Domain names are an essential asset for companies. They not only facilitate online connection between users, but also play a key role as business identifiers in the vast world of the internet. We have referred to them in other posts. Here we discuss the famous, long running and surprising dispute between France and the company France.com, Inc. over the domain name “France.com.”
Background and legal proceedings before French courts:
In 1994, the American company France.com, Inc., founded by Jean-Noël Frydman, registered the domain name “France.com” and used it for over two decades to promote tourism in France—even receiving recognition from French authorities.
In 2014, France.com, Inc. filed a lawsuit against the Dutch company Traveland Resorts before the Tribunal de Grande Instance de Paris for trademark infringement, requesting the transfer of several trademarks containing the terms “France.com” and compensation for damages.
In April 2015, the French government and Atout France (the French tourism agency) intervened in the proceedings seeking (i) a declaration of infringement of their sovereignty by Traveland Resort and France.com, Inc.; and (ii) the transfer of the disputed trademarks and the domain name “France.com” in favor of the French government. They also brought actions for unfair competition damages to the interests of the tourist agency Atout France.
The main arguments of the French government and Atout were as follows:
- Under French law, the term “France” cannot be commercially used or appropriated by an individual, as this violates France’s sovereignty and exclusive right to its name.
- Furthermore, the term “France” expresses the “geographical, historical, economic and cultural identity” of the country.
The Tribunal de Grande Instance de Paris upheld the arguments of the French government and Atout, ruling that the use of the “France.com” domain by Mr. Frydman’s company “infringes the rights of the French State to its name, which refers to a sovereign state and identifies the country.” Thus, it ordered the transfer of the domain “France.com” to the French Republic without compensation.
The Cour d’Appel de Paris confirmed this decision in a judgment of September 2017, explaining that “the designation ‘France’ constitutes for the French State an element of identity akin to the family name of a natural person.” In March 2018, the French authorities presented a copy of the decision to the domain registrar Web.com, which transferred the domain name to the French Minister of Foreign Affairs.
Legal proceedings before US courts:
In April 2018, France.com, Inc. brought actions before the Eastern District Court of Virginia against the French Republic and Atout (among others), alleging that they had engaged in (i) cybersquatting and reverse domain hijacking; (ii) trademark infringement; (iii) unfair competition; and (iv) expropriation.
The defendants moved to dismiss based on their alleged sovereign immunity under the Foreign Sovereign Immunities Act (FSIA). The district court refused to dismiss the complaint, considering that entitlement to FSIA immunity “would be best raised after discovery has concluded.” This decision was appealed.
In its ruling of March 25, 2021, the appellate court recalled that a sovereign state enjoys FSIA immunity from the jurisdiction of US courts unless a specific exception applies. To overcome the FSIA presumption of immunity, the plaintiff must set forth sufficient facts to reasonably infer that one of the specific exceptions is met. In this context, the court held that since the FSIA seeks to free foreign sovereigns from suit, immunity should be addressed as near to the outset of the case as is reasonably possible.
France.com argued that the requirements of two of the FSIA exceptions are met, namely those of “commercial activity” and “expropriation.”
- Under article 28 U.S.C. § 1605(a)(2), the “commercial activity” exception strips foreign states of sovereign immunity in cases based on: (a) a commercial activity carried out in the US by the foreign state; (b) an act performed in the US in connection with a commercial activity of the foreign state elsewhere; or (c) an act outside the US in connection with a commercial activity of the foreign state elsewhere and that act has a direct effect in the US.
France.com, Inc. argued that the act providing the basis for its suit was the French State’s use of “France.com” to offer tourist services and to sell advertisements. However, the appellate court rejected this argument. It considered that all claimed damages stemmed from the French judgment holding that the domain “France.com” belongs to the French State—and not from a commercial activity of the latter. Thus, the court concluded that the “commercial activity” exception provided for in the FSIA did not apply here.
- Article 28 U.S.C. § 1605(a)(3) provides that the “expropriation” exception applies when property is taken in violation of international law and that property is (a) present in the US in connection with a commercial activity carried out in the US by the foreign state; or (b) owned or operated by an agency or institution of the foreign state engaged in a commercial activity in the US.
According to the court, it is unclear whether the alleged conduct qualifies as an “expropriation” for FSIA purposes, since the French State did not engage in the nationalization of the website France.com, nor did it take the property through eminent domain. In any event, even if the French State may have engaged in some form of expropriation, the court found no violation of international law, as required for the exception to apply. Therefore, the court rejected the application of the “expropriation” exception under the FSIA.
For these reasons, the appellate court reversed the judgment of the district court and dismissed the claim for lack of subject matter jurisdiction under the FSIA.
The court order to transfer a domain name validly registered more than 20 years ago by a private individual in favor of the French state has generated much controversy. Indeed, the public authorities that in 2015 claimed ownership of “France.com” are the same that had publicly rewarded and praised the role played by the company France.com, Inc. The case also raised several legal questions such as (i) whether the French courts are competent to determine that the domain name “France.com” is owned by France; or (ii) whether the transfer of the domain name constitutes an act of expropriation and, consequently, the owner company should receive some kind of compensation, considering the significant losses.
At present, the appeal filed against the judgment of the Cour d’Appel de Paris by the Company is pending before the Cour de Cassation, so this conflict has not yet ended. In any case, we will be watching any developments—especially whether the Cour de Cassation finally confirms the French State’s ownership of the “France.com” domain name.
Autora: Ainhoa Rey