United States Court of Appeals
For the First Circuit
No. 00-1641
NORTHERN LIGHT TECHNOLOGY, INC.,
Plaintiff, Appellee,
v.
NORTHERN LIGHTS CLUB, JEFFREY K. BURGAR, AND
641271 ALBERTA LTD., D/B/A NORTHERN LIGHTS CLUB,
Defendants, Appellants.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Douglas P. Woodlock, U.S. District Judge]
Before
Selya, Boudin and Stahl,
Circuit Judges.
Eric C. Grimm, with whom CyberBrief, PLC, Theodore A. Lund,
and Gaeta, Courville & Lund, were on brief for appellant.
Bernard J. Bonn, III, with whom Barry S. Pollack, and
Dechert Price & Rhoads, were on brief for appellee.
January 8, 2001
STAHL, Circuit Judge. This case involves a dispute
over the simultaneous use of two similar Internet domain names
by two separate entities. Defendants-appellants Northern Lights
Club, Jeff Burgar and 641271 Alberta Ltd. (collectively
"Northern Lights" or "defendants") appeal a preliminary
injunction entered by the district court requiring the posting
of a specified disclaimer on their World Wide Web site's portal
page. The court entered the injunction after finding that
plaintiff-appellee Northern Light Technology, Inc. ("Northern
Light" or "plaintiff") was likely to prevail on the merits of
its state and federal trademark claims and its claim under the
Anticybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d)
("ACPA").
Defendants assert three bases for relief in this
interlocutory appeal: (1) that the district court lacks personal
jurisdiction, and hence the power to enjoin them; (2) that the
district court erred in concluding that the plaintiff was likely
to succeed on the merits of its claims; and (3) that the
injunction currently in place is overly broad and consequently
infringes their free-speech rights. Finding that the district
court properly acquired jurisdiction over defendants when their
agent was served with process within the forum state, and
discerning no basis for disturbing the district court's
-3-
determination on the likely success of plaintiff's suit, we
uphold the district court's issuance of a preliminary
injunction. And because defendants only obliquely pressed their
First Amendment argument before the district court, we decline
to decide the issue for purposes of this appeal.
I. Background
The facts of this case are extensively chronicled in
the district court's opinion, see Northern Light Tech., Inc. v.
Northern Lights Club, 97 F. Supp. 2d 96 (D. Mass. 2000), and so
we confine our discussion to the events relevant to this appeal.
On September 16, 1996, plaintiff registered the Internet domain
name northernlight.com with Network Solutions, Inc. ("NSI"),
which at that time was the organization exclusively entrusted
with the task of registering domain names on the World Wide Web.1
Plaintiff also filed registration papers for the "Northern
Light" service mark with the United States Patent and Trademark
Office ("PTO") during that same month.2 Nearly a year later, in
August 1997, plaintiff began its operation of the
1As they are commonly used today, Internet domain names
serve two principal functions: (1) providing the addresses for
hypertext markup language ("HTML") sites on the World Wide Web,
and (2) permitting the dissemination of e-mail accounts with a
common suffix that reflects the identity of the accounts'
proprietor.
2
The PTO issued plaintiff a registered trademark for
"Northern Light" on February 23, 1999.
-4-
northernlight.com website (and, consequently, its use of the
"Northern Light" mark in commerce) as a search engine. Search
engines are popular Web-retrieval tools that match a search
query submitted by an Internet user with the websites whose
content best corresponds to the submitted search terms. The
northernlight.com site has remained in continuous existence as
a search engine since August 1997.
Defendant Jeff Burgar, a resident of High Prairie,
Alberta, Canada, is the president and principal shareholder of
641271 Alberta, Ltd., an Alberta corporation that owns the
northernlights.com domain name. Burgar, a self-described
"Internet entrepreneur," has, since the mid-1990s, registered
thousands of "catchy" domain names – i.e., Internet addresses
appropriating, in identical or slightly modified form, the names
of popular people and organizations. He is also the president
of Northern Lights Club, an unincorporated association with a
listed address in Las Vegas, Nevada. While Northern Lights
Club's stated mission is to bring together devotees of the
Northern Lights, or aurora borealis, including businesses that
take their name from the famous celestial phenomenon, Burgar's
testimony indicates that the club has no actual individual
members.
