Universal Tube & Rollform Equipment Corp. v. YouTube, Inc., 2007 WL 1655507 (N.D. Ohio June 4, 2007)

Boy, this case got a lot of attention when it was first filed (which isn’t surprising; YouTube lawsuits usually do). You may remember the story: the plaintiff is a dealer of used tube mills, used pipe mills and used pollforming machines. The plaintiff operated a website at utube.com. As you might expect, like most other industrial B2B vendors’ websites, utube.com had a small but targeted audience.

With the phenomenal and quick rise in popularity of YouTube, a lot of web users mistyped youtube.com and entered utube.com instead, causing utube.com to suddenly experience disproportionate popularity. Unfortunately for the plaintiff, few of these visitors were interested in pollforming machines—as the opinion starts out, “This is a case about two very different types of ‘tubes.’” As a result, the plaintiff was paying big bandwidth charges for customers who weren’t buying. In some cases, the plaintiff claimed that the traffic overwhelmed the servers, causing utube.com to be offline and preventing the plaintiff’s real customers from conducting business with the plaintiff.

The plaintiff sued YouTube for trademark infringement, trespass to chattels and related claims. Last week, the court addressed YouTube’s motion to dismiss. The net result is that the court allowed some of the plaintiff’s trademark and related claims to survive, but the court dismissed several other claims (with leave to amend).

Trespass to Chattels

Most interesting to me is the court’s dismissal of the plaintiff’s claims that YouTube “trespassed” utube.com. The court correctly says that trespass to chattels (TTC) claims require physical contact, so it is not possible to trespass intangible property like a domain name. While this is the right result, I can’t help but note the Ninth Circuit’s holding that domain names can be converted like personal property (in the Sex.com case), and the recent Thyroff case, which also said that digital files could be converted. But here we’re talking about a smaller possessory interest than conversion, and the court rightly understands that TTC could become a bypass to trademark infringement. As a result, this decision channels unhappy domain name owners towards trademark claims instead of some TTC bypass.

Even if the domain name itself can’t be trespassed, the plaintiff can still claim that the computer servers attached to the domain name were trespassed. The court dismisses the claim for two independent reasons:

1) The plaintiff uses a third party web host, and the court says that the plaintiff didn’t allege an adequate possessory interest in its host’s equipment.

This may just be a pleading issue that gets corrected in an amended complaint, but it raises an interesting question about TTC standing that I don’t recall seeing discussed before. Assuming that TTC is occurring to a site hosted by a third party vendor, does the TTC claim rest with the website operator, the vendor, or no one? I had always assumed that the website operator and the vendor EACH had standing for TTC because each has shared possessory interest in the computers, but I can see outer limits to this. For example, a person using a free web host vendor who is one of a zillion customers shouldn’t have standing if there’s a TTC to the vendor’s computers. OTOH, if a customer is paying a vendor to operate a dedicated computer, and the customer will bear all economic charges associated with that computer’s usage, I think the customer has standing. In that circumstance, perhaps the vendor does as well.

In my case, I pay a nominal amount to my web host for shared computer usage, but I pay bandwidth charges associated with my domain name. I think that if a third party were trespassing my website, and I bore the economic consequences from bandwidth usage, I should be able to claim TTC even though I only “lease” the computer space and I share that computer with other sites. Perhaps this warrants more thought.

2) Independently, the court correctly says that YouTube’s customers, not YouTube itself, are “contacting” utube.com, and therefore YouTube isn’t committing the actus reus. This result also appeared to be designed to channel this complaint into trademark law.

Nuisance

Some pundits have theorized about the existence of a nuisance claim that would parallel (or supplant) online TTC claims. These nuisance claims are occasionally pleaded (for example, a nuisance claim was made initially in the Intel v. Hamidi case, though Intel voluntarily dropped it), but this argument has not gotten any traction in court. This court’s terse rejection of the claim is typical:

“Universal has provided virtually no legal support for its contention that a private nuisance can exist when no land is involved. Nor has Universal shown any support for the proposition that a domain name, a website, or a computer that hosts a website somehow constitutes real property. There being no such support or other basis for its nuisance claim, that claim will be dismissed.”

Other Claims

The court also dismissed the plaintiff’s attempt to cancel (in district court) YouTube’s trademarks and claims for negligence and violation of state RICO laws. The court rejected YouTube’s motion to dismiss for unfair competition, state dilution, and deceptive trade practices, so those claims are still active (plus any causes of action revived with an amended complaint).