Before the newest addition of Electronic Arts’s (“EA”) snowboarding franchise “SSX” was set to hit stores, it was no surprise it looked to the domain <ssx.com> for a promotional website. Only one problem – Abstract Holdings International, LTD (“Abstract”) had bought the domain name back in October 2011. EA didn’t take the news very well and filed a complaint with the National Arbitration Forum (“Forum”) seeking transfer of the domain name, claiming that Abstract had no legitimate interest in the website, the purchase was made in bad faith, and ownership of the “SSX” trademark. The full text of the decision can be found here.
Why arbitration? Considering that EA didn’t file its complaint with the Forum until November 16, 2011, and SSX was slated for a February 2012 release, it likely chose arbitration with the hopes of resolving the issue as quickly as possible. While EA could have (and still can) assert its trademark rights in federal court, arbitration tends to be much faster. When Abstract registered the domain name with Moniker Online Services, Inc., it agreed to resolve any domain disputes brought by 3rd parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (“UDRP”). The UDRP provides for expedited proceedings when the dispute is alleged to arise from abusive registrations of domain names (i.e. cybersquatting). UDRP ¶ 4(a) requires that a complainant prove the following three elements to obtain an order that a domain name be cancelled or transferred:
(i) the domain name registered by respondent is identical or confusingly similar to a trademark or service mark in which complainant has rights; and
(ii) Respondent has no rights or legitimate interests in respect of the domain name; and
(iii) the domain name has been registered and is being used in bad faith.
With respect to the first element, the arbitration panel agreed with EA that the marks were identical and that EA had rights to the “SSX” trademark. The panel found that EA’s trademark registrations with United States Patent and Trademark Office (first-use date October 17, 2000), the European Union’s Office for Harmonization of the Internal Market, and many other countries were conclusive evidence on this point. The panel noted that the mere addition of the “.com” suffix was insufficient to distinguish the domain from EA’s trademark.
EA had more difficulty proving the second element. Oddly enough, Abstract just happens to be in the business of buying and selling domain names containing letters that create generic acronyms. Really? Under UDRP ¶ 4(c)(i), Abstract was afforded an opportunity to demonstrate their rights/legitimate interests in <ssx.com> by showing that prior to EA’s complaint, “the domain name…[was used] in connection with a bona fide offering of goods or services.” The panel concluded that the buying and selling of generic domain names constituted “a bona fide offering of goods” under ¶ 4(c)(i) and, as such, Abstract established its legitimate interest in the disputed domain name. After failing to meet the 2nd element, the panel held that there was no need to address the 3rd element of bad faith.
Even though EA lost the battle, it certainly hasn’t lost the war; it still can assert its trademark rights in federal court. UDRP ¶ 4(k) states that the arbitration requirement does not prevent either party from submitting the dispute to a court of competent jurisdiction before or after an administrative proceeding. If EA decides to file suit in federal court, it will likely assert a cause of action under the Anti-cybersquatting Consumer Protection Act (“ACPA”). Under the ACPA, Abstract can be found liable if its registration evinces a bad faith intent to profit from the SSX mark, and the disputed domain name is confusingly similar to a registered trademark. (15 U.S.C. §1125 [d]). The ACPA directs the court to consider various factors bearing on whether the requisite bad faith exists, including whether the registrant offered to sell the domain for financial gain without having used (or intending to use) it in the bona fide offering of goods and services.
EA would likely argue, as they did in the arbitration proceeding, that element of bad faith is met considering that at one point in time, when the site was parked with Google, it was automatically populated with hyperlinks (one of which linked to a computer gaming site). In ruling that Abstract’s practice of buying and selling generic domain names constitutes a bona fide offering of goods, the panel stated that “where there is no attempt to target” EA’s interest in its mark, or to “capitalize on the good will” associated with it, mere click through revenue is insufficient to establish bad faith. (See Dinah, S.L. v. WebQuest.com, Inc., WIPO Case No. D2005-0573). However, UDRP proceedings are not binding on federal courts, so EA still has a chance of gaining possession of the domain.
All in all, EA may have to look elsewhere to promote its “SSX” games online in the future. For now at least, interested gamers will be forced to type an extra two letters into address bar <http://www.ea.com/ssx>.