223 F.3d 1082 (9th Cir. 2000), 99-15099, Bancroft & Masters, v. Augusta National

Docket Nº:99-15099
Citation:223 F.3d 1082
Party Name:BANCROFT & MASTERS, INC., a California corporation, Plaintiff-Appellant, v. AUGUSTA NATIONAL INC., a Georgia corporation, Defendant-Appellee.
Case Date:August 18, 2000
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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223 F.3d 1082 (9th Cir. 2000)

BANCROFT & MASTERS, INC., a California corporation, Plaintiff-Appellant,

v.

AUGUSTA NATIONAL INC., a Georgia corporation, Defendant-Appellee.

No. 99-15099

Office of the Circuit Executive

United States Court of Appeals, Ninth Circuit

August 18, 2000

Argued and Submitted April 13, 2000--San Francisco, California

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[Copyrighted Material Omitted]

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Douglas A. Charkin, Peninsula IP Group, Morgan Hill, California, for the plaintiff-appellant.

Carla B. Oakley, Brobeck, Phleger & Harrison LLP, San Francisco, California, for the defendent-appellee.

Appeal from the United States District Court for the Northern District of California, D.C. No. CV-97-04412-TEH; Thelton E. Henderson, District Judge, Presiding

Before: Joseph T. Sneed, Mary M. Schroeder, and Stephen S. Trott, Circuit Judges.

SCHROEDER, Circuit Judge:

This is a trademark dispute. The principal issue is whether the district court in California has personal jurisdiction over the defendant, a Georgia corporation. We hold that the district court can exercise specific jurisdiction over this suit because the complaint alleges the defendant engaged in wrongful conduct that individually targeted the plaintiff in California.

BACKGROUND

Plaintiff-appellant Bancroft & Masters, Inc. ("B&M") is a small California corporation that sells computer and networking products and support services. B&M does almost all of its business in the San Francisco area. It brought this action against defendant-appellee Augusta National Inc. ("ANI"), which operates the Augusta National Golf Club in Augusta, Georgia and sponsors the annual PGA Tour event known as the Masters Tournament.

ANI holds several federally registered trademarks for the mark "Masters" and operates a website at the domain name "masters.org." B&M registered the domain name "masters.com" with Network Solutions, Inc. ("NSI") in 1995. Until recently, NSI was the sole registrar of domain

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names in the United States, under an exclusive contract with the U.S. government. B&M alleges that sometime in late 1997, ANI sent a letter to NSI's Virginia headquarters challenging B&M's use of the domain name "masters.com." ANI also sent a letter to B&M in California demanding that B&M cease and desist its use of masters.com and transfer it immediately to ANI.

ANI's letter to NSI triggered NSI's then-applicable dispute resolution policy. Under this policy, B&M had three options: (1) voluntarily transfer the masters.com domain name to ANI; (2) allow the domain name to be placed "on hold, " meaning that it could not be used by either party; or (3) obtain a declaratory judgment establishing its right to use the masters.com domain name. See Lockheed Martin Corp. v. Network Solutions, Inc., 194 F.3d 980, 982 (9th Cir. 1999) (explaining NSI's procedures). Rather than give up its website, B&M chose the third option. B&M filed suit in the Northern District of California seeking a judgment declaring non-dilution and non-infringement. B&M's complaint also requested in a separate count that the court order the cancellation of ANI's federally registered trademarks.

The district court granted ANI's motion to dismiss for lack of personal jurisdiction, reasoning that the continuous and systematic contacts in California necessary for general jurisdiction were lacking and that B&M had not satisfied the criteria for specific jurisdiction. See Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 45 F.Supp.2d 777 (1998). B&M appeals this dismissal. We now hold that the district court had specific jurisdiction and reverse and remand. ANI's contention that its settlement offer moots this appeal is without merit.

DISCUSSION

ANI's threshold argument is that this appeal has been rendered moot because ANI has offered to waive all trademark infringement, dilution, and unfair competition claims against B&M, so long as B&M stays out of the golf business. B&M's request for a declaratory judgment that it is entitled to use the domain name is not moot, however, because ANI has not made the requisite showing that it is absolutely clear that it will never seek to prevent B&M from using its domain name in the future. See FTC v. Affordable Media, LLC, 179 F.3d 1228, 1238 (9th Cir. 1999) (A declaratory judgment action is not moot unless it is absolutely clear that the defendant will never renew its allegedly wrongful behavior.). ANI's promise was an incomplete and qualified one.

Furthermore, even if ANI's promise had been unqualified, it would not have mooted B&M's separate request for cancellation of ANI's "Masters" trademarks. The trademark cancellation count is separate from the declaratory judgment count in the complaint and does not appear to be obviously meritless. Cf. Arizonans For Official English v. Arizona, 520 U.S. 43, 71 (1997) (obviously meritless and belatedly asserted damages claim cannot save appeal from mootness). The Lanham Act authorizes district courts to order trademark cancellation in...

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