Snap! Crackle! Popped! CNet hit with suit over portal name
The suit, filed in federal court in San Francisco Thursday, seeks to ban Cnet (Nasdaq:CNWK) from using the word "Snap" to describe its popular portal site. Snap Technologies, which runs the CollegeEdge Web site, said it received a trademark on the name "snap" in 1997 and actually began using the term in 1996.
A spokesman for CNet's Snap said the lawsuit was groundless.
Snap Technologies last week also filed an opposition to CNet's application to trademark certain uses of the word "snap" with the U.S. Patent and Trademark Office.
Finders keepers
CNet launched its Snap portal site in September 1997. At the time, the snap.com domain name was still available.
Since its launch, Snap has landed some major backers. In June, NBC bought a 19 percent stake in Snap for $6 million, with the option to raise it to 60 percent, as well as a 5 percent stake in CNet itself for $26 million.
In recent weeks, Snap has started a major promotion of the site on network television, thanks in part to the backing of NBC.
Snap Technologies CEO Young Shin said CNet's increased ad campaign prompted the company to file suit.
Mistaken identity
"The confusion is that our customers and people who use our services are mistaking CollegeEdge as being a subsidiary of CNet," he said. "It's becoming more urgent because of Snap's publicizing themselves."
Shin said he's worried that his customers in the education sector will shy away from his company if they think Snap Technologies, which uses the domain snapweb.com, is associated with commercialized sites such as CNet and NBC.
Snap Technologies has moved away from referring to itself as Snap in recent months. Many of its most recent press releases refer to the company and its site as CollegeEdge.
Squatters' rights
In disputes over domain names, the rights to a certain address usually go to the company that began using and trademarked the name first. Trademark infringement lawsuits involving domain names have become increasingly popular, especially as individuals known as "squatters" have bought up high-profile addresses in the hopes that a company with big pockets will by them out.
Network Solutions Inc. (Nasdaq:NSOL), the keeper of domain names, even has a policy of pulling a URL if a company can prove that it had the trademark first and therefore has the right to a certain Internet address. But NSI only gets involved when a company complains to it directly, not merely because a suit has been filed. NSI officials said there were no plans to pull the snap.com domain name.