Inferences are variously drawn when it comes to passively held domain names. Dictionary words and colloquial combinations are harder to prosecute and easier to defend. The reverse is true with well known trademarks. The onus shifts to the respondent to prove a defense. Failing on the rights or legitimate interests factor is then grist in the bad faith analysis. “Disney” is among the iconic trademarks. The Respondent in Disney Enterprises, Inc. v. ll, FA1007001336979 (Nat. Arb. Forum August 31, 2010) registered <disneyoffer.com> “almost five years” ago. According to the Respondent he “does not sell any Disney products on this site. The site is not built. It is only parked at GoDaddy.com.” However, the domain name resolves to a parking website that (evidently) it contains “offending material.”

The Respondent offered three arguments. The first is noted because it displays a complete lack of understanding of the Complainant’s rights. He states

Just because Complainant holds onto the name “disney” it does not have the right to squash and try to control every other holder of the word “disney” in the English speaking community or every domain name with the word “disney” in it. They own the market and brand name, but they do not own the word “disney” across the entire English language as long as those interests pose no threat or try to infringe upon their business.

The Panel’s assessment is that “Respondent surely knew of the Complainant’s trademark in DISNEY at the time he registered the disputed domain name and thus his silence regarding the reasons for registering the disputed domain name is telling.” Knowing that the dominant term in the domain name is a well known “suggests that Respondent registered the disputed domain name precisely for its trademark value, rather than in spite of it.” A complementary finding is that in registering the domain name “Respondent acted in bad faith by breaching its service agreement with the registrar.” That is, “Respondent falsely represented that registering the disputed domain name did not infringe on the intellectual property rights of another User or any other person or entity when he knew or should have known that it did.” This also breaches paragraph 2 of the Policy.

Respondent’s second argument recites a false history that the Complainant approached him to purchase the domain name rather than the opposite. There is a line of cases that finds no bad faith where the negotiation is initiated by the complainant, but this does not apply to domain names incorporating well known trademarks. “[A]fter receiving Complainant’s ‘cease and desist’ letter ... Respondent offered to sell the disputed domain name to Complainant for an unspecified amount.” This is evidence of bad faith registration. “Even if Respondent’s offer to sell were not specific as to price, a general offer to sell a disputed domain name to a complainant is nonetheless evidence of bad faith registration and use.”

The third argument is based on the false notion that the respondent bears no responsibility for the content of a website maintained by a hosting company. On the contrary, “[o]ne who registers a famous mark in whole or in part should in effect ‘inspect and make safe’ any website referenced by some domain name to be sure there is no infringement.” When the respondent fails to do so he is accountable for the links that infringe another’s trademark.

September 1, 2010

Consequences of Failing to Police One’s Trademark

Ordinarily, a transferee inherits the bad faith of its transferor and can be dispossessed of the disputed domain name if the use continues unabated. Unopposed, the inference is that the transferee has purchased the domain name for its monetized value. But the result will be different if the transferee proves its intent to use of the domain name for a bona fide offering of goods or services. The Respondent in Averitt Express, Inc. v. DI S.A. c/o Domain Admin., FA1006001332938 (Nat. Arb. Forum August 23, 2010) alleged that it acquired <averitt.com> “because it consists of a short surname, suitable for various purposes, and represents an investment in the Respondent’s portfolio of first and last name domain names.” As a general rule, if the domain name is used as a personalized e-mail service for persons bearing identical names to the trademark and is unadulterated with illegitimate content there can be no actionable claim. Buhl Optical Co v. Mailbank.com, Inc., D2000-1277 (WIPO March 1, 2001) (<buhl.com> and Int'l Raelian Religion & Raelian Religion of France v. Mailbank.com Inc., D2000-1210 (WIPO April 4, 2001) (<rael.com>) are other examples.

What makes Averitt more interesting is that the Complainant pounced on the domain name before the Respondent had an opportunity to redesign the website. The Respondent stated that as a result of the commencement of the administrative proceeding “the disputed domain name was immediately blocked by the Registrar.” Because of this, it was “impossible for the Respondent to implement its plan to use the disputed domain name in conjunction with <lastname.com>.” Further,

The screen shot taken by the Complainant on June 24, 2010 has no connection with the Respondent, it having been placed by the previous registrant of the domain name. The Respondent has been unable to place its own content on the website because the website was blocked before the Respondent had a chance to do so.

The Panel was persuaded on this point. It seems that the transferor “represented to the Respondent that none of the domain names being sold violated any rights.” While it “is difficult to see how this representation could have been made in view of the use of the Complainant’s trademark and references to competitors on the website ... that cannot be held to the account of the Respondent.”

Partly, the Complainant’s problem is that personal names are lower on the scale of protection. This is particularly the case where there is geographic distance between the parties. “In some cases the fact that the Complainant and the Respondent are located in different and distant jurisdictions does not provide a defence to a claim of registration and use in bad faith.” However, “[t]hose cases usually relate to domain names which reflect trademarks which have a worldwide reputation.” This requires the complainant to give more thought to its record. The “Complainant has offered no evidence to show what outreach its services have outside of the United States and, in particular, what, if any, business it does in Luxembourg, where the Respondent is located.” In other words, denial of complainant’s existence is persuasive because it is more probable than not it is true.

One other point is worth making. The Panel notes in its final paragraph that there “appears to have been abusive use of the domain name since [it was first registered], and yet it has taken the Complainant 14 years to assert its rights.” The Coda concurs with other panelists on the issue of laches: “Whilst the equitable doctrine of laches does not apply to the Policy, one might have thought that the Complainant might have taken action before now.” Sleeping on one’s rights does have consequences even if the decision is not based on a laches analysis.

August 31, 2010

Accrual of Trademark Rights: Principal and Supplemental Registers

UDRP is not centric to any particular national law, but where the parties are “domiciled in the United States and United States courts have recent experience with similar disputes ... the Sole Panelist shall look to rules and principles of law set out in decisions of the courts of the United States,” EAuto, L.L.C. v. Triple S. Auto Parts d/b/a Kung Fu Yea Enterprises, Inc., D2000-0047 (WIPO March 24, 2000). The dispute in Live Link, Inc. v. R Schwartz and Virtual Dates, Inc., FA1007001333180 (Nat. Arb. Forum August 26, 2010) concerned accrual of right where the Complainant relies on a trademark registered on the Supplemental Register. While a trademark registered on the Principal Register is presumptively valid and unassailably satisfies the threshold requirement for UDRP standing – once “the USPTO has made a determination that a mark is registrable, by so issuing a registration ... an ICANN panel is not empowered to nor should it disturb that determination,” U.S. Office of Pers. Mgmt. v. MS Tech. Inc., FA 198898 (Nat. Arb. Forum December 9, 2003) – the result is otherwise with the Supplemental Register.

Registration on the Supplemental Register “provides the Complainant with no protectable rights” in the alleged mark, CyberTrader, Inc. v. Bushell, D2001-1019 (WIPO Octobrt 30, 2001). Indeed, it is “evidence that there are no common law rights at the time of application,” Roberta Chiapetta dba Discount Hydroponics v. C.J. Morales, D2002-1103 (WIPO January 20, 2003). It signifies that the generic or descriptive mark is incapable of crossing the threshold of distinctiveness accorded to marks enrolled on the Principal Register. Nevertheless, having a registration on the Supplemental Register “shall not constitute an admission that the mark has not acquired distinctiveness,” 15 U.S.C. §1095.

Although not an admission, registration on the Supplemental Register certainly challenges the complainant to prove secondary meaning. In Live Link the Complainant argued that it had been “using the Mark variably as ‘Gay Live,’ ‘Gay Live Network,’ ‘Gay Live [with City Name]’ and ‘1800gaylive’.” However, since the Complainant submitted no evidence of trademark rights in marks other than GAY LIVE NETWORK and GAY LIVE, the Panel limited its analysis to those two marks. The former trademark was originally registered on the Supplemental Register and subsequently abandoned. The latter trademark was registered on the Principal Register 10 years after the registration of the domain name. The Complainant was challenged to prove that it acquired its common law trademark prior to the Respondent’s registration of <gaylive.com>.

The difficulty, of course, begins with the documentary evidence. Although the Complainant had represented first use in commerce on its original application that resulted in registration on the Supplemental Register earlier than the domain name, it offered no evidence to support the claim. At best, the “effective date of Complainant's federal rights is . . . the filing date of its issued registration,” Phoenix Mortgage Corp. v. Toggas, D2001-0101 (WIPO Mar. 30, 2001), which in Live Link post-dated the domain name.

“Prior UDRP panels have expressed skepticism that a supplemental trademark confers rights to the owner until it is converted into a principal registration,” citing Jahnke & Sons Construction, Inc. v. Trachte Building Systems, Inc., FA 1292233 (Nat. Arb. Forum November 5, 2009). Registration on the Supplemental Register carries little, if any, weight under United States law. “Even setting aside the contrary statements about the date of Complainant's first actual use, the mere claim of use is not enough to establish rights. Use must be in a manner sufficiently public to create some public awareness,” Phoenix, supra., citing T.A.B. Systems v. PacTel Teletrac, 77 F.3d 1372 (Fed. Cir. 1996); Lucent Information Management, Inc. v. Lucent Technologies, Inc., 186 F.3d 311 (3rd. Cir. 1999).

August 30, 2010

Concurrent Right to a Lexical String Registered by One Party as a Trademark and the Other as a Domain Name

Trademark law recognizes, with qualification that two parties can be entitled to the use of similar, even identical lexical strings where the concurrent user offers unrelated goods or services. The qualification is that “the Lanham Act's tolerance for similarity between competing marks varies inversely with the fame of the prior mark,” Kenneth Parker Toys Inc. v. Rose Art Industries Inc., 963 F. 2d 350, 353 (Fed. Cir. 1992). The Court continues, “[a]s a mark's fame increases, the Act’s tolerance for similarities between competing marks falls.”

This proposition is also central in UDRP jurisprudence. A domain name identical or confusingly similar to a trademark is no more than an ocular description of their appearance based on a side by side comparison. Where, without knowledge and in some instances with it (nominal fair use) [SAP AG v. Stephen M Meli, D2010-0760 (WIPO July 27, 2010))] a party operates in a different market or channel of trade [Streetwise Maps, Inc. v. Ryan Gibson, D2010-0984 (WIPO August 6, 2010)] and offers goods or services in different classes [G DATA Software AG v. Geologic Data Systems, D2010-0389 (WIPO May 10, 2010) (Respondent uses <gdata.com> as a domain name and e-mail address and the Complainant as its trademark; as such it has a right or legitimate interest in the domain name.)

The Complainant in Streetwise Maps located in the United States (Florida) alleges that Respondent (located in the U.K.) is a competitor in the market it serves. However, “markets” variably refer to geographical locations (International, regional, or local) or to customer or client bases wherever located. Parties can be distant from each other in a number of ways without collision. Argument that a respondent is a competitor – intending to suggest thereby that it should have been aware of the complainant – necessarily requires a threshold analysis of the parties’ locations and their products or services. The Panel in Streetwise Maps carefully parses what each party offers, to whom and their locations. “While Respondent does refer to maps on its website” (the Panel notes) it “does not offer to sell maps to the public or sell maps to the public on its website. Respondent offers its services to develop a system, not to sell products such as maps.” Further,

A review of Respondent’s website discloses that its pedestrian orientation and navigation systems include on-street information posts, mapping and directional panels for car parks and train and bus stations. The systems are produced purely for the client and if requested by the client they can also include a pocket map that corresponds with the on street units both in design and content. The system is sold as a whole unit to the client who then becomes responsible for the way in which they distribute or dispose of the pocket maps if they have chosen to include them in their system. Respondent does not publish the map and is in no way responsible for the distribution of any of the maps.

In contrast, “Complainant is in the business of producing and selling folding maps to the public ... [it] produces and sells maps of many of the principal cities of the world as well as maps of underground transit systems. Complainant offers its maps to the public at its website <streetwisemaps.com>.”

Setting aside the issue of nominal fair use that implies knowledge of the complainant and its trademark or the respective timing of the domain name and trademark registrations there may still be no overlap in parties’ targeted customers and they may be geographically remote. In Streetwise Maps, when markets, products and services are examined for their specifics relieved of abstraction the Panel concluded that the parties were not competitors.

August 27, 2010

Toward Establishing an Objective Criterion for Unconfusing Similarity

Paragraph 4(a)(i) of the Policy is not satisfied by simply showing that the trademark and the domain name bear a similarity of parts, unless it suggests the whole. The similarity must be confusing to an “objective bystander,” so stated by the minority Panel in Open Society Institute v. Gil Citro, FA1007001333304 (Nat. Arb. Forum August 24, 2010) (concurring in the ultimate holding denying the complaint but dissenting on the 4(a)(i) finding in the Complainant’s favor). How to draw the line between names that are confusingly similar and those that are simply similar but not confusing seems to be in the same category as holding water. It is easier for the Panel to pass the complainant on the threshold test and deny the complaint for failure to prove bad faith. But, some panelists scratch to relieve the itch. The 3-member Panel in Tire Discounters, Inc. v. TireDiscounter.com, FA0604000679485 (Nat. Arb. Forum June 14, 2006) ruling on TIRE DISCOUNTERS to form <tirediscounter> held that the “omission of the letter ‘s’ from the mark is one of those small differences that matters.” See the “Small Differences” Note of August 24. The “small differences” approach is a start that works with some combinations and not others.

The scratching Panel in Open Society Institute (if I may say this without offense) builds a more nuanced approach to confusing similarity based on a whisper made in a case decided in the first months of UDRP, SportSoft Golf, Inc. v. Sites to Behold Ltd., FA0006000094976 (Nat. Arb. Forum July 27, 2000). In SportSoft, the “trademark [GOLF SOCIETY OF THE U.S.] links together two generic words – golf and society with a geographic entity, the United States. The disputed domain name incorporates the two generic terms golf and society with an upper level domain dot.com.” Generalizing the particular is similar only in incorporating the same generic terms but the “objective bystander” is unlikely to confuse the two.

In Open Society also the trademark “links together two generic words.” The “sole question ... is whether the domain name <opensociety.org> is confusingly similar to the trademark OPEN SOCIETY INSTITUTE.” Is there enough of a similarity to confuse the “objective bystander” of a relationship with the trademark holder? The majority said Yes. The minority scratches. “The test to be applied” (he observes) “has two parts” and continues

The first part is to ask if the domain name is similar to the trademark. In this case it is similar, for the domain name is made up of two of the three words of the trademark. The second part of the test is whether the similarity is confusingly so. This part of the test is satisfied by asking the further question if the Panel can conclude that an objective bystander, comparing the domain name and the trademark, would reasonably conclude that the “open society” of the domain name was referring to the OPEN SOCIETY INSTITUTE of the trademark and by that means giving rise to confusion between the two.

If omission of “institute” is one of those “small differences” only because it is said to be, that is not good enough. “The real obstacle in the way of finding that an objective bystander would reach that conclusion is that the domain name is referring to a concept or a notion, whereas the trademark is referring to an entity or, more precisely, an institute and one institute in particular.” That is a significant advance over “small differences” by emphasizing a distinction between “a concept or a notion” and the actual name of the legal entity. “An objective bystander is therefore unlikely to think that the domain name was referring to the Complainant’s institute or to any institute at all and unlikely to be confused into thinking that the one necessarily referred to the other.” It is more likely that “the concept or notion invoked by the domain name” will be taken to mean “the idea of a society that is not closed or secretive, but open and committed to imparting information, in part by means of freedom of information legislation.”

The scratcher also has a nuanced view of the rights or legitimate interests requirement where a domain name found to be confusingly similar is composed of a combination of generic words. I will discuss his paragraph 4(a)(ii) analysis in a later Note.

August 26, 2010

Making Changes to the Website After Notice and Filing of Complaint

Despite misgivings expressed by some panelists over the past year (the Octogen line of cases), where there is no evidence of bad faith registration the Policy does not penalize a respondent for changing use before notice and filing of complaint. After notice and filing of complaint there are different rules. Inadvertent transgressors typically involving domain names composed of generic or descriptive words and combinations used in their commonplace sense are treated more kindly than respondents advertently taking advantage of the complainant or its trademark. Yesterday's case, American Airlines v. James Manley d/b/a Webtoast Internet Services, Inc., FA1006001330044 (Nat. Arb. Forum July 27, 2010)(<americanway.com>) brought attention to this issue and it is worth reporting.

The Panel in that case noted that “[c]ontrary to Complainant’s urging, the Panel draws no adverse inference from the fact that Respondent made post-complaint changes to its website.” Although “other panels may have held that changing a website after being notified of a dispute cuts against, or negates a finding of rights or interests in a disputed domain name [citing decisions to that effect] ... this Panel respectfully sees such holdings as unwarranted departures from long standing evidentiary rules and rational[e] concerning subsequent remedial measures.”

It could be argued that a position that “draws no adverse inference” under any circumstances is not sufficiently discriminating. It is appropriate when applied to the inadvertent transgressor, but not otherwise. The Panel really makes a case for the former. “A respondent, by changing its website to mitigate concerns levied by a complainant via either a cease and desist letter or a UDRP complaint, arguably reduces further harm from such website to the consuming public.” Modification of “such a website also may attenuate the harm to a complainant whose trademark or commercial interests are allegedly compromised by the website prior to remediation.” The Panel’s point is that respondents (in the innocent class) should not be discouraged from “this positive behavior.... [T]he fact of a website’s remediation should not create an evidentiary inference adverse to the respondent.”

The Panel in American Airlines arrives at this conclusion on the authority of the Federal evidence rule where “the rational[e] for excluding evidence of subsequent remedial measures is set out in the Federal Rules of Evidence §407 and its accompanying Notes.” He cites GMC v. Keystone Auto. Indus., 453 F.3d 351, 359 (6th Cir. 2006) for the proposition that “finding that evidence of post-litigation changes to the form of an allegedly infringing trademark device was prohibited pursuant to FRE 407.” Since “Rule 407 is applied in trademark litigation ... there is no reason why its rational[e] should not be consider[ed] and its principles applied to UDRP disputes where appropriate.”

Other Panels take a different view. For some the defense is limited to actions taken “before any notice to you of the dispute,” hewing strictly to the letter of paragraph 4(c)(i) of the Policy. “To allow Respondent’s claim that he has made post-filing changes to his website to alter the outcome of this dispute would open the door for all future respondents ... to avoid the consequences of their actions,” Hewlett-Packard Company v. Alvaro Collazo, FA0302000144628 (Nat. Arb. Forum March 5, 2003). Another Panel similarly held: “If use following complaints were taken into account, the Policy could be rendered wholly ineffective by respondents rapidly posting websites which ostensibly constituted fair use of disputed domain names,” Poker Host Inc. v. Russ "Dutch" Boyd, D2008-1518 (WIPO December 1, 2008).

The logic to this position is that a respondent should not be rewarded for sanitizing its website upon notice of infringement. The two views can be harmonized by considering where respondents fit on the continuum. There are certainly respondents who inadvertently transgress; where the evidence supports a right or legitimate interest. Just as certainly, the Respondent in American Airlines being a good example, there are respondents who advertently transgress.

August 25, 2010

Prosecuting a Claim Against a Previously Successful Respondent on a Different TLD

Complainants from time to time refile complaints on change of circumstances. Refiling is not barred but complainant must satisfy strict rules generally applied on applications to reargue or renew motions. Entered judgments do not bar commencing an entirely new case. In an early ACPA case, Cello Holdings, L.L.C. v. Lawrence-Dahl Companies, 347 F.3d 370 (2nd Cir. 2003) the Second Circuit held that “the res judicata effect of the First Action [relating to domain names] is not dispositive in the Instant Action as Cello may have a claim premised on facts arising after the First Action. The ‘bad faith intent to profit’ element of a trademark rights-holder’s ACPA claim may be premised on the domain-name registrant’s ongoing use of the domain name.... The judgment in the First Action, therefore, does not bar Cello from arguing that Storey's use of ‘cello.com’ is unlawful insofar as Cello relies on conduct post-dating the First Action to make its claim,” (emphasis added).

