Words and phrases in common use are attractive equally to purveyors and domainers. That one has a trademark does not disqualify the other from registering an identical or confusingly similar composition as long as proof fails to demonstrate bad faith. While registration confers distinctiveness, trademarks on the lower rung acquire this virtue over time. Trademarks qualified for registration under Section 2(f) of the Lanham Act (15 U.S.C. §1052(f)) for example are concededly generic or descriptive. This being the case, it is equally true that as a trademark descends in rank it has less protection. PetsMed Express Inc. v. JLB a/k/a Joseph Brinton, D2009-0179 (WIPO April 6, 2009) (“The Policy was not intended to permit a party who elects to register or use a common or descriptive term as a trademark to bar others from using the common term in a domain name, unless it is clear that the use involved is seeking to capitalize on the goodwill created by the trademark owner.”).

Viewed in this light distinctiveness is a fluid concept. In the UDRP context, domain names composed of common words or descriptive string employed for their common meanings infringe complainant’s right only on evidence that respondent intended to take advantage of complainant’s existing reputation in the marketplace. British Sky Broadcasting Group Plc. and British Sky Broadcasting Limited v. Global Access, D2009-0817 (WIPO August 26, 2009) (). As a result, while potential use by many of common words and descriptive strings may be an argument in favor of a respondent’s good faith, the test is whether respondent targeted complainant’s trademark in particular, and that is determined either from the resolving website’s content or the parties’ geographic or product/service proximity.

These principles are reinforced in a new proceeding by PetsMed Express against a different respondent, Brian Schiffman, Inc., D2012-0326(WIPO April 4, 2012). It lost the first time for the same reasons as the second. The Panel notes in the second proceeding tha

Whether a respondent acted in bad faith depends on its intentions, which in turn can be determined from its business operation and further inferred from its use of the domain name. “If the Complainant’s mark [PETMEDS] were highly distinctive or famous, that conclusion woThese principles are reinforced in a new proceeding by PetsMed Express against a different respondent, Brian Schiffman, Inc., D2012-0326 (WIPO April 4, 2012). It lost the first time for the same reasons as the second. The Panel notes in the second proceeding that

“Pet meds,” referring to pet medications, appears to be widely used as a descriptive term, and it is found in numerous domain names, including <directpetmeds.com>, <discount-pet-meds.net>, <discountpetmeds.info>, <royalpetmeds.com>, <petmedssupplies.com>, <petmedsreviews.com>, <all-pet-meds.com>, <pet-med.biz>, <petmedsonline.info>, <nationalpet meds.com>, <petmedsonline.org>, <onlinepetmeds.info>, <petmedstore.net>, <petmedstore.com>, <dogspetmeds.com>, <petmeds online.org>, <petmedoutlet.com>, and <petmed shop.net>. This suggests that many retailers of pet medications find the term useful for its descriptive value rather than its trademark value. (Emphasis added).

There is no question that the Respondent had knowledge of the Complainant, but that is not dispositive either of lacking rights or legitimate interests or of abusive registration. But, as noted above, the mark is neither “highly” distinctive nor famous. Furthermore, competition is not grounds for forfeiture.

Gmlevine

Common word trademarks, PRICELESS for example, are no less common for being owned by a major brand complainant and no more protectable from others using identical or confusingly similar words in their ordinary senses than if they were owned by parties of no market stature. As a complainant’s choice descends the scale, the less protectable the trademark. It is not as though common words never ascend in strength. They can when selected as arbitrary signs. The distinctiveness of APPLE, ORANGE and BLACKBERRY (to take only fruit names) is not because the owners are recognized in the marketplace as sources of produce.

The point about commonness and weakness is made in a duo of decisions by the same Panel, Mastercard International Incorporated v. Wesley Wobles, D2011-2311 (WIPO March 8, 2012) () and Mastercard International Incorporated v. Education, Ersin Namli, D2011-2312 (WIPO March 8, 2012) (). Complainant claims PRICELESS is one of a family of trademarks. The Panel dismissed both complaints. The fact that Complainant in its MASTERCARD identity is internationally famous is irrelevant.

Whereas the adjectival phrase MASTERCARD is strong – more suggestive than descriptive – PRIVILEGE is weak. It is not made strong by association. Furthermore, Complainant’s certified services are in the financial sector. In its application to the USPTO, Mastercard describes its services as follows:

Financial services, namely, providing credit card, debit card [charge card and stored value smart card services, prepaid telephone calling card services, cash disbursement,] and transaction authorization and settlement services.

