Domain Speculation:

In 1995, I registered about 200 domain names. It was clear to me at the time that 
domain names were valuable, undeveloped virtual real estate. There was absolutely 
no statutory or case law regarding trademarks in the context of Internet domain 
names. It seemed to be an excellent opportunity to do the virtual equivalent of 
buying up property around a factory -- eventually the factory owner would realize 
that he needed the scarce resource which I possessed.

Some of the domain names I registered were generic English words, like 
hydrogen.com. Others corresponded with trademarks that were shared by more than 
one company, like americanstandard.com. And some corresponded with trademarked 
coined words, like panavision.com. Let me say that again: There were three types 
of domain names in my portfolio.

I sat on my virtual real estate and waited for offers and threats. Many 
even-tempered folks purchased domain names and went on their way. Others sued me. 

I litigated Panavision because I wanted the court to rule whether or not a 
trademark holder had a preemptive right to a domain name. Winning Panavision 
would have bestowed infinite value on my portfolio of domain names. Losing 
Panavision suit would mean that I'd have to abandon the domains in my portfolio 
that corresponded with trademarks. Litigating Panavision was a sensible high-risk 
gamble.

Unfortunately, Federal Courts sided with trademark holders in Intermatic and 
Panavision. Rather than accepting my real estate analogy, the courts likened my 
actions to taking a lollipop from a child. 

The ruling in Panavision contained some nonsensical conclusions. For instance, 
to find confusion, the court essentially ruled that if Panavision were to buy
the domain name panavision.com from me, they might mistake the source of the 
domain name as being Panavision -- themselves. Did you get that? It makes no
sense whatsoever. 

They also had to find "commercial use" - that the domain name was being used 
for a commercial purpose like selling or promoting a product or service. But it 
was not. So they did some mental gymnastics and found that selling a domain name 
constituted a commercial use. That, of course, is totally incorrect as far as 
trademark law goes.

Shortly after the court ruled, I abandoned all domain registrations corresponding 
with known US trademarks. 

In the years since the Panavision ruling, I've sold domain names from the original 
batch for about $2m, total. The three largest transactions wre $800k, $175k, and 
$120k. 

The Panavision and Intermatic cases formed the foundation of modern Internet 
trademark law. Both unreasonably and incorrectly favored trademark holders. In the 
years since, more sensible rulings have come out of the courts.

It's worth noting that a well-known letter which I sent to Panavision in 1996 was 
not an extortive demand, as it was mischaracterized by Panavision's attorney. Rather,
it was a taunt, designed to ensure that the matter would be litigated. 

I grew impatient and had my attorney prepare a declaratory judgement action for 
filing in Chicago Federal Court. I instructed him to file it after I completed my 
June 1996 bicycle ride from Chicago to LA on Route 66. But then, Panavision beat 
us to the punch and filed in LA. They had a bit of a home-court advantage in LA. 

As a result of domain litigation, I appear in most introductory business law texts 
and virtually all trademark law texts. Most of the time, I'm cast as a villian. But
now and then I encounter thoughtful people who are intrigued that I successfully
divined the value of domain names much earlier that others did.

Dennis Toeppen
May, 2023



Excerpt from Guzman Ruling on Intermatic.com matter:

WILLFULNESS OF TOEPPEN'S DILUTION

Having found no infringement or unfair competition, it is not necessary to 
consider the appropriate remedies for Intermatic under those counts. However, the 
controversy still at issue in this case is whether Toeppen's conduct was willful, 
thus justifying an award of attorneys fees to Intermatic under the provisions of 
15 U.S.C. $51 125(c)(2) and 11 17. Intermatic asserts that Toeppen acted with 
willful intent to hinder Intermatic's commercial exploitation of the Internet. 
Toeppen maintains that he was merely asserting and defending his position that 
trademark owners do not have a preemptive right to register their trademarks as 
domain names. 

As in Panavision International, L.P. v. Toeppen, 945 F. Supp. 1296 
we find that an award of attorneys' fees in this case would be inappropriate. The 
particular issues dealt with in this case were primarily issues of first 
impression and at the relevant period there was a lack of legal precedent 
regarding issues arising from the intersection of trademark law and the Internet. 

Furthermore, the remedies available under the Anticybersquatting Consumer 
Protection Act ( "ACPA"), 15 U.S.C. 5 1 125(d)(2)(D)(i) depend on when the 
unlawful activity took place. A person who unlawfully registers, traffics in, or 
uses a domain name after the ACPA's date of enactment, November 29, 1999, can be 
liable for monetary damages under 15 U.S.C. 5 1 1 17(d) and can have the domain 
name transferred to the owner of the mark or canceled under 15 U.S.C. 8 1 
125(d)(2)(D)(i). The only remedy available for ACPA violations that occurred 
before November 29, 1999, however, is to have the domain name transferred to the 
owner of the mark or canceled. Anticybersquatting Consumer Protection Act, Pub. L. 
No. 106-1 13,s 3010, 1 13 Stat. 1536. Toeppen's alleged cybersquatting occurred 
before the ACPA's date of enactment. 

Nor do we find willful mess. It is apparent that defendant neither damaged nor 
intended to damage plaintiffs reputation. It is also apparent that he did not in 
any way deceive or intend to deceive the purchasing public. He did no more than 
what entrepreneurs and businessmen do or try to do every day. He used his 
particular legitimately gained knowledge, in this case of a new technology, to 
position himself, before others did so, so as to attempt to make a profit with 
very little work. At the time he did this there was a vacuum in both statutory and 
case-law regarding the degree to which, if any, the law of trademarks and unfair 
competition protected trademarks from being used in this manner. In addition, 
when plaintiff objected the defendant immediately did all he could do to ensure 
that he was not damaging plaintiffs reputation in any way. He professed a 
willingness not to use the domain name in question to sell any product or service. 
Thus eliminating any potential for product confusion. In short, he did everything 
but give up his right to the use of the domain name. This he did not have to do 
as it was not at all clear that he was legally bound to do so.

CONCLUSION

This Court hereby enters final judgment for defendant, and against plaintiff as to 
plaintiffs willfulness allegations in Count 111; plaintiffs trademark infringement 
allegations (Count I); plaintiffs federal unfair competition claims (Count 11); 
plaintiffs common law unfair competition claims (Count V); plaintiffs Illinois 
Deceptive Trade Practices claim (Count VI); and plaintiffs Illinois Consumer Fraud 
Act claim (Count VII). Judge Williams previously entered judgments of permanent 
injunctive relief on Counts I11 and IV. All parties are to bear