The factual circumstances in American Airlines v. James Manley d/b/a Webtoast Internet Services, Inc., FA1006001330044 (Nat. Arb. Forum July 27, 2010) (<americanway.com>) offer an interesting variant on refiling and new claim prosecutions. In a previous claim of abusive registration, American Airlines Inc. v. Webtoast Internet Services Inc., FA0112000102954 (Nat. Arb. Forum February 24, 2002) the Panel denied the complaint for <americanway.biz>. The Complainant did not challenge <americanway.com> at that time (registered in 1996) because (presumably) the website was making a bona fide offering of goods or services. In the earlier case the Respondent relied (and the Panel accepted) that <americanway.biz> passed the paragraph 3(c)(ii) test. I will refer to the 2002 case as American Airlines 1 and the more recent one as American Airlines 2.

At the time the Complaint was served in American Airlines 2 the website “contained links to Complainant’s competitors.” The Respondent did not deny this but explained that its “web server was recently, very seriously, hacked.” The Panel was skeptical:

Respondent attempts to explain post-complaint website changes as some sort of restoration to the site’s complexion before a troublesome hacking incident, but the hacking incident is unsubstantiated. The effect of hacking on the website’s metamorphosis from one sponsoring ‘hunting and jumping’ videos to one where there are links to Complainant’s competitors is not explained by Respondent and not shown to be benign.

The factual record in American Airlines 1 supported the Respondent’s claim that it was using the .biz as it had been doing with the .com “an e-commerce gateway for sales of videotapes, books and CDs and as a website for access to the works of the American author, Ralph Waldo Emerson.” Somewhere along the way, the alleged hacking occurred and transformed the website, hence the Panel’s humorous reference to “metamorphosis.”

While modifying a website to remove accidental linking may in certain instances be excusable it is still a factor to be considered in assessing bad faith. In American Airlines 2 the Panel concluded that “Respondent’s lack of concern for the rights of Complainant at that time it originally registered the disputed domain name is inferred from Respondent’s recent conduct.” This may be regarded as too attenuated since the first Panel was persuaded to the contrary. However, there was another fact that told against the Respondent, its “lack of candor” in its Response to evidence about its purported application for a trademark. It “claims to have trademarked THE AMERICAN WAY, but fails to reveal that the Trademark Office records show that the registration was owned by The Pony Venture Project. The Respondent also fails to note that the Registration was cancelled by the Trademark Office as a result of the owner failing to submit a declaration and supporting documentation evidencing that the alleged trademark was still in use.”

August 24, 2010

Targeting, A Key Element in Determining Bad Faith Registration and Use

It is fundamental that a respondent’s intent at the time it registers a disputed domain name to take advantage of the complainant’s reputation in the marketplace is an essential element of bad faith. Intent is linked to knowledge of the complainant or its trademark, but proving intent through knowledge in the face of a respondent’s denial is a heavy burden. It is lighter for arbitrary and heavier for descriptive trademarks. Evidence is particularly hard to marshal in those instances where the domain name is composed of generic elements that have currency in several lines of commerce. This is the story in Take-Two Interactive Software Inc. v. Name Administration Inc., D2010-0845 (WIPO August 6, 2010). The Complainant holds a trademark registration for BIOSHOCK, but the disputed domain name <bioshock.com> was registered prior to the registration of the trademark.

The Complainant in Take-Two also had other problems of proof, some of its own making. Where knowledge of the complainant or its trademark is denied, concrete evidence to the contrary is generally unavailable. At one end of the spectrum knowledge means actual intelligence of the complainant and its trademark; at the other end, it means presumed or “more likely than not” knowledge inferred from evidence submitted in support of bad faith. The Complainant in Take-Two alleged that the Respondent “had been made aware of the Complainant’s BioShock game from the statement made by the game developer” prior to the registration of the domain name. Awareness can be inferred, but even if in this case it were

it would nevertheless have been insufficient to establish the Respondent’s bad faith. In fact, the Respondent’s use of the Domain Name is connected to a web site that does not seek to trade on the goodwill of the underlying trademark since it is associated with fields other than computer games and consistent with the scientific fields conjured up by the constituent components of Domain Name.

The burden of proof cannot be satisfied by asserting a possibility of knowledge without intention to take advantage of the complainant’s reputation or the penetration of its trademark.

There were two further disqualifications in Take-Two. First, Complainant filed an “intent to use” trademark application and it subsequently represented that its first use in commerce post-dated the registration of the domain name by almost two years. An admission against interest may be excusable on concrete proof of secondary meaning but even if that were likely in Take-Two “there is no evidence nor suggestion that the reason why the Domain Name was registered (whether automatically or otherwise) was as a result of any goodwill or reputation that the Complainant has built up in the name,” citing Promatic International Limited v. Name Administration Inc., D2006-0673 (WIPO July 19, 2006).

The second disqualification lies in combining dictionary words. The result of joining “bio” and “shock” is not “exclusive to the Complainant, since, as highlighted by the Respondent, it has been selected and used by other companies, including Johnson & Johnson, prior to the Complainant, to identify products different from videogames (e.g., cleaning products, nutritional products, etc.).” Even if these disqualifications were not present, the “content published on the web page linked to the Domain Name [were] links related to scientific content.” This is rather evidence of good faith than targeting.

August 23, 2010

Small Differences Can Have a Major Effect on the Way Domain Names Are Read

The threshold requirement sets a low bar but small differences “can have a major effect on the way domain names are read,” Travellers Exchange Corporation Limited v. FairFX Plc. D2010-1056 (WIPO July 29, 2010). The Complainant holds the trademark TRAVELEX; it complained that the Respondent’s registrations of <travelexexpensive.com> and <travelexpensive.com> were abusive. The first of the two disputed domain names incorporates the trademark; the second either consists of two dictionary words “travel” and “expensive” or the trademark plus “pensive.” But, “pensive ... is [a word] which is much less widely used. In the Panel’s view Internet users are most unlikely to recognize the Domain Name by itself as comprising the words “Travelex” and “pensive.”

There are several classes of domain names that may be similar to trademarks without being confusing. The omission of a single letter from the mark such as an “s” in Tire Discounters, Inc. v. TireDiscounter.com, FA0604000679485 (Nat. Arb. Forum June 14, 2006) (comparing TIRE DISCOUNTERS and <tirediscounter>), for example, is one of those small differences that matters in this context, citing Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1147 (9th Cir. 2002): “[s]imilarity of marks or lack thereof are context-specific concepts. In the Internet context, consumers are aware that domain names for different Web sites are quite often similar, because of the need for language economy, and that very small differences matter.”

There are, also, those domain names for which trademark holders have disclaimed generic words to satisfy legal requirements or whose registration has been permitted subject to disclaimer and proof of continuous use [15 U.S.C. § 1052(f) ]. Similarity in other instances may not be confusing since the trademark is not the disclaimed elements, as in design plus word marks. Another class is illustrated in General Electric Company v. Edison Electric Corp. a/k/a Edison Electric Corp. General Energy, Edison GE, Edison-GE and EEEGE.COM, D2006-0334 (WIPO August 13, 2006) (cited in FairFXsame, same Panel). At issue in that case were several domain names, most of which passed the threshold test and were transferred to the Complainant. The similar but not confusing domain name was <eege.com>.

The Panel in General Electric noted that “the separation of elements of a string of characters by a hyphen can be crucial.” The domain name <eege.com> is on one side of the divide and <ee-ge.com> on the other. From “one point of view there is only a slight distinction between <eege.com> and <ee-ge.com>, namely, the interposition of a single hyphen,” but it makes all the difference, citing The Football Association Limited v. Websitebrokers Limited, D2001-0156 (WIPO April 5, 2001). That Panel held

While the practice of omitting spaces between words is characteristic of ‘domainspeak’, the addition of only a consonant and a vowel to the definite article in English makes for a special case. ‘Thefa’ seems inherently a fabricated word. The combination which is the Complainant’s abbreviated name has to be picked out from it by deliberate mental effort. Not for nothing, in my view, is the Complainant’s own official domain in the form <the-fa.org>. The hyphen makes a crucial difference.

The absence of a hyphen made no substantive difference in Chernow Communications, Inc. v. Jonathan D. Kimball, D2000-0119 (WIPO May 18, 2000) (C-COM [the registered trademark] and <ccom.com> [the disputed domain name]). That is, the Panel noted that the use or absence of punctuation did not alter the fact that a name is identical or confusingly similar to a mark, a position that is consistent with United States court decisions dealing with trademarks. As we see, however, the generalization must be qualified because in certain factual instances the absence of a hyphen (or the addition of one) makes a difference in respondent's favor.

August 20, 2010

The Role of Precedent and Authority in UDRP Cases

The UDRP mandates that “[i]n all cases, the Panel shall ensure that the Parties are treated with equality and that each Party is given a fair opportunity to present its case,” Paragraph 10(b) of the Rules of the Policy. And, because a dispute resolution should not be a roulette wheel, the ICANN panelists aim for a high degree of predictability and consistency. This is achieved through “a strong body of precedent” which notes the Panel in Pantaloon Retail India Limited v. RareNames, WebReg, D2010-0587 (WIPO June 21, 2010) “is strongly persuasive” even if not binding. The story behind “not binding” comes from the WIPO Overview of Panel Views on Selected UDRP Questions (the “WIPO Overview”) published in 2005. It states that the UDRP does not operate on a “strict doctrine of precedent,” which may be true but (as I have pointed out before) it is rare for a Panel not to cite precedent and (although less often) case authority.

Many of the formative principles of UDRP jurisprudence were quickly identified and cogently laid out in early decisions. Where there were (and continue to be) uncertainties of construction Panels sought (and seek) to build and refine the work of their colleagues. There are also decisions setting forth or proposing constructions and legal standards which fail to ripen to consensus that have either been abandoned as dead ends or rejected in later decisions. This can be seen, for example, in Igor Lognikov v. Web Ventures, Nerdec, Inc. and Charles Edmunds, D2009-1684 (WIPO January 29, 2010) in which Respondent cited cases to the effect that “the existence of a mark as to the date of registration is a rigid pre-requisite for a finding of bad faith registration.” The Panel noted, however, that “these were both cases in early days of the existence of the Policy. Things have moved on from then.”

One of the principal tasks for early Panels was to assure parties that they could expect a fair hearing based on the evidence and the law; not statutory law, but domain name law based on the Policy’s text as informed by the WIPO Reports and interpreted by prior Panels. There has been some discussion particularly as it relates to laches whether “law” is an inclusive term that subsumes “equity.” According to the Panel in Ni Insan Kaynaklari Personel ve Danismanlik Limited Sti v. Timothy Michael Bright, D2009-0315 (WIPO May 7, 2009) “the Policy is not a proceeding in ‘equity’ in which a panel seeks to generally determine whether one party or another has acted more or less fairly toward the other, thereafter fashioning a ‘just’ remedy.” “It is possible” (the Panel further noted) “for a respondent to be infringing the trademark rights of a complainant, yet be found not to have acted in bad faith.” This refers to the Policy's requirement for conjunctive bad faith. If the holder's claim is for trademark infringement its remedy is in a civil court of law.

For claims within the Policy's jurisdiction Panels have emphasized that decisions “should consist of more than, ‘It depends [on]what panelist you draw’,” Time Inc. v. Chip Cooper, D2000-1342 (WIPO February 13, 2001) (<lifemagazine.com>). It is particularly important for a jurisprudence that authorizes the Panel to order a domain name forfeited to the complaining party to adhere to standards articulately expressed and consistently and objectively applied. The majority in Time “believes potential users of the UDRP are entitled to some degree of predictability.” That is, if “a principle enunciated in a decision is well-reasoned and repeatedly adopted by other panels, the majority believes that absent compelling reasons which require a determination otherwise, that the rule established should be respected.” “[U]sers of the internet are better served through panel decisions that promote consistency and predictability.” Predictability is assured by the Policy’s openness in requiring public accessibility of all decisions. The database then becomes the source of authority.

August 19, 2010

Application for Trademark Registration By Itself Does Not Qualify as a Right

A certificate of registration satisfies the threshold requirement for maintaining a UDRP proceeding while a mere “intent to use” application to register a trademark or registration on the Supplemental Register does not. The consensus is that no “presumption [of validity] arises from a pending application to register a mark,” Aspen Grove, Inc. v. Aspen Grove, D2001-0798 (WIPO October 17, 2001). This was particularly highlighted in Martha Stewart Living Omnimedia, Inc. v. Joe Perez, FA0904001259275 (Nat. Arb. Forum June 24, 2009) in which the USPTO initially rejected the trademark for registration on the Principal Register. The Respondent in that case may very well have learned about the Complainant’s plans from scanning the TESS database, but “Everyday Eating” is a purely descriptive phrase and Complainant’s trademark post-dated the registration of the domain name.

If the complainant argues that its trademark nevertheless pre-dates the registration of the domain name, it must offer proof of secondary meaning to pass the threshold. This is not achieved by the complainant pointing to its representation on the trademark application of an earlier “first use in commerce” date. While proof of a right based on a registered trademark is simply a copy of the certificate, proof of secondary meaning is a considerable undertaking. The Complainant in Kaizen Applications, LLC v. Private Whois Service, FA1005001324496 (Nat. Arb. Forum July 8, 2010) (<blackhatworld.org>) is stopped at the threshold simply because it did not understand that mere assertion is not equivalent to proof of a common law trademark.

The “Complainant” (noted the Panel) “has provided evidence that it applied to register Complainant’s Domain as a trademark.” It also asserted that it has a common law trademark in the domain name. However, neither of these assertions “establish any enforceable trademark rights in [the disputed] Domain [Name].” In order to qualify, to cross the threshold, the complainant must first “identify the jurisdiction in which it is claiming common law rights and elucidate the relevant legal principles of that jurisdiction with a view to justifying its allegations of acquired common law rights. This is important because not every country recognizes common law rights, and the relevant law of each jurisdiction has its own nuances.” This view is questionable. The WIPO Overview of WIPO Panel Views on Selected UDRP Questions states that “Unregistered rights can arise even when the complainant is based in a civil law jurisdiction,” Paragraph 1.7. The more important deficiency and controlling one is that the Complainant failed to “demonstrate that the trademark is, in fact, associated by the relevant public with the complainant’s goods or services.” The Panel continued with advice that complainants alleging common law trademark should make note of:

It must prove that at least some goodwill and reputation has been generated in connection with the mark as a consequence of active use in commerce. In other words, Complainant must provide credible evidence establishing that the common law trademark on which it relies has acquired distinctiveness.

The consensus is that this is done by the complainant offering evidence of (1) the length and continuity of a mark's use, (2) sales, advertising, and promotional activities, (3) expenditures relating to promotion and marketing, (4) unsolicited media coverage, and (5) sales or admission figures. See also Mitek Corporation v. Xedoc Holding SA, FA1007001337379 (Nat. Arb. Forum August 18, 2010): “Complainant has not provided any evidence in the form of advertising expenses, unsolicited media coverage, consumer or other third-party recognition, which are traditional means of proving common law rights.”

August 18, 2010

The Work of Early Panels in Establishing the UDRP Jurisprudence

The first five UDRP decisions (1 commenced in 1999 and the first four of 2000) were decided in Complainants’ favor without Respondents’ participation. Default gives the complainant an advantage, but only to the extent that the Panel is working with a one-sided record. Otherwise, the burden of proof remains with the complainant on all elements of the Policy. Failure to appear and plead is not an admission of bad faith registration and use as it is in a court of law. The fifth decision, Telaxis Communications Corp. v. William E. Minkle, D2000-0005 (WIPO March 5, 2000) is based on a full record. It reveals that the parties had entered into negotiations without success, but once the UDRP proceedings commenced there began an escalation of threats by each party and bad faith use by the Respondent that raised the question whether in those circumstances the Panel would be justified in finding abusive registration.

It is important for understanding the jurisprudence to look back to the earliest UDRP cases to see the incremental process of its assembly. The jurisprudence we see now was not in existence in 2000. The only authorities then available were the WIPO and ICANN reports (the former equivalent to a legislative study), the Lanham Act and case law, generally from United States federal courts. The Panel in the second decision (the first in 2000), for example, cited a pre-ACPA decision, Intermatic v. Toeppen, 947 F.Supp. 1227 (N.D. Ill. 1996) for a fundamental proposition. The court held that “Toeppen’s intention to arbitrage the ‘intermatic.com’ domain name ... was sufficient to meet the ‘commercial use’ requirement of the Lanham Act.” An inferential finding of “intention” satisfies the “primarily for the purpose” element of paragraph 4(b)(i) of the Policy.”

In Telaxis the Panel rested his decision on a close reading of the factual record without citation to authority. However, he established (put a foundation under) the timing issue. Unless a registrant is shown to have actual notice of the complainant or its trademark it is more probable than not that it registered the domain name in good faith. To assert otherwise the complainant would have to demonstrate that the domain name was registered with knowledge of the complainant and its trademark. The Panel in Telaxis also established that bad faith use following good faith registration does not support a finding of abusive registration. “Once the dispute arose” (the Panel concluded)

the parties each engaged in a series of actions for the primary purpose of strengthening their respective positions in the dispute. The redirection of the disputed domain names to the websites of Claimant’s competitors or to pornographic websites were acts of bad faith by Respondent. However, Paragraph 4.a.(iii) requires that the domain name “has been registered and is being used in bad faith” (emphasis added).

Essentially, there occurred mutual goading, something like a temper tantrum by the Respondent, but the Complainant offered no evidence that the Respondent registered the domain name in bad faith. Bad faith in the conjunctive is a feature of the UDRP. In the first decision decided, World Wrestling Federation Entertainment, Inc. v. Michael Bosman, D99-0001 (WIPO January 14, 2000) the Panel made the point clearly (which has been under recent pressure) that the “WIPO report, the DNSO recommendation, and the registrars-group recommendation all required both registration and use in bad faith before the streamlined procedure would be invoked. [ICANN] Staff recommends that this requirement not be changed without study and recommendation by the DNSO,” Second Staff Report on Implementation Documents for the Uniform Dispute Resolution Policy, submitted for Board meeting of October 24, 1999, para. 4.5,a.

August 17, 2010

Complainant Must Hold a Trademark in His/Her Personal Name to Succeed in a UDRP Proceeding

Celebrities whose names are source indicators have common law trademark rights, thus standing under the Policy to capture corresponding domain names, while those who are simply rich and famous do not. Do not, that is, unless the given name is the functional equivalent of a generic affix to a trademarked family name. This dichotomy is illustrated in a pair of cases decided by the same Panel, Vanisha Mittal v. info@setrillonario.com, D2010-0810 (WIPO August 8, 2010) and ArcelorMittal Legal Affairs Corporate, Vanisha Mittal, Aditya Mittal v. All Illumination, Vanisha Mittal, info@setrillonario.com, DME2010-0006 (WIPO July 30, 2010). The Complainant was unsuccessful in the first because her celebrity was not a source indicator, but successful as a Joint Complainant with the trademark holder in the second.

Vanisha Mittal is celebrated as the daughter of a rich father with extensive industrial and commercial holdings in India and Europe. There are trademark registrations for MITTAL; none for “Vanisha Mittal.” The consensus holds that “[w]ithout any evidence that the Complainant holds some specific right as licensee of a ‘Mittal’ trademark, the license argument must fail.” A similar finding was made in Birgit Rausing, AB Tetra Pak v. Darren Morgan, D2008-0212 (WIPO April 5, 2008) in which the Panel noted that Birgit Rausing “does not appear to have become well-known because she has written books.” Rather, “[s]he was well-known before that, due in part to her membership of the well-known Rausing family.”

“Celebrity status, on its own” (notes the Panel in Vanisha Mittal) “does not provide a complainant with rights in a trademark or service mark, which is the bottom line requirement for a complainant to satisfy paragraph 4(a)(i) of the Policy” The sole exception to personal name exclusion from UDRP protection is for founders who are in the scrum of business associated with their entrepreneurial enterprises. In Chung, Mong Koo and Hyundai Motor Company v. Individual, D2005-1068 (WIPO December 21, 2005), for example, the Panel stated that the problem “eventually… come[s] down to whether the evidence establishes [a] sufficient ... nexus between the name itself and its use and association in trade and commerce.” He provided a list of guidelines to establish whether there was proof of such a nexus.

