Company thinks paying six figures for a three letter domain name is proof of bad intent.
JFXD TRX ACQ LLC has asked a federal district court (pdf) in Arizona to issue a preliminary injunction to give it the domain name trx.com.
The saga over the domain name started in November of last year when Fitness Anywhere won a surprising UDRP against trx.com.
The owner hadn’t responded to the dispute (he later said he overlooked it) and filed a lawsuit in Arizona to block the transfer.
Interestingly, it appears that Fitness Anywhere didn’t actually own the TRX marks it relied on in the UDRP despite certifying that to be the case. Fitness Anywhere LLC had actually assigned the trademarks to JFXD TRX ACQ LLC before the dispute. It looks like Fitness Anywhere LLC filed for bankruptcy in June, transferred its US trademarks in August (and was recorded by the USPTO in September), and filed the UDRP in October.
Now, JFXD is asking for a preliminary injunction, even though it has never actually used the domain.
It argues that the domain name “sleeps in digital limbo held by a Malaysia cyber-pirate.”
Oddly, it also argues that “Defendant filed with this Court a sworn pleading admitting cyber-piracy and purchase of for investment purposes.”
While the domain owner did say he bought it for investment purposes, he didn’t admit to “cyber-piracy.”
One of JFXD’s arguments is that the current owner must have paid what he did for the domain because of the alleged fame of the TRX mark and bases this on automated appraisals at Estibot:
The #1 online value estimator for three-letter domains is Estibot®, a public website. It shows trx.com at $42,000. (Villeneuve Declaration at Exhibit A, ¶ 16, Attachment H). The value is extrapolated comparable from $33,333 (eok.com) to $38,000 (yeb.com=). Id. The Defendant admitted paying $138,000, or more than 350% the value. (2:22-cv-02042, Complaint, Dkt. #1, ¶ 16). Payment of 350% of the basic value of any “investment” is not random.
The plaintiff also walks through factors that could be used to help it show that the domain owner is violating the Anticybersquatting Consumer Protection Act. I’m a bit baffled by some of the arguments, such as:
The next prong is a defendant’s “registration or acquisition of multiple domain names” that are “identical or confusingly similar to the marks of others that are distinctive at the time of registration of such domain names.” 15 U.S.C. § 1125(d)(1)(B)(vii). The owner admits paying $138,000 for a URL as a digital investment is evidence of clear cyber-piracy. (2:22-cv-02042, Complaint, #1, ¶ 16). URL’s are generally sold at $1.99/year and this person acquired one for $138,000 if the pleading is to be believed. It is difficult to conceive this party could randomly have acquired only a single domain. Discovery remains to be secured.
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