999 F.Supp. 1337AVERY DENNISON CORPORATION, Plaintiff,v.Jerry SUMPTON, et al., Defendants.No. CV 97-407 JSL.United States District Court,C.D. California.March 16, 1998.Lonnie Kocontes, David Quinto, Adrian Pruetz, Quinn, Emanuel, Urquhart, Oliver & Hedges, L.L.P., LosAngeles, CA, for Avery Dennison Corp.G. Gervaise Davis, III, Davis & Schroeder, Monterey, CA, for Jerry Sumpton.Edward Poplawski, Los Angeles, CA, for Network Solutions.JUDGMENT AND ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT ONPLAINTIFF'S CLAIM FOR TRADEMARK DILUTIONLETTS, District Judge.Defendants are "cybersquatters," as that term has come to be commonly understood. They have registeredover 12,000 internet domain names not for their own use, but rather to prevent others from using thosenames without defendants' consent. Like all "cybersquatters," defendants merely "squat" on their registereddomain names until someone else comes along who wishes to use them. Like all "cybersquatters,"defendants usurp all of the accepted meanings of their domain names, so as to prevent others from using thesame domain names in any of their accepted meanings. And like all "cybersquatters," defendants seek tomake a financial return by exacting a price before consenting to allow others to use the domain names onwhich they have chosen to "squat."Defendants have added two new wrinkles, by which they seek to differentiate themselves from other"cybersquatters." Based upon these new wrinkles, defendants hope to avoid what has been the uniformoutcome of decided cases involving disputes between "cybersquatters" and the holders of famoustrademarks. See discussion at pages 7-8 infra. These wrinkles are (a) defendants allegedly have found aclass of persons who are willing to pay a modest price for defendants' consent to the use of particulardomain names as e-mail addresses, and (b) defendants selected the trademark domain names on which theyhave "squatted" by reference not to the fact that they are trademarks, but rather to the fact that they arecommon proper last names."Avery.net" and "Dennison.net" are two of the domain names that defendants have chosen to register.Plaintiff owns a number of federally registered trademarks that it uses in marketing its line of officeproducts. These include the marks "Avery" and "Dennison." Plaintiff has brought this action allegingfederal and state claims of trademark infringement, trademark dilution and unfair competition. The partieshave filed cross motions for summary judgement.Page1of6Avery Dennision v. Sumpton9/18/2007mhtml:file://C:\CMU\LawCourse2007\readings\DomainNames\Avery Dennision v_ Sumpton....On motion for summary judgment, it is the moving party's burden to establish "that there is no genuineissue as to any material fact and that the moving party is entitled to a judgment as a matter of law."Fed.R.Civ.Proc. 56(c). If the moving party carries this burden, the burden shifts to the non- movant whothen "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.Proc. 56(e); seealso Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986).UNCONTROVERTED FACTSThe court incorporates facts 1, 2, 6, 8, 10-14, 17, 18, 25 and 26 from plaintiffs' Statement ofUncontroverted Facts and Conclusions of Law submitted in connection with its motion. The courtdetermines these facts to be undisputed, and finds them as facts for purposes of decision. Additional factsstated herein for purposes of decision are also determined to be undisputed.CONCLUSIONS OF LAWBecause the court's conclusions of law under the Federal Trademark Dilution Act of 1995, 15 U.S.C. §§1125(c), 1127, (the "Act") are case- dispositive, the court will state only its conclusions under this statute.[FN1] The Act provides as follows:FN1. It appears to the court that its reasoning here might lead to the same result under some or all ofplaintiff's remaining claims. If this reasoning were rejected, however, it would seem likely that thealternative reasoning selected would lead to rejecting plaintiff's other claims as well.The owner of a famous mark shall be entitled, subject to the principles of equity and upon such terms as thecourt deems reasonable, to an injunction against another person's commercial use in commerce of a mark ortrade name, if such use begins after the mark has become famous and causes dilution of the distinctivequality of the mark...."15 U.S.C. § 1125(c)(1). The term "use in commerce" is defined for purposes of the Act as "the bona fideuse of a mark in the ordinary course of trade...." 15 U.S.C. § 1127. "Dilution" is defined as "the lessening ofthe capacity of a famous mark to identify and distinguish goods or services...." Id.Determining whether an injunction should be issued at the behest of the holder of an allegedly famous markto enforce the Act requires a four part analysis: (a) whether the alleged trademark is "famous," (b) whetherit has been used by another person in the ordinary course of trade," (c) whether the other person's use of themark has "lessened the ability of the mark to identify goods or services," and (d) whether the principles ofequity require that the injunction be issued. 15 U.S.C. § 1125(c).1. Plaintiffs marks are famous.Defendants argue that the Avery and Dennison marks are not famous. This argument is adequately disposedof by reference to the previously enumerated findings of fact. Based upon these findings, whichdemonstrate plaintiff's longstanding use of these marks and the degree to which these marks are recognizedby individuals in the community, the court finds that the Avery and Dennison marks are famous within themeaning of § 1125(c)(1).2. Defendants have engaged in a commercial use of the marks.Defendants do not deny that they are using the words "Avery" and "Dennison" in commerce by offeringthem for license as domain names. They argue instead that they are not using these words as "marks," andthat, therefore, their use is not within the coverage of the Act, because to be "use[d] in the ordinary course oftrade" within the meaning of 15 U.S.C. § 1127, a trademark name must be used, as such, specifically toconnote its secondary meaning as a product source identification.Page2of6Avery Dennision v. Sumpton9/18/2007mhtml:file://C:\CMU\LawCourse2007\readings\DomainNames\Avery Dennision v_ Sumpton....The court disagrees. The court holds that for purposes of the Act, a famous mark is "used in the ordinarycourse of trade" when
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