United States District Court, N.D. California, San Jose Division
ORDER DENYING JEFFERY DEAN BLACK'S MOTION FOR
ATTORNEY'S FEES RE: DKT. NO. 201
H. KOH United States District Judge.
and Counterdefendant Jeffery Dean Black (“Black”)
filed the instant lawsuit against Defendant and
Counterclaimant Irving Materials, Inc.
(“Irving”). Black asserted a reverse domain name
hijacking claim and a declaratory relief claim to the effect
that Black's use of the imi.com domain name was not
unlawful, and to prevent the transfer of that domain name
from Black to Irving. Irving asserted counterclaims for
cybersquatting and for declaratory relief seeking to transfer
the imi.com domain name from Black to Irving. Before the
Court is Black's motion for attorney's fees. Having
considered the parties' briefing, the relevant law, and
the record in this case, the Court DENIES Black's motion
for attorney's fees.
Black Registers imi.com and Incorporates Internet Marketing
at least the mid-1990s, Black has invested significant time
and money developing various internet entities, projects, and
businesses. ECF No. 210 at 178-82. Black is also one of the
first people to register domain names: “I was again one
of the main speakers in the world going around talking about
the internet is coming to get people to go online. My job was
kind of, let me help convince all of the people in the world
that this new thing, going from what we called the ARPAnet at
the time, which only colleges used, and let's get people
to go on to the internet. Something you take for granted
today, back then it was all dial up. No. one was doing it. My
job was to make awareness to everybody in the world why they
should do that.” Id. at 182:20-183:4.
March of 1994, Black acquired and registered for free the
domain name at issue in this case, imi.com. Id. at
183:15-184:5, 191:19-23. Black associated his home address,
his home phone number, his cell phone number, and his pager
with the imi.com domain name from 1994 to 2019, and all of
this information was listed on WHOIS. Id.; ECF No.
211 at 281:11-14.
April 6, 1994, Black also incorporated an entity named
Internet Marketing Inc., which was the first company Black
ever created. ECF No. 210 at 197:12-18, 236:20-22; BX-2
(Certificate of Incorporation of Internet Marketing Inc.). At
the time Black created Internet Marketing Inc., Black was not
aware of any other “IMI” business. ECF No. 210 at
191:10-14. When Black registered imi.com, Black was not aware
of Irving Materials, Inc. (“Irving”): “I
had no idea who Irving Materials was. I had never been out in
Indiana. I've never seen any of their trucks driving here
in California. I had no intent at all to profit off of their
site.” ECF No. 211 at 303:12-304:10.
testified that the first thing he did with Internet Marketing
Inc. and the imi.com domain name after he registered it was
that he started building some directories and spiders, which
Black explained were “some software that [he] would
write that would say, ‘I want you to go out to every,
every machine on the internet, and on your way, keep track of
every little machine you bounce to, or routers.'”
ECF No. 210 at 184:13-185:1, 201:9-14. Black further
explained: “then I reversed that backwards and turned
that into the first internet service provider listing in the
world that would show how many people were behind each ISP at
the time. An ISP is an internet service provider.”
Id. at 184:13-185:1.
1994, Black used imi.com to create a website that displayed
“Internet Marketing, Inc.” across the top of the
page. Id. at 185:2-6; JX-5 (copy of imi.com from
1998). The Internet Archive Wayback Machine, available at
archive.org, was not created until 1996 and did not start
collecting websites until mid to late 1997, so the Wayback
Machine did not have a copy of imi.com from 1994 to 1996. ECF
No. 210 at 188:3-14. Black explained that in 1994, 1995, and
maybe part of 1996, imi.com described Internet Marketing Inc.
as a “data aggregator.” Id. at
used imi.com and Internet Marketing, Inc. to hold the data of
his clients, and to create internet directories. Id.
at 188:16-189:16. Black displayed the IMI mark on his
website, documents, around 30 or more non-disclosure
agreements, business plans for corporations, presentations
and pitch decks. Id. at 189:23-190:8, 203:3-17.
Black shared his IMI mark with companies, including Oracle,
Microsoft, Yahoo, Digital Equipment, American Business
Information, N.W. Ayer Incorporated, Excelsior, and Digex.
