Hacker Connect January 16 in New York
An event for and by the real estate tech community

A dispute over a Realtor’s use of "MLS" in his Web site address, which already has been reviewed by two arbitration panels, has erupted into a lawsuit in federal court.

Marc Rasmussen, a Realtor in Sarasota, Fla., who in 2003 registered TheSarasotaMLS.com as a domain name for his real estate Web site, has filed the legal complaint in an effort to keep that Web address, which he says is important to his business. The Sarasota Association of Realtors owns the SarasotaMLS.com Web site.

The lawsuit, filed in U.S. District Court in Virginia, charges the Sarasota Association of Realtors Inc. with "reverse domain name hijacking" in "attempting to wrest control of (a) domain name by asserting … allegations of trademark infringement, trademark dilution and cybersquatting."

Douglas Cherry, a lawyer for the association, said today, "This is a classic example of cybersquatting where you use someone else’s trademark in a way to mislead consumers and divert consumers to (another) Web site)." Cherry also said that the association has not yet been served with a copy of the lawsuit.

The use of "MLS" and related terms has been a contentious one for Realtors, multiple listing services and Realtor trade associations — policies and guidelines set by some local associations and MLSs as well as the National Association of Realtors have led to other conflicts over business and Web site names.

A dispute over naming restrictions in Minnesota, for example, led to an antitrust lawsuit against a Minnesota MLS that ended in a settlement (see Inman News article). And there have been several arbitration cases held by local Realtor associations over the use of MLS in Web site names — the results of these hearings are private.

Rasmussen’s lawsuit follows a hearing of the dispute by a panel of the Internet Corp. for Assigned Names and Numbers, a nonprofit corporation that has oversight over several Internet functions including disputes over domain names.

In June, the Sarasota Association of Realtors filed a complaint with ICANN charging that Rasmussen’s thesarasotamls.com domain name "is identical or confusingly similar" to service marks in which the association has rights, which include "Sarasota MLS" and "Sarasota Multiple Listing Service," among others, according to the public decision by the ICANN arbitration panel.

In its complaint, the association charged that Rasmussen was misleading the public with the "thesarasotamls.com" domain name and "is using the domain name in an effort to attract Internet users to his Web site for commercial gain by taking advantage of confusion" with the association’s service mark, the ICANN decision states.

Rasmussen had countered that the association had abandoned its use of the Sarasota MLS mark on its Web site and that he posted a disclaimer on his Web site stating that it "is not the actual Sarasota Multiple Listing Service." He also cited an ethics panel decision by the Realtor association to support his position, according to the ICANN decision.

The three-person arbitration panel sided with the Sarasota association in a 2-1 split decision, finding that Rasmussen’s use of the Web site address "misleads consumers to foster his own commercial advantage," which constitutes "unfair competition." The decision also states that Rasmussen "violated a non-disclosure provision" of the National Association of Realtors in citing an ethics panel decision from the local Realtor association.

The National Association of Realtors in November approved a provision that gives Realtor-affiliated MLSs the option to enact a policy banning members’ use of the terms "MLS" and "Multiple Listing Service" from Web site URLs, company names, e-mail addresses and other marketing materials. The policy is optional (see Inman News article).

The national group also has provided guidance on cases in which a Realtor’s use of terms such as "MLS" in a Web site might conflict with provisions in the group’s Code of Ethics that all members are bound to comply with.

In a case example related to its Code of Ethics, NAR notes that the use of "MLS" in a Web site address could "in many cases lead reasonable consumers to conclude that the Web site would be an MLS’s, and not a broker’s Web site," which could lead a local association review panel to find that participant in violation of the code (see Inman News article).

And because NAR leaves the matter to local panels to decide, the decisions on such matters can vary from case to case.

Realtors who oppose the naming restrictions have said that they believe it is unfair for associations to impose the restrictions on Realtors when non-Realtors are not bound by those restrictions. Also, Web sites can be an important source of new business for real estate professionals, and critics have charge that enforcement of the naming restrictions can hurt their bottom line.

Also, NAR does not own the trademark to the term "MLS" as it does for the term "Realtor."

Rasmussen told Inman News today that he is redirecting his Web site to another address, luxurysarasotarealestate.com, while the federal court case is pending.

Rasmussen’s site states, "This is not the Sarasota Multiple Listing Service (MLS). The Sarasota MLS no longer exists. Realtors in Sarasota and Manatee counties now use the Mid-Florida MLS system." But Cherry, the lawyer representing the association, said that the Sarasota MLS system does still exist, and continues to supply information to the Mid-Florida MLS system and statistics to members.

Rasmussen said that he draws about 90 percent of his new business from his Web site, which draws an average of 700 to 800 visitors per day.

"I’m very visible in search engines," and his Web site has been ranked as the top search result for users who query "sarasota mls" on Google.

That high placement in Google results may have drawn the association’s attention, Rasmussen said. Giving up his Web site "is going to have a dramatic on my business. It took me years to get where I am in the ranking.

"If I pulled the domain name, I’m going to have to essentially start from scratch."

He said he has received supportive comments from other Realtors, both within his market area and outside the area, about his Web site fight. Morgan Carey, director of technology for the Real Estate Webmasters site, detailed Rasmussen’s Web site naming issues in a blog post that has drawn dozens of comments.

Rasmussen said he does not believe his Web site is deceiving consumers, and he said he has not personally received complaints about the site. "I’ve never had one complaint from anyone. There was no way that (consumers) could be confused to think that was an MLS site," he said.

But Cherry, who leads the intellectual property and technology practice for the Abel Band Chartered law firm in Sarasota, said the association has received complaints about Rasmussen’s use of thesarasotamls.com site, though he did not know the exact number of complaints.

The association had initiated a letter campaign several years ago, he said, to crack down on perceived trademark violations. The association sent 28 letters, Cherry said, and Rasmussen was the only association member "who refused to change his domain name."

Cherry also said that high rank of Rasmussen’s Web site for consumers who search for "Sarasota MLS" "gives him significant competitive advantage that is unfair to other Realtors in our area."

Rasmussen, meanwhile, said it’s too bad that the association is spending members’ money for the legal battle. The lawsuit seeks to reactivate the domain name of his site and prevent the transfer of the domain to the Sarasota association. He also seeks an injunction prohibiting the association "from interfering with or challenging … registration, possession or use" of the "thesarasotamls.com" domain name.

***

What’s your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story.