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Registering Internet domain names that are intentional misspellings of famous domain names is a violation of the Anticybersquatting Consumer Protection Act, a federal appeals court has ruled in an issue of first impression. The 3rd U.S. Circuit Court of Appeals affirmed the permanent injunction by federal Judge Stewart Dalzell of the U.S. District Court for the Eastern District of Pennsylvania against John Zuccarini. Zuccarini had registered several misspelled versions of the popular Web site joecartoon.com. The plaintiff, Joseph Shields, is a graphic artist from Alto, Mich., who creates, exhibits and markets cartoons under the names Joe Cartoon and The Joe Cartoon Co. His Internet creations include the popular “Frog Blender,” in which visitors click on the buttons of a blender and watch a frog spin until it explodes in a bloody mess. Similarly, “Micro-Gerbil” allows viewers to press higher and higher settings on a cartoon microwave and watch a cartoon gerbil get zapped. Shields also licenses his cartoons to others for display on T-shirts, coffee mugs and other items, many of which are sold at gift stores across the country. He has marketed his cartoons under the “Joe Cartoon” label for the past 15 years. In June 1997, Shields registered www.joecartoon.com as his World Wide Web site and has operated it ever since. When it won “shock site of the day” from Macromedia in April 1998, the site’s traffic increased considerably, and it now averages 700,000 visits per month. Shields testified that he earns about $160,000 from the site, both from marketing his goods and from advertisers who pay 10 cents to 25 cents whenever a visitor clicks on the ad. In November 1999, Zuccarini, an Andalusia, Pa., “wholesaler” of Internet domain names, registered five World Wide Web variations on Shields’ site — joescartoon.com, joecarton.com, joescartons.com, joescartoons.com and cartoonjoe.com. Before Shields filed suit, Zuccarini’s sites featured ads for other sites and credit card companies. Visitors would get “mousetrapped” in the sites, meaning they would have to click on advertisements before they could exit. Zuccarini received payment for each click on an ad. Immediately after Shields filed suit, Zuccarini changed the five sites to “political protest” pages and posted a message that said: “joecartoon.com is a Web site that depicts the mutilation and killing of animals in a shockwave based cartoon format — many children are inticed [sic] to the Web site, not knowing what is really there and then encouraged to join in the mutilation and killing through use of the shockwave cartoon presented to them.” In July 2000, the district court found in Shields’ favor and awarded statutory damages in the amount of $10,000 for each infringing domain name and $39,109 in attorneys’ fees. Zuccarini appealed. The ACPA, which amended Section 43 of the Lanham Act, became law in November 1999. The act was intended to prevent cybersquatting, or the “registration and use of the distinctive trademarks of others as Internet domain names, with the intent to profit from the goodwill associated with those trademarks.” The act calls for three inquiries. First, the court must determine whether the plaintiff’s Web site name is a distinctive or famous mark entitled to protection. Second, the court must decide if the alleged cybersquatter’s domain names are “identical or confusingly similar to” the plaintiff’s mark. Finally, the court must decide if the cybersquatter registered the domain names with “a bad-faith intent to profit from them.” A court may award $1,000 to $100,000 per domain name and in “exceptional” cases, attorneys’ fees. The 3rd Circuit, led by Judge Ruggero J. Aldisert and joined by Judges Maryanne Trump Barry and Thomas L. Ambro, determined that Shields met all three prongs of the test. THREE-PRONG TEST The court said Joe Cartoon can be considered famous because Shields’ Web site receives hundreds of thousands of hits a month, Shields sells products on his Web site and through Spencer Gifts and that Shields and his Web site appeared in a story on page one of The New York Times. In addressing the second prong of the test, Zuccarini argued that registering misspelled domain names is not actionable under the act. The court, however, disagreed. “[Zuccarini's] intent was … to register a domain name in anticipation that consumers would make a mistake, thereby increasing the number of hits his site would receive, and, consequently, the number of advertising dollars he would gain,” Aldisert wrote. “We conclude that Zuccarini’s conduct here is a classic example of a specific practice the ACPA was designed to prohibit.” The court next determined that Zuccarini acted with a bad-faith intent to profit from Shields’ trademark. The court determined the permanent injunction against Zuccarini and the award of summary judgment to Shields were proper. Turning to the issue of damages, the court ruled the award of damages was also proper. Aldisert also ruled that Dalzell’s determination to deem the case “exceptional” and award attorneys’ fees was proper. “The record indicates that Zuccarini’s conduct was particularly flagrant and that he showed no remorse for his actions,” the court wrote. “The court’s interpretation of what constitutes an ‘exceptional’ case under the ACPA is proper.” Florida attorney Howard M. Neu represented Shields. Michael P. Coughlan and William J. Levant of Blue Bell’s Kaplin Stewart Meloff Reiter & Stein represented Zuccarini. The case is Shields v. Zuccarini. Shannon P. Duffy contributed to this report.

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