Class Action Complaint’s Anti-Cybersquatting Protection Act Claims do not Warrant Class Action Treatment because Rule 23(b)(3)’s Predominance Requirement for Class Action Certification not Met due to Individualized Issues Surrounding Trademarks or Personal Names Illinois Federal Court Holds
Plaintiffs filed a class action against Google and others alleging “a wide-ranging scheme whereby they receive ‘billions of dollars in ill-gotten advertising and marketing revenue’ by knowingly and intentionally registering, licensing and monetizing purportedly deceptive domain names at the expense of the plaintiff-mark owners.” Vulcan Golf, LLC v. Google Inc., ___ F.Supp.2d ___ (N.D.Ill. December 18, 2008) [Slip Opn., at 1]. In part, the class action alleged that Google’s conduct violated the Anti-Cybersquatting Protection Act (ACPA), _id._ Plaintiffs filed a motion for class action certification, _id._; defense attorneys countered that class action treatment was not warranted because plaintiffs’ claims are not typical and because they are not adequate class representatives, _see id._, at 4, and because the predominance and superiority tests of Rule 23(b)(3) had not been met, _see id._, at 7. The district court rejected the first defense challenges, finding the requirements for class action certification under Rule 23(a) were satisfied. However, the district court concluded that Rule 23(b)(3)’s requirements for class action treatment had not been met. Accordingly, the court refused to certify the litigation as a class action.
With respect to the requirements for class action certification set forth in Rule 23(a), the district court easily found that numerosity and commonality had been satisfied. Vulcan Golf, at 4-5. Defense attorneys argued that plaintiffs’ claims were atypical and that they were not adequate class representatives “because intra-class conflicts exist.” Id., at 5. For reasons we do not detail here, the district court rejected the defense arguments and found that each of Rule 23(a)’s requirements for class action treatment had been met. See id., at 5-7. In sum, the federal court explained at page 7, “The representatives’ claims arise from the same course of conduct as the other class members and the class representatives have the same interests and have suffered the same injury as the putative class members.” It turned, therefore, to whether the class action requirements of Rule 23(b)(3) had been met.
Defense attorneys argued that the class action’s infringement claims under the ACPA turned on individual issues that precluded class action certification. Vulcan Golf, at 8. The federal court agreed with the defense claim that a determination of whether a putative class member “own[s] the mark or personal name…could lead to potentially thousands of individual merits hearings and rulings.” Id. The court added that even if such inquiries were required as to “even a tiny fraction of the potentially millions of registered and unregistered marks or personal names of the putative class members, such an undertaking would render proceeding as a class unmanageable.” Id. Similarly, litigating the “distinctiveness” of the various trademarks and personal names would be a daunting proposition, see id., at 8-11. And the federal court expressly rejected the argument that distinctiveness may be presumed, id., at 10.
We do not here discuss the federal court’s consideration of the class certification motion with respect to the unjust enrichment, other than to note that the district court again found that individual issues would predominate thereby precluding class action treatment. See id., at 13-16. We also do not discuss the court’s analysis of the superiority aspect of Rule 23(b)(3), other than to note that it concluded a class action was not the superior means of resolving the dispute, see id., at 16-18, particularly because “plaintiffs seek to resolve relatively novel legal theories in one case with one throw of the dice as to potentially hundreds of thousands of claims,” which is something the Seventh Circuit has cautioned against, id., at 18 (citation omitted). In the end, the court denied plaintiff’s motion for class action treatment. Id., at 20-21.
NOTE: The district court also held that it could consider the affirmative defenses advanced against the class action claims to the extent that they confirmed the lack of common issues. See Bernal, at 11-13. Specifically, “[t]he defendants also assert that the plaintiffs’ request for class certification should fail because individual factual issues predominate as to the defendants’ affirmative defenses. These defenses include that: (1) the marks were obtained fraudulently; (2) the marks have been abandoned; (3) the marks are being used to misrepresent the source of goods or services, and (4) the defendant is making fair use of the marks. See 15 U.S.C. § 1115(b)(1)-(4).” Id., at 11. As the district court concluded at page 13, “Ultimately, the affirmative defenses related to the putative class members’ marks simply add another layer to an already fact-specific inquiry that the court must delve into with respect the putative class members’ marks or names.”
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