Motion Picture Academy's Five-Year Quest To Make GoDaddy Pay For 'Infringing' Websites Ends In A Loss
from the we're-still-big,-it's-the-courts-that-got-small dept
Back in 2010, the notoriously-litigious Motion Picture Academy sued GoDaddy for allowing a bunch of "infringing" domains to be registered. According to the Academy, anything that might use the word "Oscar" is under its control, thanks to several registered trademarks. Trademark infringement doesn't fall under Section 230 protections, which is basically the only reason this lawsuit managed to stay alive for five years.
Now, it's finally over. (Well, pending appeal…) Kieren McCarthy of The Register is reporting that the court has found in favor of GoDaddy.
The Academy was seeking $31m in damages for 293 domain names that it identified as being registered with and hosted by GoDaddy. An original list of 151 domains in 2009 was subsequently added to as the complaint progressed through the courts.Far too many trademark holders believe holding a registered wordmark gives them veto power on any use of that word. This simply isn't the case, but acts of faith predicated on this belief have resulted in multiple bogus lawsuits and an even greater number of baseless legal threats.
However, a significant number of the names registered were either found not to infringe the Academy's trademarks or were being used legitimately (usually by people called Oscar).
The court found that GoDaddy had a significant number of domain-squatting deterrents built into its system. And, even if it didn't, the sheer number of domains registered with the company makes it impossible to police thoroughly, or at least not to the extent the Academy would like.
GoDaddy is the largest domain name registrar in the world with approximately 60 million domain names under management. GoDaddy has registered more than 150 million domain names since becoming an ICANN-accredited registrar in 2000, averaging over 25,000 domain registrations per day. On average, GoDaddy registers a domain name every 0.7 seconds.The Academy further claimed that GoDaddy violated its trademarks with relevant ads (from Google) running on parked domain pages.
[...]
Requiring GoDaddy to subject each domain registration to a costly, manual legal review is not commercially practical and would dramatically increase GoDaddy’s costs, which would in turn be passed on to the consumer.
GoDaddy pointed out that it had no control over what ads would be run by Google on parked domain pages. It further pointed out that the Academy could have contacted Google to prevent the placement of Oscar-related ads on parked domain pages, but chose not to.
Google has implemented a comprehensive trademark protection policy for those domains participating in AdSense for Domains.The court also noted that GoDaddy makes several proactive efforts to protect trademark holders -- like warning prospective registrants against registering domains using trademarked terms as well as shifting the liability to registrants, who must agree they are not knowingly committing infringement before a registration is granted. On top of that, GoDaddy strips ads from any domain being disputed to ensure no one is capitalizing on possible infringement.
Despite being aware of the protections afforded by Google’s trademark policy, AMPAS (Academy of Motion Picture Arts and Science) chose not to avail itself of the policy in relation to any of the domain names at issue.
AMPAS never contacted Google to object to the use of the AMPAS Marks in Google’s AdSense program, nor has AMPAS complained to Google that the use of the AdSense or AdWords programs infringe on the AMPAS Marks.
Beyond its internal constraints, GoDaddy is forbidden by ICANN from unilaterally cancelling registrations. To do so without the permission of the registrant, a court order must be presented to GoDaddy. Obviously, this is what the Academy was seeking, but it skipped a step by taking GoDaddy to court for not immediately killing registered domains the moment the Academy started getting grumpy about it.
Because this is a trademark case, the Academy's arguments revolved around GoDaddy profiting from allowing the registration of "infringing" domains. As noted above, GoDaddy stripped all ads from the parked domains the Academy complained about. Even the sites that remained active hardly generated any money for GoDaddy or the registrants themselves. Over the years, the Academy has claimed anywhere from $6 to $31 million in damages. The court does the math and finds that if anything was actually owed to the Academy, the check amount wouldn't even reach four digits.
GoDaddy received approximately $107 in total revenue from popunder and Google-provided, third-party pay-per-click advertisements on seventy-two (72) of the 293 domain names at issue. The pop-under revenue accounted for less than $1 of the total revenue.The court finds that GoDaddy made significant good faith efforts to resolve the issues brought to its attention. Not only did it proactively strip ads from offending domains, but it instituted additional keyword blacklists for future use. But this wasn't good enough for the Academy, which still believed the only reason anyone would use the word "Oscar" in a domain name was to siphon profit away from the Academy.