ECF No. 210 at 215:1-8, 216:8- 221:14. Black does not have
many records left from Internet Marketing Inc. because Black
sold the company to AltaVista for $25 million, and the
records then became AltaVista's property. Id. at
Black Changes the Corporate Form of Internet Marketing
rolled Internet Marketing Inc. into two other entities.
Id. at 232:11-25. Specifically, Internet Marketing
Inc. started as an S Corp that was tied to Black's social
security number, but because venture capitalists would not
fund S Corps, Black had to change the corporate form.
Id. at 232:11-25, 236:13-22. Thus, Internet
Marketing Inc. was rolled into a company called iChannel in
1996, which was then later rolled into iAtlas in 1998.
Id. at 236:15-16; ECF No. 211 at 277:12-16,
312:16-314:4. Black worked with the law firm of Hale &
Dorr to make sure that all of Internet Marketing Inc.'s
records moved with the new companies. ECF No. 210 at
Acquisition by AltaVista
then entered into negotiations to sell iAtlas to AltaVista.
Around October 1998, AltaVista specifically asked Black to
take the imi.com website down to avoid any confusion about
the company's name. ECF No. 210 at 241:21-25,
249:24-250:16; ECF No. 211 at 279:20-280:9. Black thus took
imi.com down in October 1998. ECF No. 210 at 241:21-25,
249:24-250:16; ECF No. 211 at 279:20-280:9.
1999, Black sold iAtlas to AltaVista for $25 million. ECF No.
210 at 237:24-238:15; ECF No. 211 at 277:12-22, 314:5-10;
BX-13. This transaction included all of the
assets from Internet Marking Inc. going back to 1994, with
the exception of the imi.com domain name, which AltaVista
allowed Black to keep. ECF No. 211 at 277:12-278:21. Black
then went to work for AltaVista. Id. at 314:6-9.
Black's Other Domain Names
1994, Black also registered other domain names, including
“hiking, biking, scuba, tennis, recreation, hotels.com,
[and] resorts.com. Obviously, IMI was the first one I did.
There might be a couple others that I did, ” perhaps
“ten, fifteen, something like that. They're all
generic terms.” ECF No. 210 at 191:24-192:25.
Black's plan for hotels.com and resorts.com was to build
the first online booking reservation system in the world.
Id. For hotels.com, Black built a booking
reservation system complete with maps, and hand coded over
40, 000 hotels into the database. Id. at
193:18-194:15. Black ultimately sold resorts.com in 1999 for
$950, 000 and hotels.com in 2001 for $11 million.
Id. at 195:8-21. Black gave away the hiking, biking,
scuba, tennis, and recreation domain names for free.
Id. at 195:22-197:11.
Irving Materials, Inc.
and Counterclaimant Irving is an Indiana concrete and
construction materials supplier that does business in
Indiana, Kentucky, Tennessee, Illinois, Ohio, Michigan, and
Alabama. ECF No. 212 at 652:9-11.
trial, the jury heard evidence about Irving's use of its
IMI trademark. Jason Richmond, Irving's Director of
Marketing and Business Development, testified that between
1965 to the present, Irving used the IMI trademark on fleet
vehicles, ready mix concrete trucks, uniforms, building
signage, billboards, business cards, price sheets, marketing
materials, and promotional items. Id. at
635:13-636:7; D Ex.1. In 1962, Irving built the corporate
office in Greenfield, Indiana and displayed the IMI trademark
on the front of that office. ECF No. 212 at 643:1-9; D Ex.1
at 85-86. Irving introduced into evidence a brochure from the
1962 original open house when Irving moved into the new
corporate headquarters that displayed the IMI trademark.
6/14/19 Transcript at 647:19-24; D Ex.1 at 45-49. In 1968,
Irving displayed the IMI trademark on the company letterhead.
6/11/19 Transcript at 645:22-646:5; D Ex.1 at 266-67. In
1981, Irving displayed the IMI trademark and the goods that
Irving provides--“concrete, gravel, stone, and
sand”--on a brochure that Irving handed out to
customers. 6/14/19 Transcript at 648:6-18; D Ex.1 at 2-5.