-5-
In October 1996, approximately one month after
plaintiff registered its northernlight.com website, Burgar, on
behalf of Northern Lights Club, registered the
northernlights.com domain name with NSI.3 Soon after
registration, Burgar licensed the name to FlairMail, a vanity e-
mail service that he manages and that is owned by a local
Alberta newspaper.4 Burgar "believes" that this newspaper is
owned by his wife. Under this arrangement with FlairMail,
defendants offered e-mail accounts under the northernlights.com
domain name that users could access through some other website,
such as flairmail.com, although Internet users who attempted to
visit the northernlights.com page on the World Wide Web would
find that no such site existed.5
The two similar domain-name registrations enjoyed a
peaceful coexistence until March 2, 1999, when a USA Today story
3Plaintiff does not allege that defendants had actual
knowledge of the northernlight.com registration when they
registered the northernlights.com domain name.
4 Vanity e-mail permits a subscriber to choose both the user
name and the domain name for their e-mail address. To use as an
example the service offered by defendants, an admirer of the
aurora borealis named John Doe could choose the vanity e-mail
address "John.Doe@northernlights.com."
5The district court found, at the time of its March 2000
opinion, that approximately 112 individuals used the
northernlights.com domain name as part of their vanity e-mail
address. See 97 F. Supp. 2d at 101.
-6-
on Internet search engines erroneously identified plaintiff's
website as northernlights.com. After ascertaining that
defendants were the owners of this domain name, plaintiff's
marketing director contacted Burgar to find out whether
defendants might be interested in selling it. The parties
exchanged a series of proposals and counterproposals by e-mail
over a two-month period but ultimately no sales or licensing
agreement was consummated. Soon thereafter, in April 1999,
defendants posted an active page on the northernlights.com World
Wide Web site. Visitors to the site saw, among other things, a
site-search function near the top of the screen that enabled
users to perform a search of the northernlights.com site for
specific words or phrases, as well as links to FlairMail and
other members of the "Northern Lights Community." Plaintiff's
Web site was placed third in the list of the Northern Lights
Community "Business Listings."6 Plaintiff had not agreed to this
listing.
On July 14, 1999, plaintiff sent Burgar a cease-and-
desist letter, demanding that the northernlights.com site be
deactivated. Defendants chose not to respond to this letter.
6Plaintiff asserts that it received approximately 300
referrals per day from defendants' site about the time that the
northernlights.com site went online, and that this number later
increased to several thousand referrals per day.
-7-
Fifteen days later, plaintiff asked NSI to strip defendants of
the northernlights.com domain name based on the similarity of
their respective marks, but NSI declined, citing the one-letter
discrepancy between the name of defendant's website and
plaintiff's trademark. On August 6, 1999, plaintiff filed the
instant lawsuit under federal and state theories of unfair
competition, trademark infringement, and trademark dilution. In
its complaint, plaintiff sought both a temporary restraining
order and a preliminary injunction. In December 1999, plaintiff
amended its complaint to add a claim under ACPA (which had been
enacted into law less than one month earlier) and to abandon its
federal trademark-dilution claim and its state-law claims of
unfair competition and trademark dilution.
Moments before the district court hearing on September
1, 1999 to consider the merits of plaintiff's claims and the
court's personal jurisdiction over defendants, plaintiff's agent
physically served process upon Burgar, who had traveled
voluntarily to Boston from Alberta to witness the proceedings
and to make himself available for testimony if needed. Although
the hearing itself focused largely on the convoluted issues of
personal jurisdiction arising from Internet activities, it also
touched upon the merits of plaintiff's request for preliminary
injunctive relief. At the end of the hearing, the district
-8-
court indicated that it would issue a temporary restraining
order modifying the content of the northernlights.com site to
prevent further public confusion, and solicited advice from both
parties as to the appropriate substance of that order.
