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Inman New ran an article yesterday (link here) about a Sarasota real estate agent who filed a federal lawsuit in the U.S. District Court in for the Eastern District of Virginia in September in order to keep his domain name www.thesarasotamls.com. See Rasmussen v. Sarasota Association of Realtors, Inc., Case No. 08-cv-00954 (E.D. Va. September 15, 2008).

In August 2003, Marc Rasmussen, a REALTOR® and member of Sarasota Association of Realtors (?SAR?), registered the domain name http://www.thesarasotamls.com/ to promote his real estate services. In June, SAR filed a UDRP action against Rasmussen arguing that SAR had acquired trademark rights to the Sarasota MLS mark and that his domain name was confusingly similar to such mark and was registered in bad faith. A split decision by the arbitration panel ordered the domain name to be transferred. Rasmussen?s lawsuit will provide a temporary reprieve against the panel?s domain name transfer order while the parties battle it out in federal court.

As most people (and certainly most real estate agents) know, MLS is the well-recognized abbreviation for Multiple Listing Service ? the databases of real estate listings which are controlled by various regional associations affiliated with the National Association of Realtors (?NAR?). In this case, SAR owned the domain name SarasotaMLS.com. What people may not know is that the term MLS is not actually a registered trademark owned by NAR or any associated group (unlike the REALTOR® mark which NAR for years has worked to protect from genericide).

What complicates the issue for NAR members is that for many years, NAR did not have any policy regarding the use of the MLS mark in domain names. In fact, NAR?s own REALTOR magazine an article at one time (before Rasmussen registered his domain name) by ?Mr. Internet? (Michael J. Russer) specifically advising agents to register domain names with the term ?MLS? in them in order to drive internet traffic to their sites.

When NAR last November finally did approve a policy, it gave the local associations running the local MLSs the option to enact a policy banning their members from using the terms "MLS" and "Multiple Listing Service" from Web site URLs, company names, e-mail addresses and other marketing materials. NAR also provided some guidance for local associations to use in determining whether the use of terms such as "MLS" in a website operated by an NAR member might conflict with provisions in NAR?s Code of Ethics that all members are bound to comply with (e.g., where use of MLS for a domain name might lead a consumer to believe that the website is the local MLS). But such a determination of whether a member?s use of MLS in a domain name is an ethical violation is ultimately left in the hands of the local associations ? and thus decisions about use of MLS in domain names can vary by regional area and even on a case by case basis. In addition, the impact is felt mostly by members of the local association ? real estate agents who choose not to be affiliated with NAR and the local NAR chapter or its MLS are not bound by NAR?s Code of Ethics or any local policy.

In the case of Rasmussen, there was an ethics panel decision by SAR which apparently found the he had not committed an ethical violation by the domain name registration. Interestingly, when Rasmussen attempted to enter this ethics decision into evidence before the UDRP panel, SAR cited a provision in NAR?s rules governing the ethics proceeding which apparently prevent Rasmussen from disclosing the ethics decision and or using the decision in an arbitration case.

Part of Rasmussen?s argument is that SAR does not have any valid rights to the mark Sarasota MLS. The website http://www.sarasotamls.com/ redirectes to SAR?s site at http://www.sarasotarealtors.com/. And while the website contains a small link at the top which reads ?Sarasota MLS,? a click on the link leads to the current MLS to which Realtors in the Florida counties of Sarasota and Manatee use ? the Mid-Florida MLS. SAR?s counterargument is that the Sarasota MLS does still exist and provides information to the Mid-Florida MLS.

While Rasmussen?s domain name is currently being forwarded to another domain name while the case is pending, his website still contains the disclaimer in bold that was on his previous site:

What may have given Rasmussen enough encouragement to file the federal action were the comments by the dissenting panelist in the UDRP action. That panelist felt that SAR had not established common law trademark rights to the MLS mark prior to the registration of the domain because SAR tended to use the MLS mark in a descriptive sense to identify the MLS database and not in a trademark sense, and never sought to protect the term as a mark until real estate agents began using the term in domain names. The panelist also felt that Rasmussen did not have the requisite bad faith needed under the UDRP, specifically noting the aforementioned advice to its members to register include the term ?MLS? in their domain names in order to drive traffic to their sites (even though NAR later changing its policies about that). Finally, NAR?s own ethics decision declining to censure Rasmussen for this particular domain registration ? even though the decision arguably should not have even been presented as evidence ? nonetheless supported Rasmussen?s argument that he did not have any bad faith intention at the time he registered the domain name.

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