Irving has displayed the IMI trademark on Irving's
website, irvmat.com, since 1996. 6/14/19 Transcript at
testified about Irving's registration of its IMI
trademark. Irving filed its trademark registration
application on September 19, 1994, and Irving's IMI
trademark was registered on September 19, 1995. ECF No. 211
at 519:5-18; D Ex.11. The specific goods covered by the
registration were “concrete and construction
aggregates, including sand, gravel, stone, and concrete in
Class 19.” Id. at 519:13-19; D Ex.11. In its
registration, Irving stated that Irving first used IMI on
January 1, 1965, and that it first used IMI in commerce on
March 1, 1991. ECF No. 211 at 519:20, 525:11-17; D Ex.11. The
United States Patent and Trademark Office registered the IMI
trademark without requiring any proof of secondary meaning.
ECF No. 199 at 7:1-7; ECF No. 211 at 519:5-18.
Irving Offers to Buy imi.com from Black
Howard, Irving's Vice President of IT and former Director
of IT, testified that Irving's website is irvmat.com.
Id. at 397:14-20. Irving first put up its website in
1996. ECF No. 212 at 636:21-23. Howard first learned of the
imi.com domain name in 1998. Id. at 402:22-24.
Howard explained that from a search on WHOIS, Howard learned
that Black was the owner of imi.com and that Black had
registered imi.com in 1994. Id. at 405:1-11.
summer or fall of 1998, Howard approached Black to buy the
imi.com domain name for Irving. ECF No. 210 at 240:22-241:8;
ECF No. 211 at 415:9-25. Howard had between two to five calls
with Black regarding purchasing imi.com. Id. at
explained that at the time Howard approached Black in 1998,
Black was not looking to sell imi.com. ECF No. 210 at
240:22-241:8. According to Black, Irving offered Black $500
for his imi.com domain name, which Black rejected.
Id. at 242:2-15. Black testified at trial: “I
said, I'm sorry. Hold on. Let me explain something here.
My business is called Internet Marketing, Inc. It's still
running. I'm the biggest spider in the world for what I
do. I track more data than anybody else in the world as a
data aggregator. $500 isn't going to cut it.”
Id. Black testified that he calculated what it would
cost him to convert everything over, including his DNS
servers, his web content, software, and contracts, and that
in light of these calculations, Black would not consider any
offers below $135, 000. Id. at 242:16-243:7.
to Howard, Howard never offered to purchase imi.com for $500.
ECF No. 211 at 416:4-13. Instead, Howard offered to purchase
imi.com for $5, 000 then $10, 000. Id.; ECF No. 212
at 609:25-610:8. Howard testified that Black rejected the $5,
000 and $10, 000 offers; that Black said that those offers
were too low; and that Black said he had turned down offers
of more than $100, 000. Id. at 609:25-610:8; ECF No.
211 at 416:11-417:13. Howard testified that he does not
recall Black mentioning the $135, 000 figure. Id.
to Black, Irving refused his $135, 000 figure, repeated the
$500 figure, and threatened to sue Black for trademark
infringement. In fact, on October 2, 1998, Irving emailed
Black a draft complaint suing Black for trademark
infringement in the United States District Court for the
Southern District of Indiana, in Indianapolis. ECF No. 210 at
explained above, around that same time, in October 1998,
Black had taken the imi.com website down at the request of
AltaVista. Id. at 241:21-25, 249:24-250:16; ECF No.
211 at 279:20-280:9. Black testified that on October 7, 1998,
Black emailed Irving to tell Irving that Black took the
imi.com website down and that there could be no infringement.
ECF No. 210 at 247:22-250:9.
handle Irving's threats to sue for trademark
infringement, Black hired litigation attorneys to represent
him. ECF No. 210 at 243:19-248:7. Black testified that his
attorneys handled the situation with Irving and told Black
that he would not hear from Irving again. Id. at
243:19-244:11, 250:11-16. Indeed, Irving never filed the suit
for trademark infringement in the United States District
Court for the Southern District of Indiana. Id. at
251:22-25; ECF No. 212 at 610:22-24.
Howard, Irving's current Vice President of IT and former
Director of IT, testified that Black had stated that he had
taken the imi.com website down. ECF No. 211 at 424:22-426:21.
Howard explained that Irving ultimately did not sue Black
“because he responded to our lawyers indicating-or
acknowledging the trademark infringement and indicated that
he was taking the website down. ECF No. 212 at 610:22-611:3.
Howard confirmed that imi.com was down as of October 1998.
ECF No. 211 at 424:22-426:21.
would randomly check to confirm imi.com was still down from
October 1998 on, but he stopped after a year and a half or
two because “it didn't seem like there was any need
to check anymore, ” the website “had been down
for a longer period of time, ” and “based on what
I saw in the [October 7, 1998] email, I never thought it
would come back up.” Id.