No such nexus existed with Vanisha Mittal; her membership on the Board of Directors for Mittal did not qualify. “The Panel has been told almost nothing about the Complainant, and it is only possible to infer from the Respondent’s various website postings that she is a celebrity in some parts of the world, and that she celebrated a lavish and expensive wedding.” On the other hand, the trademark holder, ArcelorMittal, does have standing. The Panel explains that

While the Respondent has used the names of two members of the Mittal family in the Domain Names, it appears to the Panel that the primary target was probably the company ArcelorMittal. First, the <arcelormittal.me> Domain Name is identical to that company’s international trademark registration. Secondly, the adityamittal website contains substantial material relating to ArcelorMittal and its operations, and the <vanishamittal.me> Domain Name resolves to a website at which ArcelorMittal’s corporate logo has been reproduced. The use of that corporate logo suggests to the Panel that the intention was probably to “bait” ArcelorMittal rather than Vanisha Mittal herself.

Since the Respondent’s primary purpose in registering the domain name was to sell it to the trademark holder (he boasted of that fact) “for valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly related to the Domain Name” he was “caught [noted the Panel] by paragraph 4(b)(i) of the Policy.” Hoisted, that is, by his own petard.

August 16, 2010

Historical Snapshots from the Wayback Machine

In the curious case of Eneco BV v. Eneco, D2010-0548 (WIPO July 7, 2010) – curious because the Panel made the Respondent’s case despite its default – a search of <eneco.com> on the Internet Archive's Wayback Machine at “www.archive.org” provided evidence of good faith registration and use years prior to the Complainant’s trademark. Moreover, “[s]ome webpages disclosed the United States Trademark Registration identifier comprised of the letter ‘R’ in a circle.” The Panel also searched and found ENECO on the USPTO database disclosing Respondent as the registered owner of a registered trademark. A review of recent cases shows that in a good many of them Panels accepted the truth of the historical snapshots. Respondents are expected to do more than deny the evidence.

The “archives” referred to in Facebook, Inc. v. Amjad Abbas, DME2010-0005 (WIPO July 13, 2010) (Note August 10) would be from the Wayback Machine. The Wayback Machine is a database of website snapshots that Internet Archive (“IA”) has been collecting from 1999. IA’s mission is nicely explained in The iFranchise Group v. Jay Bean / MDNH, Inc. / Moniker Privacy Services [23658], D2007-1438 (WIPO December 18, 2007). It collects web pages and “[l[ike a paper library ... provide[s] free access to researchers, historians, scholars, and the general public.” With Wayback Machine anyone can have literally a window on the past use of the domain name, although “Alexa respects robots.txt instructions [not to crawl a particular site], and even does so retroactively” thereby preventing the researcher from discovering targeted pages. The iFrancise Panel interpreted blocking as an attempt to conceal infringement, although is it not per se illegitimate as explained by the Respondent in Rba Edipresse, S.L. v. Brendhan Hight / MDNH Inc., D2009-1580 (WIPO March 2, 2010). Blocking after receipt of a cease-and-desist notice is different from a registrant’s policy of instructing Alexa not to crawl its websites.

It is clear that UDRP Panels are comfortable with acepting evidence from the Wayback Machine as persuasive in the absence of any counter evidence. They give historical snapshots great weight in determining both rights and legitimate interests in the disputed domain name as well as respondent's good and bad faith in registering and using it. In response to the Complainant's screen shot evidence in Facebook the Respondent “authorize[d] the panel to request archives of the page” but failed to offer any concrete refuation beyond denial of authenticity.

On the other hand, historical snapshots from the Wayback Machine have received a mixed view from U.S. courts. Although a federal magistrate has ruled IA snapshots admissible as “an admission of a party-opponent and are not barred by the hearsay rule,” Telewizja Polska USA, Inc. V. Echostar Satellite Corp., No. 02 C 3293, 2004 WL 2367740, at *5 (N.D. Ill. October 15, 2004) and there is support from the Second Circuit in Louis Vuitton Malletier v. Burlington Coat Factory Warehouse Corp., 426 F.3d 532, 535 (2d Cir. 2005) (evidence of defendant’s Website advertisements presented through archive.org capture of the site content at particular time), the trend nevertheless appears to exclude such Wayback Machine evidence as hearsay.

2007 was a particularly fruitful year on this issue. For example, in a patent case, Chamilia, LLC v. Pandora Jewelry, LLC., 04-cv-6017 (S.D.N.Y. 9-24-2007) the plaintiff alleged that Pandora failed to submit its patent application to the PTO for more than a year after marketing its product. It offered a series of archived web pages from the Wayback Machine which Pandora moved to strike. The Court held that this “putative evidence suffers from fatal problems of authentication under Fed.R.Evid. 901.” In Novak v. Tucows, Inc., No. 06-CV-1909, 2007 WL 922306, at *5 (E.D.N.Y. March 26, 2007) the Court struck Wayback Machine evidence for lack of authentication of internet printouts “combined with the lack of any assertion that such printouts fall under a viable exception to the hearsay rule.” Wayback Machine evidence was also excluded in a TTAB case, Paris Glove of Canada, Ltd. v. SBC/Sporto Corp., 84 USPQ2d 1856 (TTAB 2007).

August 13, 2010

Speculation and Unsupported Assertion is not Proof

The complainant has the burden of proof on all elements of the Policy. It is lighter where the complainant has control of the evidence. For example, for proving that a respondent lacks rights or legitimate interests under paragraph 4(a)(ii) of the Policy there is not usually any conclusive evidence since the evidence is controlled by the respondent. For this reason, a consensus quickly formed within the first few months of the UDRP that this element could be satisfied by the complainant making a prima facie case, which is defined as one that “will suffice until contradicted and overcome by other evidence.”

The burden is said to be “light” but light as it is the complainant cannot rest on speculation. There must be some evidence, or at least sufficient from which an inference can be drawn making it more likely than not that the prima facie burden is satisfied. How much evidence and of what kind depends in part on the strength of the trademark, the relationship between the parties and their geographic proximity or remoteness. Pro formerly a complainant should affirmatively state that the respondent is using the domain name without permission to attract Internet users to its website; is not making a bona fide offering of goods or services, is not “commonly known by the domain name” and is not using it in a legitimate non-commercial manner or entitled to protection under a fair use theory. Obversely, the respondent must come forward with concrete proof of one of the safe harbor defenses.

The meaning of “light” is relative; it cannot mean something less than proof. The Panel in Fender Musical Instruments Corporation v. Christopher Ruth, FA1007001333857 (Nat. Arb. Forum August 9, 2010) demands that the complainant marshal more because its trademark, FENDER (as a common dictionary word) is on the lower end of protection. Hence, its burden is heavier, even though the Respondent defaulted in responding to the complaint. “Here” (states the Panel) “Complainant claims Respondent made no use of, or any demonstrable preparations to use, the disputed domain name in connection with a bona fide offering of goods or services.” This allegation tracks the would-be defense under paragraph 4(c)(i) of the Policy. However, the “Panel finds Complainant’s assertions, without any supporting evidence or analysis, do not sufficiently establish Respondent lacks rights or legitimate interests in the <fendercustomshop.com> domain name.”

What did the Panel find missing in Fender? To satisfy a prima facie case the complainant must offer facts as opposed to assertions. The Panel in one of the cited cases, Yao Ming v. Evergreen Sports, Inc., FA 154140 (Nat. Arb. Forum May 29, 2003) rejected the complainant’s offer of proof as merely asserting a legal conclusion. The Panel “has no knowledge of Respondent's use of the domain name upon which to base a decision.”

This means that the complainant must make an affirmative statement followed by supporting evidence. In other words, it is not enough to say that the domain name is not being used in connection with a bona fide offering of goods when the complainant makes no showing of how the domain name is actually being used. “Complainant fails to allege any facts related to Respondent’s use or provide any screen shots of Respondent’s resolving website.” The missing evidence could have been as little as a narrative of the content of the website together with a screen shot. Without such evidence, it is literally impossible to know whether the registration or use of the domain name is bad faith under any of the paragraph 4(b) elements.

August 12, 2010

Asserting (Insisting on) Good Faith Even As the Factual Record Contradicts It

A respondent violates paragraph 4(b)(i) of the Policy if it is found to have registered the domain name “primarily for the purpose” of extorting payment from the trademark holder. If the registration is primarily for another purpose, to benefit in another way at the complainant’s expense, then the violation must be matched with a different theory. Not surprisingly in these cases respondents insist that they acted in good faith, in fact have a legitimate interest in the domain name, and resist any suggestion of abusive registration. But, they are defeated by their contradictory stances and inability to controvert or counterbalance unfavorable evidence.

This inability to reconcile contradictions with concrete evidence can be clearly seen in two recent cases, Broan-Nutone, LLC v. Ready Set Sales, D2010-0920 (WIPO July 27, 2010) and BBY Solutions, Inc. v. Thena Botanicals, FA1007001333656 (Nat. Arb. Forum August 8, 2010). In both, Respondents attempted to camouflage their intentions by alleging good faith registrations without recognizing that positive and negative inferences are most productively drawn from acts rather than assertions. It is inconsistent for a respondent to argue good faith while targeting the trademark and demanding payment.

In Broan-Nutone (<broanreplacementparts.com> and <nutonereplacementparts.com>) the Respondent alleged that “it registered the Domain Names solely for the purpose of truthfully identifying the fact that it sells products identified by the trademarks.” However, it not only incorporated the trademark in the domain names it also “copied images, schematics and other information at [allegedly] the direct request and with the explicit permission and knowledge” of one of the Complainant’s employees, proof of which was not forthcoming. And, by the way, it refused to transfer the domain names “unless Complainant granted a license ‘for rights to use certain videos belonging to ... Broan-Nutone’.” The Respondent failed to reconcile means and ends. As the Complainant pointed out resellers (which the Respondent was claiming to be) have a lawful right to use a trademark “provided that such use falls within the parameters of the nominative fair use doctrine; and provided that such use is not likely to mislead or confuse consumers regarding the relationship between your client and Broan-NuTone.” However, the proof did not support a claim for nominative fair use.

In BBY Solutions (<geeksquadgirl.com>) Respondent did not deny that it had knowledge of the Complainant’s trademark, GEEK SQUAD, but alleged that it “never solicited Complainant at any time.” However, in response to Complainant’s demand for transfer of the URL “Respondent asked to be compensated ... [and demanded] an amount based on expenses related to the cost of building, maintaining, and optimizing the website for the time it has been on the Web.” The Panel’s comment: “Respondent does not dispute the factual core of this case – that she knew of Complainant’s mark and chose to use it anyway as the core element of her virtually identical domain name for related services, and that when confronted about her actions, asked for the astonishing amount of $170,000.” Here, too, the Respondent took contradictory positions, but only the demand for payment was concrete.

In both cases, Respondents gave themselves away by demanding “valuable consideration in excess of [his or her] documented out-of-pocket costs directly related to the domain name.” In BBY the Complainant noted and the Panel archly agreed that Respondent “provides no evidence supporting [her] argument that the price [demanded] is consistent with the expenses incurred in connection with the disputed domain name.” In Broane-Nutone the Respondent demanded a different kind of consideration that is equally extortionate for its being a demand.

August 11, 2010

Consequences of Transferring Registration, Even From One Privacy Service to Another

Under the UDRP the losing respondent has 10 days to commence an action in a court of law in a “mutual jurisdiction” to take advantage of the regulatory stay [paragraph 4(k) of the Policy]. Otherwise, the domain name is transferred to the complainant and the respondent’s remedy under the Anticybersquatting Consumer Protection Act is for the court to grant “injunctive relief to the domain name registrant, including the reactivation of the domain name or transfer of the domain name to the domain name registrant,” Ricks v. BMEzine.com, LLC. 2:08-cv-01174 (D.Nevada July 26, 2010), citing 15 U.S.C. Sec. 1114(2)(D)(v). Inexplicably, the plaintiff in Ricks (formerly the Respondent in a UDRP proceeding) commenced the ACPA action but not in a “mutual jurisdiction” thereby losing his automatic stay.

As followers of UDRP decisions know transfer equals new registration. Bad faith is measured from the date of transfer. BMEzine.com, LLC. v. Gregory Ricks / Gee Whiz Domains Privacy Service, D2008-0882 (WIPO August 21, 2008) established the proposition that transfer can mean to any holder, even from one privacy service to another. While transfers are mostly to unrelated third parties, it is not a defense that beneficial ownership remains with the original registrant. “While the Panel can imagine reasons not to apply the principle in all cases ... [the Respondent] made its latest transfer, from one privacy service to another, to conceal his identity as long as possible.”

Ricks’ argument in his ACPA action centered on his good faith registration which preceded the defendant’s trademark registration. However, the district court stated that “Congressional intent would be undermined by Ricks’ proposed interpretation. If a domain name was registered in good faith originally, but thereafter re-registered in bad faith, the cybersquatter would escape liability, a result not supportable by the statutory scheme.” Note that the “statutory scheme” is different from the UDRP in that a registrant engages in unlawful conduct if he “registers, uses, or traffics in a domain name” – not conjunctive as under the UDRP – that is identical or confusingly similar to a distinctive mark “with the bad faith intent to profit from that mark” [15 U.S.C. Sec. 1125(d)(1)(A)].

“Although the ACPA principally was aimed at prohibiting cybersquatting, the Act also provides some protection to domain name registrants against ‘overreaching trademark owners’ who ‘reverse hijack’ a domain name from a registrant where the registrant’s actions were lawful,” Ricks, citing Barcelona.com, Inc. v. Excelentisimo Ayuntamiento De Barcelona, 330 F.3d 617, 625 & n.1 (4th Cir. 2003). But, to prevail on this claim the plaintiff must show (in addition to other proof) that its registration or use of the domain name was not unlawful under the ACPA. The district court (in granting summary judgment dismissing the cause of action for reverse hijacking) held that

Ricks’ bad faith is evident when considered in the context of Ricks’ history and knowledge.... Instead of altering the content [of the website to which the disputed domain name resolved] to avoid possible infringement, the bme.com website became increasingly focused on body modification content [thereby taking advantage of the Complainant’s reputation in the marketplace].

While renewals under the UDRP do not start anew the analysis of bad faith registration they and transfers are consequential under the ACPA. “Consequently, if the LLC’s ‘BME’ mark was distinctive or famous before any of these dates, Ricks would not be entitled to summary judgment on the LLC’s counterclaim for cybersquatting.”

August 10, 2010

The Principle that a Prior Registered Domain Name (In the Hands of the Original Registrant) Cannot Have been in Bad Faith Is Not Nullified by the Domain Name Being Passively Held

“When a domain name is registered before a trademark right is established, the registration of the domain name was not [indeed, could not have been] in bad faith because the registrant could not have contemplated the complainant’s non-existent right,” WIPO Overview of WIPO Panel Views on Selected UDRP Questions, paragraph 3.1. Only “when the respondent is clearly aware of the complainant, and it is clear that the aim of the registration was to take advantage of the confusion between the domain name and any potential complainant rights, bad faith can be found.”

Passive holding of a prior registered domain name is not a contingency that transforms good faith to bad. Yet, the Panel in GS Enterprises LLC v. Thierry Ehrmann, FA1005001324481 (Nat. Arb. Forum August 5, 2010) appears to suggest that bad faith could be found for passive holding of a domain name registered prior to the Complainant's acquisition of a trademark. “The Panel finds that Respondent’s failure to make active use of the disputed domain may indicate bad faith registration and use.” Further, “[i]n this case, the Panel finds it troubling that Respondent apparently has not made substantial use of the domain name in any way other than to post a single page of apparent art work, for over 13 years.... However, the Panel is also mindful of the high burden required for an actual showing of bad faith for non-use alone.”

The Panel’s statements are not simply a misreading of the law. They are nonsensical because (facts not supporting targeting) no inference of bad faith can be drawn from passive holding of a prior registered domain name that remains in the hands of the original registrant. Why in light of the well settled law the Panel found the Respondent’s conduct “troubling” is, well, troubling. The “high burden” requirement is applicable to registrations of domain names contemporaneous with or newer than the trademark. To call a post-acquired trademark holder’s burden “high” in proving bad faith leaves the impression that the burden can be satisfied. While a complainant whose trademark right postdates the registration of the domain name has standing to maintain the proceeding it has no actionable claim to the disputed domain name.

Where the complainant’s trademark preexists the domain name it must demonstrate that the respondent had knowledge of its trademark and intended to target it for commercial gain. See Facebook, Inc. v. Amjad Abbas, DME2010-0005 (WIPO July 13, 2010) discussed in August 6 Note. But, the “high burden” has no relevance to a prior registered domain name except under very limited circumstances. This could not have been made clearer in Telstra Corporation Limited v. Nuclear Marshmallows, D2000-0003 (WIPO Feb. 18, 2000) which the GS Enterprises Panel invokes as authority. The Telstra Respondent registered a domain name identical to the Complainant’s trademark which “ha[d] a strong reputation and is widely known, as evidenced by its substantial use in Australia and in other countries.” Therefore, to cite Telstra in analyzing a case in which the respondent is holding a domain name registered years prior to the trademark is to miss the point entirely.

Whether the Respondent in GS Enterprises took “active steps to conceal [his] true identity, by operating under a name that is not a registered business name” (which, incidentally, was not the fact), is irrelevant even if he had. The Consensus principle is not contingent even if the Panel were unable for lack of imagination “to conceive of any plausible actual or contemplated active use of the domain name by the Respondent that would not be illegitimate.”

Passive holding without proof of demonstrable preparations to use the domain name may support a finding of lack of legitimate interest in a technical sense, meaning that the respondent cannot prove a defense under paragraph 4(c)(i) of the Policy, but if the domain name is registered in good faith the respondent must then have an unforfeitable “right”. And, if a respondent has an unforfeitable right he cannot be said to have registered the domain name in bad faith. There would be a totally different result if the current respondent were a transferee of the domain name. See BMEzine.com, LLC. v. Gregory Ricks / Gee Whiz Domains Privacy Service, D2008-0882 (WIPO August 21, 2008) and Ricks v. BMEzine.com, LLC., 2:08-cv-01174 (D.Nevada July 26, 2010) (ACPA action commenced by the Respondent. The ACPA decision llustrates the vulnerability of respondents who register their domain names in good faith but commence using their domain names in violation of the trademark holder's rights).

August 9, 2010

Reasonable Grounds to Believe that the Use of the Domain Name is Fair Use or Otherwise Lawful

Of 19 UDRP proceedings commenced by SAP AG 5 were terminated and in 9 the Panels ordered the disputed domain names transferred. The remaining 5 complaints including the most recent SAP AG v. Stephen M Meli, D2010-0760 (WIPO July 27, 2010) were denied. It is not bad faith to incorporate another’s trademark where the use describes the respondent's business. The Panel in DaimlerChrysler A.G. v. Donald Drummonds, D2001-0160 (WIPO June18, 2001) held

Under the present facts, if the Panel were to find for the Complainant, the majority can conceive of no case in which a legitimate competitor in the sale of parts and aftermarket accessories could ever register a domain name descriptive of that business.

Similar reasoning was then (a few months later) applied to unauthorized dealers in Oki Data Americas, Inc. v. ASD, Inc., D2001-0903 (WIPO November 6, 2001). The Panel concluded that a respondent could succeed where it proved that it (1) actually offers the goods or services at issue; (2) uses the site to sell only the trademarked goods; (3) accurately discloses or disclaims the registrant’s relationship with the trademark owner; (4) tries not to corner the market in all domain names. The right created for respondents extends to authorized and unauthorized resellers and dealers and consultants.

Nominative fair use is regularly applied in UDRP cases. Oki Data and its progeny are frequently cited as precedent for the proposition. The defense has been endorsed by U.S. Circuit Courts most recently in Toyota Motor Sales USA Inc. v. Tabari, 07-55344 (9th Cir. July 8, 2010) discussed in the Note for July 19. The proposition can also be found in the Anticybersquatting Consumer Protection Act, 15 U.S.C. Sec 1125 (d)(B)(ii). The section reads in full, “Bad faith intent described under subparagraph (A) shall not be found in any case in which the court determines that the person believed and had reasonable grounds to believe that the use of the domain name was a fair use or otherwise lawful.”

