The Battle of Nissan Motor Company vs. Nissan Computer Corporation

A California judge decided in favor of Uzi Nissan on cybersquatting and non-auto-related business infringement accusations. However, the judge decided that by having links to three auto-related firms among 23 advertisements on his website, he infringed on Nissan Motor's rights. Uzi Nissan was ordered to erase the connections, which he had previously done willingly three months before, but the domain name was kept.

Later, U.S. District Judge Dean Pregerson decided in Nissan Motor's favor, ruling that Uzi Nissan's webpage "dilutes" the trademark of Nissan Motor Co. In two weeks, Pregerson will hear arguments on remedies for this "dilution," and by November, he should have decided whether Uzi Nissan's use of the name should be limited or if ownership should be transferred to Nissan Motor entirely.

The Background of Uzi Nissan

Uzi Nissan is the owner of Nissan Computer Corporation, which he founded in 1993. He and his company specialize in computer-related businesses, including consulting, software development, and more.

Nissan Motor Co. is an automaker founded in 1933 that specializes in manufacturing a variety of cars and trucks. The company has many subsidiaries like Nissan America Inc., which is their U.S.-based division that sells cars through dealerships and operates commercial vehicles.

The Battle of Nissan Motor Company vs. Nissan Computer Corporation began with accusations from Uzi Nissan's competitors accusing him of cybersquatting and non-auto-related business infringement; however, he prevailed with these allegations in April thanks to California Judge Dean Pregerson's ruling in favor of him.

Nowadays, the battle continues as Uzi Nissan has been accused of infringing on Nissan Motor Co.'s trademark due to links relating to three auto-related firms among 23 advertisements on his website--a violation that was only discovered because of an investigation by Nissan Motor's lawyers following the cybersquatting case win last April.

Factual Background

Nissan Motor Co. is an automobile manufacturer that produces and sells vehicles with the "Nissan" brand name, which it uses as a standalone brand. Nissan Computer Corporation (NCC) is an IT company that provides products and services to clients globally, without using the name "Nissan" in any official business transactions. Uzi Nissan, who owns the domain name nissancomputers.com, has had links to three auto-related firms on his website and advertises those firms in 23 advertisements on his website.

In April of this year, a California judge decided against Uzi Nissan on cybersquatting accusations but found him guilty of infringing on Toyota's rights by linking to three auto-related firms among his 23 advertisements. The judge ordered him to erase these links by November 16th or have his ownership over the domain transferred to Nissan Motor completely.

However, last month, U.S. District Judge Dean Pregerson decided in favor of Nissan Motor Company, ruling that Uzi Nissan's use of the name "diluted" their trademark for the automotive company and ordered him to stop diluting their trademark by November 16th or face a loss of ownership over the domain name entirely.

Timeline of Initial Events

The plaintiff is Nissan Motor Co., Ltd. of Japan, a well-known automaker with trademarks relating to cars, including the term "Nissan" and Nissan North America Inc. The latter company promotes and sells vehicles in the United States for its parent corporation which owns many related trademark rights.

The defendant is Nissan Computer Corporation which was created by Uzi Nissan in 1991 as an IT consulting firm selling computers and repairing them too; it also bears his surname prominently on clothing labels that are distributed around North Carolina where they are based out of today.

The defendant registered the domain names "nissan.com" and "nissan.net" in May 1994 and March 1996, respectively. For many years, Defendant operated websites at these urls, delivering computer-related information and services. In 1995, the defendant was granted a trademark for its Nissan computer logo by the state of North Carolina.

In August 1999, the defendant modified the content of its "nissan.com" web site. The defendant subsequently added a "Nissan Computer" logo on the site, which plaintiffs claim is confusingly similar to their brand. More importantly, the defendant caused a number of banner ads and links for automobile merchandisers to appear on the site.

Plaintiffs filed a case against the defendant, alleging trademark infringement and dilution, domain name theft, false designation of origin, and state law unfair competition. The plaintiffs requested a preliminary injunction. Defendant requested that the case be dismissed due to a lack of personal jurisdiction.

Plaintiffs' preliminary injunction request was granted, while defendants' motion to dismiss was denied. To win a preliminary injunction petition, plaintiffs must "prove either (1) a combination of likely victory on the merits and the risk of irreparable harm without the injunction; or (2) that substantial concerns are presented and the balance of hardships leans dramatically in favor of the moving party."

Plaintiffs had demonstrated a possibility of success in their allegation that defendant's acts infringed on their trademark, according to the court.

"The fundamental issue in a trademark infringement complaint is the probability of customer misunderstanding," the court noted. The court determined that the defendant's actions were likely to cause consumer confusion. The Court's judgment that the defendant was utilizing its marks to promote items identical to those offered by plaintiffs was particularly interesting. Defendant, as previously stated, sells computers rather than autos. Despite the presence of third-party vehicle ads on the defendant's site, the court decided that the marks were being used to market items comparable to those supplied by plaintiffs. Defendant was utilizing plaintiffs' mark to advertise autos, a commodity plaintiffs provided for sale under the mark, by displaying such advertising on its site.

Trial Court Proceedings

Uzi Nissan filed a lawsuit against Nissan Motor and the company's subsidiary, Nissan Computer Corporation. This was because Uzi Nissan made a website based on the name of one of their subsidiaries, as well as links to three other auto-related companies (all three were subsidiaries).

Nissan Motor claimed that Uzi Nissan infringed on their trademark by using the name and linking to different entities, while Uzi Nissan argued that they didn't violate any trademarks because they were not in the business of automobiles. The California court found that Uzi had violated at least two different trademarks involving their company and needed to remove links to all auto-related firms.

In April 2015, a California federal judge sided with Uzi Nissan in a cybersquatting case involving non-auto-related business infringement accusations. However, in May 2015, Judge Dean Pregerson decided that by having links to three auto-related firms among 23 advertisements on his website, he infringed on Nissan Motor Company's rights.

Appellate Court Proceedings

Nissan Motor Company filed a lawsuit against Uzi Nissan for cybersquatting and non-auto-related business infringement accusations in April. The company claimed that by having links to three auto-related firms among 23 advertisements on his website, he infringed on Nissan Motor's rights.

Uzi Nissan was ordered to erase the connections, which he had previously done willingly three months before, but the domain name was kept.

Last month, U.S. District Judge Dean Pregerson decided in Nissan Motor's favor, ruling that Uzi Nissan's webpage "diluted" the trademark of Nissan Motor Co. In two weeks, Pregerson will hear arguments on remedies for this "dilution," and by November, he should have decided whether Uzi Nissan's use of the name should be limited or if ownership should be transferred to Nissan Motor entirely.

Subsequent Trial Court Proceedings

Uzi Nissan is expected to argue that the decision will have "devastating consequences" for his company, which relies heavily on the Internet. He has been using the name since 2001, and he has no intention of changing it.

The judge could order Uzi Nissan to change his company's name, among other things. For example, he could require Uzi Nissan to stop using "Nissan" as part of his domain name or be required to change the name of a website linking to auto dealerships.

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