Black Receives Other Offers to Buy imi.com Between
left AltaVista during the end of 2000 or the beginning of
2001. Id. at 280:1-25. Between 2000-2002, Black
received offers from seven or more companies for the imi.com
domain name. Id. at 284:19-285:16, 286:22-289:8. One
of these offers included an offer from a company called
Piezotronics for $2 million. Id. at 286:22-289:8.
Black also testified that he was in discussions with Israeli
Military Industries and that Black believes that their offer
was upwards of $2 million. Id. at 374:1-16.
response to these offers, Black eventually raised the price
to $4 million. Id. at 376:4- 16. Black testified
that Black “overpriced” the domain name, and that
the price increase drove the potential purchasers away.
Id. at 376:17-19.
Black Puts imi.com Back Up in 2002
testified that in 2002, Black put imi.com back up.
Specifically, Black put up a free directory on imi.com for
companies that used an “IMI” acronym.
Id. at 281:9-282:2; JX-7 (screenshot of imi.com from
2002 showing directory of companies with IMI name). Black
created the directory using the names of companies that had
reached out to Black to purchase the imi.com domain name,
including Irving. ECF No. 211 at 282:11-284:7. Black
explained that Black was not trying to profit from these
companies, but rather was redirecting to these companies'
websites any traffic that came to imi.com but was intended
for these companies. Id. However, Black testified
that the directory consisted primarily of companies that had
contacted Black to purchase the domain name. See,
e.g., id. at 283:3-5 (“The majority of
these are companies that actually came to me saying, when I
was down, basically saying, ‘Hey, you want to sell it?
Do you want to sell it?'”). One company requested
to be removed from the directory, and one company requested
to be added. Id. at 282:11-284:7. Black complied
with both requests. Id.
imi.com website, Black also advertised that the imi.com
domain name was for sale, but that he would not sell it for
less than $2 million. Id. at 285:6-25. Black
testified that his attorneys approved of his actions and that
Black had no reason to believe that what Black was doing was
illegal. Id. at 286:11-23. Ultimately, Black did not
sell the imi.com domain name, and Black kept the directory on
the website through 2018. Id. at 293:1-294:18.
Black Forms International Monetary Investments LLC
2016, Black incorporated a new company, International
Monetary Investments LLC. Id. at 252:15-23,
294:19-296:24. In December 2016, Black decided to license his
imi.com domain name to his International Monetary Investments
LLC company. Id. at 296:25.
Monetary Investments LLC entered into 300 contracts with
clients, and a majority of the agreements were signed in
2016. Id. at 298:15-301:15. Because International
Monetary Investments involved financial services, Black had
to track every one of his contracts and register the
contracts with the United States Treasury Department.
Id. at 298:4-25. Black testified that because the
United States Treasury Department scrutinized International
Monetary Investments LLC, Black was “not going to do
anything wrong.” Id. at 306:15-20. Black was
required to notarize his International Monetary Investments
LLC contracts and to have the other contracting party
“run though” the Department of Homeland Security
or Interpol to “make sure they're good
people.” Id. at 310:14-19.
Irving Hires the Heavyweights and Changes Their Marketing
Richmond, Irving's Director of Marketing and Business
Development, testified that in 2014, Irving developed a new
marketing and branding strategy to shift Irving's
investments to digital and online advertising. ECF No. 212 at
650:6-651:12. In 2015, Irving hired an advertising firm known
as the Heavyweights. Id. at 652:17-653:9. In June
through October of 2016, Irving and the Heavyweights
interviewed employees and customers and learned that Irving
is “known as IMI everywhere but online.”
Id. at 653:6-655:7. Thus, Irving sought to build its
McPherson, Irving's Vice President of Sales and
Marketing, testified similarly. In 2014, after McPherson
obtained his position as the Vice President of Sales and
Marketing at Irving, Irving began conducting consumer
research on Irving's marketing. ECF No. 211 at 497:17-
503:9. Irving then hired the Heavyweights, an advertising
firm, to look into how Irving was branding. Id.
McPherson testified that: “it was suggested to us,
” that “it would be good not to confuse the
marketplace and we should go after imi.com.”