In a recently filed registered trademark, PRICELESS NEW YORK (not referred to in either of these cases) the Complainant describes its services as follows:

Promoting the goods and services of others by means of coupons, discounts, advertisements, rewards and incentives generated in connection with the use of credit and debit cards, electronic links to merchant and retailer web sites, and through promotional contests.

The Panel notes that implicit in Complainant’s claim are two assertions:

(1) that the PRICELESS family of marks is associated with some of the areas represented by third-party links on Respondent’s website, which, according to the Complaint, are “hotel reservations, restaurant coupons, and tours”; or (2) that the PRICELESS family of marks is broadly associated with virtually any promotion of goods and services on the Internet – by “merchant and retailer web sites.”

If it were so that Complainant’s trademark by its implicit range could prevent anyone from using “priceless,” then (in effect) it would take control of the word coupled or not with any product or service. Implicit in the argument is that no one else can employ “priceless.” The Panel was not persuaded:

Although hotel reservations, restaurant coupons, and tours may be among the millions of things that might be obtained through use of Complainant’s trademarked products and services, the Panel finds that the Complaint in this proceeding has not established that the PRICELESS family of marks is associated in the trademark sense with “hotel reservations, restaurant coupons, and tours.”

Mastercard in its new application for PRICELESS NEW YORK and Respondents in their domain names with other geographic locations are all using “priceless” either as a qualifier to describe the value of the location (New York is priceless) or goods and services in New York are “priceless”).  In this use no one has a monopoly on the qualifier standing alone.  Respondents do not violate any third-party rights.

Gmlevine

The UDRP is not a general court for trademark infringement, but a niche forum for a particular kind of infringement. It authorizes a Panel to determine whether a domain name incorporating a complainant’s trademark violates the terms of a respondent’s registration, i.e. that it “will not infringe upon or otherwise violate the rights of any third-party.” Paragraph 2 of the Policy. The registration agreement is similarly worded. The Panel is not authorized to rule on whether the registration and use of the domain name is a trademark infringement.

The distinction between a violation of a third-party’s trademark rights and a trademark infringement is subtle and not always clear, but it is important to understand the outer limits of the UDRP. Some light is shed on the distinction in two cases by the same panelist, Sunovion Pharmaceuticals Inc. v. ProCommerce, LLC, D2012-0232 (WIPO March 28, 2012) and Sunovion Pharmaceuticals Inc. v. Gadd Formulas, LLC, D2012-0234 (WIPO March 28, 2012). Respondents did not respond in either case.

While the Respondents in the two cases are different, the Complainant alleges that both are controlled by a third party who it is currently suing in the United States District Court for the District of Massachusetts. In that case Complainant asserts claims of trademark infringement, unfair competition, and trademark dilution under United States federal law and Massachusetts state law. It alleges that the defendant Health Science Nutrition Inc. “owns and/or operates websites” at which Lunexor is sold, including the disputed domain names in the proceedings,(ProCommerce) and(Gadd). Complainant owns the trademark, LUNESTA, which is also the name of a prescription sleep drug.

Only the first four letters, “lune” are identical. The question is whether the aural similarity (which is “not obvious”) has any meaning:

The Panel does believe that Complainant has demonstrated aural similarity, however, based upon the apparent phonetic pronunciations – “lu-NES-ta” and “lu-NEX-or”. For purposes of the Policy – and for reasons set out below the Panel expressly disclaims any opinion on whether the aural similarity has significance under United States trademark law – Complainant has shown, in the view of the Panel, that the disputed domain name is confusingly similar to a mark in which Complainant has rights.

The Complainant itself points to the problem in these cases. Respondent actually sells a product by the name “Lunexor,” which is identical to the dominant feature of the disputed domain name. This would appear to support Respondent’s right or legitimate interest in the domain name. However,

Complainant seeks to avoid this conclusion on one basis only: that Respondent’s choice (or Respondent’s principal’s choice, as alleged in the Massachusetts lawsuit) was done solely to sell a product that infringes Complainant’s mark under national (U.S. federal or Massachusetts state) law, i.e., that Respondent is selling an “infringing product”.

The implication is that the similarity between the domain name and trademark is not mere happenstance because the Respondents’ product is infringing. As presented, the “infringement” is outside the scope of the Policy. “At this point all the Panel has to rely upon are Complainant’s allegations in this proceeding and in the Massachusetts lawsuit.” The Panel notes

For reasons that should be obvious to those familiar with the UDRP process, this proceeding is not the place – and certainly should not be the first place – for a declaration that a particular product infringes (or not) another party’s trademark…. An action for infringement (or contesting a trademark application in the USPTO … involves different legal standards and calls for a broader record, with factual and expert evidence on many topics of marginal (if that) relevance to the Policy standards.

