Film Academy Blasts GoDaddy for Revealing Settlement Offers in Cybersquatting Lawsuit

Who is going to pay the tab for a long-running case that could result in GoDaddy being ordered to implement filters to catch trademarks like "The Oscars"?
THR

Nearly five years ago, the Academy of Motion Picture Arts and Sciences filed a massive cybersquatting lawsuit against GoDaddy, alleging that the domain registrar giant allowed its customers to buy domains like 2011oscars.com or betacademyawards.com, "park" that page and collect a portion of revenue from GoDaddy's advertising partners on a pay-per-click basis.

Since then, with legal bills piling up, the case has gotten very bizarre. For example, GoDaddy once accused the Academy of trying to "game the system" by having all of its legal matters referred to U.S. District Judge Audrey Collins, whose daughter was a professional actress and who has issued rulings like denying GoDaddy safe harbor from allegations of infringing trademarks.

GoDaddy was bench slapped for that one, though the lawsuit with now about 300 domain names in dispute has landed in the hands of Judge Andre Birotte Jr., who must now contend with new theatrics.

Earlier this month, GoDaddy submitted a new motion for partial summary judgment and disclosed the plaintiff's settlement offers.

"At the outset of this litigation, AMPAS offered to dismiss its lawsuit in exchange for a payment of $20 million," wrote GoDaddy's lawyers. "On August 27, 2012, during a private meeting between the parties, AMPAS offered to settle this action for a payment of $12 million. On March 19, 2013, AMPAS offered to settle this action during mediation for a payment of $10.7 million. On October 8, 2013, counsel for AMPAS sent correspondence to counsel for GoDaddy in which AMPAS offered to settle this action for a payment of $6 million."

GoDaddy told the judge this because it is looking to avoid paying AMPAS' considerable bill for litigating the case with high-priced lawyers at Boies Schiller & Flexner for five years. The analysis on whether GoDaddy has to pick up the tab has to do with measuring the plaintiff's financial benefit for pursuing the case with any public benefit. GoDaddy emphasizes the former by touting $31 million in potential damages it might have to pay while downplaying the latter as "incidental public benefit."

On Monday, AMPAS responded to GoDaddy by slamming GoDaddy for "improper and meritless" disclosures of confidential settlement discussions and hinting that it would be seeking sanctions.

The plaintiff also had a different view of the calculus on who pays the attorney fees — saying the judge could award the minimum amount of statutory damages. That would be $1,000 per domain name, or just $310,000 for a case that's lasted so long. If that happens, AMPAS will take home the award for the year's best pyrrhic victory. That's why the eventual ruling on attorney fees is so important to both sides.

AMPAS also tells the judge that the lawsuit could result in substantial public benefit. It says that the case seeks to establish that cybersquatting is a "serious problem that should not be tolerated even if it is being perpetrated by a company that generates over a billion dollars in revenue and has the resources to make litigation both time consuming and costly."

And more from AMPAS' opposition papers: "At the conclusion of this lawsuit, the Court will be able to issue a permanent injunction to prevent GoDaddy’s business practice of cybersquatting by, for example, requiring GoDaddy to implement and permanently maintain a trademark filter to protect against the inclusion in its Parked Pages Program of any domain names that are confusingly similar to any and all registered trademarks. This type of injunction would confer a substantial benefit upon a large group of trademark holders and consumers."

After five years, the lawsuit might finally get to trial, though AMPAS has indicated that it prefers a bench trial to one where a jury decides the issues.

GoDaddy still thinks it can win. For example, in its summary judgment motion, the domain registrar company is reviving old arguments that AMPAS hasn't done any surveys to prove its marks are famous.

AMPAS responds that Judge Collins already settled that issue as triable, and even if there's reconsideration, there's the fact that 40 million viewers watch the Academy Awards each year in the United States, the fact that it spends millions of dollars advertising the event each year, the fact that a 30-second spot during the Academy Awards garners a significant price, the fact that the Oxford English Dictionary includes a definition for "Oscar," and finally, the U.S. Patent and Trademark Office "has actually used AMPAS’ marks in an instructional video to introduce famous marks."

Email: Eriq.Gardner@THR.com
Twitter: @eriqgardner

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