Masters of Their Own Domain (Name)

By Robin D. Gross
November 1998

Corporate titan, the Augusta National Corp., annual host of the prestigious Masters Golf Tournament covets what a small Bay Area computer company possesses: the Internet address of "masters.com". Currently pending before U.S. District Court Chief Justice Thelton Henderson in San Francisco, a dispute between two organizations vying for the identical domain name, "masters.com" challenges the rapidly evolving law of cyberspace. (Case No. C97-4412).

Bancroft & Masters, Inc. a Redwood City, California computer consulting company registered the Internet domain name "masters.com" in 1995 and has operated its business Website from that address ever since. Late last year the company received a letter from attorneys representing the powerful Augusta National Corp., alleging that the Bay Area firm's use of the domain name "masters.com" infringes upon the golf club's federally registered trademark, the "Masters". Augusta National instructed Bancroft & Masters to turn the domain over to the golf club at once or face a law suit in federal court.

To the famous golf club's surprise, the computer company beat them to the punch by initiating suit in San Francisco asking for a declaratory judgment that Bancroft & Masters' use of the domain name "masters.com" does not infringe upon Augusta National's trademark. The golf club responded by asserting that the federal court in California lacks personal jurisdiction over it and moved for a dismissal or transfer to Georgia.

Augusta National is reported to be one of the most exclusive and powerful clubs in the world. It's membership is made up of wealthy and influential men including Warren Buffet, George Schultz, and Roger Miliken. An Augusta tradition, women are not allowed, and minorities nonexistent at the club.

Attorney for Bancroft & Masters, Douglas Chaikin of the law firm, Peninsula IP Group, stated, "Augusta is clearly abusing the power of its trademark registrations and is attempting to use its economic advantage and prestige to bully a smaller party into giving up its legitimate rights."

Usually in domain name disputes, the name is awarded to the owner of the federally registered trademark. But Chaikin thinks the case presents new and unanswered questions as trademark law and domain name disputes square off again. "Augusta does not have the unfettered right to the term 'masters', Chaikin stated. Bancroft & Masters contends that over 900 other companies use the term 'masters' as part of their trademarks, so it would be unfair for this one company to be automatically entitled to the domain name.

According to Chaikin, "Augusta's proprietary domain for its mark 'masters' has been defined as limited to golf. Bancroft & Masters clearly falls outside the scope of golfing products or the entire golfing industry. Bancroft & Masters is strictly in the computer servicing and sales business." The computer firm believes there can be no confusion between these companies. Likelihood of confusion in the minds of consumers is the test used to determine trademark infringement.

Augusta National must now show that its contacts with the state of California are insufficient to establish personal jurisdiction over the Georgia corporation or the case will go forward in California. Either way, the dispute could lead to a precedent setting ruling and more clearly defined legal standard in cyberspace for trademark infringement by domain names.