True to its word, the district court imposed the TRO
the following day, stating that Northern Light had successfully
demonstrated probable personal jurisdiction, that it would be
likely to succeed in its trademark-infringement suit, and that
the balance of hardships and the public interest favored
temporary relief. The court ordered that defendants remove all
content from the northernlights.com site and post in its place
a blacked-out screen containing only an image of the aurora
borealis and links to three websites: (1) flairmail.com (where
users could access their northernlights.com e-mail accounts);
(2) plaintiff's northernlight.com site; and (3) the content page
that formerly existed at northernlights.com, to be described,
for purposes of the link, as "BUSINESSES THAT ARE LISTED WITH
THE NORTHERN LIGHTS COMMUNITY." On the same day that this
ruling was issued, the parties jointly moved the court for a
continuance of "at least 60 days." In this joint motion,
defendants acquiesced in an extension of the restraining order
against them until discovery and further hearings in the matter
were conducted, and the parties agreed to a schedule governing
-9-
the completion of discovery and the filing of any additional
motions. The court granted this motion, and both parties
submitted further motions during this period. After granting
several motions for extensions of time, the district court
ultimately held hearings on January 19 and 21, 2000 on the
personal-jurisdiction issue and the merits of plaintiff's
request for preliminary relief.
In its written opinion issued on March 31, 2000, the
district court ordered, inter alia, that what had become a de
facto preliminary injunction should remain in place.7 In so
doing, the court began by holding that it had personal
jurisdiction over defendants.8 It determined that plaintiff had
satisfied sections 3(c) and 3(d) of the Massachusetts Long-Arm
Statute, see Mass. Gen. Laws ch. 223A, § 3, because defendants
7The record does not clearly reveal when the TRO became a
preliminary injunction. At some point following the submission
of their joint motion for continuance, the parties (and the
district court) started describing the TRO as a preliminary
injunction. Furthermore, in its written opinion, the district
court stated that the preliminary injunction already in place
would not be modified. In any event, the present appeal clearly
is from a preliminary injunction.
8The district court noted that its decision was responsive
to a plethora of pretrial motions pending before it, including
motions to dismiss for lack of personal jurisdiction and for
failure to state a claim; plaintiff's initial motion for a
preliminary injunction; defendants' motions for reconsideration
of the temporary relief that had already been ordered; and the
parties' motions to compel discovery and to impose sanctions.
See 97 F. Supp. 2d at 98.
-10-
had likely caused tortious injury to plaintiffs in
Massachusetts, both through their acts within the Commonwealth
(in the form of their trademark-infringing website) and their
regular solicitation of business through acts outside of the
Commonwealth (by virtue of, inter alia, the site's
"entice[ment]" to users to post material). See 97 F. Supp. 2d
at 104-06. The court also found that defendants had sufficient
contacts with Massachusetts to support the exercise of specific
jurisdiction under International Shoe Co. v. Washington, 326
U.S. 310 (1945), thereby satisfying the constitutional due-
process element of personal jurisdiction. See Northern Light
Tech., Inc., 97 F. Supp. 2d at 106-08.
