3rd Circuit Rules on Retroactivity of Cyber Squatting Act

February 11, 2003. The U.S. Court of Appeals (3dCir) issued its opinion [4 pages in PDF] in Schmidheiny v. Weber, a case regarding retroactive application of the Anti-cybersquatting Consumer Protection Act's (ACPA) protection of individuals' names, and the effect of re-registration of a domain name. The Appeals Court held that while the ACPA does not apply retroactively to registrations of domain names prior to the effective date of the statute, it does apply to re-registrations of domain names after the effective date, for which the original registration was before the effective date.

Background. Steven Weber registered the domain name schmidheiny.com in February 1999. The ACPA took effect in November 1999. He re-registered the domain name in the name of his company, Famology.com in June 2000 with a different registrar. In November 2000 he sent a letter to Stephan Schmidheiny offering to sell him the domain name.

District Court. Schmidheiny filed a complaint in U.S. District Court (EDPenn) against Weber and Famology.com alleging violation of the ACPA. The District Court granted summary judgment to Weber and his company on the grounds that Weber registered the domain name before passage of the ACPA. It reasoned that the ACPA does not apply retroactively, and a re-registration is not actionable under the ACPA. Schmidheiny appealed.

Statute. The ACPA provides, at 15 U.S.C. § 1129, in part, that "[a]ny person who registers a domain name that consists of the name of another living person, or a name substantially and confusingly similar thereto, without that person's consent, with the specific intent to profit from such name by selling the domain name for financial gain to that person or any third party, shall be liable in a civil action by such person."

Appeals Court. The Appeals Court reversed. It wrote that "We do not consider the ``creation date´´ of a domain name to control whether a registration is subject to the Anti-cybersquatting Act, and we believe that the plain meaning of the word ``registration´´ is not limited to ``creation registration.´´"

The Court noted that "The words ``initial´´ and ``creation´´ appear nowhere in § 1129, and Congress did not add an exception for ``non-creation registrations´´ in § 1129(1)(B)."

The Court added that "We hold that the word ``registration´´ includes a new contract at a different registrar and to a different registrant. In this case, with respect to Famology.com -- that occurs after the effective date of the Anti-cybersquatting Act."

The Court also offered this rationale. "To conclude otherwise would permit the domain names of living persons to be sold and purchased without the living persons’ consent, ad infinitum, so long as the name was first registered before the effective date of the Act. We do not believe that this is the correct construction of the Anti-cybersquatting Act. We are therefore satisfied that Famology.com, Inc. engaged in a ``registration´´ that is covered by the Anti-cybersquatting Act."