Unusual is that in SAP against Meli (to distinguish the case from the other 18 proceedings) Respondent Meli defaulted in appearance. It appears, however, as though the Complainant made the Respondent’s case. Its submission included the Respondent’s position, namely that “he noted differences in the parties’ channels of trade and a number of other users of SAP....” It also included a description of the Respondent’s business sufficient for the Panel to conclude in Respondent’s favor despite the default. Thus, the record demonstrated that

the Respondent is the managing director of an entity called SAP Resources Group LLC, which company name is identical to the disputed domain name, that the services that SAP Resources Group LLC offers and apparently has been offering for some time are consulting services that are at least partly related to SAP software and that the Respondent is making use of the disputed domain name for the purpose of a company website of SAP Resources Group LLC. The Respondent, on this website, is making an express disclaimer that SAP Resources Group LLC is not affiliated to SAP AG or any SAP Company.

Although the Panel in SAP against Meli made no reference to Oki Data, its progeny or to the ACPA (in fact the decision is curiously sparse in citing precedential cases on any material issue), these authorities are nevertheless implicit. The Panel concluded that “it is not implausible that the Respondent, as the business SAP Resources Group LLC, may be commonly known by the disputed domain name and/or that he may be making fair use of the mark as a designation of the content or target of his services without intention to misleadingly divert consumers or to tarnish the trademark at issue.”

August 6, 2010

Supplementing the Complaint to Request a Three Member Rather than a One Member Panel

The Panel in Facebook, Inc. v. Amjad Abbas, DME2010-0005 (WIPO July 13, 2010) addresses an issue of first impression, namely whether a complainant can change its mind after electing a one member panel. The issue has two branches, whether A) the Center (meaning the administrative wing of the Provider) has power to allow amendment of the complainant’s first designation before referring it to the one member Panel? And B) a Panel has Power to allow an amendment of a party’s panel designation after referral? As a general rule governing arbitration proceedings, the arbitrator has the power to resolve procedural as well as substantive issues within his jurisdiction.

In Facebook, the Panel concluded that it had the power to reach a decision on the procedural issue but not the jurisdiction to accept the Complainant untimely request to change panel designation. “The Panel’s starting point in coming to [the] view [that the Center has no such power], is that the Policy is intended to provide a quick, relatively inexpensive dispute resolution system. Timeframes are accordingly short.” The reasons for this is that the “choice between a single-member panel and a three-member panel is an important step in the dispute resolution process.” The “first question is whether the Center has power to accept an amendment to a complainant’s panel designation made in its Complaint after formal notification of that Complaint to the Respondent and commencement of the administrative proceeding.”

In the Panel’s view, the Center has no such power. The reasons for this lies in the intended tempo of the UDRP proceeding. Given its “‘fast-paced’ character ... the Panel considers it unlikely that the framers of the Policy intended to give the parties the ability to delay the proceeding by changing their panel elections if they wished to do so.” “Once a response has been received, the Center only has five working days (where neither party has designated a three-member panel) to appoint a single panelist (Rules, paragraph 6(b)), and the Panel when appointed only has fourteen days (absent exceptional circumstances) to give its decision. The Panel is required to conduct the proceeding fairly, but with “due expedition” (Rules, paragraph 10(c)).”

The “more compelling” interpretation of the Rules is “that the reference to ‘elected’ in [] paragraph [6(b) of the Rules]refers only to the parties’ elections made in their initial filings – if in the complaint and the response both parties have designated a single member panel, then ‘neither the Complainant nor the Respondent [would have] elected a three-member Panel’, and paragraph 6(b) would apply.” The Complainant’s interpretation would “pointless waste quite a lot of time.”
“Any interpretation of the Rules which would open the door to that possible outcome seems unlikely to be correct.”

On the second branch of the issue, whether the designated one member Panel can refer the case back to the Center is equally incorrect. The Panel's authority is no greater than that which the Policy grants. “There is nothing in the Rules which contemplates a (sole) panelist directing the appointment of a three-member panel.” “More fundamentally, the appointment of panels is a function of the Provider under the Rules, and this Panel considers that his jurisdiction could not extend to directing the Center on the kind of panel it should appoint. The most he could reasonably do would be to recuse himself, and invite the Center to reconsider the question of panel appointment. But there would be no point in doing that if the panel believed, as this Panel does, that the Center has no power to allow the Complainant to change its election.”

August 5, 2010

Creating a False Record to Capture a Prior Registered Domain Name

We associate opportunism with respondents, but it equally describes a class of complainants who overreach their trademark rights in an attempt to capture prior registered domain names. The tactic may even be successful where the respondent fails to respond to the complaint. Between 75% and 80% of UDRP filings are uncontested, which gives ample opportunity for complainants to imply more than they have. Who would know that pleaded allegations were misleading if not tested by denial and contrary proof? The Complainant in Credit Europe Bank N.V. v. Peter Yu, D2010-0737 (WIPO July 14, 2010) decided it was worth the risk of commencing a proceeding for <crediteurope.com> without disclosing a fact “crucial to the merits of [its] case.” The concurring panelist concluded that the Complainant was using the UDRP proceeding “as a less expensive, quick-and-dirty alternative to an infringement action or other legal claim.”

In the concurring panelist’s view “[s]everal undisputed objective facts require such a finding.” The first is that the Complainant pleaded that it had been in business since 1994 without disclosing that it “did not begin using its current Credit Europe designation until 2006 or 2007.” The Respondent had registered the domain name several years earlier. “[T]his is an inexcusable omission that is misleading in the extreme ... [and which] cannot be squared with Complainant’s certification, required by paragraph 3(b)(xiv) of the Rules, that “that the information contained in this Complaint is to the best of Complainant’s knowledge complete and accurate . . .”

The implication in the pleading that the trademark preceded the domain name is so affirmative that absent proof that it was (in fact) later acquired it would be impossible to detect. That is surely one of the reasons for the concurring panelist’s scolding. “I write separately because, unlike my colleagues, I believe the filing of the Complaint in these circumstances requires a finding by the Panel ‘that the Complaint was brought in bad faith’ and ‘constitutes an abuse of [this] administrative proceeding,’ Rules, paragraph 15(e).” The scolding is also directed at the professional representative. Paragraph 3(b)(xiv) of the Rules tracks Rule 11 of the Federal Rules of Civil Procedure. It reads: “the assertions in this Complaint are warranted under these Rules and under applicable law, as it now exists or as it may be extended by good faith reasonable argument.” But, the Panel explains,

The Policy has been in force for more than a decade and the thousands of cases decided under it now constitute a workable body of (to use a legal term) precedent. In my opinion any complainant, and even more so any professional representative of a complainant, should be at least minimally versed in the Policy, the Rules, their scope, and their limits. It is no excuse that a party or its representative is unfamiliar with clear Policy precedent, much less the clear language of the Policy and the Rules themselves.

The professional representative “pitched” his client’s case on a totally untenable theory that “my client’s interests are more important and carry bigger weight than the interests of the Respondent, and therefore it is justified if the domain name is transferred to [it].” This raises ignorance of the UDRP jurisprudence and complicit deception to an unacceptable level. The “Complainant, or Complainant’s representative, seems to believe not only that under some inchoate and undisclosed standard that Complainant has a greater entitlement to the domain name than Respondent, but also that this belief justifies relief in a UDRP proceeding.” It does not, and for the concurring panelist it justifies “the limited censure available to the Panel under the Policy and the Rules, if only to deter similar conduct in future. I would include a finding in the Panel’s opinion that the Complaint was brought in bad faith and is an abuse of this administrative proceeding.”

August 4, 2010

Shifting the Burden to Respondent on Proof of a Prima Facie Case

Let us look back to one of the key rules of a UDRP proceeding, namely shifting the burden on proof of a prima facie case. It is expected that the party controlling the facts has an affirmative burden. For example, proof of complainant’s right under paragraph 4(a)(i) of the Policy is based on facts within its knowledge and evidence under its control. Withholding but compelled to admit dispositive evidence that its trademark right came into existence years after the registration of the domain name “constitutes,” as the concurring Panel in Credit Europe Bank N.V. v. Peter Yu, D2010-0737 (WIPO July 14, 2010) notes “a flagrant abuse of the entire UDRP process.” The Complainant intended to create a false impression. Had the Respondent defaulted, the Complainant's misleading allegations as to the commencement of its trademark right would have been sufficient to capture the domain name. This is what the Panel meant by “flagrant abuse.” But, more of this case tomorrow.

Paragraph 4(a)(ii) is (or would be if the burden were unrelieved) a harder test for the complainant and is the fulcrum for both parties. It requires the complainant to prove that the respondent lacks rights or legitimate interests in the domain name, but in contrast to paragraph 4(a)(i) the facts are not within its own but under the custody and control of the respondent. Here, Panels quickly determined that the test required something less than conclusive proof. The complainant could satisfy its burden by offering a prima facie case. Prima facie is defined as one that “will suffice until contradicted and overcome by other evidence,” Black’s Law Dictionary (Revd Fourth Ed).

Once the complainant offers a prima facie case that respondent has no rights or legitimate interests in respect of the domain name, the burden shifts to respondent to provide credible evidence that it does. Shifting the burden entered the UDRP vocabulary tentatively in April 2000 in two cases by the same panelist, EAuto, Inc. v. Available-Domain-Names.com, d/b/a Intellectual-Assets.com, Inc., D2000-0120 (WIPO April 13, 2000) and EAuto, L.L.C. v. EAuto Parts, D2000-0096 (WIPO April 9, 2000). It took only a few more months to solidify as a rule in the decision process, D2000-0252, 0270, 0374, 0624.

The complainant satisfies its burden by offering sufficient evidence that yields an inference that the respondent lacks rights or legitimate interests. The inference is tentative and subject to rebuttal. As explained in Educational Testing Service v. Netkorea Co., D2000-0087 (WIPO April, 2000), the complainant’s burden is “relatively light” for the reason that “[b]y and large, such information is known to and within the control of the respondent.” The “light” standard is explained by the relative difficulty of marshaling evidence “uniquely within [the respondent’s] ... knowledge and control,” G.D. Searle v. Martin Mktg., FA 118277 (Nat. Arb. Forum Oct. 1, 2002); Croatia Airlines d.d. v. Modern Empire Internet Ltd., D2003-0455 (WIPO August 21, 2003). The Panel in Croatia Airlines noted that

Since it is difficult to prove a negative (i.e. that Respondent lacks any rights or legitimate interests in the mark) – especially where the Respondent, rather than the Complainant, would be best placed to have specific knowledge of such rights or interests – and since Paragraph 4(c) describes how a Respondent can demonstrate rights and legitimate interests, a Complainant’s burden of proof on this element is light.

A consensus quickly formed that application of the prima facie rule was necessary owing to the difficulty of proving a negative. Without respondent’s participation and even with it, the complainant must make do with whatever adventitious information it can glean from the Internet (search responses for example), deconstruct from the website to which the domain name resolves (its present and historical content) and/or deduce from a respondent’s UDRP statements in the response to the complaint, cease and desist letters, and communications prior to the initiation of the proceedings.

At a minimum the complainant must affirmatively state that 1) it has no relationship with the respondent and did not authorize the respondent to use its trademark, facts within the complainant’s knowledge [paragraph 4(c)(i) of the Policy], 2) the respondent is not commonly known by the domain name, a fact evidenced by the respondent’s name disclosed in the Whois database [paragraph 4(c)(ii)] and 3) the respondent is not using the website for legitimate noncommercial or fair use purposes, a fact discernable from the contents of the website [paragraph 4(c)(iii)]. The inference in support of a finding in complainant’s favor is sustainable unless the respondent comes forward with affirmative proof that its right or legitimate interest trumps complainant’s trademark right.

August 3, 2010

Judicial Efficiency in Declining to Continue Analysis Where the Complainant Lacks Proof to Support its Case

I noted yesterday that secondary meaning is earned not presumed. Panels determine first whether there is jurisdiction. If there is, they continue; if there is not, the proceeding is brought to an end. There may well be dispute over the domain name, but it belongs in a civil court of law applying different legal standards. Dismissal of the UDRP complaint at the earliest moment in the proceeding is justified on grounds of judicial efficiency. It makes no sense to do more analysis than is necessary. So, if there is no jurisdiction, there is no necessity to analyze facts for rights or legitimate interests or bad faith registration and use and proper for the Panel to decline to do so.

Dismissal for lack of jurisdiction is a standing issue. In Surfside Animal Hospital, APC v. Mission Animal & Bird Hospital, FA1006001330046 (Nat. Arb. Forum July 28, 2010) it is evident that the parties are locked in an overlapping or inclusive dispute which appears to include the domain name as one component, but both parties have withheld governing facts from the record. There is an unexplained relationship. However, none of this is of any consequences because the Complainant fails to demonstrate that SURFSIDE ANIMAL HOSPITAL had gained secondary meaning. The Panel noted

Complainant alleges it has used the SURFSIDE ANIMAL HOSPITAL mark in association with its veterinary services and all filings and business licenses associated with these services since May 18, 2009. Complainant also claims that it has invested substantially in marketing the SURFSIDE ANIMAL HOSPITAL mark.

Those claims are not in any way supported by evidence. There is no evidence whatsoever of reputation in, or public recognition of, the trademark, something consistently demanded in formative decisions under this Policy. The trademark is essentially descriptive. Even with extensive, well documented proof of use, Complainant might have struggled to show common law rights acquired over a period of barely more than one year.

Application “for a mark [as opposed to issuance of registration] is not per se sufficient to establish rights in a trademark for the purposes of the UDRP,” Wave Indus., Inc. v. Angler Supply, FA 304784 (Nat. Arb. Forum September 20, 2004); Amsec Enterprises, L.C. v. Sharon McCall, D2001-0083 (WIPO April 3, 2001) and many later decisions. Although the Complainant in Surfside Animal Hospital alleges that its “first use in commerce” preceded by a year the registration of the disputed domain name the fact is its trademark registration occurred after the domain name. It is for this reason that the Panel could not accept its assertion of prior use without proof that its trademark had achieved recognition in the marketplace.

Since “it is impossible” (said the Panel) for it “to attribute common law rights in the trademark ... [b]ased simply on the material before it” there was no necessity to proceed with the analysis. Because the complainant must prove all three elements under the Policy, the complainant’s failure to prove one of the elements makes further inquiry into the remaining elements unnecessary, citing Creative Curb v. Edgetec Int’l Pty. Ltd., FA 116765 (Nat. Arb. Forum Sept. 20, 2002). Although the Panel in Creative Curb is making reference specifically to paragraph 4(a)(ii) of the Policy, this procedure applies equally to the threshold requirement.

August 2, 2010

Proving Common Law Trademark: Threshold for Jurisdiction

In common law jurisdictions an unregistered trademark is no less protected than one registered. But, the burden of proof is different; the bar is higher. This is illustrated in DogsBite.org v. Domain Privacy, Animal Farm Foundation Inc., D2010-0861 (WIPO July 27, 2010) in which the Complainant is arguing superior rights to the descriptive phrase, DOGS BITE. Also in Surfside Animal Hospital, APC v. Mission Animal & Bird Hospital, FA1006001330046 (Nat. Arb. Forum July 28, 2010) in which the Complainant has an application pending for a trademark. In these cases secondary meaning is earned not presumed.

Common words, descriptive phrases and pending applications aside, paragraph 4(a)(i) is silent on whether the trademark right the complainant is seeking to vindicate must be registered, but panelists within a few months of the UDRP’s introduction held that the Policy “does not distinguish between registered and unregistered trademarks and service marks in the context of abusive registration of domain names,” The British Broadcasting Corporation v. Jaime Renteria, D2000-0050 (WIPO March 23, 2000). It is not necessary for a trademark to be registered by a governmental authority or agency for such rights to exist, SeekAmerica Networks Inc. v. Masood, D2000-0131 (WIPO April 13, 2000). However, the proof demands for registered and unregistered are significantly different. Whereas the owner of a registered mark succeeds in proving its trademark right by submitting a copy of the registration certificate – which “is prima facie evidence of [the trademark’s] validity,” NetApp, Inc. v. July Linett c/o Jolly Co., FA0812001238829 (Nat. Arb. Forum February 5, 2009) and also “creates a rebuttable presumption that the mark is inherently distinctive,” Janus International Holding Co. v. Scott Rademacher, D2002-0201 (WIPO March 5, 2002) – an owner of an unregistered mark has the heavy burden of marshaling evidence sufficient to prove that its mark was recognized by the consuming public as an indicator of its goods or services when the domain name was registered.

There nevertheless remained following these cases a question as to whether a complainant residing in a jurisdiction that did not recognize common law trademark rights could be said to have one for UDRP jurisdiction. The uncertainty is reflected in The Staff Manager’s Issues Report on UDRP Review (August 1, 2003) which posed the following question: “Should the policy be amended with respect to protection for non-registered marks?” Those in favor of reducing or eliminating recognition of unregistered marks argued that it “would increase registrants' certainty and the predictability of decisions.” It was also noted that “National (and local) trademark laws vary with respect to the deference afforded un-registered marks, so harmonization would not be feasible or within ICANN's scope.” “These rights” (one Panel noted) “derive from national laws and do not exist divorced from such laws,” Antonio de Felipe v. Registerfly.com, D2005-0969 (WIPO December 19, 2005).

As it turned out, however, the issue was decided by construction: unregistered marks in countries that recognize them are no less entitled to protection from abusive registration than registered marks. The WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Paragraph 1.7 states that “Unregistered rights can arise even when the complainant is based in a civil law jurisdiction.”

In DogsBite the Complainant is located in Texas and the Respondent appears to be a coalition of parties located in the United Kingdom and New York. If common law rights are invoked, there must be a foundation. The Panel turned to earlier UDRP decisions that drew guidance from U.S. Courts. “In assessing secondary meaning, one must consider a variety of factors, including, but not limited to, (1) advertising expenditures, (2) consumer ... linking [of] the mark to the source, (3) unsolicited media coverage of the product, (4) sales success, ... and [(5)] length and exclusivity of the marks use,” citing Paco Sport, Ltd. v. Paco Rabanne Parfums, 86 F.Supp. 2d 305, 313 (S.D.N.Y. 2000) (quoting Centaur Communications, Ltd. v. A/S/M Communications, Inc., 830 F.2d 1217, 1222 (2d. Cir. 1987).

Centaur Communications held that a mark acquires secondary meaning when “it [is] shown that the primary significance of the term in the minds of the consuming public is not the product but the producer.” “Thus” (the DogsBite Panel notes)

the crux of the doctrine of secondary meaning ‘is that the mark comes to identify not only the goods but the source of those goods,’ even though the relevant consuming public might not know the name of the producer. … Nonetheless, someone seeking to establish secondary meaning must show that the purchasing public associates goods designated by a particular mark with but a single--although anonymous—source [...]

“The mark” (continued the Panel) “is, at best, merely descriptive of the services offered by the Complainant.” Moreover, “[g]iven the clear lack of inherent distinctiveness, it falls to the Complainant to prove that its purported mark has acquired distinctiveness.” While, “[i]t is possible that at a full trial hearing with all the benefits of discovery and cross-examination, the Complainant might be able to establish itself as the owner of a common law right ... [o]n the record before it in this proceeding, however, the Panel is unable to conclude that the Complainant has met its burden in this case.”

July 30, 2010

Proof of Actual Knowledge Required Where There is Plausible Denial

The greater the geographic distance between parties the more plausible the respondent’s denial that at the time it registered the domain name it had any knowledge of the complainant or its trademark. Plausibility is bolstered by the commonness of the words comprising the trademark and complainant’s failure to submit any evidence of its reputation in the respondent’s country that would support an inference of prior knowledge. The Complainant in Juicy Details B.V. v. Another.com, D2010-0809 (WIPO July 15, 2010) acquired a Benelux trademark in the same time frame that the respondent registered the domain name <juicydetails.com>, but operates in a different market than the Respondent.