On the merits of plaintiff's suit, the district court
found that, based on the likelihood of confusion between the two
websites because of their similar form and function, plaintiff's
state and federal trademark-infringement and unfair-competition
causes of action would probably succeed. See id. at 109-15,
120. The court further opined that plaintiff was likely to
succeed on its ACPA claim, based on the confusing similarity of
the two domain names and proof of defendants' bad-faith intent
to profit from plaintiff's northernlight.com mark. See id. at
115-20. On the latter issue, the court reasoned that, although
Burgar's initial reluctance to sell the northernlights.com site
-11-
and defendants' uninterrupted use of the northernlights.com
name for vanity e-mail accounts militated against a bad-faith
finding, defendants' historical practice of "targeting
trademarked names, creating fictional entities to register them,
and offering dubious explanations for the selection of these
domain names" ultimately tipped the scales in favor of such a
preliminary determination. Id. at 119. Finally, the district
court found that plaintiff had established a likelihood of
irreparable harm, that the balance of hardships favored the
plaintiff, and that the public interest favored the preservation
of the preliminary injunction already in place. See id. at 120-
21.
On appeal, defendants dispute the district court's
personal-jurisdiction ruling and aspects of its decision
regarding the likelihood of plaintiff's success on the merits.
Defendants also pursue their argument, not expressly considered
by the district court, that the present injunction unduly
burdens their First Amendment rights.
II. Personal Jurisdiction
Defendants first challenge the injunction entered by
the district court on the ground that the court was without
personal jurisdiction to order such a remedy. At each stage of
the proceedings, the parties have contested whether defendants'
-12-
activities, both in terms of the content of their website and
their discussions with the plaintiff regarding a potential
business venture, meet the personal-jurisdiction criteria of the
Massachusetts Long-Arm Statute and the requirements of due
process. Plaintiff also posited a more conventional basis for
personal jurisdiction in the district court – namely, the
service of process effected upon Burgar just prior to the
September 1, 1999 preliminary injunction hearing. We afford
plenary review to the district court's determination of personal
jurisdiction, and may affirm its judgment for any independent
reason supported by the record. See, e.g., Phillips Exeter
Acad. v. Howard Phillips Fund, Inc., 196 F.3d 284, 288 (1st Cir.
1999).
The district court expressly declined to consider the
validity of personal jurisdiction based on physical service of
process. See 97 F. Supp. 2d at 108 n.12. On appeal, however,
plaintiff continues to press its case that, under the doctrine
of transient jurisdiction, it has satisfactorily created
jurisdiction through its service of process on Burgar prior to
the September 1, 1999 hearing. See Burnham v. Superior Court of
Cal., 495 U.S. 604 (1990) (plurality opinion); Schinkel v. Maxi-
Holding, Inc., 565 N.E.2d 1219, 1222-23 (Mass. App. Ct. 1991)
(holding that personal jurisdiction in Massachusetts need not be
-13-
predicated on Long-Arm Statute when defendant served with
process while in forum under transient-jurisdiction doctrine).
Defendants dispute this proposition, claiming that this method
of service of process is fundamentally unfair in that it
represents a trap for the unwary litigant who travels to the
forum state solely to contest the issue of personal
jurisdiction. Defendants also argue that permitting service of
process under these circumstances is unwise from a public-policy
perspective in that it discourages the litigant from actively
assisting the district court in the jurisdictional- discovery
process.
Although they do not specifically ask for process
immunity, defendants' argument against personal jurisdiction
essentially boils down to a request that Burgar be deemed immune
from service of process since, at the time he was served, he was
present in Massachusetts only for the purpose of attending a
personal-jurisdiction hearing in this lawsuit. This argument
enjoys some measure of historical pedigree, albeit in a related
context. Long before the Supreme Court in Burnham affirmed that
personal jurisdiction can be sustained against a defendant
solely on the basis of his presence in the forum state at the
time of service of process, it had recognized that some parties
temporarily in the forum state enjoy immunity from service by
-14-
virtue of their status as participants in ongoing litigation.
For instance, in Lamb v. Schmitt, 285 U.S. 222 (1932), the Court
noted the potential peril of allowing an individual who is
attending a proceeding in one suit to be served with process in
conjunction with another:
[T]he due administration of justice requires
that a court shall not permit interference
with the progress of a cause pending before
it, by the service of process in other
suits, which would prevent, or the fear of
which might tend to discourage, the
voluntary attendance of those whose presence
is necessary or convenient to the judicial
administration in the pending litigation.