In a UDRP proceeding, even if the evidence is persuasive of product infringement, complainant would “not automatically make out a claim for cybersquatting, and vice versa.”

Gmlevine

The conjunctive rule for proving bad faith weighs heavily on manufacturers who entered into distribution arrangements authorizing use of their trademarks in domain names without anticipating the consequences of termination. The issue is illustrated in Danshar (1963) Ltd. v. Joey Gilbert/ Daisy Li, D2011-2304 (WIPO March 11, 2012) (Complainant acquired the business for which Respondent without formal contract was an authorized distributor). Complainant’s burden is not satisfied by withdrawing permission prior to commencement of proceedings. Proof of authorized registration is fatal to complainant’s case.

If respondent registered the domain name pursuant to a licensing agreement without complainant expressly reserving right for its return at the expiration of the contract, then the respondent’s continued use after termination of its business relationship is either arguably legitimate for the reason that the registration was in good faith, The Prudential Insurance Company of America v. Sheri Jones, FA0510000584625 (Nat. Arb. Forum December 19, 2005) )); Miss Universe L.P., LLLP v. A Visual Group, D2005-0738 (WIPO August 29, 2005), or (because authorization refutes registration in bad faith) beyond the scope of the Policy.

The result is similar when a respondent registers a domain name with the explicit permission of complainant who later withdraws it, or the contract is silent on the post-termination use of the domain name. Continued use may be in bad faith but not registration. Green Tyre Company Plc. v. Shannon Group, D2005-0877 (WIPO October 5, 2005). The respondent may lack rights or legitimate interests, but complainant is trumped by its authorization. The Respondent in Danshar continued using the domain name to sell competitive products:

The redirection of the disputed domain name to a website selling products competitive with the Complainant’s MINERAL CARE brand is plainly use in bad faith (in the absence of rights or legitimate interests). That is a necessary finding, but not sufficient in itself to establish this requirement as there must also be registration in bad faith.

Panels have recognized that respondents whose rights have expired may nevertheless continue to have a legitimate interest. Loss of portal could be particularly harmful to respondents with inventories and customers to service in which the factual circumstances support a legitimate interest that overrides complainant’s right. International E-Z UP, Inc. v. PNH Enterprises, Inc., FA0609000808341 (Nat. Arb. Forum November 15, 2006) (“Respondent is not claiming a legitimate interest that comes from a right to resell Complainant’s goods, but a legitimate interest in maintaining its reputation and avoiding disruption.”). The Panelist in E-Z UP noted that respondent”is merely unwinding the detail that comes from having stock already acquired that it must dispose of…. [It] is not claiming a legitimate interest that comes from a right to resell Complainant’s goods, but a legitimate interest in maintaining its reputation and avoiding disruption” (Emphasis added). The Panel acknowledged: “Clearly this interest cannot last forever…. [But it] seems contrary to common sense and all business practice to deny that these situations give rise to interests that are legitimate.”

The complainant’s “right” to prevent a respondent from continuing its use of an infringing domain name is barred by the conjunctive rule. The Panel notes in Danshar that some panelists “have been willing to rule that a registration was in bad faith where the respondent’s continued use of the domain name was inconsistent with the terms on which the domain name had been registered.” They would hold an authorized registration in bad faith on the fiction that had the later circumstances been contemplated by the parties at the time of the registration it would have been bad faith. Subjective intent is inferred. However, the logic of this view is undercut by too many subjunctives. The view has not gained traction, anymore than the theory of retrospective bad faith which it resembles.

Gmlevine

One of the central propositions of UDRP jurisprudence is that mere assertion of bad faith is insufficient for the complainant to establish infringement of its rights. This is so even if respondent lacks rights or legitimate interests in the domain name. The Panel in Murad, Inc. v. Stacy Brock, FA1202001430865 (Nat. Arb. Forum March 31, 2012) took the unusual position of making no formal findings under the first and second elements to focus on the bad faith: “for the reasons set forth below, the Panel finds that it need not rule on this element of the Policy.” Whether or not complainant prevails on the first two elements its fate hangs on the third.

Inactivity (or the expressive oxymoron, “passive use”) as a factor in determining bad faith “use” came into the UDRP vocabulary in the third decided case, Telstra Corporation Limited v. Nuclear Marshmallows., D2000-0003 (WIPO February 18, 2000). The Panel held that bad faith registration of domain names identical or confusingly similar to well-known trademarks can be found inferentially whether or not the domain name resolves to an active website. Inactivity by itself is not condemned. Although websites are “the prevalent use” [The Hong Kong and Shanghai Banking Corporation Limited v. Bill Lynn, D2001-0915 (WIPO September 28, 2001)] email, FTP and hosting services “are legitimate commercial uses …. [T]he lack of a formal web page does not detract from these real and viable commercial uses.” Innotek, Inc. v. Sierra Innotek, D2002-0072 (WIPO April 22, 2002). It is only where the trademark ascends in protectability do inferences of bad faith bend in the other direction.

