Sunday, May 18, 2014

Cable News Network LP v. case brief summary

Cable News Network LP v.

Owners of the U.S. registered trademark "CNN," sued the domain name "," registered by Maya Online Broad-bank Network ("Maya"), in U.S. Federal Court. In the lawsuit, CNN claimed that Maya had registered and was using the domain name in bad faith. Maya moved to dismiss the complaint and attacked the constitutionality of the ACPA's in rem jurisdiction provisions. Maya argued that in order for a domain name to be subject to U.S. jurisdiction, the domain name holder must have minimum contacts with the United States. Maya argued that, as a Chinese news company located and doing business exclusively within China-whose web site is in Chinese, with 99.5% of its registered users located within China, and the registrar for the domain name being located in China-Maya did not have sufficient minimum contacts with the United States to subject it to jurisdiction, consistent with the due process clause of the U.S. Constitution.

The Court denied Maya's motion to dismiss, holding that in rem jurisdiction was proper under the ACPA because the domain name itself was located within the forum, based on the presence of the Verisign Global Registry Services ("Verisign") (f/k/a Network Solutions, Inc.) -the ".com" registry, in Herndon, Virginia. This is an action against the physical property
A domain name is a physical piece of property and is located where it was created. 


Cable News Network LP v.
(a)    Π, DE partnership, with principal place of business in GA, providing news and owning trademark ‘CNN’, and is available in China.
(b)   Δ set up as a link within its site. “CN” is the standard abbreviation for China.
(c)    Π filed an ACPA in rem claim in the Eastern District of Virginia when Δ refused to transfer the domain name and/or change it to
(d)   Criteria for an ACPA in rem claim:
1.      Owner of a mark, like Π, may maintain an action against an infringing domain name if:
2.      action is brought in the Jx where registrar or registry of infringing domain name is located
3.      and if in personam Jx over the registrant does not exist
4.      *Meets both criteria
(e)    Due Process analysis:
3 types of in rem actions:
1.      “True” in rem actions – where ct adjudicates property rights of a res (thing) for every potential rights holder. True ACPA cases are of this type. 
2.      Quasi in rem actions – Adjudicates property rights against named persons – ex: Remove a cloud on land title. 
3.      Quasi in rem II- concerns rights of persons ina “thing” (as opposed to quasi in rem action – the claim here is unrelated to the res that provides jurisdiction. Ct recites Shaffer case as an example of this. There, in rem jurisdiction was invoked – the court basically locked up (sequestered) stocks of a company to compel the officers of the company to appear in the jurisdiction. The matter (stock holder derivative suit) was unrelated to the stocks (res) upon which jurisdiction was based. 
i.         A minority of cts have held that Shaffer requires that all in rem actions must establish the same “minimum contact” required of in personam jurisdiction case. The majority of cts, however, believe that rule only extends to Quasi in rem cases (#3 above.). Because this case is a “True” in rem case, no minimum contacts are necessary.
(f)     Δ argues Π must plead and prove bad faith to withstand jurisdictional challenge.
1.      Court rejects this argument because it confuses a jurisdictional requirement with a substantive element. Bad faith is not a jurisdictional requirement.
2.      The stringent standard of dismissal for lack of subject matter Jx is if the claim is “so insubstantial, implausible, foreclosed by prior decision of this Court, or otherwise completely devoid of merit as not to involve a federal controversy.”
i.         That standard is not met here, and it is a legitimate trademark infringement claim.

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