Id. at 225 (internal citations omitted). Similarly, Justice
Scalia's plurality opinion in Burnham referred to several
states' historical imposition of statutory or common-law
prohibitions on the service of process of those individuals
present in the forum as parties or witnesses in unrelated
judicial proceedings – a practice that led him to conclude that
transient jurisdiction comported with constitutional due
process. See 495 U.S. at 613.
Accompanying the courts' repeated recognition of the
validity of the party/witness immunity exception, however, has
been a persistent acknowledgment of the exception's limitations.
The Lamb Court itself noted that, because the privilege exists
for the convenience of the district court in its exercise of
-15-
judicial administration, rather than to protect the individual
seeking to avoid service of process, courts enjoy the discretion
to confer (or deny) immunity in such instances. See 285 U.S. at
225 (citing Stewart v. Ramsay, 242 U.S. 128, 130 (1916)). Just
as importantly, the extension of the privilege has been limited
by the majority of courts to cases in which the party or witness
was participating in an unrelated litigation at the time that he
was served with process in the forum state. See, e.g., ARW
Exploration Corp. v. Aguirre, 45 F.3d 1455, 1460 (10th Cir.
1995) (denying process immunity where party was served with
process in second lawsuit while attending deposition in first
lawsuit alleging similar facts); In re Fish & Neave, 519 F.2d
116, 118 (8th Cir. 1975) (similar); LaCroix v. American Horse
Show Ass'n, 853 F. Supp. 992, 994-95 (N.D. Ohio 1994) (applying
Lamb and denying defendants' claim of entitlement to immunity
based on appearance in forum state solely to contest personal
jurisdiction); 4 Charles A. Wright & Arthur R. Miller, Federal
Practice and Procedure § 1080, at 511 (2d ed. 1987) ("There is
generally no immunity from service of process when the suit in
which immunity is sought is part of, or a continuation of, the
suit for which the person claiming immunity is in the
jurisdiction."); see also Lamb, 285 U.S. at 225 ("[T]he
[process-immunity] privilege should not be enlarged beyond the
-16-
reason upon which it is founded, and . . . should be extended or
withheld only as judicial necessities require.").9 The rationale
for the differing-lawsuit prerequisite to process immunity in
this context is relatively straightforward: while a court can,
in cases before it, choose to protect the jurisdictional status
of a party or witness who is reluctant to come to the forum
state by issuing protective orders or subpoenas, it cannot wield
such power in other cases. The process-immunity exception
therefore fills the gap only where it needs to be filled – that
is, in cases where a district court wishes to shield an
individual from service of process to encourage his or her
travel to the forum state, but would be unable to do so absent
the power to grant immunity.
9
In their brief, defendants cite to other cases, such as
American Centennial Ins. Co. v. Handal, 901 F. Supp. 892, 895
(D.N.J. 1995), which interpret Lamb differently. Those cases
hold that process immunity should be granted to non-residents
present in the forum state to participate in any litigation,
whether or not related to the suit for which the disputed
service has been effected, as long as such immunity does not
obstruct justice in the first suit. See, e.g., Shapiro & Son
Curtain Corp. v. Glass, 348 F.2d 460, 461-62 (2d Cir. 1965);
NASL Marketing, Inc. v. de Vries, 94 F.R.D. 309 (S.D.N.Y. 1982);
United Nations v. Adler, 90 F. Supp. 440, 441 (S.D.N.Y. 1950).
We reject this view, as Lamb definitively retains the
distinction between presence in the forum state for related and
unrelated cases. See 285 U.S. at 225 ("[T]he due administration
of justice requires that a court shall not permit interference
with the progress of a cause pending before it by the service of
process in other suits . . . .") (emphasis added).