Of the 293 domain names at issue, 221 domain names generated no revenue from Google-provided, third-party pay-per-click advertisements. The most revenue generated by any domain was $13.67.
The total page impressions recorded from 2005 to 2014 for the 293 accused domains was 48,763: (a) 60 accused domains had less than or equal to 10 impressions, (b) 244 accused domains had less than 100 impressions. Some of the recorded impressions were made by AMPAS’s counsel and consultants. The 48,763 recorded impressions on the accused domains represent 0.00044% of all impressions (10,997,067,487) on all domain names participating in one of GoDaddy’s Parked Page programs.
As Kieren McCarthy points out, the Academy long thought it had an open-and-shut case. That's the sort of misconception often accompanies inflated senses of self-worth. To the Academy, the word "Oscar" only refers to one thing. But on the internet, it can mean thousands of things -- most of them entirely unrelated to its annual bloated act of self-congratulation.
Taken overall, the five-year court battle highlighted an enormous clash of cultures. The Academy Awards believes that anything at all to do with its name represents a calculated effort to extort millions of dollars, while GoDaddy as a company that deals with the broader internet and millions of web addresses barely registers the Oscars existence in their systems.The decision will undoubtedly be appealed, but there's not much in this decision that points to a more favorable outcome. The Academy threw it weight around and expected that would be all it ever needed to do. It failed to provide anything that backed up its claims that an internet entity was (yet again) screwing a legacy out of its "rightful" earnings. GoDaddy, on the other hand, showed the court it had done everything it could to assist the Academy in its ridiculous trademark protection efforts, and got thanked for its efforts with five years of litigation.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Filed Under: domain registration, domains, oscars, secondary liability, third party liability, trademark
Companies: godaddy, motion picture academy, oscars
Reader Comments
Subscribe: RSS
View by: Time | Thread
rightful earnings
[ link to this | view in chronology ]
Re: rightful earnings
Oscar de la Renta - OscardelaRenta.com
[ link to this | view in chronology ]
Re: Re: rightful earnings
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Infringing Domain?
Can you please define what is an infringing domain?
Do you mean a domain name owned by a copyright infringer? If so, what material has the infringer infringed, and which of their servers is it hosted on?
Oh, so this site does not host infringing content. Merely links to it? Isn't that like telling someone "the crack house is on 14th street". It doesn't mean I am facilitating or enabling or even condoning use of illegal drugs.
[ link to this | view in chronology ]
Re: Infringing Domain?
[ link to this | view in chronology ]
Re: Re: Infringing Domain?
[ link to this | view in chronology ]
Re: Infringing Domain?
What about 'sucks' domains?
In fact, maybe '.sucks' should be a new top level domain. Whoever registers a .com domain cannot register the same .sucks domain.
[ link to this | view in chronology ]
Re: Re: Infringing Domain?
As to the "sucks" domains, they've also been held to be free speech and not confusing (at least in the US), provided the site content is not otherwise infringing.
[ link to this | view in chronology ]
Re: Infringing Domain?
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Felix says
[ link to this | view in chronology ]
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Which is amusing, given that the term was not what the award was originally called, it was a nickname (the origin is disputed but the name was not official until 1939, 10 years after the awards began).
That's how single-minded this industry is. Forget that the word has a huge number of meanings from the names of royalty (King Oscar I & Oscar II of Sweden) to great literary figures (Oscar Wilde) to fictional characters (Oscar the Grouch) to an oceanographic dataset (OSCAR) to a letter of the damn alphabet (Oscar being the phonetic alphabet indication or the letter O). They didn't even come up with the damn name in the first place - and many of its uses predate their existence by centuries! Yet, the only use they can imagine is directly related to them.
Nice to see courts ruling on the side of sanity and reality.
[ link to this | view in chronology ]
[ link to this | view in chronology ]
There's Another Wrinkle
The Academy was attempting to hold GoDaddy responsible for placing the ads because GoDaddy chose what service to use to place the ads, and was the only party earning revenue from the ads. While it definitely appears the harm here (if you even want to call it harm) was de minimis at best, that doesn't really get into the issue of who should be responsible for putting content on parking pages.
