Texas Intern. Property v. Hoerbiger Holding Ag

• Decision Date: 12 May 2009
• Docket Number: Civil Action No. 3:07-CV-2099-K.
• Citation: 624 F.Supp.2d 582
• Parties: TEXAS INTERNATIONAL PROPERTY ASSOCIATES, Plaintiffs, v. HOERBIGER HOLDING AG, Defendant/Counterclaimant, v. Dauben, Inc. d/b/a Texas International Property Associates and Joey Dauben a/k/a Joseph G. Dauben, Counterclaim Defendants.
• Court: U.S. District Court — Northern District of Texas

624 F.Supp.2d 582

TEXAS INTERNATIONAL PROPERTY ASSOCIATES, Plaintiffs, v. HOERBIGER HOLDING AG, Defendant/Counterclaimant, v. Dauben, Inc. d/b/a Texas International Property Associates and Joey Dauben a/k/a Joseph G. Dauben, Counterclaim Defendants.

Civil Action No. 3:07-CV-2099-K.

United States District Court, N.D. Texas, Dallas Division.

May 12, 2009.

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Daniel George Altaian, Shrull Altaian, Fort Worth, TX, for Plaintiffs and Counterclaim Defendants.

Austin D. Jones, Gerald C. Conley, Timothy E. Taylor, Andrews Kurth LLP, Dallas, TX, for Defendant/Counterclaimant.

MEMORANDUM OPINION AND ORDER

ED KINKEADE, District Judge.

Before the court is Defendant Hoerbiger Holding AG's Motion for Partial Summary Judgment, filed September 19, 2008. After review and consideration of the motion, response, reply, summary judgment record, and the applicable law, the court has determined that the motion should be granted, and all of Plaintiff's claims against it shall be dismissed with prejudice. Further, Defendant is also entitled to judgment as a matter of law on its cyberpiracy claim against Counter-Defendants.

I. Factual and Procedural Background

Defendant Hoerbiger Holding AG ("Hoerbiger") conducts business worldwide in the fields of compression technology, automation technology, drive technology, and actuator technology. Hoerbiger owns and maintains various internet web sites, including but not limited to www. hoerbiger.com. In connection with its business, Hoerbiger obtained a registration of the mark HOERBIGER from the United States Patent and Trademark Office on October 8, 2002. Plaintiff and Counter-Defendant Texas International Property Associates ("TIPA") manages a portfolio of approximately 500,000 internet domain names that it uses to generate advertising revenues via click-through fees. Counter-Defendant Joey Dauben ("Dauben") is the president and only employee of counter-Defendant Dauben, Inc., which does business as TIPA.

In early June 2007, Hoerbiger became aware of the horbiger.com domain name. At that time, the horbiger.com site provided access to various hyperlinks labeled Automation, Compressor, Business, Valve, Web Site, Motion Control, Actuators, Storage Cylinder, Linear Actuators and Control Valves. By clicking on the various hyperlinks, the user was taken to a series of sponsored results or advertising links related to the user's selection. Although Hoerbiger asked TIPA to voluntarily transfer the horbiger.com domain name, TIPA refused to comply.

Hoerbiger then brought an action before an Administrative Panel of the World Intellectual Property Organization ("WIPO"). In its complaint filed with WIPO on June 27, 2007, Hoerbiger asserted that TIPA had registered the domain name horbiger.com in violation of Hoerbiger's 100-plus trademarks of HOERBIGER. Hoerbiger therefore requested that the horbiger.com domain name be transferred to it.

In that proceeding, the WIPO panel concluded that Hoerbiger had met its burden of showing that the domain name should be transferred. Specifically, it found that Hoerbiger had shown that the horbiger.com domain name was confusingly similar to its HOERBIGER trademarks; that TIPA had no rights or legitimate interests in respect to the horbiger.com domain name; and that TIPA had registered and was using the horbiger.com domain name in bad faith. Accordingly, the WIPO panel ordered on October 19, 2007 that the horbiger.com domain name be transferred to Hoerbiger. Despite WIPO's ruling, TIPA did not transfer the disputed domain name to Hoerbiger.

Following the WIPO ruling, TIPA filed suit against Hoerbiger in Texas state court on November 15, 2007, claiming that Hoerbiger has no rights in the horbiger.com domain name, and asking the court to prevent the transfer of the domain name to Hoerbiger. Hoerbiger then removed the case to this court on December 14, 2007, and answered TIPA's suit on December 21, 2007, joining Dauben, Inc. and Joey Dauben as counter-Defendants and adding counterclaims for federal trademark infringement, federal unfair competition, federal cyberpiracy, and federal trademark dilution against TIPA, Dauben, Inc. and Dauben (collectively, "counter-Defendants"). Hoerbiger also pleaded state law counterclaims against counter-Defendants for trademark infringement and injury to business reputation or trade name.

