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Covington Prevails for American Automobile Association in Important Domain Name Arbitration


WASHINGTON, DC, February 13, 2009 — A panel of the National Arbitration Forum has ruled that “proxy” services that register domain names for others and keep private the true owners’ identities may be sued directly in trademark disputes under the Uniform Domain Name Dispute Resolution Policy (UDRP). The ruling came in response to a proceeding initiated by trademark holder The American Automobile Association, Inc. (AAA), which recovered 55 domain names in the dispute. Covington & Burling LLP represented AAA in the action.

By withholding the identities of domain names' actual owners, proxy services such as Domains By Proxy have made it difficult for trademark holders to enforce their intellectual property rights against cybersquatters and other infringers. In September 2008, therefore, AAA filed a UDRP complaint against Domains By Proxy, seeking transfer of potentially confusing domain names it had registered, including AAAtourguide.com and similar domain names.

The Forum initially rejected AAA's complaint because Domains By Proxy had transferred the contested domain names to its individual customers after the complaint was filed, a decision that would have required AAA to file more than 30 separate actions against Domains By Proxy's customers and would have effectively immunized Domains By Proxy from liability for registering potentially confusing domain names. The panel reversed this decision, reasoning that it would allow Domains By Proxy to violate rules requiring domain name registrants to provide public contact information and prohibiting post-complaint transfers. The arbitration panel agreed with AAA that Domains By Proxy registered and used the domain names in bad faith and ordered 55 domain names be transferred to AAA.

The decision represents the largest victory to date against a proxy service and sets an important precedent that proxy services, which are frequently used by cybersquatters and other intellectual property infringers to avoid being held accountable for their activities, are not immune from the UDRP process.

The Covington intellectual property team was led by partner Neil Roman, who was assisted by associates Roger Ford, Hope Hamilton, and Shannon Nestor and special counsel Kristina Rosette. All are based in Covington’s Washington office. 

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