For example, I'm sure many of us have typed a domain name wrong, and ended up on a GoDaddy (or other) parking page. Now, while I might know that I should just check the domain name, many other people will just click on the links/ads. Someone earns money from those clicks, and if the links/ads are for the same type of goods as those of the trademark holder, that's clearly cybersquatting. But who is at fault here? I would say the registrant, but the GoDaddy specific issue is that GoDaddy places parking pages at newly registered domain names by default, and the process for getting the parking page removed is not as simple as unpicking a box (it requires, at least, a phone call). As another kick in the pants, GoDaddy doesn't share any of the revenue from this program with the registrant that has now paid GoDaddy for the privilege of having a parking page hosted at their domain name.
Additionally, the terms of this automatic program are somewhat buried, and no one reads them anyway. So, the options appear to be, where actual cybersquatting is occurring, hold the registrant that likely had no idea responsible, hold GoDaddy responsible, or hold no one responsible. The issue with holding no one responsible is two-fold. By the terms of the license agreement registrants provide GoDaddy, there is a clear warning and GoDaddy even includes language regarding indemnification. However, GoDaddy makes it non-trivial to opt out of this program, and this is not appropriate based on the fact that the same term may be used in both infringing and non-infringing ways (same trademark, different industries, for example). GoDaddy is sophisticated enough to be aware of this risk, but hardly informs registrants of what they're doing at all. I don't know that this rises to the level of trademark infringement (or some sort of licensee cybersquatting theory), but it sure isn't how I would want my registrar operating.
Final thought. While I am generally all for service provider immunity applying to trademarks, that's not what is happening here. GoDaddy is providing this service to itself. Any argument that it's putting up these pages so that a page loads instead of a timeout and its associated burden falls flat when a page full of ads loads slower than the type of "coming soon" page that many other Registrars provide.
I don't know what the right answer is here, but it looks like at least some of the domain names contained actual Academy related links. In those instances at least, I would have liked to see a little more consideration on the part of the judge regarding who, exactly, is at fault (and yes, I get that the judge is not obligated to do this since the Defendant at issue is only GoDaddy). The problem now is all the poor folks too stupid to not use GoDaddy might get the short end of this particular stick.
[ link to this | view in chronology ]
Re: There's Another Wrinkle
Not exactly true. If you want GoDaddy to host the DNS *and* don't point it toward any other hosting provider *and* don't forward it to another existing page *and* don't have an alternative parking service, then you may need to call them and tell them you don't want the page to resolve anywhere. If you're using all their services, they will of course default to their preferred method that brings in alternative income while you're at minimum using their DNS services free of charge.
"As another kick in the pants, GoDaddy doesn't share any of the revenue from this program"
Not always true. GoDaddy offer a "Cash Parking" scheme, where the owner of the domain does share in the ad revenue. This involves a cut for GoDaddy, of course, but it's completely passive revenue for the customer.
"the registrant that has now paid GoDaddy for the privilege of having a parking page hosted at their domain name."
Not true. They've paid for a domain name, which is their to use as they wish. If they're using GoDaddy's DNS servers & hosting for the parked page, they're not charged any extra than someone who registers the domain through them, then immediately points them to a 3rd party set of services. If they dislike this deal, GoDaddy have hundreds of competitors, many of whom will charge more for offering the same service not discounted by the parking ads.
"the registrant that likely had no idea responsible"
No idea of what? They registered the domain, they chose the name, they chose the service for it to be hosted on. GoDaddy had no control over that part of it, nor control over the ads that appear on the page.
I get that in a case like an above example - where issues are raised because the word "Oscar" in the name triggered ads related to Academy Awards even if that's not what the word was intended to signify - the registrant might be innocent of any ill intention. But, to make GoDaddy fully responsible for typosquatting and more obvious infringement? No, that's wrong.
Far be it from me to defend GoDaddy with their many other indiscretions worthy of criticism, but you're misguided here.
[ link to this | view in chronology ]
Re: Re: There's Another Wrinkle
Many people that register domain names do not have an immediate use in mind, and my point was merely that all of that "ands" you mention are ALL default settings. For a non-technically savvy user (i.e., the consumers GoDaddy actively targets), this is going to be the result at least until an intentional use of the domain name is made on the part of the user. Additionally, GoDaddy does not allow a registered domain name to lack a name server, which is not disclosed prior to registration.
"Not always true. GoDaddy offer a "Cash Parking" scheme."