On April 18, 2008, TIPA filed its First Amended Complaint. Therein, TIPA asserted claims against Hoerbiger to prohibit transfer of the horbiger.com domain name, and also sought cancellation of Hoerbiger's federal trademark registration of the HOERBIGER mark. TIPA also alleges fraudulent trademark registration, and various state law claims including conversion, trespass to property, and tortious interference with a contract and/or peaceful use or enjoyment of property. Hoerbiger now moves for summary judgment on all of TIPA's claims, and further seeks summary judgment on its counterclaim for cyberpiracy against counter-Defendants.

II. Summary Judgment Standard

Summary judgment is appropriate when the pleadings, affidavits and other summary judgment evidence show that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2551, 91 L.Ed.2d 265 (1986). The moving party bears the burden of identifying those portions of the record it believes demonstrate the absence of a genuine issue of material fact. Celotex, 477 U.S. at 322-25, 106 S.Ct. at 2551-54. Once a movant makes a properly supported motion, the burden shifts to the nonmovant to show that summary judgment should not be granted; the nonmovant may not rest upon allegations in the pleadings, but must support the response to the motion with summary judgment evidence showing the existence of a genuine fact issue for trial. Id. at 321-25, 106 S.Ct. at 2551-54; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255-57, 106 S.Ct. 2505, 2513-14, 91 L.Ed.2d 202 (1986). All evidence and reasonable inferences must be viewed in the light most favorable to the nonmovant. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962).

III. Hoerbiger's Motion for Partial Summary Judgment

Hoerbiger contends on summary judgment that all of TIPA's claims against it should be dismissed with prejudice. Hoerbiger also seeks summary judgment against counter-Defendants on its federal cyber-piracy claim. For the following reasons, the court agrees that partial summary judgment is warranted, and grants Hoerbiger's motion. Each claim will be discussed below.

A. Anticybersquatting Consumer Protection Act ("ACPA")

Hoerbiger first alleges that TIPA's registration of the horbiger.com domain name was done in bad faith for the purpose of "typosquatting"—using a domain name that oftentimes constitutes a typo or intentional misspelling of distinctive or famous names. See Southern Co. v. Dauben, Inc., 324 Fed.Appx. 309, ___ n. 2, 2009 WL 1011183, *2 n. 2 (5th Cir.2009), citing Shields v. Zuccarini, 254 F.3d 476, 483 (3d Cir.2001); Green v. Fornario, 486 F.3d 100, 103 n. 5 (3d Cir.2007). Specifically, Hoerbiger contends that TIPA has violated the cyberpiracy provisions of the ACPA, 15 U.S.C. § 1125(d). The relevant portion of that statute provides:

(1)(A) A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark under this section, if, without regard to the goods or services of the parties, that person

(i) has a bad faith intent to profit from that mark, including a personal name which is protected as a mark under this section; and

(ii) registers, traffics in, or uses a domain name that—

(I) in the case of a mark that is distinctive at the time of registration of the domain name, is identical or confusingly similar to that mark;

(II) in the case of a famous mark that is famous at the time of registration of the domain name, is identical or confusingly similar to or dilutive of that mark; or

(III) is a trademark, word, or name protected by reason of section 706 of Title 18 or section 220506 of Title 36.

To prevail on the merits of an ACPA claim, Hoerbiger must show that 1) its mark "is a distinctive or famous mark entitled to protection"; 2) TIPA's "domain names are `identical or confusingly similar to' [Hoerbiger]'s mark"; and 3) TIPA "registered the domain names with the bad faith intent to profit from them." See Shields, 254 F.3d at 482 (quoting 15 U.S.C. § 1125(d)(1)(A)).

Addressing the first relevant factor, Hoerbiger contends that because its HOERBIGER mark is a federally registered mark, it is presumed to be distinctive. See Union Carbide Corp. v. Ever-Ready, Inc., 531 F.2d 366, 378 (7th Cir.), cert. denied, 429 U.S. 830, 97 S.Ct. 91, 50 L.Ed.2d 94 (1976) (registration is prima facie evidence of registrant's ownership of mark); March Madness Athletic Assn., L.L.C. v. Netfire, Inc., 162 F.Supp.2d 560, 568 (N.D.Tex.2001) (same); In addition to case law, Hoerbiger relies upon 15 U.S.C. § 1115(a), which states, in pertinent part, that:

Any registration issued ... and owned by a party to an action shall be admissible in evidence and shall be prima facie evidence of the validity of the registered mark and of the registration of the mark, of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the registration subject to any conditions or limitations stated therein, but shall not preclude another person from proving any legal or equitable defense or defect, including those set forth in subsection (b) of this section, which might have been asserted if such mark had not been registered.

Further, Hoerbiger argues that the HOERBIGER mark has acquired distinctiveness through secondary meaning. In support, Hoerbiger points to...