Italian court solves a cybersquatting case over Altavista search engine

Genova first instance Court issues a judgement on July 17, 1999 in the matter of cybersquatting case as complained by Compaq. The application is granted for the implicit appropriation of the Altavista’s name worldwide importance by the means of the altavista.it domain, whose home page returns information related to the real search engine to make users believe they are browsing one of the greatest web indexes.

Being the registration in bad faith, Altavista suffered an unjustified and immediate damage not fully mendable, consisting in preventing Altavista to register its own domain name to the Italian Registration Authority.

Rise and fall of Compaq

Before being merged into Hewlett-Packard in 2002, and becoming one of its signs, Compaq was one of the most famous and powerful manufacturer of personal computers.

A Texas based firm, Compaq is founded in 1982 by three colleagues formerly working together at Texas Instruments as senior managers. Since Compaq’s pc were running IBM compatible software, its name is an acronymous meaning Compatibility and Quality.

After an initial investment of 1000 dollar each, the founders are soon joined by external investors. As a supplier of personal computer into a market with an increasing demand, Compaq’s business is growing fast.

Its notebooks were compatible and high-quality standards

In 1982, it launches the first notebook ever, calling it “Portable”. Its compatibleness with main operative systems at a very reasonable price made it a big deal for users. While Portable is still being sold at a rate of 50.000 items per year, Compaq launches Deskpro, a PC running a revolutionary 16-bit Intel processor. It is as compatible as other Compaq’s PC, but a lot faster than them. As a leader among computer manufacturers combining high quality performance and technology products with fair prices, Compaq wins the market over IBM, which has to give up its primacy and its business too.

Entering in agreement with Hewlett-Packard marks the end of Compaq

In early 2000’s, Compaq enters in agreement with Hewlett-Packard for production of printers’ software. But, torn apart by a war against HP’s investors on whether the two undertakings should merge or not, and distressed by Dell’s competition, Compaq is becoming less attractive for market. Once incorporated by HP, Compaq’s business is reduced over and over until a mass redundancy dismissing thousands of Compaq’s workers is proceeded by HP’s CEOs.

Compaq was the licensee of Altavista, the most loved search engine before Google’s era

When Compaq was holding a good market share, its Italian subsidiary was the licensee of Altavista with exclusive rights.

In the 90’s Altavista is a leader among search engines. Google is still far from being the giant we all know and Altavista runs on most users’ computers.

They do appreciate its rapidity – just 0,7 seconds to return results after a query – and prefer it to Lycos and Excite, once loved search engines.

Despite making efforts to improve its technology, as search per images or implementing speed rate of search service, in the late 90’s Altavista is bound to perish.

Google is too young, too innovative, and its algorithm-based intelligence makes it much more revolutionary than any former search engine has ever been.

But, before its death, Altavista was so famous that an Italian small tech company launched a website for its selling and installing services naming it after the search engine, to exploit the remarkable success Altavista scored during those years.

The preliminary injunction ex art. 700 cpc and the subsequent trial before Genova Court

Filing for a preliminary injunction ex art. 700 cpc, Compaq sues ABX s.r.l. before Genova Fisrst Court. After the first hearing where both parties proved evidence, in this one-stage trial the judge holds hearings to examine persons of interest onto the matter of case then, issues judgment, ordering to reassume the merit within 30 days.

Unfair anti-competitive conduct asked to be ceased

Compaq seeks for ABX to be interdicted to any further use of the registered trademark “AltaVista”, for any unfair competition conduct still in place to be ceased by ABX being ordered to eliminate any reference to the trademark into the register held at the Authority and make the applicant able to register its internet domain using the proper name “Altavista”, for the judgment to be published on print and web at the expense of ABX.

Defendant claims the altavista.it domain name was not harmful being not related to internet search service

ABX affirms the full legitimacy of its own initiative, which is assumed on behalf of a client not operating in the computer sector. It holds that the explicit formulation of the pages excludes per se any intent of unfair competition or counterfeiting of the mark and that they had been temporarily deactivated not following the COMPAQ initiative, but "waiting to achieve a complete graphic layout” of the product.

Genova Court grants the application and orders to stop cybersquatting practices

The Court grants the application because of the illicit use of the trademark Altavista.it by ABX Sistemi s.r.l. and inhibits the Defendant any further use of the registered trademark. ABX is ordered to cease any further unfair competition conduct set through the registration of the trademark to the Italian Registration Authority and ordered to delete from Internet the trademark Altavista as referred to ABX sistemi s.r.l. at its own expenses. The judgment is published at the expenses of ABX on web site Altavista.it being it activated only to the purpose, and on the periodical PC Professional.

Italian Registration Authority has not any duty to activate out of the public contestation process

First, the Court dismisses the request to issue an order directly against the Italian Registration Authority. Beside the fact that it is not a party of the litigation, Registration Authority has not any duty to activate itself in the sense required by the applicant. As Court notes, it is a private subject devoid of any public connotation or public function.

When two domain names are conflicting for their websites having the same name, Registration Authority can activate a “public contestation process”: the site is marked as disputed and the parties invited to reach a settlement. Should the settlement not be reached, Registration Authority’s role is confined to take note of the situation because it is not entitled to suspend the domain name.

Defendant seeking profit from Altavista worldwide importance as a technologic related service

As to the dispute between trademark AltaVista and the address www.altavista.it, the Court points out that ABX Systems is clearly exploiting the most famous software held by Compaq to gain users access. It can be deduced by what is reported on the homepage of the altavista.it with its call to the possibility to access to one of the biggest web index with over 23 million users every day.

It is clear that ABX is aware to be unfairly competitive even if altavista.it has not relationship with the most famous search engine which wants to extend its domain name to Italy, or if they are on behalf of a client not operating within the field of the internet search service.

The same domain name for subjects operating in the same field implies unfairness of conduct

Should the domain be entitled to a different entity not operating within the technology field, Compaq would likely be subject of a fair competitive conduct without prejudice for its mark. But, being the domain used by a technology company, the trademark Altavista is suffering an unfair and immediate damage to its visibility for its illicit appropriation realized through the activation of the page altavista.it.

Since it is not at stake the mere disrepute or confusion of the mark but its relevance, for the legitimate owner of the mark is prevented by the abusive registration to register the mark as its own domain name to the Registration Authority, the case should be considered within civil code provision of art. 2598 c.c. paragraph 1 and 3, under fairness and loyalty of the competition with regard to access and use to integrated computer systems.

Cybersquatting definition

The matter exposed is a common case of cybersquatting or the practice of purchasing a domain name with the intent to profit from its value and related trademark. The profit comes from selling it to its rightful owner at a higher price or selling advertisement spaces being more attractive to users who looks for products related to the trademark.

Apart from the cybersquatting theme, the judgement is interesting for the Court defines the core business of search engines. Italian Court outlines that search engines can give users a service for free thanks to the selling of ads slots to advertisers reflecting the search engine’s value as an advertising channel and as an orientation for users.

Furthermore, the judge does not recognize the provider as a publisher whose duty is to avoid illicit registration of a domain against law provision on competition.

Altavista was typosquatted too

Altavista has been subject to a typosquatting case too. Typosquatting is when it is registered in bad faith a domain name similar to a more famous one, profiting from confusion. In 2000 resulted over 40 typosquatting domain names transferred to Altavista search engine, as alkavista.com or actavista.com.