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Hewlett-Packard Development Co., L.P. v. Midwest Information Technology Group

June 2, 2006

HEWLETT-PACKARD DEVELOPMENT COMPANY, L.P., HEWLETT-PACKARD CO., AND COMPAQ TRADEMARK B.V., PLAINTIFFS,
v.
MIDWEST INFORMATION TECHNOLOGY GROUP, INC., DEFENDANT.



The opinion of the court was delivered by: Jeanne E. Scott, U.S. District Judge

OPINION

This matter comes before the Court on Defendant Midwest Information Technology Group, Inc.'s (Midwest) Motion for Summary Judgment (d/e 77). Midwest claims that a prior proceeding before the National Arbitration Forum (NAF) pursuant to the Uniform Domain Name Dispute Policy (Policy) has preclusive effect to bar Plaintiffs Hewlett-Packard Development Company, L.P., Hewlett-Packard Co. and Compaq Trademark B.V. (collectively HP) from bringing this action. For the reasons set forth below, the Court denies the Motion. The decision of the NAF arbitrator does not have preclusive effect.

STATEMENT OF FACTS

The facts of this case are discussed in detail in this Court's previous Opinion entered April 11, 2006 (d/e 79). Essentially, HP's predecessor entered into an agreement with Midwest by which Midwest operated a telephone call center and websites to accept orders for HP products. In the course of that relationship, Midwest registered several Internet domain names that contained various forms of HP's trademarks, such as "Hewlett-Packard," "HP," and "Compaq." HP terminated the agreement with Midwest, effective February 7, 2004. HP asked Midwest to stop using its trademarks and to turn over the Internet domain names. HP alleges that Midwest refused. HP then brought this action claiming trademark infringement, unfair competition, and violation of the Lanham Act. Plaintiffs' Original Complaint (d/e 1).

HP also commenced a proceeding before the NAF under the Policy. The Policy was established by the Internet Corporation For Assigned Names and Numbers (ICANN) as a means to resolve disputes over Internet domain names. A party wishing to challenge the use of a domain name on the Internet may file a complaint under the Policy. The Policy refers to the complaining party as the "Complainant" and to the owner of the domain name as "You." To prevail, the complainant must prove:

(i) your domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and

(ii) you have no rights or legitimate interests in respect of the domain name; and

(iii) your domain name has been registered and is being used in bad faith.

Plaintiffs' Response to Midwest Information Technology Group, Inc.'s Motion for Summary Judgment (d/e 80), Exhibit 2, Policy, ¶4. An arbitrator reviews the complaint and evidence submitted by the parties. If the arbitrator finds that the complaint is meritorious, he will enter an order in favor of the complainant. The only remedies available in the process are either cancellation of the domain name or transfer of the domain name registration to the complainant. Policy, ¶ 4(c)(i). All other disputes between the parties must be resolved in a different proceeding:

All other disputes between you and any party other than [ICANN] regarding your domain name registration that are not brought pursuant to the mandatory administrative proceeding provisions of Paragraph 4 shall be resolved between you and such other party through any court, arbitration or other proceeding that may be available.

Id., ¶ 5.

The parties may also submit their dispute, "to a court of competent jurisdiction for independent resolution before such mandatory administrative proceeding is commenced or after such proceeding is concluded." Id. If a lawsuit is filed, either before the arbitrator's decision is made or within ten days thereafter, ICANN will not implement the arbitrator's decision. Id. Rather, ICANN will abide by the decision from the court proceeding. Id., ¶¶ 3(b) & 4(k).

In this case, the arbitrator noted that this proceeding was pending. Defendant's Memorandum in Support of its Motion for Summary Judgment (d/e 78), Exhibit 6, Decision of David Sorkin, Arbitrator, dated April 8, 2004 (Decision) at 4. The arbitrator then found that HP failed to prove that Midwest registered the domain names in bad faith. Id. Because HP failed to prove this element, the arbitrator found in favor of Midwest. The arbitrator made no other findings on any issue.

Midwest now asks for summary judgment. Midwest argues that the prior decision has preclusive effect under both res judicata and collateral estoppel to preclude HP from ...


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