-17-
Turning to the facts of this case, several features of
defendants' litigation posture counsel against a finding that
Burgar is entitled to process immunity. First, and most
apparent, is the fact that defendants have never asked the
district court for such immunity on behalf of Burgar, either
prior to or following the hearing at which Burgar was served
with process. In lieu of a specific request for immunity,
defendants instead have asked this court to fashion a broad, per
se rule precluding the exercise of personal jurisdiction
whenever the served individual is in the jurisdiction to attend
litigation-related proceedings that pertain to him or her. In
light of the admonitions in Lamb and other cases that process
immunity should be meted out sparingly, we reject this
suggestion. Moreover, the circumstances surrounding the service
of process on Burgar are not those that would ordinarily favor
a finding of immunity even in a case where it had been timely
requested. Specifically, Burgar voluntarily entered into
Massachusetts to attend proceedings as a spectator in the same
case in which he was served with process. While we need not
decide the issue, it seems apparent that under these facts, the
district court would have faced a relatively heavy presumption
against granting such immunity if it actually had been sought by
Burgar.
-18-
For these reasons, we hold that the district court
properly exercised personal jurisdiction over defendants in this
case.10 Based on this determination, we need not reach the
alternate bases for personal jurisdiction discussed in the
district court's opinion.
III. Plaintiff's Likelihood of Success on the Merits
Defendants' second claim in this appeal, which goes to
the merits of plaintiff's suit, is that the preliminary
injunction should be dissolved because it is premised on
erroneous findings by the district court. Specifically,
defendants claim that the court erred as a matter of fact in
determining that Northern Lights manifested a bad-faith intent
to profit from plaintiff's mark, and as a matter of law in
concluding that ACPA should be applied retroactively to
encompass defendants' behavior prior to the enactment of the
statute.
10
We believe that the service of process effected upon
Burgar also conferred personal jurisdiction over the other
defendants. Burgar serves as the president of both Northern
Lights Club, an unincorporated association, and 641271 Alberta,
Ltd., a foreign corporation. See Fed. R. Civ. P. 4(h)(1)
(permitting personal service of process upon officers of
unincorporated associations and foreign corporations).
In all events, defendants have attacked the efficacy of
service of process only in general. They have not attacked its
efficacy vis-à-vis particular defendants. Consequently, we deem
waived any possible argument that personal service upon Burgar
was ineffectual as a means of bringing Northern Lights Club
and/or 641271 Alberta, Ltd. before the court.
-19-
A. Defendants' Bad Faith
Defendants vehemently contest the district court's
finding that the registration and maintenance of the
northernlights.com domain name represented a bad-faith effort to
profit from plaintiff's Northern Light trademark. The issue of
bad faith is principally relevant to the merits of plaintiff's
suit insofar as "bad faith intent to profit from [another's]
mark" constitutes an essential element of the cause of action
under ACPA. 15 U.S.C. § 1125(d)(1)(A)(i). In this case,
however, it also relates, albeit tangentially, to plaintiff's
trademark-infringement claim. This is so because the district
court's finding with respect to defendants' intent in adopting
the Northern Lights mark, which the court rendered while
considering one of the eight factors under the "likelihood-of-
confusion" test for trademark infringement, see, e.g., I.P. Lund
Trading ApS v. Kohler Co., 163 F.3d 27, 43 (1st Cir. 1998),
expressly incorporated by reference the intent findings it had
made in its ACPA analysis. See 97 F. Supp. 2d at 114. Thus, we
must consider the court's "bad-faith intent to profit" findings
to the extent that they bear on the trademark-infringement
claim. We review the district court's finding of bad faith for
clear error. See American Bd. of Psychiatry & Neurology v.
Johnson-Powell, 129 F.3d 1, 3 (1st Cir. 1997) (noting clear-
-20-
error standard of review applies to findings of fact made in
conjunction with ruling on motion for preliminary injunction)
(citing Keds Corp. v. Renee Int'l Trading Corp., 888 F.2d 215,
222 (1st Cir. 1989)).