“Juicy” in combination with “details” is a metaphor colloquially “denot[ing] gossip or titillating information.” The Complainant, on the other hand, uses the phrase in its literal sense, for its operation of “juice bars.” Knowledge of a trademark registered in a foreign jurisdiction is not established by assertion; the UDRP does not embrace the theory of constructive knowledge. In Juicy Details, “[t]here is no evidence in the record that the Complainant operated or advertised in the United Kingdom, where the Respondent is located, in 2002.” Thus,

it is not clear how the Respondent would have been aware of the Complainant’s mark in May 2002, when it registered the Domain Name in the United Kingdom, unless it examined the records of Benelux trademark applications.

But, charging a respondent of an awareness of foreign trademark applications assumes more than the record allows. There is no legal requirement to examine foreign trademark databases. The WIPO Final Report at paragraph 103 states that “the performance of a prior search for potentially conflicting trademarks should not be a condition for obtaining a domain name registration.” In Juicy Details, the Panel “does not read the Policy as requiring such an investigation,” at least where the disputed domain name involves common words used in their metaphoric sense. The Respondent states that

it purchased the Domain Name in furtherance of one of its domain-related businesses, “to offer a vanity email service built around words that would be perceived by customers as an amusing identifier”. Since the Respondent is English and offers a variety of domain name services, this proposed use of the Domain Name is credible.

This is more plausible than the Complainant’s “improbable theory that the Respondent was aware of the Complainant’s new mark in May 2002 and sought to exploit it.” The Complainant’s problem is one frequently seen in these UDRP proceedings. Later acquired reputation is not evidence of respondent’s bad faith when the complainant had none. Unless there is evidence that the complainant’s reputation had actually traveled to the respondent’s market and its trademark recognized by the purchasing public as the source of good offered it falls short of undermining the respondent’s good faith registration (however the website may be used).

July 29, 2010

Foreign Respondent Targeting Complainant in its Language and Market

Conceivably, a respondent on one continent could register a domain name confusingly similar to a trademark actively used on another and plausibly deny knowledge of the existence of the complainant or its mark. Plausibility dissolves, however, when the domain name resolves to a website populated with advertisements “directed solely to US.-based businesses,” AutoZone Parts, Inc. v. Konstantinos Vardakastanis, FA1006001331739 (Nat. Arb. Forum July 27, 2010) and “100 percent of the content located at the Domain Name is in English.”

Respondent waxes indignant at being targeted by the Complainant, although he admitted to the Complainant’s outside counsel that “he earns more than $500 per month [amended in a nonconforming email to the Provider to $50 per month] from ‘link sales, publisher networks, etc’.” The Panel in World Wrestling Entertainment Inc. v. Israel Joffe, D2010-0860 (WIPO July 1, 2010) noted in connection with that case that the Respondent’s request for time “appears to be yet another attempt by a respondent to keep its domain names a bit longer, for whatever reason.”

The Respondent in AutoZone takes a further step in risibility. He “seems to admit the sole purpose of the web site is to generate ‘click through’ revenue,” although concludes his nonconforming email with “Give me a break here.” “First of all” (he says):

I would like to state that I leave [sic] in Greece and there is not any lawyer here capable of represent me as there is not such field (domain names dispute etc) in the law profession and no one has the experience in such cases. ... The English language is not my mother tongue.... From the things I know when the above reasons exist:

a) The state, the complainant or the forum or what so ever appoints a lawyer free from any fees to represent the defender, in this case me. So I would like a representative free of charge for me and the fees should be covered from the complainant.

b) The defender has the right to be heard in his mother tongue in this case Greek language. So I want all the documents translated in Greek language and the sum for this translation must be covered from the complainant as he is the one starting the confliction. Also my answers will be in Greek language.

Naturally, “[a]ll the money spend [sic] in this procedure must be covered from the complainant despite the final verdict. In any other different case I declare that I do not understand any of this documents send to me and that I am not aware of any information as a result no deadline of 24/June/2010 and timeframes exist.”

Setting aside the fact that the Respondent in AutoZone offers no defense or explanation for the registration, as a general rule minor additions to a trademark are not sufficient to create a distinctive name. Adding “the” as affix and an “s’ to AUTOZONE to form <theautozones.com> is not transformative; rather, it is confusingly similar to the Complainant’s trademark. When used “as a directory of links to third-party competitors of Complainant on a website resolving from a confusingly similar domain name” it supports a finding of bad faith registration and use.

July 28, 2010

Protecting Existing Trademarks from Predators and Parasites

Predators and Parasites come in a variety of shapes and sizes as are abundantly illustrated in these ongoing Notes. Some specialize in omitting or adding letters to a complainant’s trademark; others, adding affixes or suffixes to the second level domain; still others, appropriating the whole trademark and running with the domain name until forfeiture. Some are strangers; others are contractually related. Trademarks whole or altered (but confusingly similar) have demonstrable power to attract traffic, which is the summum bonum of the exercise. The “website is used only for two purposes: advertising hyperlinks to Complainant’s competitor pandemic preparedness providers and purportedly selling fake pig noses,” MM Herman & Associates, LLC v. Black Knight Publishing c/o Black Knight, FA1005001324437 (Nat. Arb. Forum June 16, 2010).

The underlying premise of the UDRP is protecting existing trademarks from predators and parasites. The UDRP is available only to holders whose trademarks are incorporated in whole or in part by respondents who have no right or legitimate interest in the domain name and are shown to have registered it in bad faith. Cybersquatters are “people who register domain names knowing them to be the trade marks of others and with the intention of causing damage or disruption to the trade mark owners and/or unfairly exploiting the trade marks to their own advantage,” Tomatis Developpement SA v. Jan Gerritsen, D2006-0708 (WIPO August 1, 2006). The “notion of an abusive domain name registration is defined solely by reference to violations of trademark rights and not by reference to violations of other intellectual property rights, such as personality rights,” WIPO Final Report, paragraph 135 [ii]). In defining the proscribed conduct WIPO chose to use the encompassing term “abusive registration” rather than “cybersquatting”. It explained that “[i]n popular terms, ‘cybersquatting’ is the term most frequently used to describe the deliberate, bad faith abusive registration of a domain name in violation of rights in trademarks and service marks”, Report, paragraph 170. However,

precisely because of its popular currency, the term has different meanings to different people. Some people, for example, include “warehousing,” or the practice of registering a collection of domain names corresponding to trademarks with the intention of selling the registrations to the owners of the trademarks, within the notion of cybersquatting, while others distinguish between the two terms. Similarly, some consider “cyberpiracy” to be interchangeable with “cybersquatting,” whereas we consider that the former term relates to violation of copyright in the content of websites, rather than to abusive domain name registrations.

Therefore, (the Final Report continues) “[b]ecause of the elastic meaning of cybersquatting in popular terminology, we have ... chosen to use a different term––abusive registration of a domain name––in order to attribute to it a more precise meaning.” The term “abusive registration” describes a range of deceptive practices that adversely impacts the rights of trademark holders. Theories encompass violation of statutory prohibitions and rights; torts (wilful and negligent), such as misappropriation, conversion and breach of fiduciary duty; and criminal conduct, such as larceny and identity theft (phishing).

However, a case can be made that instead of being more precise the term “abusive registration” opened up opportunities to include by construction abusive conduct as a distinct category of bad faith within the scope of the Policy. Elasticity more invites expansion than contraction. It can reasonably be argued that since its inception there has been an incremental broadening of the UDRP. Issues and factual circumstances that in early decisions were thought to be outside the scope of the Policy have been brought within.

July 27, 2010

Exceptional Circumstances in Request to Extend Time to Respond to Complaint

UDRP complaints must be answered within 20 days [Rule (5a)] or by an extended date on proof of exceptional circumstances [Rule 5(d)]. The Rules were amended effective March 1, 2010 to permit service of papers electronically. Prior to the amendment respondents were technically in default if their electronic service was timely but their hard copy by postal service or overnight courier was not. The consensus excused this type of default on the theory that cases should be decided on their merits.

This tolerance was not extended to untimely responses for which the consensus is less forgiving. The Panel in Mobile Communication Service Inc. v. WebReg, RN, D2005-1304 (WIPO February 24, 2006) held that in order for a late response to be considered the circumstances for its lateness must be “exceptional”, hewing to the literal prescription in Paragraph 5(d) of the Rules of the Policy. “An ‘exceptional’ case, by its very nature” (the Panel held) “must be the exception, not the rule,” (emphasis in original). Moreover, according to the Mobile Communication Panel, the decision should not be influenced by the possibility that the late response might have dictated a contrary result.”

A third group of untimely responding respondents is the respondent who asks for more time. This is governed by Rule 5(d) which reads, “At the request of the Respondent, the Provider may, in exceptional cases, extend the period of time for the filing of the response.” There is little if any tolerance for respondents who request an extension as though it is permitted as of right. This is illustrated in World Wrestling Entertainment Inc. v. Israel Joffe, D2010-0860 (WIPO July 1, 2010). A request to the Provider cannot succeed without the respondent providing evidence of exceptional circumstances. In the absence of evidence “it appears to be yet another attempt by a respondent to keep its domain names a bit longer, for whatever reason.”

Respondents genuinely needing an extension must act promptly. The World Wrestling Panel Respondent suggests that “it is “generally desirable for any respondent seeking an extension first to apply to the complainant or its representative before approaching the Center for an extension.” (The second sentence of Rule 5(d) reads: “The period may also be extended by written stipulation between the Parties, provided the stipulation is approved by the Provider.”)

The Respondent in World Wrestling waited two weeks before making a request to the Provider and in its “communication to the Center Respondent gave no reason for the requested extension.” It later stated in its attenuated response that his “lawyer’s wife [was] having a baby.” The Complainant objected to the extension, noting that it “saw nothing ‘exceptional’ about this case.” The Panel agreed

given the nature of the Response actually filed, the twenty days provided by the Rules constituted ample time to address the merits of the Complaint. Rather than an extension based upon legitimate need, this appears to be yet another attempt by a respondent to keep its domain names a bit longer, for whatever reason. This Panel and other panels have condemned this respondent tactic in the past.

The Respondent’s argument rested on a mis-interpretation (really a lack of understanding) of the law as pronounced in the ACPA, to which the Panel noted that this “single contention” is “defeated” by the language of paragraph 4(b) of the Policy.” Neither the ACPA nor the Policy limits a finding of abusive registration to proof of the registrant’s intention to sell the disputed domain name to the trademark holder. Offering to sell a domain name to the trademark holder is one of several nonexclusive grounds for bad faith.

July 26, 2010

Foregoing Analysis When Respondent Offers to Transfer Domain Name

In Benchmark Brands, Inc. v. Sky Blue Marketing, FA1006001331227 (Nat. Arb. Forum July 23, 2010) the Respondent admitted that there was “no dispute over the domain names complained about and they have already offered to transfer the names.” The Panel concluded that all it needed to do was “state its basic finding on these issues. Indeed these basic findings give it the jurisdiction to order transfer of the Domain Names under the Policy.” This is true, but Rule 17(a) addresses only mutual agreement. It reads: “If, before the Panel's decision, the Parties agree on a settlement, the Panel shall terminate the administrative proceeding.” More typically the respondent pleads nolo contendere (as in Benchmark Brands) and agrees to relinquish its registration. But, in Benchmark Brands there is no indication that the Complainant has stipulated to termination without a finding of bad faith.

A unilateral consent raises a challenging issue as to the respondent’s motivation and how to assess it. The Panel in The Cartoon Network LP, LLLP v. Mike Morgan, D2005-1132 (WIPO January 5, 2006) identified at least three possible courses of action for the unilateral consent:

(i) to grant the relief requested by the complainant on the grounds of the respondent’s consent without reviewing the facts supporting the claim;
(ii) to find that consent to transfer means that the three elements of Paragraph 4(a) of the Policy are deemed to be made out and thereby reach the conclusion that transfer should be ordered and
(iii) to proceed to consider whether, on the evidence, the three elements of Paragraph 4(a) of the Policy are satisfied because the respondent’s offer to transfer is not an admission of the complainant’s right.

Whether to accept respondent’s consent even in the face of the complainant’s refusal to stipulate depends upon the genuineness of the offer. In The Cartoon Network the Panel concluded that the Respondent’s offer was genuine and that such unilateral consent “provides a basis for an immediate order for transfer without consideration of the paragraph 4(a) elements.” Termination benefits the respondent because it does not constitute an admission of bad faith. The consent in fact may be accompanied by a strong denial of any violation, “for example, where a domain name was registered in error.”

A decision to terminate is questionable where there is a credible basis for concluding that the consent is offered to avoid a holding of bad faith. Indeed, for some respondents the purpose in consenting to transfer is to avoid a finding that it has violated the Policy. In this event, panelists view the offer more skeptically. For example, in Messe Frankfurt GmbH v. Texas International Property Associates, D2008-0375 (April 29, 2008) in which the Respondent has been found by prior Panels to be a serial cybersquatter in violation of paragraph 4(b) of the Policy with over a hundred claims against it. The Panel in rejecting the Respondent’s request to terminate the proceedings without a decision, stated:

[I]n cases of this type it would be contrary to the spirit and intent of the Policy for a party to use the expedient of offering to transfer the disputed domain name at the last minute, in order to avoid a decision on the merits and thereby minimize the risk of adverse findings/comments.

Foregoing the “lengthy traditional UDRP analysis and order[ing] an immediate transfer of the Disputed Domain Names” is to give the respondent a pass. In Benchmark Brands there is no question that the Respondent intentionally registered the disputed domain names, <footsnart.com> and <gootsmart.com>. The names are simply typographic variants of the trademark FOOTSMART and the registration is a clear case of typosquatting. The conduct should have been called for what it is as did another Panel involving the same Complainant decided the same date, Benchmark Brands, Inc. v. Anunet Pvt Ltd c/o Jyoti Mehta, FA1006001331154 (Nat. Arb. Forum July 23, 2010). Typosquatting is not an innocent registration for which the “lengthy traditional UDRP analysis” should be discarded.

July 23, 2010

Respondent’s Registration of Domain Name Contrary to Complainant’s Instructions

Employees, vendors and agents perform services and act on instructions of employers and principals. That a respondent in one of these classes registers a domain in his own name and refuses to transfer it on his employer’s or principal’s request is in violation of the UDRP. Sommerpine Books LLC v. Henton Enterprises, Hank Roberts, D2010-0805 (WIPO July 7, 2010). A distinction is made between respondents who register for their own accounts and those instructed to register for their employer’s or principal’s account.

Panels have refused to find bad faith registration where the respondent registered the domain name on consent or at the request of the trademark owner and it was understood that the domain name belonged to the respondent and not the complainant. Prior business relationships in which respondents legitimately hold domain names for their own accounts defeat a claim for abusive registration. See, e.g., ITMetrixx, Inc. v. Kuzma Productions, D2001-0668 (WIPO August 2, 2001); The Thread.com, LLC v. Jeffrey S. Poploff, D2000-1470 (WIPO January 5, 2001). A respondent with no prior business relationship who registers the domain name “to try to force Complainant to use his independent web-hosting service is a classic form of cybersquatting except that he sought work rather than cash,” Westfield Corp. v. Graeme Michael Hobbs, D2000-0227 (WIPO May 18, 2000).

In contrast, “[i]n cases where respondent has registered the domain name in its own name contrary to instructions received from complainant, panels have consistently held such a practice to constitute bad faith registration and use,” citing Champion Innovations, Ltd. v. Udo Dussling (45FHH), D2005-1094 (WIPO December 16, 2005) (“in this case, the Complaint suggests that Respondent was expected to register the Domain Name in the name of Complainant. In that circumstance, the Respondent’s refusal to follow his employer’s instruction and his registration of the Domain Name in his own name constitutes bad faith registration.”); Robilant & Associati Srl v. POWERLAB snc (ROBILANT6-DOM), D2006-0991(WIPO October 5, 2006).

The Sommerpine Respondent has a business relationship with the Complainant as a vendor performing services. In pre-arbitration e-mails it admitted that “Henton held the domain names in trust for Complainant, because the disputed domain names were hosted on Respondent’s server.” However, the Respondent went one step further in rejecting the Complainant's demand to transfer the domain name. It insisted that it had intellectual property rights in the content of the web site and that transfer of the domain name was contingent on an agreement that recognized that interest. However, this confuses two different regimes of interest.

There is no law or rule for domain names equivalent to a garage lien that authorizes an owner to withhold delivery of a vehicle pending payment of accrued fees. A respondent cannot hold for ransom a domain name without falling foul of paragraph 4(b)(i) of the Policy. It may have counterclaims for unpaid fees but the respondent has no remedy under the UDRP.

July 22, 2010

Good Faith Registration Overrides Lack of Rights or Legitimate Interests and Bad Faith Use

It is seen as a deficiency by some that a complainant is remediless under the UDRP for blatant bad faith use of a domain name registered in good faith. There have been a number of interpretative suggestions to rationalize a construction of the Policy to circumvent the paragraph 4(a)(ii) requirement for bad faith in the conjunctive. None of these constructions has gained any serious support. In RapidShare AG and Christian Schmid v. The holder of the domain name rapidshare.net, D2010-0598 (WIPO July 9, 2010) the 3-member Panel held that it “must apply the UDRP as it is, not as the Panel thinks it should be.”

The wistful coda to the sentence, “it should be” is an acknowledgment that the UDRP cannot reach as far as country code policies or of the Anticybersquatting Consumer Protection Act that require proof in the disjunctive. Bad faith use is a legal basis for forfeiture. “If, as the Panel suspects, the Respondent’s present use began only after the Complainant’s use became widely known, it could be inferred that this use has not been in connection with a bona fide offering of goods or services, but rather that it has been in bad faith to divert Internet users seeking the Complainant’s website.”

Under the UDRP the complainant succeeds only by showing bad faith in the conjunctive, “as cumulative conditions which must both be satisfied for a complaint to succeed.” The RapidShare Panel made it clear (whatever its preference for a different outcome) that is was following precedent. It adopted the reasoning of three recent cases that forcefully rejected a unitary construction of the Policy, Camon S.p.A. v. Intelli-Pet, LLC, D2009-1716 (WIPO March 12, 2010), Burn World-Wide, Ltd. d/b/a BGT Partners v. Banta Global Turnkey Ltd, D2010-0470 (WIPO May 19, 2010), and Editions Milan v. Secureplus, Inc., D2010-0606 (WIPO ). The Panel in Camon noted that

This Panel is concerned that if panelists develop their interpretation of the Policy as they go along to meet the needs of trade mark owners who are suffering at the hands of domain name registrants, a stage will be reached where they will be acting beyond their remit. At some stage the issue must be a matter for the legislators and not the panelists. The Panel is concerned that that stage is very close at hand.

A transferee, of course, is answerable for its own conduct, so that from bad faith use bad faith registration can be inferred. In RapidShare there is an apparent discrepancy raising “some doubt as to whether there may have been a transfer since the Domain Name was originally registered.” However, “the Complainants must prove their case, as the UDRP specifies in its paragraph 4(a). The Complainants have not asserted, let alone substantiated, that the Domain Name has been transferred in bad faith.” Had there been an intermediary transfer, the result would have been different, based on the theory that transfer=new registration.

July 21, 2010

Establishing Credibility as an Element of Persuasion

A credible witness has a better chance of persuading the Panel than one who fails to present his case properly. “It is possible,” states the Panel in Maurice Sporting Goods, Inc. v. American Sportcase, LLC, D2010-0689 (WIPO June 29, 2010) “to theorize a different story” but the story presented is “supported by some circumstantial evidence ... and the owner of the Respondent is a well-established entrepreneur operating substantial businesses that demonstrate significant industrial capacity.” The timing of the domain name registration which is ordinarily the starting point of analysis is offset by the Respondent's plausible showing. It has established credibility of means of manufacture which assists in proving its own business purpose and undermines the contention that the registration was intended to take advantage of the Complainant or its trademark.

