Harrods Limited,v. Sixty Internet Domain Names

302 F.3d 214 (4th 2002)

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Nature of the Case

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Facts

P is the owner of the Harrods of London department store. Ds are 60 Internet domain names registered in Herndon, Virginia, by Harrods (Buenos Aires) Limited (D), once affiliated with P, that is now a completely separate corporate entity. Until recently D operated a 'Harrods' department store in Buenos Aires, Argentina. P sued the 60 Domain Names under 15 U.S.C. § 1125(d)(2), the in rem provision of the recently enacted ACPA. P alleged that the Domain Names infringed and diluted its American 'Harrods' trademark and that D registered the Names in bad faith as prohibited by 15 U.S.C. § 1125(d)(1). P originally created Harrods South America Limited to carry on business in South America. Harrods South America Limited created D as an independent company, and in 1914 D opened a department store under the name 'Harrods' in a new building in downtown Buenos Aires designed to look like P's historic London building. D registered 'Harrods' as a trademark in Argentina, Brazil, Paraguay, Venezuela, and a number of other South American countries. By the 1920s D was operating largely independently of P, and the last remaining legal ties between the two companies were severed in 1963. P and D entered into negotiations for P to buy D's South American trademark rights in the name 'Harrods.' They never reached agreement. P sued D in British court, alleging breach of contract, breach of fiduciary duty, and passing off, all arising from D's use of the name 'Harrods' in South America. It was held that D had an implied contractual right to carry on business under the name 'Harrods' anywhere in South America. In 1998 D ended its department store operation entirely, and the building now sits vacant. D's only current revenue is about $300,000 annually from the continued operation of the building's parking garage. P launched a website at the domain name harrods.com, and the website became a functioning online retail store in November of 1999. D decided to do the same and began registering the first of what eventually became around 300 Harrods-related domain names. Ds, in this case, were registered with Network Solutions, Inc. (NSI), a domain name registry located in Herndon, Virginia. D registered about 300 Harrods-related domain names in the United States. D's plan was not to sell any merchandise itself but would simply earn commissions from vendors that it sponsored. D’s plan fell apart. P could not obtain personal jurisdiction over D, so the suit was filed in rem against the 60 Domain Names themselves. Before discovery got underway, Ds moved for summary judgment as to just six of the names, specifically the .com, .net, and .org permutations. The district court granted summary judgment to the Argentina Names, reasoning that D had legitimate trademark rights in Argentina and that these Names on their face were clearly identified as Buenos Aires-and Argentina-related. The court found bad faith intent to profit on the part of D with respect to the remaining 54 Domain Names and ordered that those names be transferred to P. P appealed the district court's order dismissing its infringement and dilution claims and the order granting summary judgment to the six Argentina Names. Ds appealed the court's order entering judgment for P against the remaining 54 Domain Names.