On appeal, defendants claim that their conduct did not
meet the statutory guidelines for a finding of bad faith, and
that even if it did, the subjective and objective reasonableness
of their actions should shield them from liability. Defendants
stress that their mere registration of multiple domain names
does not, by itself, indicate that they were acting in bad faith
with regard to any of their individual registrations or website
uses. Defendants also assert that the statements of Burgar have
been taken out of context by the district court, and have been
unfairly used to establish Northern Lights's bad faith.
Along with its inclusion of bad faith among the
essential elements of the ACPA cause of action, Congress
provided nine nonexhaustive guideposts that courts may use to
divine whether or not bad faith exists. See 15 U.S.C. §§
1125(d)(1)(B)(i)(I)-(IX). In addition, the statute provides an
"escape clause" to those whose conduct would otherwise
constitute bad faith if the potential infringer "believed and
had reasonable grounds to believe that the use of the domain
name was a fair use or otherwise lawful." Id. §
-21-
1125(d)(1)(B)(ii). In this case, the district court determined
that defendants' myriad explanations for their use of the
northernlights.com site – e.g., as an experimental new business
model, as a site for aurora borealis admirers, and as a
compilation of businesses that contain the phrase "Northern
Lights" – undermined Northern Lights's claim of subjective
belief in fair use, and hence their entitlement to the "escape
clause" of § 1125(d)(1)(B)(ii). See 97 F. Supp. 2d at 118-19.
Additionally, the court concluded that the defendants' numerous
registrations of domain names containing the trademarks of
others, which defendants accomplished in some cases by creating
fictional "fan clubs" so that they could present a mantle of
legitimacy in their registration requests to NSI, represented
powerful evidence of defendants' bad faith in operating the
northernlights.com site. This conclusion of bad faith was
reinforced, according to the district court, by defendants'
history of disregarding cease-and-desist letters from legitimate
trademark owners, and their apparent openness to sell the
northernlight.com registration to the plaintiff at the right
price. Id. at 119-20.
Based on our review of the record, we see no clear
error in the district court's finding that defendants will
likely be found to have acted in bad faith in operating the
-22-
northernlights.com site. 11 Although defendants are correct in
asserting that their multiple registrations alone are not
dispositive of the bad-faith issue, their well-established
pattern of registering multiple domain names containing famous
trademarks, such as rollingstones.com, evinrude.com, and
givenchy.com, has been made highly relevant to the determination
of bad faith by the list of factors in ACPA. See 15 U.S.C. §
1125(d)(1)(B)(i)(VIII) (noting as relevant factor "the person's
registration or acquisition of multiple domain names which the
person knows are identical or confusingly similar to marks of
others that are distinctive at the time of registration of such
domain names"). Those facts are not clearly trumped by facts
favoring defendants' side of the story, such as their use of
northernlights.com as an e-mail domain name for several years
prior to the dispute with the plaintiff and Burgar's initial
resistance to the plaintiff's efforts to acquire defendants'
domain-name registration. The district court's finding that
defendants were not entitled to the "escape clause" also is not
clearly erroneous; as the court found, defendants' oft-changing
explanations for the purpose of the northernlights.com website
11
The district court found that defendants' posting of a
website at northernlights.com, rather than their initial domain-
name registration, was the act that constituted bad-faith intent
to profit in this case. See 97 F. Supp. 2d at 119 n.27.
-23-
evince a lack of subjective belief in the domain name's fair
use.
Based on defendants' apparent modus operandi of
registering domain names containing the famous trademarks of
others in the hope that the famous trademark holder will be
willing to pay to reclaim its intellectual-property rights, the
district court reasonably concluded that defendants acted
according to script in this case. 12 Accordingly, we determine
that the district court did not err in finding that defendants
will likely be found to have acted in bad faith in operating
their northernlights.com website.