The second level domain in Maurice Sporting Goods is identical to the Complainant’s trademark, READY2FISH, published for opposition by the USPTO on December 7, 1999. The disputed domain name, <ready2fish.com> was registered December 10, 1999. The different story that could have been theorized, however, involves a series of “might have beens.” The Respondent “might have been aware of Complainant’s asserted common law use ... in early 1999 ... [and] might of been aware of Complainant’s application for trademark registration in April 1999 ... [and] might of been sufficiently impressed ... to seek to take unfair advantage.” But, there is no “tangible basis for concluding that Respondent knew or should have known of common law rights asserted by Complainant in early 1999.”

Respondent supported its “plausible story” with evidence sufficient to establish that he “is a well-established entrepreneur operating substantial businesses that demonstrate significant industrial capacity.” At the same time that it registered the disputed domain name it also registered two other domains (<ready2golf.com> and <ready2ski.com>) as part of its business strategy of “manufacturing a line of products (i.e. molded plastic cases) for use with fishing, golfing and skiing equipment.” In the Panel’s view “[r]egistration of the three similar domain names circumstantially supports Respondent’s story, and plausibly supports a claim of demonstrable preparations to use the disputed domain name for a bona fide offering of goods prior to notice of a dispute.”

In order to prove today an adversary’s intention when it registered the domain name requires production of “meaningful evidence.” In Maurice Sporting Goods there was at best suspicion arising from the timing of the two registrations but unaccompanied by any“meaningful evidence that Respondent sought to take unfair advantage of Complainant or its trademark” at any time since it registered the domain name 10 years earlier. The evidence does not undermine the Respondent's contention that there was a legitimate business purpose even if not realized.

July 20, 2010

Prior Right to Domain Name Through Purchasing Predecessor’s Assets

A successor in interest related to a predecessor who acquired the disputed domain name in good faith is not a new registrant whose right is vulnerable to forfeiture to a well known trademark holder. It not only succeeds to its predecessor’s good faith registration, it holds the domain name as an asset to use (consistent with trademark law and the Policy) or sell as it determines. It cannot be compelled to sell it, which was the thrust of plaintiff’s case in Southern Grouts & Mortars, Inc. v. 3M Company, 575 F.3d 1235 (11th Cir. 2009). 3M had come into possession of <diamondbrite.com> legally by acquiring the company that owned it years earlier. Its offense (as the plaintiff saw it) was not that it was using the domain name, but that it wasn’t. Southern Grouts “accuse[d] 3M not of a design to sell a domain name for profit but of a refusal to sell one.”

There is some similarly between Southern Grouts and Genomatix Software GmbH v. Intrexon Corporation, D2010-0778 (WIPO July 8, 2010), although in the latter while the Complainant was an interested purchaser it was unwilling to pay what the Respondent demanded. In an exchange of e-mails in which the Complainant offered $10,000, the Respondent replied “that it would not be interested in any offer which was not substantially in excess of this sum.” This is not a violation of paragraph 4(b)(i) of the Policy. “Where several years and a corporate reorganisation and rebranding elapse between the registration of a domain name and a discussion of its possible sale, it cannot be inferred that it was registered at the outset for the purpose of sale to the Complainant or a competitor of the Complainant.”

If the related respondent “merely intends to continue to do what [its related predecessor] has always legitimately done, then it is difficult to see how that continued use could be characterized as use in bad faith,” ehotel AG v. Network Technologies Polska Jasinski Lutoborski Sp.J., D2009-0785 (WIPO August 5, 2009). But, in that case, the Panel found that the original registrant did not continue to use the domain name legitimately, “[i]nstead, he effectively abandoned his own prior use and actively sought to associate the Domain Name with the Complainant’s business.” In that event the related successor cannot rely on the original good faith registration but inherits its predecessor’s subsequent bad faith.

In contrast, no inference of bad faith can be drawn against the successor in interest where its predecessor operated a bona fide business. “The Panel finds on the evidence that the Domain Name was registered by the Respondent’s predecessor in business Genomatix Ltd for the purpose of bona fide use in connection with a bona fide business carried on under the mark GENOMATIX and the name Genomatix Ltd. The Panel also finds that the transfer of the Domain Name to the Respondent, at that time called Genomatix Corporation, was made in good faith.” “These findings” (the Panel continued) “cannot be negated by any subsequent willingness of the Respondent to sell the Domain Name for a substantial price.”

The Complainant acquired its trademark in Genomatix Software prior to the registration of the domain name. Ordinarily, this could signal a problem for the Respondent, but here the parties operate in different streams of commerce. The Respondent is a biotechnology company. “[T]he Complainant emphasises that it has prior rights to the ‘Genomatix’ name, that it has remained active since its foundation in both Europe and the USA, and that (in contrast) the Respondent’s use of the ‘Genomatix’ name in its business ceased a long time ago.” However, there is no evidence that the commercial use of the Domain Name and corresponding mark by the Respondent and its predecessor was in bad faith to take unfair advantage of the Complainant’s rights.” Nor that “its commercial use at any time between then [1998] and the filing of this Complaint nearly 12 years later in May 2010 suggests that this use was not regarded as infringing whatever rights the Complainant may have had.”

July 19, 2010

Nominative Fair Use of Trademark

There are clearly circumstances under which a trademark can be incorporated into a domain name without permission from the trademark holder. Just as clearly there are domain names alleged to be used with fair intent that exploit the trademark’s value and infringe on the holder’s legal rights. The tension is palpable. A domain name containing a mark cannot be nominative fair use if it suggests sponsorship or endorsement by the trademark holder, Toyota Motor Sales USA Inc. v. Tabari, dated July 8, 2010. The 9th Circuit held, however, that an injunction issued by the district court “is clearly overbroad.” It noted that the “nominative fair use doctrine allows such truthful use of a mark, even if the speaker fails to expressly disavow association with the trademark holder, so long as it's unlikely to cause confusion as to sponsorship or endorsement.” Thus, “[e]ven assuming some form of an injunction is required ... the proper remedy for infringing use of a mark on a site generally falls short of entirely prohibiting use of the site's domain name, as the district court did here.” Further,

the important principle to bear in mind on remand is that a trademark injunction should be tailored to prevent ongoing violations, not punish past conduct. Speakers do not lose the right to engage in permissible speech simply because they may have infringed a trademark in the past.

The Court reasoned

It is the wholesale prohibition of nominative use in domain names that would be unfair. It would be unfair to merchants seeking to communicate the nature of the service or product offered at their sites. And it would be unfair to consumers, who would be deprived of an increasingly important means of receiving such information. As noted, this would have serious First Amendment implications. The only winners would be companies like Toyota, which would acquire greater control over the markets for goods and services related to their trademarked brands, to the detriment of competition and consumers. The nominative fair use doctrine is designed to prevent this type of abuse of the rights granted by the Lanham Act.

“Forced relinquishment of a domain is ... extraordinary.” In either proving cybersquatting (Interstellar Starship, 304 F.3d 936, 948 (9th Circ. 2002)) or infringement that warrants injunctive relief “Toyota must bear the burden of establishing that the Tabaris' use of the Lexus mark [in <buyorleaselexus.com and buy-a-lexus.com>] was not nominative fair use.”

It is interesting to compare the 9th Circuit’s reasoning with that from a recent UDRP decision, Haas Automation, Inc. v. noKOutmma, FA1005001326071 (Nat. Arb.Forum July 14, 2010). The Panel granted the complaint and ordered <usedenchaas.com> transferred to the Complainant. On first pass, it appears that the “[f]orced relinquishment of [the] domain ... is extraordinary.” Of course, the UDRP offers only two remedies, cancellation or transfer of the domain name. Toyota requested a permanent injunction.

Nevertheless, on the surface there are some similarities with Toyota. The Respondent alleged that it used HASS “only for nominal purposes .. To describe the products that the Respondent is legitimately selling.” Like Tabaris it placed a disclaimer on the web page. However, while the Tabaris' disclaimer “stated, prominently and in large font, ‘We are not an authorized Lexus dealer or affiliated in any way with Lexus’,” the Respondent’s disclaimer in Haas Automation “is in small print at the very bottom of the page, after a display of Respondent’s products and services. It is quite possible that Internet users would not see the disclaimer. Under these circumstances, the disclaimer is insufficient to prevent a likelihood of confusion.”

The Respondent in Haas Automation offends the Policy in other ways. While recognizing that “reselling products may be a legitimate and bona fide offering of goods and services,” the Panel found that the “Respondent uses more than reasonably necessary of the HAAS trademark.” The “more” is that the Respondent “uses the same color scheme and font as the HAAS trademark and official website,” thus creating a likelihood of confusion [paragraph 4(b)(iv) of the Policy]. The Tabaris had a similar problem, but in their case they “submitted images of an entirely changed site at the time of trial: The stylized mark and ‘L’ logo were gone, and a disclaimer appeared in their place.” “This makeover of the Tabaris’ site is relevant because Toyota seeks only forward-looking relief.”

In Haas Automation, of course, the Panel is working with an undeveloped record, but the reasoning of the 9th Circuit suggests nominative fair use UDRP disputes are not quite as open and shut as the Panel makes it appear. The above quotation from Toyota that “the only winners would be companies like Toyota” is equally applicable to balancing rights under the Policy.

July 16, 2010

Proving Exception to the General Rule, Timing of Domain Name Registration

Where two parties in the same geographic area offer the same range of goods to the general public it might appear that in registering a domain name identical to the complainant’s trademark the Respondent had an impure motive. What if the domain name was registered before the complainant established its business? Although the respondent had knowledge of the complainant’s business plans? But, there was no proof that the general public associated the trademark as the source of goods from the complainant? The Consensus is that “when a domain name is registered before a trademark right is established, the registration of the domain name was not in bad faith because the registrant could not have contemplated the complainant’s non-existent right,” WIPO Overview of WIPO Panel Views on Selected UDRP Questions, paragraph 3.1. The Overview continues, however, with an exception, that “[i]n certain situations, when the respondent is clearly aware of the complainant, and it is clear that the aim of the registration was to take advantage of the confusion between the domain name and any potential complainant rights, bad faith can be found.”

In Paragon Micro, Inc. v. Julian Pretto, D2010-0721 (WIPO July 1, 2010) the “Complainant states that it was incorporated in 2003 and began using its mark in 2006. Yet, the <paragonmicro.com> domain name was apparently registered in 2001, which would have been some time before Complainant was formed.” Generally, the exception has been applied in cases involving well known entities either merging or acquiring other entities, opening resorts or hotels before obtaining trademark rights or announcing a new corporate name. A recent example was The Old Course Limited v. Patrick Woods, D2010-0682 (WIPO June 6, 2010).

Paragon Micro, however, illustrates the difficulty in applying the exception and the heavy burden the complainant must satisfy. The Respondent in Paragon Mico is holding the domain name inactive, thus it “cannot presently be said that it is using the disputed domain name to attract visitors for commercial gain.” But, argues the Complainant “the Respondent could ‘at any time’ begin using the disputed domain name in a manner that would disrupt its business and cause confusion as to the source of the parties’ respective goods and services.” This fails because bad faith (registration and use) cannot rest on the possibility that the respondent will activate the domain name in the future to disrupt the complainant’s business or confuse the purchasing public.

If the Respondent opportunistically anticipated the Complainant’s trademark, it is not proved by asserting as a fact, speculation. “Evidence of such an exception has not been provided here; indeed, the Complaint nowhere even acknowledges that the registration predates Complainant’s trademark rights.” The record apparently contains one piece of information unexploited by the Complainant (unless it is a typographical error) consisting of a copyright notice on its own website page that reads “1995-2010.” If this notice accurately reflected the Complainant’s length in business it failed to “provide any other evidence regarding length of use and provides no information concerning sales, nature and extent of advertising, consumer surveys, or media recognition that would establish rights in a mark that is not registered.”

July 15, 2010

Falling Short of Confusing Similarity

Similarity in some respects, either of one of two common words or some identical syllables within a word, does not add up to confusing. The threshold test is simply “comparing the disputed domain name with the mark relied upon, both visually and phonetically, and by comparing the respective meanings which each conveys,” RapidShare AG, Christian Schmid v. N/A Maxim Tvortsov, D2010-0696 (WIPO June 22, 2010). “The limited nature of the exercise does not call for any consideration of extraneous material, such as what might appear on a website at the disputed domain name,” citing WIPO Overview of WIPO Panel Views on Selected UDRP Questions”, at para 1.2: “the content of a website (whether it is similar or different to the business of a trademark owner) is irrelevant in the finding of confusing similarity ...”).

The domain name <rapidbay.net> is not confusingly similar to RAPID SHARE; <caisinos.com> is not confusingly similar to CASINO.COM [Mansion (Gibraltar) Limited and Provent Holdings Ltd. v. Agens PSC, D2010-0584 (WIPO June 22, 2010). The only common feature in the first is “rapid” and in the second “sino”.

The Respondent in the second case avoided a finding of typosquatting because it appeared and explained the additional “i” and the reason for pluralizing the domain name. Using the word “casino” or “casinos” for a gaming website is not evidence that the Respondent had any knowledge of the Complainant. The explanation for the “cai” is that “Respondent’s client, CAI, holds rights to a Community Trademark for CAISINOS.” The disputed “trademark shows a wordplay between the three letters ‘CAI’ of ‘Casinos Austria International’ and the generic term ‘casino’.” In view of the explanation, “the Panel [did not] find it necessary to decide [the threshold] element under the Policy.”

In RapidShare, the “only relevant right they have proved is a right in the expression ‘rapidshare’. The issue is whether the use of the word ‘rapid’ in both RapidShare’s mark and the Domain Name, is enough to get the Complainants over the line on the ‘confusingly similar’ issue. On balance, the Panel is not satisfied that it is.” The reason for this is that

First, “rapid” is common word in the English language, and the Panel has little doubt that it must be used in thousands of business names around the world, none of which have any connection with the Complainants.... Secondly, the word “bay” neither looks nor sounds like the word “share”, and the Complainants have not suggested that “bay” has some special meaning which might cause an Internet user to make a mental link between the Domain Name and RapidShare (or the concept of “sharing”). The words “share”and “bay” are not obvious synonyms.

In order to get to the issue of bad faith registration and use “the Complainants had to ‘get to first base’ by making out their case under Paragraph 4(a)(i) of the Policy,” RapidShare. Neither Complainant in these cases got to “first base” although for different reasons. Rapid Share because the Complainant could not prove that the linguistic combination of the disputed domain name suggested its trademark in the public’s mind; and, Casino.com, because the Respondent’s explanation of the first syllable “cai” (as identifying itself to the public) showed that it was a distinctive entity operating within the gaming niche. At best there is similarity of parts but not of the whole.

July 14, 2010

Fraudulent Transfer (Hijacking) of Domain Name

The Panel in Lawrence Gurreri v. To Thai Ninh, FA1006001328554 (Nat. Arb. Forum July 12, 2010) states that “the alleged theft of a domain name falls outside the narrow scope of the UDRP policy” and cites two cases that address scope but not theft. While the conclusion is inconsistent with a number of other decisions that hold the complainant entitled to recapture the domain name, the principal reason for denying the complaint in Lawrence Gurreri follows well settled law, namely that a victim does not have standing to maintain the administrative proceeding unless he has a trademark. The Complainant in Lawrence Gurreri did not have a registered trademark in “international circuit” and offered insufficient evidence of secondary meaning to qualify for a common law trademark. Had it been otherwise, precedent holds that theft or fraudulent transfer or hijacking are within the scope of the UDRP Policy. Narrow though the scope may be it is not that narrow.

The question whether within or outside the Policy arose in Worldcom Exchange, Inc v. Wei.com, Inc., D2004-0955 (WIPO January 5, 2005). The Panel noted

Given the human capacity for mischief in all its forms, the Policy sensibly takes an open-ended approach to bad faith, listing some examples without attempting to exhaustively enumerate all its varieties. The Complainant seeks to expand the territory of bad faith, presenting a new type of abusive conduct on the part of the Respondent, one that on its face cries out for relief: the hijacking of a domain name through the manipulation of password access. Equitable considerations aside, the Panel must determine whether the unusual facts of this matter bring the Complaint within the framework of the Policy.

What the Panel determined was that the “Complaint [was] within the framework of the Policy” and ordered the disputed domain name transferred to the Complainant.

It was within this time frame, in fact, that ICANN issued warnings about hijackings of the kind described in Worldcom Exchange and Lawrence Gurreri in a report dated July 12, 2005, entitled “Domain Name Hijacking: Incidents, Threats, Risks and Remedial Actions.”

Not unexpectedly, respondents accused of hijacking rarely make an appearance. In CC Computer Consultants GmbH and WAFA Kunststofftechnik GmbH v. APG Solutions & Technologies, D2005-0609 (WIPO August 1, 2005) the Panel found that the Respondent was in default of its registration obligation to maintain current information. It “provided a false name as administrative contact for the domain name and a non-existent fax number.” While it was “not clear ... exactly how the Respondent technically registered the domain name ... it does seem clear that the registration was irregular, and that it was done without the permission of Complainant.”

In Edward G. Linskey Jr. v. Brian Valentine, D2006-0706 (WIPO September 18, 2006) a three-member Panel denied the complaint for the same reason as in Lawrence Gurreri, but they were uncomfortable with the Respondent. In response to the Respondent’s contention that “this case is unsuitable for determination by the Panel ... because of the parties' competing views of the circumstances of the case” one member in a concurring opinion joined by the other two stated

I fear that Respondent’s success in this proceeding may encourage other cybersquatters or their counsel to attempt to ‘complicate’ Policy proceedings with far-fetched or apparently outright fraudulent contentions or evidence, then claim that these ‘complications’ raise issues that cannot and were not intended to be resolved in Policy proceedings.

In cases that raise these issues and show that the domain name was unlawfully transferred the complainant is entitled to relief, the dictum in Lawrence Gurreri notwithstanding. “However it happened” ( stated the Panel in 8x Entertainment, Inc., Gener8Xion Television, Inc., Gener8Xion Entertainment, Inc. v. EXC International AG, D2005-1126 (WIPO December 28, 2005)), “the fact is that someone unlawfully took control of Complainants’ e-mail account and used it to fraudulently represent to Network Solutions and OnlineNic, Inc. that Complainants had authorized a transfer of the domain name in dispute, when in fact Complainants had not.” The range of abusive conduct is not circumscribed by the four examples set forth in paragraph 4(b) of the Policy.

July 13, 2010

Pretending Association with Trademark Holder to Draw Traffic

ICANN’s decision to approve the .xxx suffix for websites with pornographic content is essentially a zoning resolution. It has the same intention, namely to confine adult content to its own district to prevent its contaminating better neighborhoods. Offering pornography is not condemned under the Policy. “The mere fact that a domain name resolves to a website featuring adult content does not per se render the registrant devoid of rights or legitimate interests in the domain name,” West Corporation v. Domain Admin c/o Mrs Jello, LLC, FA1004001321540 (Nat. Arb. Forum June 14, 2010).

Condemned is associating “adult content” with the complainant’s trademark and piggybacking on its reputation. V&S Vin & Sprit AB is not amused when ABSOLUT is coupled with “porn” to produce <absolut-porn.com>, V&S Vin & Sprit AB v. VCN - Whois Protection Service Panama, D2010-0715 (WIPO June 25, 2010), or “escorts” to produce <absolutescorts.com>, V&S Vin & Sprit AB v. N/A, D2010-0717 (WIPO June 14, 2010). Adding a common word to a trademark does not create a distinguishable name, and since the parties are in different industries there is no defense of fair use, nominative or otherwise.

The unregistered trademark in Workers United Union v. Wesley Perkins, D2010-0738 (WIPO June 20, 2010) barely passes the threshold test. The Complainant was only formed in 2009, but has over 150,000 members. Nevertheless, the Panel found that it had standing because it had “used the name WORKERS UNITED as the common trade name or trade mark for the trade union.” More significantly, the Complainant had owned and inadvertently allowed its domain name to lapse. “[E]very case” (the Panel noted) “must be considered on its own facts and merits.” In this particular case

Had the Disputed Domain Names merely constituted generic words without a history of immediate prior use and had the Respondent parked the Disputed Domain Names to a blank holding page his explanation might have been more credible. However in the circumstances that the Disputed Domain Names were not plainly generic and had been in immediate prior use and that the Respondent chose to defer the Disputed Domain Names to a pornographic website while demanding a considerable sum of money for their transfer...

