202104.29

The “France.com” case: sovereign immunity of the French State and rejection of the complaint of France.com, Inc.

In 2015, the American company France.com, Inc., owner of the eponymous domain name since 1994, brought proceedings against the Dutch company Traveland Resorts before the Paris court of first instance for canceling French and European trademarks containing the “France.com”. The French State intervened voluntarily in the proceedings to claim the cancellation of the trademarks and the transfer of the domain name france.com. The two companies settled: Traveland Resorts assigned the trademarks to France.com, Inc., in return for which France.com, Inc. withdrew its action against Traveland Resorts before the French courts. In any case, one does not see how these two companies could have envisioned peaceful commercial use of their respective signs. Nevertheless, the French State maintained its position. The case was brought before the Paris Court of Appeal, and on September 22, 2017, the court ordered i) the transfer of france.com to the French State and ii) canceled the trademarks “France.com” (legalis.net).

First, concerning trademarks, the Paris Court of Appeal based its decision on the following reasoning:

“Considering that the list of prior rights referred to in Article L 711-4 of the Intellectual Property Code is not exhaustive, the name “France” claimed by the French State can be considered as a prior right vis-à-vis the filings of the French trademarks in question since there is a risk of confusion among the public;

Considering that it has not been demonstrated or even alleged by France.com, Inc. that the French State was aware of the use of the disputed signs by France.com, Inc. before July 2015, so that the French State acted on time, before the end of the limitation period;

Considering that, contrary to what the appellant maintains, the name “France” constitutes, for the French State, an element of identity comparable to the patronymic name of a natural person; that this term designates the national territory in its economic, geographical, historical, political and cultural identity, which is intended in particular to promote all the products and services referred to in the trademarks in question; that the .com suffix corresponding to an Internet top-level domain is not likely to modify the perception of the sign;

Considering that the general public will identify these products and services as emanating from the French State or at the very least from an official service benefiting from the permission of the French State; that the risk of confusion is further reinforced by the stylized representation of the geographical borders of France in the complex trademarks in question;

Considering that it is, therefore, appropriate to cancel the French trademarks “France.com” No. 3661596, No. 3661598, No. 3661602, No. 3661600, and No. 3661603 filed on July 2, 2009 for all the products and services”.

Secondly, concerning the domain name france.com, the Paris Court of Appeal adopted the following reasons:

“Considering that for reasons identical to those already explained, this domain name allowing access to a website dedicated to tourism in France, infringes the name “France” which constitutes for the French State an element of its identity;

That the judgment will therefore be confirmed in that it granted the transfer request for the benefit of the respondent, the good faith invoked by the company France.com, assuming it has been established, being here inoperative;

That finally and assuming that the last writing submission of the appellant contains a plea of inadmissibility based on the limitation period, it suffices to recall that a domain name is intangible movable property to which consequently the provisions of article 2276 of the Civil Code are not applicable”.

Firstly, the court applied Article L 711-4 in accordance with the law and with case law. This provision lists the prior rights likely to prevent the filing of a trademark, including prior trademarks (L 711-4 a) and company names (L 711-4 b), but also personality rights of natural persons: surnames, pseudonyms, or their image (L 711-4 g). When the Court of Appeal holds that “the name “France” constitutes, for the French State, an element of identity comparable to the patronymic name of a natural person“, it simply makes an analogy referring to Article L 711-4 g). It could also have based this a pari reasoning by referring to Article L 711-4 h) which protects the name and image or reputation of local authorities (such as Paris or Brittany) or, in other words, “elements of their identity”. Like local authorities, the French State has elements that make up its identity, starting with the name “France”.

Secondly, the court recalls that the State —like local authorities— is an economic operator having “vocation to promote all the products and services referred to the trademarks in question“.

Finally, the third follows from the second since the court insisted on the risk of confusion among the public, as it systematically does in cases raising questions of trademark validity, infringement, or unfair competition. France.com, Inc. appealed to the French supreme court.

France.com, Inc. also sued the French State before the Virginia courts (France.com, Inc. v. The French Republic (1: 18-cv-00460)). Beyond questions related to territorial jurisdiction, France.com, Inc. attempted to argue that the French State had committed:

  1. cybersquatting;
  2. reverse domain name hijacking;
  3. expropriation without financial compensation;
  4. trademark infringement; and
  5. unfair competition.

In defense, the French State requested the judge to dismiss France.com, Inc.’s claims on the basis of sovereign immunity under the Foreign Sovereign Immunities Act (FSIA). On December 6, 2019, Judge Liam O’Grady rejected the French State’s request not on the merits but because the question of immunity could not be raised before discovery (France.com, Inc. v. The French Republic (1: 18-cv-00460)). On March 25, 2021, the Court of Appeal for the Fourth Circuit reversed this judgment, recalling that the issue of immunity prevails over that of discovery: “because the FSIA seeks to free a foreign sovereign from suit, immunity should be addressed as near to the outset of the case as is reasonably possible” (France.com, Inc. v. The French Republic, No. 20-1016 (4th Cir. 2021)), in limine litis. Deciding otherwise would deprive the mechanism of sovereign immunity of its function and empty it of its value.

In summary, the court acknowledged that the French State should benefit from the presumption of immunity. Accordingly, France.com, Inc. tried to overturn this presumption, in vain, by targeting two of the exceptions provided for by the FSIA: on the one hand, the commercial activity and, on the other hand, the expropriation.

Regarding the first exception, the FSIA provides for the possibility of waiving sovereign immunity if the complainant establishes that the foreign State is carrying on a commercial activity connected with the territory of the United States territory. However, according to the court, “study of the complaint makes clear that the conduct that the Corporation asserts “actually injured” it is not subsequent use of the website, but the adverse French judgment holding that France.com properly belongs to the French State. All asserted injuries alleged in the complaint flow from the judgment” (France.com, Inc. v. The French Republic, No. 20-1016 (4th Cir. 2021)). The court added:

“Nor does it matter what motivated the French State to intervene in the French lawsuit for purposes of the commercial activity exception (…). The Corporation’s claims arise from an adverse judgment of a foreign court – in a proceeding initiated by the Corporation itself – resulting in the transfer of the domain name, not any commercial activity that may have followed that transfer. Accordingly, the commercial activity exception to FSIA immunity does not apply” (France.com, Inc. v. The French Republic, No. 20-1016 (4th Cir. 2021)).

As for the exception of expropriation, the court recalled that it is up to the complainant to demonstrate, among other requirements, that the act qualified as expropriation constitutes or leads to a violation of international law. In this regard, France.com, Inc. alleged that the French lawsuit was biased. However, according to the court, France.com, Inc. has not shown how it would have been deprived of a fair trial. Given the circumstances before the French courts, such an allegation could hardly succeed.

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