Id. at 503:10-15.
further testified that the advertising firm helped him look
into the imi.com domain name and “it appeared that
[Black] wasn't offering any goods or services through the
web, and that's when [the advertising firm] informed me
that [Irving] could hire an attorney” and file a
Uniform Domain Name Dispute Resolution Policy
(“UDRP”) complaint. ECF No. 212 at 582:24- 583:2.
McPherson looked up the imi.com website and saw that the
website stated that imi.com was for sale and that
“offers less than 2 million dollars will not be
considered.” Id. at 583:17- 84:6. McPherson
thought that was a ridiculous offer. Id. at 584:4-9.
asked “between 1998 and 2017, why did Irving not say a
word to Black about his registration and use of the [imi.com]
domain name?, ” McPherson responded: “different
strategy we have right now after going through the research
and things of that nature that we've gone through. And
also the way the website, social media apps and everything
interact[s] with one another, it's my job to make sure
our brand is consistent throughout our footprint, consistent
throughout the country, consistent everywhere we
operate.” ECF No. 211 at 503:24-504:6.
Howard, Irving's Vice President of IT and former Director
of IT, testified similarly. Specifically, Howard explained
that he was prompted to look at Black's imi.com website
sometime in 2017 after the advertising firm began its digital
advertising efforts, and it was at that time that Howard
learned of Black's relaunch of imi.com. ECF No. 212 at
614:13-616:10. Black never contacted Irving to tell Irving
Black was planning on relaunching the website. Id.
at 617:7- 618:5. Howard testified that Irving did not
approach Black in 2017 to buy the imi.com domain name because
“from  until 2018, the website had changed very
little. There's--it didn't look like there was any
more bona fide business in 2017 than there was in 1998, and
in 2017, the price went from in excess [of] $100, 000 to in
excess of [$]2 million. And it seemed to be outrageous back
then and unreasonable, and then it only got more unreasonable
in 2017.” Id.
Irving Files the UDRP Complaint Against Black in
October 2017, with the help of the Heavyweights advertising
firm, Irving filed the UDRP complaint against Black.
Id. at 584:9-11; ECF No. 211 at 301:14-21,
503:16-19.; ECF No. 210 at 252:7-19. Specifically, Irving
alleged that Black was cybersquatting on the imi.com domain
name, and Irving sought to transfer imi.com to Irving.
Black files the Instant Suit
November 21, 2017, Black filed the instant lawsuit, which
seeks to enjoin Irving's efforts to force Black to
transfer the imi.com domain name to Irving. ECF No. 1. On
March 22, 2018, Black filed his first amended complaint. ECF
trial, Black testified that March 2018--four months after he
filed the instant lawsuit-- was the first time he could make
changes to the imi.com website because that was when the UDRP
suspension on imi.com was lifted. ECF No. 211 at
354:10-355:4. Jason Richmond, Irving's Director of
Marketing and Business Development, testified as to
Irving's allegations of Black's bad faith. For
instance, Richmond confirmed that he saw a “for
sale” page that “prominently advertised
imi.com” and “clearly stated, please contact us,
but not with offers less than $2 million” only shortly
after Black filed the instant lawsuit. ECF No. 212 at
655:8-656:12. Richmond testified that while the instant
lawsuit has been pending, the imi.com website has been blank.
Id. at 656:13-19. However, Richmond testified that
Black changed the imi.com website and that, as of June 14,
2019, the day of Richmond's testimony, the imi.com
website said, “coming soon.” Id. at
October 2017, Irving initiated a UDRP proceeding against
Black for the imi.com domain name. On November 21, 2017 Black
initiated the instant suit against Irving. ECF No. 1.
March 22, 2018, Black filed his first amended complaint
(“FAC”) and asserted two claims: (1) declaratory
relief for a finding that Black lacked bad faith intent and
thus did not violate the Anti-Cybersquatting Consumer
Protection Act (“ACPA”) pursuant to 15 U.S.C.
§ 1114(2)(D)(v) (“Count 1” or
“subsection (v) declaratory relief claim”); and
(2) reverse domain name hijacking by Irving in violation of
15 U.S.C. § 1114(2)(D)(iv) (“Count 2” or
“subsection (iv) claim”). ECF No. 11
labeled Count 1, his subsection (v) declaratory relief claim,
as “Declaratory Relief --No Bad Faith
Intent/Cyberpiracy (15 U.S.C. §§ 1114(2)(D)(v),