True. I was keeping my analyses simple. The cash parking scheme clearly indicates awareness and intent on the part of the registrant to monetize the domain name. Thus, this is irrelevant regarding the activity I take issue with, namely that GoDaddy monetizes newly registered domain names and makes it difficult for a user to opt out of this "free" service.
"GoDaddy had no control over that part of it, nor control over the ads that appear on the page."
This is demonstrably false. First, as I point out in my initial comment, and above regarding an inability to leave name servers unconfigured, unless you register a domain name at GoDaddy knowing what alternative name servers to use (and this also assumes you even know what name servers are), you're stuck with this program unless you take further steps involving at least one phone call to opt out. Second, GoDaddy, after pushing new users into it's "free service" chose the mechanism for ad display (adwords), and chose to link the displayed ads to the domain name. It didn't have to link the ads to keywords based on the domain name. Third, GoDaddy is benefiting from the ad revenue, not the user.
"I get that in a case like an above example - where issues are raised because the word "Oscar" in the name triggered ads related to Academy Awards even if that's not what the word was intended to signify - the registrant might be innocent of any ill intention. But, to make GoDaddy fully responsible for typosquatting and more obvious infringement? No, that's wrong."
This is my whole point. I'm not saying GoDaddy should be held responsible, but you're saying the registrant shouldn't. If it's not the registrant, and it's not GoDaddy (who earns revenue), who the hell should it be? A lot of what I say above assumes a user is ignorant, and I think a reasonable person could hold the opinion that their ignorance is their problem, but if that's the case, shouldn't they be legally culpable? And if you think ignorance isn't their problem, because again, these are the users GoDaddy targets, then again, who is responsible? Because in some instances there is actual cybersquatting, and if the registrant isn't responsible for what happens on their domain name, and GoDaddy isn't responsible as the licensee, then GoDaddy has found a way to thread that needle quite nicely. It's scummy.
[ link to this | view in chronology ]
Re: Re: Re: There's Another Wrinkle
...and until they make their mind up, GoDaddy offers a free parking service that allows the domain to resolve to something and work quickly when they do something with it. This free service is paid for by ads. I really don't see the problem there.
"Additionally, GoDaddy does not allow a registered domain name to lack a name server, which is not disclosed prior to registration."
Does any registrar? I've never used one that doesn't default to its own if you don't supply one. Maybe I have and haven't noticed because I usually have a reason to register the domain, but I'm sure there's always been default nameservers.
"makes it difficult for a user to opt out of this "free" service."
Again, no it doesn't. It only makes it difficult for the non-tech savvy user who wants to make sure the domain doesn't work in any way. I don't see what's wrong with them wanting to talk to them to make sure that's what they actually want. For every other conceivable use, they provide a free tool to perform that action online.
So, your point is GoDaddy are wrong because they try to monetise a free service they offer, and because drooling morons with no clue about what they're doing on the internet might need to make a phone call.
There's a lot of genuine problems to criticise GoDaddy for, but that's pretty weak.
"Third, GoDaddy is benefiting from the ad revenue, not the user."
..for providing that user with a free service, and also allow the customer to opt into if they wish. Again, what's the problem here? Because barely functional morons who can't work out why they bought a domain name in the first place might have to pick up a phone? Which other default settings that include ads do you rage against? There's many of them online.
"Because in some instances there is actual cybersquatting"
...and as mentioned in the article, they have procedures to deal with that.
"who is responsible?"
Depends on each issue individually. In the case of oscarsmile.com above, probably Google if anybody since they're the only ones even remotely referencing the Academy Awards. There's a thousand uses for the domain name otherwise that has nothing to do with the trademark, so I don't see why GoDaddy have any responsiblity there.
In the case of something more deliberate like typosquatting, the person who registered the domain unless they can prove there was a genuine use for the domain. In cases where GoDaddy's internal procedures should have caught a deliberate cybersquatting attempt, the blame can be shared between the registrant and the registrar.
"It's scummy"
As are attempts to attack GoDaddy for thing they didn't do. You seem to be intent on placing all the blame on them, because their customers are idiots. That's just as bad as saying they have zero responsibility (which, you'll note, I didn't say).
[ link to this | view in chronology ]
Oscar
Silly is it not.
[ link to this | view in chronology ]