The Complainant in Workers United approached the Respondent “immediately after realizing that its domain name had expired... [M]any of its 150,000 members were probably still trying to contact on its email address using the Disputed Domain Names.” The Respondent freely admitted “that he acquires domain names for the purposes of trading” and in this particular case demanded $28,000 to transfer it. “Meanwhile, every time that the Complainant’s members tried to log onto its original website they were deferred to a blatantly pornographic website.”

Particularly with adult oriented websites Panels give lesser known trademarks more leeway (as long as they are not composed of dictionary words). Moreover, threats to offer (no less displaying) pornography through the disputed domain name, the trademark well known or not, is a sufficient basis for finding bad faith use; from which bad faith registration is inferred. Threatening and offering can be seen as tantamount to a demand for ransom, which would be an additional basis under for finding bad faith.

July 12, 2010

Challenging a UDRP Order Denying Complaint or Granting Cancellation or Transfer

There is no provision under the UDRP for an administrative appeal from an adverse order granting or denying the complaint. Rather, the loser’s recourse is to commence a de novo law suit under the national law of its jurisdiction, which in the case of the United States would be a claim under the Anticybersquatting Consumer Protection Act, [specifically, §1125(d) of the Lanham Act]. If the Panel rules in favor of the complainant the respondent must act within 10 days of the issuance of the order to take advantage of the Policy’s automatic stay of cancellation or transfer [paragraph 4(k) of the Policy]. While a respondent’s failure to act timely does not affect its right to contest the UDRP order it will lose control of the domain name to the complainant pending the outcome of the litigation.

The Policy provides that either party may commence an action “in at least one specified Mutual Jurisdiction. Rule 1 of the UDRP defines Mutual Jurisdiction as

a court jurisdiction at the location of either (a) the principal office of the Registrar (provided the domain-name holder has submitted in its Registration Agreement to that jurisdiction for court adjudication of disputes concerning or arising from the use of the domain name) or (b) the domain-name holder's address as shown for the registration of the domain name in Registrar's Whois database at the time the complaint is submitted to the Provider.

If the order denies the complaint, the complainant may commence an action under the ACPA against the registrant directly if it is amenable to service, or if not amenable an in rem proceeding in the location of the Registrar or the Registry. Notice that ACPA enlarges venue over Rule 1 of the UDRP to include the “registry.”

Statistically, judicial challenges by losing complainants are likely to be successful. The most recent decision is illustrative. The plaintiff in Volvo Trademark Holding AB v. Volvospares, 1:09 cv 01247 (E.D. Va. Apr. 1, 2010) (formerly the Complainant Volvo Trademark Holding AB v. Volvospares / Keith White, D2008-1860 (WIPO February 10, 2009)) won summary judgment transferring the domain name. Challenges by respondents are likely to be unsuccessful, although there are exceptions. Unsuccessful: Lahoti v. Vericheck, C06-1132JLR (WDWA, 2007), aff’d __ F.3d __ (9th Cir. 2009), after losing in Vericheck, Inc. v. Admin Manager, FA0606000734799 (Nat. Arb. Forum August 2, 2006); Yung v. Bank of America Corp. (S.D.N.Y. 2-16-2010), after losing one of two domain names in Bank of America Corporation and Merrill Lynch & Co., Inc. v. Webadviso, FA0903001254121(Nat. Arb. Forum May 15, 2009) (district court awarded both domain names to plaintiff).

Respondent exceptions: Barcelona.com, Inc. v. Excelentisimo Ayuntamiento De Barcelona, 330 F.3d 617, 626 (4th Cir. 2003), summary judgment in favor of plaintiff, formerly Respondent in Excelentisimo Ayuntamiento de Barcelona v. Barcelona.com Inc. D2000-0505 (WIPO August 7, 2000); 3 member Panel in XM Satellite Radio Inc. v. Michael Bakker, FA0612000861120 (Nat. Arb. Forum February 27, 2007) unanimously decided to transfer <xm.com>; de novo action in The Regional Court in Cologne held in Respondent’s favor: “[a]s the (US based) Complainant did not have any trademark rights for ‘XM’ in Germany (where both the Respondent and the Registrar were located) the court rejected any claims under applicable trademark law” Case no. 33 O 45/08, 16 June 2009, translation adr.eu.

It has been held that “a federal court's interpretation of the ACPA supplants a WIPO panel's interpretation of the UDRP,” Sallen v. Corinthians Licenciamentos LTDA, 273 F.3d 14, 28 (1st Cir. 2001); again, “because a UDRP decision is susceptible of being grounded on principles foreign or hostile to American law, the ACPA authorizes reversing a[n] [arbitration] panel decision if such a result is called for by application of the Lanham Act,” Barcelona.com, supra.; again, that a UDRP decision is not an “arbitration” as envisioned by the FAA, Parisi v. Netlearning, Inc. 139 F. Supp. 2d 745 (E.D.Va. 2001; again, the “[r]eview [] must be de novo and independent of any WIPO panel conclusion,” Parisi, Id. at 752. Sallen, supra. 273 F.3d at 20: “[T]he UDRP explicitly contemplates independent review in national courts.”

July 9, 2010

Respondent’s Exposure to Future Claim Following Exoneration of Abusive Registration

There is a notion that a respondent adjudicated as having a legitimate interest in a disputed domain name can be exposed in the future if it changes its content to take advantage of the complainant’s trademark. There is disagreement on the issue (the Octogen line of cases and variants of that thinking), but the consensus is that bad faith use following good faith registration is not abusive as the Policy is presently constituted. There is no exposure to the original registrant without an amendment to the Policy.

Nevertheless, the notion is by no means resolved. It is directly challenged in a Separate Opinion (concurring in the result to deny the complaint) in Charter Communications, Inc. v. CK Ventures Inc. / Charterbusiness.com, D2010-0228 (WIPO June 25, 2010). The challenged statement by the majority reads: “if Respondent in the future used the Domain Name at issue to resolve to a web site which targeted Complainant’s trademarketed services, then Complainant would presumably be entitled to bring another UDRP proceeding on that basis.” The statement is clearly not necessary for the holding, thus theoretically is no more than dictum. Nevertheless, even as dictum it exceeds the Panel’s authority (says the separate Panel):

This Panel does not agree ... for two reasons. First, the Panel has no power under the Policy to give directions on future conduct and its powers are limited to ordering transfer, cancellation or denying the relief sought. Secondly, the statement concerned is open to the interpretation that such targeting, after registration, would mean that the domain name had been registered and used in bad faith, but the fact must show in the words of the Policy, both that the domain name was registered in bad faith and that it has been used in bad faith. Such determinations on matters of fact can only be made when the facts are known.

There have been a scattering of decisions in which Panels have either implicitly suggested that the complainant can return, Umpqua Investments, Inc. v. Private Registrations Aktien Gesellschaft, FA1005001324718 (Nat. Arb. Forum June 15, 2010) (in which the Panel ended his ruling with the statement that it was “without prejudice”); explicitly invited complainants to refile if in the future the respondent crosses the line, Cluett, Peabody & Co., Inc. v. Sanford Bus. Writing Serv., FA 95842 (Nat. Arb. Forum December 12, 2000) (the panel allowed a complaint to be refiled because the previous Panel had “expressly reserved the right of Complainant to recharge bad faith registration and use of the domain name in issue”) ; or to correct a deficiency in pleading, Jones Apparel Group Inc. v. Jones Apparel Group.com, D2001-1041 (WIPO October 16, 2001) (refiling allowed because the previous panelist gave the “green light in the clearest possible way to refiling the Complaint to correct [the previous Complaint’s omissions].”

Complainants whose trademarks consist of common words alone or in combination with other common words cannot claim the highest protection unless there is dispositive proof that the trademarks preceded the domain names and the domain names are being used to target the complainants’ trademarks. The disputed domain name in Charter Communications is <charterbusiness.com> which is identical to the Complainant’s present trademark. But, when the domain name was registered the Complainant’s trademark was CHARTER DIGITAL CABLE and CHARTER COMMUNICATIONS. The majority deferred the question of rights or legitimate interests and folded its conclusion into the bad faith analysis, which it found in Respondent’s favor.

Under the terms of the Policy currently in effect and the consensus construction of it the only basis to support refiling a claim (rare against the same respondent unless a pending trademark application has advanced to a certificate of registration) is if the domain name registration has changed to a new respondent.

July 8, 2010

Suspending or Terminating a UDRP Proceeding

Paragraph 18(a) of the Rules of the Policy authorizes the Panel in its discretion to suspend or terminate a UDRP proceeding “[i]n the event of any legal proceedings initiated prior to or during an administrative proceeding in respect of a domain name dispute . . . or to proceed to a decision” (emphasis added). The authority imports into the proceedings the familiar prescript of judicial economy exercised in a court of law. Generally, it makes no sense to proceed to decision in a UDRP proceeding where there is a prior action pending or new action timely filed concerning the disputed domain name. Whether the Panel exercises its discretion “to suspend or terminate the administrative proceeding” depends on a number of factors including the status of the pending action.

The phrase “ ‘in respect of a domain-name dispute’ ... cannot be that mere reference to litigation on a website somehow makes the domain name at which the website is hosted the subject of the litigation. Nor is a reference to a domain name in correspondence that is also about proceedings sufficient to make these proceedings,” Telstra Corporation Limited v. Sean Mullen, Network Administrator, D2010-0724 (WIPO June 15, 2010). The phrase also is not meant to include unsuccessful pre-arbitration applications in national courts to stay proceedings, Sonido, Inc. v. MU21C.COM Inc., D2006-0685 (WIPO September 6, 2006); unsupported allegations referring to a pending action in a national court, Allstate Insurance Company v. Aardvark (a/k/a Joseph Bologna, John Day, Paul Day, Jay Arby, Jay Bologna), and d/b/a Aardvark Internet Services, Allstate Information Exchange, Inc., Allstate.org, Inc., and Professional Publications, D2001-1346 (WIPO March 14, 2002); or lawsuits for copyright infringement and injunction that do not seek transfer of disputed domain names, Union Square Partnership, Inc., Union Square Partnership District Management Association, Inc. v. unionsquarepartnership.com Private Registrant and union squarepartnership.org Private Registrant, D2008-1234 (WIPO October 22, 2008).

TTAB proceedings as a court of law have mixed results. The Panel in Family Watchdog LLC v. Lester Schweiss, D2008-0183 (WIPO April 23, 2008) analogized the TTAB proceeding to a pending lawsuit and denied the complaint, whereas the Panel in Private Communities Registry, Inc. v. Himalaya Rankings LLC and John Sweeney, FA0808001220432 (Nat. Arb. Forum October 23, 2008 held that the PTO is not a “legal proceeding ... in respect to a domain name dispute.” There is no basis for suspension or termination where the “filing of the Complaint was done in accordance with a court order, that the matter be referred to arbitration under the Policy despite the pendency of that action,” BD Real Hoteles, SA de C.V. v. Media Insights aka Media Insight, D2009-0958 (WIPO September 15, 2009).

In Telstra, the Respondent “asked that the proceedings be adjourned because of [an alleged pending litigation before] ... the Australian Administrative Appeals Tribunal.” The Respondent contends that the use of <teamtelstra.com> “is a play on words in relation to Telstra’s association with parties ‘it should not be associated with’ and that the Respondent intends to publish further genuine criticism on the site, once the AAT Litigation has been resolved.” However, the matter before the AAT is not litigation, but a “freedom of information” request. “The Respondent says that he will post more information critical of the Complainant to the website once the AAT Litigation is complete,” but offered no evidence to support this assertion. In any event, calling a request for information a litigation does not support suspension or termination since it is neither a legal proceeding nor one that would qualify as such “in respect of a domain name dispute.”

July 7, 2010

Adjudicating Disputes with Business and Contract Components

Claims that raise business or contract issues have a mixed history of adjudication under the UDRP. They are sometimes found to be within and other times outside the scope of the Policy. The decision can go either way. Sometimes the decision to dismiss a complaint for lack of jurisdiction rather than grant or deny it appears to be arbitrary; or the panelist not taking time to think through the conclusion. H-D Michigan, LLC v. Jim Harley, FA1004001318741 (Nat. Arb. Forum May 25, 2010) and Larry Moss v. EdgemarCenter fortheArts d/b/a Larry moss studios c/o Lora Guarnieri, FA1004001320711 (Nat. Arb. Forum July 1, 2010). The mantra is that cases that “appear[] to hinge mostly on a business or civil dispute between the parties, with possible causes of action for breach of contract or fiduciary duty” are outside the scope of the UDRP.

In H-D Michigan the Complainant offered into evidence an agreement under which the Respondent promised “That my company shall forthwith take all such steps as lie within its power to change or facilitate change of its corporate name to ‘J. Harley’s Rider Training Limited’…[I hereby undertake] not in any event use the word ‘Harley’ in relation to motorcycle training services or any other goods or services relating to the motorcycle industry or motorcycling without prefixing the word ‘Harley’ with the letter ‘J’, the word ‘Jim’ or the word ‘James.’” In his defense, the Respondent “claims [that] the agreement applies only to his company and not to him individually.” The text of the agreement and surrounding circumstances (such as whether or not there was any consideration) are not disclosed in the decision. However, based on the letter an argument can be made that the complaint should rather have been granted for <harleysridertraining.com> and <harleysridertraining.net> than dismissed. Had there been no agreement and a decision based on the Respondent’s surname the result might very well have favored the Respondent.

In Larry Moss, there is clear evidence of acquiescence in the registration and use of the disputed domain name. Concededly, the Complainant may have remedies in a court of law relating to the dissolution of the parties’ partnership which may affect the rights to the domain name, but on record there is no evidence of bad faith registration or use. An argument can be made that the complaint should rather have been denied than dismissed.

One consequence of a maturing jurisprudence is a greater flexibility in deciding cases on their merits. “[S]ome disputes routinely and oftentimes of necessity require ICANN panels to consider broad ancillary legal principles and issues that lie outside the sharp confines of the Policy,” Bell Helmets, Inc. v. 4X Development, FA0602000651064 (Nat. Arb. Forum April 11, 2006) (Respondent appeared and prevailed). Where some panelists find cases ineligible for UDRP adjudication, others look further to establish and balance the parties’ rights. San Giorgio Coffee, Inc. v. Marc DeCaria, D2010-0567 (WIPO June 10, 2010). The Complainant stated that he formerly employed Respondent. The Respondent “assert[ed] that he had been operating the company website as a separate business from Complainant’s company and that in December 2006, he and Complainant decided to separate the two businesses, with Respondent retaining the e-commerce website and receiving severance payments and Complainant retaining the local business within the state of Florida.” The evidence that persuaded the Panel to deny (not dismiss) the complaint were two letters the Respondent received from Complainant in 2006 and 2007 in “neither of which [did the Complainant] raise any issue concerning the website.” The failure to come forward with evidence of one's own or to explain evidence offered by the adversary supports a negative inference in favor of the respondent that the complainant has nothing to complain about. On this subject, see Charter Communications, Inc. v. CK Ventures Inc./Charterbusiness.com, D2010-0228 (WIPO June 25, 2010), separate opinion.

Indeed, the record is clean of any objection by Complainant to Respondent’s use of the domain name until March 2010. The statement of Complainant’s president that Complainant never authorized or acquiesced to Respondent’s use of the domain name for his own benefit is, in the absence of other details or supporting evidence, self serving and unpersuasive.

July 6, 2010

Admissions Against Interest: Documentary Evidence Drawn from Complainant's Website

In the electronic age as compared to the paper it is harder to scrub or obfuscate the past because the past is continually present in some accessible form, whereas papers may be lost or lie undiscovered. Parties may deny facts, but be unexpectedly confronted by electronically preserved proof contradicting their present contentions. The point is illustrated in India Infoline Ltd. v. Myles Hare, D2010-0542 (WIPO June 16, 2010). (I mentioned this case on another point in last Thursday’s Note).

There is no disagreement in India Infoline that the disputed domain name is confusingly similar to the Complainant’s trademark or that the Respondent is a member of that much criticized fraternity, a domainer who “registers domain names for speculative purposes and associates such domain names with a pay-per-click revenue system.” The Complainant’s colorful but unavailing epithet for the Respondent’s line of business is that it is a “career cybersquatter,” believing apparently that domaining and cybersquatting are synonyms. There is also no dispute that for a short period the website included links to the Complainant’s competitors and for this reason was being used in bad faith. Prompt removal of offending links after notice is forgivable. Charter Communications, Inc. v. CK Ventures Inc./Charterbusiness.com, D2010-0228 (WIPO June 25, 2010).

The controlling issue in Infoline, however, turned on registration. The disputed domain name was originally registered in 2003, but not acquired by the Respondent until 2007 upon the expiration of a prior registration unrelated to the Complainant. The Complainant submitted no evidence that it used its trademark prior to 2007. The Respondent offered the following evidence in support of its registration in good faith: an email from an officer of the Complainant in 2007; a screen capture of a television advertisement published on the Complainant’s website; and information on the Complainant’s website.

Each of the pieces of evidence was a proverbial nail in the coffin. The email was a request to purchase the disputed domain name. “Our project is on innovations in Freelancing landscape for which we wanted the domain www.iifl.com.” No mention is made in the email about abusive registration of the domain name. The screen capture of the television advertisement which began running only in April 2010 stated that “India Infoline group’s brand identity is now [the IIFL logo].” The announcement on the Complainant’s website dated March 2010 was to the effect that henceforward “we have shortened our name to IIFL.” These facts, however, do not support the conclusion

that, at the time the disputed domain name was acquired by Respondent, Complainant was using the designation IIFL as a trademark or servicemark. Rather, the record indicates that Complainant only recently re-branded itself as IIFL and invested significant advertising expenditures in that rebranding effort in 2009 and 2010.

The aggregate of evidence accessible to the world is that the Respondent’s registration of the domain name preceded the Complainant’s registration and that “[w]ithout evidence of bad faith, registering domain names is not an illegitimate activity under the Policy.” On the other hand, Respondent was “aware that the disputed domain name was linked to websites providing financial services.” Since the Respondent “has a continuing duty to ensure that the domain name is not used in violation of third party trademark rights” its failure to “abide by his continuing duty ... constitutes bad faith.”

July 2, 2010

Patterns of Registering Domain Names Legitimate Practice

Acquiring domain names as assets – for selling, financing, monetizing, trading and warehousing – has been part of the culture of the Internet from the beginning. Merchants in the domain business simply pitched their stalls alongside the more traditional sellers of goods and services in the new souk, sometimes creating such friction with their neighbors that lightens the days of readers of domain name decisions. The Complainant in Pantaloon Retail India Limited v. RareNames, WebReg, D2010-0587 (WIPO June 21, 2010) is the trademark holder of PANTALOON in India. The Respondent’s base of operations is the United States. It acquired <pantaloons.com> in 2002 after a prior registrant unconnected with the Complainant allowed it to lapse. It is not as though the Respondent is actually selling pantaloons or, strictly, in competition with the Complainant. “Clearly, from the evidence provided, Respondent is not itself offering pantaloons for sale, it is merely providing links to eBay and other sites where such offers are made.”

It cannot be denied that the Respondent is in the domain name business and doing what souk merchants do. It has, as the Complainant alleges, an established pattern of registering generic domain names. However, there is “a substantial consensus among panelists that the acquisition and offering for sale of domain names and/or using them to provide links to other sites may well (provided it is not directed at trademark misuse in breach of the Policy) be a legitimate business.” There is no illegality in having a stall with a name identical or confusingly similar to its trademark holding neighbor. “Whether that consensus [in holding that a respondent in the domain name business] is justified may be a matter for debate, but in the opinion of the Panel there is a strong body of precedent which, though not binding, is strongly persuasive.”

