Jurisdictional Limits of in rem Proceedings Against Domain Names

In 1999, Congress passed the Anticybersquatting Consumer Protection Act (ACPA) to combat “cybersquatters” who profited by registering domain names that were confusingly similar to established trademarks. Under the ACPA, trademark owners have a specific cause of action against domain name registrants accused of cybersquatting. Moreover, the law gives U.S. courts in rem jurisdiction over trademark infringing domain names registered to parties that are not subject to personal jurisdiction. Over the past decade, proceeding in rem against domain names has proven to be an effective strategy for trademark owners.

While many companies have used the ACPA against cybersquatters, others have relied on the in rem provision to secure domain names registered to foreign companies that happen to use a similar mark for their goods or services. From a policy perspective, this latter practice is troubling because it allows district courts to determine whether foreign companies can use their marks as domain names, even if these companies lack minimum contacts with the court’s forum. To prevent such overreach, courts should limit the ACPA’s in rem jurisdiction to domain names that were registered in a bad faith attempt to profit from another’s trademark.