B. Retroactive Application of ACPA
Defendants also ask that we review the district court's
legal determination that the retroactive application of ACPA to
the facts of this case is permissible.13 After reviewing the
12
Defendants claim that since they expected no revenue
stream from the content on the northernlights.com website, they
could not have acted with a bad-faith intent to profit. Based
on their past practices, however, it is reasonable to conclude
that defendants harbored a broader, more long-term notion of
"profit." Instead, defendants likely hoped to cash in on the
confusion surrounding the sponsorship of the websites by finding
famous trademark holders willing to pay defendants to end the
diversion of Internet traffic from their website to defendants'
sites.
13
As we recently noted in Hasbro, Inc. v. Clue Computing,
Inc., 232 F.3d 1 (1st Cir. 2000) (per curiam), courts are split
on the issue of whether recent Lanham Act provisions should be
applied retroactively. Compare, e.g., Sporty's Farm, L.L.C. v.
-24-
district court opinion and the parties' briefs, however, we find
it unnecessary to reach this issue, as even if we were to decide
the matter in defendants' favor, it would not provide an
adequate basis for dissolving the injunction. This is so
because the district court expressly stated that its decision to
impose a preliminary injunction rested principally upon its
finding that Internet users would likely be confused by the
concomitant existence of the northernlight.com and
northernlights.com marks. See 97 F. Supp. 2d at 121 ("Before
turning to the balancing factors, I must emphasize the
importance of the likelihood of confusion findings to the
preliminary injunction calculus."). Because an ACPA violation
does not require a showing of likely confusion,14 the district
court's decision to enter a preliminary injunction must have
been based on its resolution of the non-ACPA claims, such as
plaintiff's trademark-infringement claim. In their appeal,
Sportsman's Market, Inc., 202 F.3d 489, 496-97 (2d Cir.)
(concluding that ACPA should apply retroactively), cert. denied,
120 S. Ct. 2719 (2000) with Thomas & Betts Corp. v. Panduit
Corp., 108 F. Supp. 2d 976 (N.D. Ill. 2000) (holding that new
trade-dress provisions of Lanham Act should not be applied
retroactively).
14
As the district court noted, the "likelihood of confusion"
test of trademark infringement is "more comprehensive" than the
"identical or confusingly similar" requirement of ACPA, as it
requires considering factors beyond the facial similarity of the
two marks. 97 F. Supp. 2d at 117.
-25-
defendants' only argument on the merits that does not impugn the
district court's ACPA findings concerns the determination that
Northern Lights acted in bad faith. And as we have determined
in Part III.A, supra, that finding was not clearly erroneous.
Thus, no matter how we might resolve the ACPA-retroactivity
issue – and we expressly eschew doing so at this time – our
decision would fail to affect the validity of the injunction.15
In sum, we conclude that defendants have identified no
basis for overturning the preliminary injunction already in
place. We therefore affirm its issuance by the district court.
15Defendants do claim that there were other "grossly unfair
factual errors by the trial court" which constituted "an
egregious result-driven pattern of prejudice" against them. But
they have failed to specify those errors in their appellate
briefs.
-26-
IV. First Amendment Overbreadth of the Injunction
Defendants argue that the scope of the preliminary
injunction violates the First Amendment. We need not, however,
consider that issue here, for although it may have been raised
below, defendants did no more than obliquely refer to the issue
when the district court held the critical hearing, and
subsequently took part in the framing of the preliminary
injunction. Because we do not find waiver, the issue can be
argued in the trial on the merits.
Conclusion
Because the district court obtained personal
jurisdiction over defendants when Burgar was served with process
while in the forum state, we affirm, albeit on different
grounds, the court's personal-jurisdiction finding. We find no
basis for disturbing the court's determination of likelihood of
success on the merits of plaintiff's suit, and therefore affirm
those portions of the district court's opinion. Finally, while
not precluding further consideration of the First Amendment
issue at trial, we decline to resolve defendants' free-speech
challenge to the scope of the injunction at this time.
Affirmed. Costs to appellee.
-27-