Porsche Dealt Court Defeat Over Domain Names
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Porsche Cars North America has lost a closely-watched lawsuit involving domain names and trademark infringement.
Porsche Thursday said a Virginia federal court in Virginia dismissed its lawsuit against holders of 138 Internet domain names on June 8. All of the defendants had registered names which contained the words Porsche or Boxter, trademarks of the Germany-based company.
According to Porsche, the court rejected its "in rem" legal tactic of simultaneously suing all the registrants, some of whom are located outside the United States or whose identities can't easily be gleaned from Internic records.
Atlanta-based Porsche Cars North America filed the suit in Virginia this past January since domain registry zone files are maintained by Herndon, Va.-based Network Solutions Inc.
"Porsche was trying to simplify matters for themselves, but in the process stepped on due process, and the court recognized that. These in rem suits have been put to bed now."
Had the umbrella strategy been successful, Internet legal experts predicted copycat suits from other companies with famous names or trademarks.
Instead, Porsche must now combat trademark dilution by alleged cybersquatters on a case by case basis, according to Bret Fausett of Fausett, Gaeta & Lund in Boston.
"It increases the cost for domain name holders who are probably now going to have to pursue people in various jurisdictions. They will have to look carefully at who they want to sue and go after the real cyber squatters and not the hobbyists," Fausett said.
Internet free speech advocates had criticized the Porsche legal strategy for casting too wide a net and snaring fan and car club sites as well as those registered by speculators.
"The amount of backlash against this is incredible," said Mikki Barry, president of the Domain Name Rights Coalition.
"These companies are overstepping their rights. Trademark law doesn't give them complete control over any use of the word in any context. It only gives them the right to ensure consumers aren't confused about the source of a product or service."
Porsche Thursday said it intends to appeal the ruling. Since it filed the lawsuit in January, approximately 50 of the 138 domain names listed in the action have already agreed to cancel their registrations, according to the company. Porsche wouldn't disclose whether it offered any kind of compensation to the registrants for giving up the domains.