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A Fort Wayne man is at the center of a trademark infringement lawsuit filed by techno-giant Microsoft, but it’s not the first time he has found himself in this position.
Microsoft sued Anthony Peppler this week, one of three lawsuits filed by the Washington-based company. Filed in the U.S. District Court for the Northern District of Indiana, the lawsuit against Peppler also names his companies, 260.com, RealTimeInternet.com, based in Delaware, and Modern Limited, with offices in the Cayman Islands.
The lawsuit is similar to suits filed this week against different individuals in federal courts in Washington and New York.
All the suits allege trademark infringement by creating and registering Internet domain names “confusingly similar” to marks belonging to Microsoft. Such actions are in violation of the Anticybersquatting and Consumer Protection Act, according to the court documents.
For example, if a Web surfer was looking for Microsoft’s Internet portal for news, www.msn.com, but they mistakenly typed in msnnew.com, they would find a site that provided some news links but also links to other fake sites.
The Web site is one of the 95 listed in the lawsuit against Peppler.
Within the past few years, Peppler has been sued in similar cases by companies ranging from America Online Inc.; Linens ‘n Things; Syracuse University; Stargate Communications (Chuck E. Cheese); and, most recently by Express Franchise Services, according to federal court records.
Attempts to locate Peppler were unsuccessful. A search of court documents and recent public records indicate he lived in Fort Wayne within the last couple of years. His current whereabouts are not known.
This particular type of trademark infringement is known as “typo squatting,” and involves registering Internet domain names similar to licensed trade names, said Fred Cate, a professor at the Indiana University School of Law.
“One way to figure it out is to see how people most commonly misspell domain names in the Web browser and register them,” he said.
Long before the Internet, the practice was common with telephone numbers, Cate said.
People usually typo-squat or cyber-squat – using companies’ actual names in a Web site. But in this case, Cate suspects it is a form of extortion, an attempt to make money deviously by creating a similar site, creating confusion and then demanding money from the legitimate company to go away, he said.
“It’s irritating for customers who are trying to get to a site and go to a wrong site,” he said.
Peppler is listed on the Web site Hourlylaff as a member of the top 100 people who made $1 million selling domain names.
Besides seeking money from the real company, it is possible to make money by selling ads on the copycat Web pages. Customers, who may think they are on a different site, click on the ads, making money for whoever owns the similar Web page.
“If I can get you to my site mistakenly and you click on a banner ad, I’m going to make money,” Cate said. “It’s like collecting a toll on the way to the site that you want.”
Such activity can be maddening for companies and is bad for consumers, Cate said.
“If I’m looking for something and you manage to divert me, you may confuse my initial interest,” he said. “That’s fine, if it’s an open and fair competition. But if you’re exploiting the fact that I can’t type accurately, that just seems a little devious. There’s a certain element of unfairness, an element of deception.”
In its lawsuit, Microsoft is seeking $100,000 in damages per domain name. With all the domain names Microsoft links to Peppler, he could be on the hook for $9.5 million and that does not include the punitive damages and the surrender of all “ill-gotten gains” requested in the lawsuit.
Should Microsoft win, and Peppler refuse to pay, the company could seize any assets he may have, Cate said.
“Generally we think it’s a bad thing to confuse consumers,” Cate said. “Do you really want a marketplace where every time you go online you have to be vigilant that you’re actually at the site where you think you are?”
Microsoft’s attorney was not available for comment, though the company provided summaries of all three lawsuits filed in the three different federal courts.
rgreen@jg.net
