Domain Trademark Ruling Spells Out Jurisdiction

SAN FRANCISCO — In an important jurisdictional decision of interest to webmasters, a federal appeals court has ruled that a foreign business that operates online and caters to American customers overseas can’t be sued in U.S. courts.

This week’s decision by the 9th U.S. Circuit Court of Appeals affirmed the dismissal of a trademark infringement action brought by the owners of the Pebble Beach golf club and resort against an English bed and breakfast of the same name.

Pebble Beach Co. has used the name Pebble Beach for its California golf course and resort for 50 years, and operates www.pebblebeach.com.

Michael Caddy is a dual U.S./U.K. citizen who resides in the U.K. and operates a bed and breakfast, restaurant, and bar located on a cliff overlooking the pebbly beaches of England’s south shore. He calls his business, which does not include a golf course, Pebble Beach.

Caddy has a website, located at www.pebblebeach-uk.com.

Pebble Beach Co. filed suit against Caddy in U.S. District Court, claiming that its trade name had acquired secondary meaning in the U.S. and the U.K.

A lower court dismissed the suit for lack of jurisdiction, ruling that Caddy’s contacts with California were insufficient.

On appeal, the company argued that Caddy was subject to jurisdiction in California because he targeted potential customers in California.

But the court disagreed.

“We conclude that Caddy’s actions were not expressly aimed at California,” 9th Circuit Judge Stephen S. Trott wrote. “The only acts identified by Pebble Beach as being directed at California are the website and the use of the name Pebble Beach in the domain name. These acts were not aimed at California and, regardless of foreseeable effect, are insufficient to establish jurisdiction.”

Pebble Beach Co. also sought to establish jurisdiction under a rule that allows any forum in the U.S. to have jurisdiction if the party’s conduct was aimed at the U.S., and no state has jurisdiction.

It argued that Caddy’s use of the famous U.S. trademark Pebble Beach showed that the U.S. was his primary target.

Again, the court disagreed.

“The fact that the name Pebble Beach is a famous mark known worldwide is of little practical consequence when deciding whether action is directed at a particular forum via the [Internet],” Trott wrote.

Pebble Beach Co. argued that use of a .com domain shows that the site was geared primarily toward the U.S.

“To suggest that .com is an indicator of express aiming at the U.S. is even weaker than the counter assertion that having U.K. in the domain name, which is the case here, is indicative that Caddy was only targeting his services to the U.K.,” Trott said.

The case is Pebble Beach Co. vs. Caddy, 04-15577.

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