E. & J. Gallo Winery v. Spider Webs Ltd.

286 F.3d 270 (2002)

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E. & J. Gallo Winery v. Spider Webs Ltd.

United States Court of Appeals for the Fifth Circuit
286 F.3d 270 (2002)

Facts

E. & J. Gallo Winery (Gallo) (plaintiff) registered the trademark “Ernest & Julio Gallo” in 1964. Gallo also registered numerous other trademarks and multiple Internet domain names, but Gallo had not registered ernestandjuliogallo.com. Spider Webs Ltd. (defendant) registered more than 2,000 domain names, approximately 300 of which appeared to be associated with existing businesses. Spider Webs offered some of the domain names for sale on its own website and on eBay. Spider Webs registered ernestandjuliogallo.com in June 1999 but had not offered it for sale. Gallo sent a letter to Spider Webs asking it to release the domain name or transfer the domain name to Gallo, but Spider Webs refused. In February 2000, Gallo sued Spider Webs under the Anticybersquatting Consumer Protection Act. About six months later, Spider Webs published a website at ernestandjuliogallo.com that discussed the lawsuit and contained other content that could be construed as disparaging of Gallo, including a picture of a wine bottle with the words Whiney Winery. The district court found that because domain names could not contain ampersands or spaces and had to end in a top-level domain such as .com or .org, ernestandjuliogallo.com was essentially the same as Gallo’s registered trademark, “Ernest & Julio Gallo.” The court granted Gallo’s motion for partial summary judgment, ordered Spider Webs to transfer the domain name to Gallo, and awarded Gallo $25,000 in statutory damages under the act, finding that Spider Webs’ actions put Gallo at risk of losing business and having its business reputation tarnished. Spider Webs appealed, arguing that Gallo was not entitled to statutory damages.

Rule of Law

Issue

Holding and Reasoning (Jolly, C.J.)

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