that is not who they have reached, take advantage of McGee's services ... [c]onfusion will result among consumers who are seeking Cardservice International by searching for its trademark as a domain name on the Internet.