The value of a jurisprudence lies in the consistency of its rulings which in the case of the UDRP is achieved through “a strong body of precedent.” Readers of UDRP decisions will note that it is a rare case in which the panelist does not anchor his or her opinion with citations, even though, technically, precedent in UDRP jurisprudence (according to the WIPO Overview) is not binding. The question in Pantaloon and similar cases involving common words in the English (or any other) language is “whether the acquisition and use of the disputed domain name for that purpose constitutes a bona fide offering for sale.” The question “is intimately linked with the question of whether or not the acquisition and use is in good faith.” In regard to this, the Panel continues

the general approach among panelists appears to be to divide the cases into two categories; those in which the concerned trademark is fanciful or non-generic, and those in which the relevant trademark comprises a common generic word, particularly where the word is a word germane to the goods or services in respect of which the disputed domain name is used.

In assessing whether a respondent’s use constitutes a bona fide offering of goods or services, the Panel in Zerospam Security Inc. v. Internet Retail Billing Inc., Host Master, D2009-1276 (WIPO December 18, 2009) suggested that the determination lies in the answers to the following questions. Does “(i) the respondent regularly engage[] in the business of registering and reselling domain names and/or using them to display advertising links; (ii) the respondent make[] good faith efforts to avoid registering and using domain names that are identical or confusingly similar to marks held by others; (iii) [is] the domain name in question ... a “dictionary word” or a generic or descriptive phrase; (iv) [is] the domain name ... identical or confusingly similar to a famous or distinctive trademark; and (v) ***is [there any] evidence that the respondent had actual knowledge of the complainant’s mark.”

In Pantaloon, “criteria (i) and (iii) are clearly satisfied and so too, in the Panel’s view, is criterion (v). As to criterion (iv), the Panel is satisfied that Complainant’s mark is famous and distinctive in India, however there is no evidence that it is well-known outside that country and in particular, in the United States, where Respondent is located.” This raises the interesting issue of geographic distance and the question of “knowledge.” “There is no evidence that Complainant's Pantaloon trademark is registered outside India or that it is known or used outside India.” For trademarks on the lower end of the classification scale the complainant needs significantly more evidence of its reputation at the time the domain name was registered. It cannot rest on its present reputation in a far country.

July 1, 2010

Dialogue and Debate in the Development of UDRP Jurisprudence

UDRP jurisprudence did not come ready made. Panelists assembled it from readily available legal and cultural artifacts, and it grew (among other ways) through the friction of dialogue and debate. An example of this has been observed in earlier Notes discussing the Octogen line of cases advocating “retrospective bad faith.” The dialogue or debate has advanced to the conclusion (if I’m not being premature) that the new construction advocated appears to be a dead-end. The Panel in India Infoline Ltd. v. Myles Hare, D2010-0542 (WIPO June 16, 2010) noted that these cases “have not been generally accepted by panelists within UDRP jurisprudence.”

In one of the earliest cases in the canon, J. Crew International, Inc. v. crew.com, D2000-0054 (WIPO April 20, 2000) the majority granted Complainant’s request for transfer of the domain name <crew.com>, apparently under the influence that Respondent was “a speculator who registers domain names in the hopes that others will seek to buy or license the domain names from it.” Speculation and trade in domain names, however, are not condemnable. The dissent’s view was more on target and has prevailed. “In my judgment,” (he said)

the majority’s decision prohibits conduct which was not intended to be regulated by the ICANN Policy. This creates a dangerous and unauthorized situation whereby the registration and use of common generic words as domains can be prevented by trademark owners wishing to own their generic trademarks in gross. I cannot and will not agree to any such decision, which is fundamentally wrong.

He was prescient in stating that “[w]here the domain name and trademark in question are generic, and in particular where they comprise no more than a single, short, common word, the rights and interests inquiry is more likely to favor the domain name owner.”

Dialogue and debate is also apparent in Visual Systems, Inc. v. Development Services Telepathy, Inc., FA1004001318632 (Nat. Arb. Forum June 25, 2010). Although not determinative, the parties raised the issue of laches, with the Respondent advocating it and the Complainant denying its applicability. The Panel was unanimous in finding for the Respondent for its registration of <cygnet.com>. “Cygnet” is a common word in the English language meaning a “young swan.” One of the panelists filed a separate opinion to discuss the issue of laches. The consensus is that laches is not applicable in a UDRP proceeding, but not all panelists are entirely comfortable in its not being available as a defense. Delay, after all, is a factor in determining a right or legitimate interest under paragraph 4(c)(i) of the Policy. The separate opinion took the view (citing Board of Trustees of the University of Arkansas v. FanMail.com, LLC, D2009-1139 [WIPO November 2, 2009] in which he was a member)

that whether the delay is properly characterized as laches or not, the considerable delay on the part of Complainant in bringing the Complaint militates against its success in this proceeding.... Such an extreme delay calls for some explanation. Although Respondent’s attorneys squarely raised the issue in correspondence and in the Response and relied on it as a defense, and although Complainant filed a Supplementary Reply to the Response and had an opportunity to explain its delay, it did not do so and did not put forward any facts to explain either the delay or the consequences that Respondent sought to draw from it.

Where the respondent raises the issue of delay and the complainant submits a supplemental response without explaining itself, it fails its burden. “All of that being so, it is reasonable to conclude that there should be more debate on recognizing laches, or at least unexplained delay, as a defence to a UDRP claim.”

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Why do this?

Blogs discussing UDRP decisions, I find, lean heavily on summaries with little or no discussion of the jurisprudence, its history and development. Useful perhaps, but insufficient to educate parties about the theoretical underpinning of domain name law and their burdens under the Policy. Above all else it is important for parties to understand that panelists take the law of evidence seriously. They examine the record as presented by the parties as would a judge in a civil action in considering a motion for summary judgment and when they find it necessary will issue procedural orders compelling further discovery to supplement the record. Most helpful is to examine what panelists' make of the evidence – what they are looking for in the record – and their analysis of it in drawing inferences and reaching conclusions. One can go to school on the best reasoned decisions and even learn from the lesser. The raisen raison d’ètra for <udrpcommentaries.com> is to open the window to the principles of domain name law and the parties' evidentiary burdens as these matters are analyzed, reflected upon and discussed in the decisions.

Parties want to know that they will be dealt with fairly and in accordance with law. The fact is, the UDRP jurisprudence is not static; decisions are not based on rote and the best panelists are both clear headed, well versed in trademark and unfair business practice law and inventive in their analyses. That the jurisprudence develops, acquires an ever greater subtlety of analysis, will I think, be demonstrated.

Some of the reports from the front are triggered by panelists discussing, engaging with their colleagues and sometimes arguing principles, citing earlier decisions and resolving issues in current cases, and other reports look back to cases in which the particular principles were first enunciated or elegantly expressed. There is, as every litigator has experienced, an ongoing dialogue in whatever forum he or she happens to be, not only between or among the parties, but also among judges or, in the UDRP lexicon, panelists speaking through their decisions and sometimes when there is a 3-Member Panel in these domain name proceedings, even, within the case itself through dissents. I hope to highlight this engagement and, in passing, discuss the principles for which consensus has formed and those other instances in which there is still division.

WHAT IS THE UNIFORM DOMAIN NAME RESOLUTION POLICY AND WHAT IS ITS PROVENANCE ?

The Uniform Domain Name Resolution Policy (“UDRP” or the “Policy”) is a special purpose alternative dispute resolution regime implemented by the Internet Corporation of Assigned Names and Numbers (“ICANN”) in October 1999. It is based on studies undertaken by experts under the auspices of the World Intellectual Property Organization (“WIPO”) which published a Final Report earlier in the same year addressing the collision of two systems, the trademark system and the domain name system. The experts found that there was an urgent need to protect “the orderly functioning of the market through the avoidance of confusion and deception” (WIPO Final Report at ¶11). The Final Report recommended a regime that would balance rights between trademark owners and registrants of domain names based on procedural and legal principles widely accepted around the world.

One complaint was filed in the implementation year and decided on default in January 2000. Since its inauguration, ICANN panelists from WIPO and the National Arbitration Forum have filed over 25,000 decisions. Each of the Providers maintains a databank of decisions, WIPO here and Nat. Arb. Forum here. WIPO more so than Nat. Arb. Forum has organized its databank in creative ways to facilitate research [see Index of WIPO UDRP Panel Decisions]. Nat. Arb. Forum is less research friendly, but publishes a monthly newsletter, here. WIPO publishes statistics for a number of categories of information; Nat. Arb. Forum does not.WIPO also publishes an Overview of WIPO Panel Views On Selected UDRP Questions. Interestingly, although WIPO disclaims precedent in favor of consensusin in its Overview, panelists routinely reinforce governing principles by citing authority from UDRP and decisions from cases decided in national courts and many of them use the term "precedent". For common law jurisdictions, precedent is an ancient procedure and the absence of historical citation can undermine the authoritativeness of a decision. Parties naturally want to know why they have won or lost. Others, and prospective parties, want to learn what it takes to prevail or avoid losing in such a proceeding.

Domain name law is a developing jurisprudence. To U.S. federal judges the UDRP process is "adjudication lite," which it may be. But it performs well the task of balancing disputants' rights to keep possession of domain names. The appointees who serve as experts on ICANN panels and drive the jurisprudence are drawn from an international bench of lawyers, scholars and retired jurists. Their decisions draw on well established legal principles the sources for which are set out in Rule 15(a) of the Policy: “A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.” The final clause -- "and principles of law that it deems applicable" -- opens the jurisprudence to construction. So, for example, where “both the Complainants and Respondent are domiciled in the United States and United States courts have recent experience with similar disputes ... the Sole Panelist shall look to rules and principles of law set out in decisions of the courts of the United States,” KeyCorp and City of Seattle v. i-designsolutions.com, Inc., D2005-0104 (WIPO April 14, 2005) citing Tribeca Film Center, Inc. v. Brusasco-Mackenzie, D2000-1772 (WIPO April 10, 2001) that cites EAuto, L.L.C. v. Triple S. Auto Parts d/b/a Kung Fu Yea Enterprises, Inc., D2000-0047 (WIPO March 24, 2000). In the case of the statutory principle of constructive notice, if applied at all, it is limited to parties resident in the United States. The Sportsman’s Guide, Inc. v. Modern Limited, Cayman Islands, D2003-0305 (WIPO June 18, 2003) (“constructive knowledge” exists in principle under United States trademark law and is valid, especially in the situation when the Complainant and the Registrant of the disputed domain name are located in the United States).

The great benefit of the UDRP is its international reach. It operates across national borders without territorial restriction. If the complainant qualifies as a trademark owner in any jurisdiction in the world and has a marketing presence in the respondent's jurisdiction or proves that it or its mark was known to the respondent (actually or was at least aware of it) at the time it registered the domain name, then it is entitled to a remedy under the Policy. If there is jurisdiction -- proof that the complainant has a trade or service mark in which it claims a right [¶4(a)(i)] -- the proceeding will be decided efficiently, quickly and relatively inexpensively in the form of a declaratory order to the Registrar. If the complainant cannot prove that it has a trademark or that it or its trademark was known to the respondent at the time it registered the domain name, then the complaint must be denied. The theory underlying this conclusion is that a registrant cannot be said to have acted in bad faith when, at the time of registration, it had no knowledge or awareness of the complainant or its trademark, but the respondent's alleged lack of knowledge and unawareness cannot be "wilful blindness." Household Int’l, Inc. v. Cyntom Enter., FA 95784 (Nat. Arb. Forum November 7, 2000). The defense must be creditworthy. Circumstances supporting lack of knowledge include classification of the mark (fanciful, arbitrary, suggestive, descriptive, and generic), geographic distance, and respondent’s business.

The UDRP model of bad faith is substantially different from the Anticybersquatting Consumer Protection Act and some country code ADR policies by requiring either/or proof rather than conjunctive bad faith.

THE ARCHITECTURE OF THE UDRP: A QUICK PRIMER

The architecture of the Policy could not be more simple. There are three requirements each having a number of elements that can be satisfied on an either-or basis. The analysis of the evidence is not entirely linear; it shifts back and forth. It starts with the complainant’s proof of its own right and disproof of any right or legitimate interest of the respondent; shifts to the respondent’s proof of defenses, if any; then, back to the complainant’s conjunctive proof of the respondent’s bad faith (registration + use).

1. – the domain name is A) either identical or confusingly similar to a trademark B) in which the complainant claims a right [¶4(a)(i)];

IF THE COMPLAINANT FAILS TO SATISFY THE JURISDICTIONAL REQUIREMENT OF EITHER ELEMENT, THE COMPLAINT MUST BE DISMISSED FOR LACK OF SUBJECT MATTER JURISDICTION.

2. – the respondent has either A) a right or B) a legitimate interest in the domain name [¶4(a)(ii)] ;

IF THE RESPONDENT REBUTS THE COMPLAINANT’S PRIMA FACIE CASE BY PROVING THAT IT DOES HAVE A RIGHT OR A LEGITIMATE INTEREST IN THE DOMAIN NAME, THE COMPLAINT MUST BE DISMISSED.

3. – the respondent rebuts complainant’s prima facie case by proving one or more of three affirmative defenses [¶4(c)(i-iii)]. The affirmative defenses are:

i. “[B]efore any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services.”

ii. “[Y]ou (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights.”

iii. “[Y]ou are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.”

IF THE COMPLAINANT MAKES AN UNREBUTTED PRIMA FACIE SHOWING THAT THE RESPONDENT HAS NEITHER A RIGHT NOR A LEGITIMATE INTEREST, THE ANALYSIS PROCEEDS TO THE NEXT REQUIREMENTS.

4. – the complainant must prove that the respondent BOTH A) registered and B) is using the domain in bad faith [¶4(a)(iii)].

– to satisfy the bad faith requirement of ¶4(a)(iii), the complainant has to prove one or more of four elements [¶4(b)(i-iv)]. The elements of bad faith are:

i. “[C]ircumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant who is the owner of the trademark or service mark or to a competitor of that Complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name.”

ii. “[Y]ou have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct.”

iii. “[Y]ou have registered the domain name primarily for the purpose of disrupting the business of a competitor.”

iv. “[B]y using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site or other on-line location, by creating a likelihood of confusion with the Complainant's mark as to the source, sponsorship, affiliation, or endorsement of your web site or location or of a product or service on your web site or location.”

IF THE COMPLAINANT IS ONLY ABLE TO PROVE USE IN BAD FAITH, THE COMPLAINT MUST BE DISMISSED.

IF THE COMPLAINANT SUCCEEDS ON ALL THREE REQUIREMENTS THE PANEL IS EMPOWERED TO ORDER THE DISPUTED DOMAIN NAME EITHER CANCELLED OR TRANSFERRED TO THE COMPLAINANT.

Basic Rules for Claiming and Defending Disputed Domain Names

The Uniform Domain Name Resolution Policy (“UDRP” or the “Policy”) is an arbitral procedure of limited scope. It is intended to provide an effective international enforcement mechanism to protect “the orderly functioning of the market through the avoidance of confusion and deception” (WIPO Final Report, Para. 11). The Policy does not operate as a trademark court. Nor does its “administrative dispute-resolution procedure ... extend to cases where a registered domain name is subject to a legitimate dispute.” ICANN’s Second Staff Report on Implementation Documents for the Uniform Dispute Resolution Policy (October 24, 1999) at Sec. 4.1 c. Subject matter jurisdiction for relief under the Policy is limited to resolving claims of abusive registration of domain names. While there is some elasticity to the meaning of “abusive registration”, it is generally defined as cybersquatting or some other kind cyber-tort, such as phishing. There is a thin band of variability as to what the Policy's scope includes. Some panelists find breach of contract/fiduciary duty within the scope as long as the domain name issue predominates.

Complainants and putative respondents unfamiliar with the UDRP can find introductory explanations on both the WIPO and Nat. Arb. Forum websites. It is recommended that the parties review and understand their burdens of proof and persuasion before submitting their pleadings and supporting evidence. The submissions essentially initiate a review similar to a motion for summary judgment. A party's right to the disputed domain name is determined as a matter of law. Complaints that exceed subject matter jurisdiction authorized under the Policy or raise triable issues of fact must be dismissed. If either a complainant's right is uncertain or a respondent's bad faith registration or use cannot be established the relief must be denied and the complaint dismissed.

In order to prevail, the complainant must satisfy a tripartite, cumulative burden to have the domain name cancelled or transferred. The respondent's failure to submit an answer does not automatically result in its losing the domain name. The onus remains with the complainant, although it will have the advantage of any negative inferences against the respondent. If the complainant's proof tends to establish that the respondent has no right or legitimate interest in the domain name and has registered and is using it bad faith, then the respondent loses the domain name. The respondent prevails either if the complainant's proof of bad faith is insufficient or the respondent proves that it registered the domain name in good faith.

The complainant's first requirement is to establish that it has a present right to a trademark (¶4(a)(i)). Proof requirements differ for registered and unregistered marks. It is not sufficient simply to assert a claim. The second requirement is to prove that the respondent has no right or legitimate interest in the domain name (¶4(a)(ii)). Panels early recognized that the respondent controls proof of this element just as the complainant controls proof of its trademark. Therefor, they construed the Policy to impose a light burden on the complainant and to shift the burden of proof to the respondent to prove its right or legitimate interest. The third requirement is to prove that the respondent registered and is using the domain name in bad faith (¶4(a)(iii)). World Wrestling Federation Entertainment, Inc. v. Michael Bosman, D1999-0001 (WIPO January 31, 2000) (Default; Transferred)

In order to prevent loss of the domain name, the respondent may interpose any defenses from a non-exclusive safe-harbor list to prove its good faith right or legitimate interest in the disputed domain name. Paragraph 4(c) of the Policy provides:

Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, shall demonstrate your rights or legitimate interests to the domain name for purposes of ¶4(a)(ii) [of the Policy]:

(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

If the respondent satisfies its burden by proving that it has a right or legitimate interest in the domain name, the complaint must be denied. If the respondent is unable to satisfy the safe harbor defenses, then the complainant must prove bad faith conduct from the following non-exclusive list, ¶¶4(b)(i -iv):

For the purposes of Paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith....

[Para. 4(b)(i)] [C]ircumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant who is the owner of the trademark or service mark or to a competitor of that Complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name.

[Para. 4(b)(ii)] [Y]ou have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct.

[Para. 4(b)(iii)] [Y]ou have registered the domain name primarily for the purpose of disrupting the business of a competitor.

[Para. 4(b)(iv)] [B]y using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site or other on-line location, by creating a likelihood of confusion with the Complainant's mark as to the source, sponsorship, affiliation, or endorsement of your web site or location or of a product or service on your web site or location.

Decisions rest on well established legal procedures that are set out in Rule 15(a) of the Policy: “A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.” It can be seen in more than a handful of cases that inferences are not drawn with scientific scrupulosity, although on the whole decisions are of high quality given time pressures to file them.

Illustrative Cases:
[Beyond Scope of Policy] The Thread.com, LLC v. Jeffrey S. Poploff, D2000-1470 (WIPO January 5, 2001) the Panel held that UDRP does not apply because attempting "to shoehorn what is essentially a business dispute between former partners into a proceeding to adjudicate cybersquatting is, at its core, misguided, if not a misuse of the Policy... It cannot be used to litigate all disputes involving domain names."

[Burden Ignored] Landers Brothers Auto Group v. mga enterprises limited, FA0708001067455 (Nat. Arb. Forum October 15, 2007) ("Complainant does not make any assertions with respect to the three-pronged burden under the Policy.")

[Successfully defended] Carl Stahl Sava Industries, Inc. dba Decorcable Innovations, LLC v. Michael Vierra, D2007-1215 (WIPO October 8, 2007)("Respondent has shown with credible evidence that he or his company has been known by the phrase incoprorated in the disputed domain name for more than forty years.")

GO TO COMMENTS ON CASES THEMATIC INDEX

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Information on this site and analyses of UDRP cases should not be construed as "legal advice". Questions of law and interpretation of legal theories, legal advice and analysis of legal procedure should be addressed to your own counsel, attorneys in the State or Country in which you reside or where attorneys are licensed to practice law. No attorney-client relationship is established merely by contacting the webmaster of this site or speaking to an attorney. Moreoever, unless you have an agreement with counsel, you should not rely on any communications as being confidential or governed by the attorney-client privilege.

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