In Telstra the Panel held that registration of a domain name incorporating a well-known trademark is justified only if respondent proves a defense under paragraph 4(c)(i-iii) of the Policy. The Panel construed the term “use” [paragraph 4(a)(iii) of the Policy] to include passive holding when it is “not possible to conceive of any plausible actual or contemplated active use of the domain name by respondent that would not be illegitimate.” Simply, “[o]ccupying an entry in the DNS is ‘use’ in any event, since it has a blocking function.” Time Inc. v. Chip Cooper, D2000-1342 (WIPO February 13, 2001) (over dissent who argued “Telstra is based on a conviction that the fame of the mark owner obliterates any possible legitimate use of the domain. This is simply not the law in the US, the jurisdiction where both parties [in Time] reside.”

However, where the domain name is composed of strings that can be independently used inference is weakened. There is no presumption of bad faith. Mediaset S.p.A. v. Didier Madiba, Fenicius LLC., D2011-1954 (WIPO February 4, 2012) (MEDIASET [trademark owned by an Italian television company] and). A three-member Panel denied the complaint with the following observation

In the present case, there are … various possibilities to use the disputed domain name in good faith in connection with its generic meaning. Even if future users landed on an active website of the Respondent, there would be no unfair advantage over the Complainant, as long as the Respondent uses the disputed domain name bona fide in connection with its generic meaning.

The Panel added a proviso that “should the Respondent start to use the disputed domain name in bad faith, this may constitute a material new development pursuant to which the Complainant could well have the possibility to re-file a new complaint under the Policy.” [Note: the Mediaset Complainant commenced a civil action in Rome and the court reportedly restored the domain name to it, although since the registrar is in the United States it is unclear how the judgment can be enforced.]

Returning to Murad and like disputes, where domain names are composed of dictionary words identical or confusingly similar to a trademark no definitive inference can be made under paragraph 4(b)(iv) of the Policy that its use is illegitimate. It is only after respondent launches its website is it possible to conclude that it does or does not violate complainant’s rights.

Gmlevine

Rule 17 of the Rules of the Policy provides instructions for terminating a proceeding after the file has been submitted to the Panel. Subparagraph (a) states that “[i]f, before the Panel’s decision, the Parties agree on a settlement, the Panel shall terminate the administrative proceeding.” Subparagraph (b) contemplates the happening of an intervening contingency that makes it either “unnecessary or impossible to continue the administrative proceeding for any reason,” in which event “the Panel shall terminate the administrative proceeding, unless a Party raises justifiable grounds for objection within a period of time to be determined by the Panel.” The Rule applies equally to complainants and respondents, but it is more typically the respondent who requests termination.

In practice there are two possibilities under (a), either the parties mutually “agree on a settlement” (which is the literal construction of the subparagraph) or the complainant objects but the Panel terminates the proceeding anyway because in his or her view (taking a phrase from subparagraph (b)) there is no “justifiable grounds for objection.” The Cartoon Network LP, LLLP v. Mike Morgan, D2005-1132 (WIPO January 5, 2006). As a general rule, complainant has little incentive to “agree on a settlement” once the dispute has been submitted (unless the evidence supports a paragraph 4(c) defense) because doing so rewards respondent who has held onto its income stream to the last second. Rather, the incentive is for a ruling on the merits. Where both parties consent to the transfer it would be inappropriate for the Panel to do otherwise than “simply make an order for the transfer of the domain name to Complainant.” Digg Inc. v. Damien Overeem, FA 836770 (Nat. Arb. Forum December 20, 2006). This is consistent with a general legal principle governing arbitrations as well as court proceedings. A Panel should not “issue a decision that would be either less than requested, or more than requested by the parties.” It “must recognize the common request of the two parties.” The Body Shop International plc v. Agri, Lacus, and Caelum LLC, FA 679564 (Nat. Arb. Forum May 25, 2006).

The less usual situation is presented in H. Pratt d/b/a Solar Mart v. Mushka, FA1202001429169 (Nat. Arb. Forum March 28, 2012) where Complainant attempted to withdraw its complaint after submission but before the Panel’s decision. The Respondent objected. Rule 17(a) applies and the Panel issued its decision denying the complaint. The National Arbitration Forum supplements Rule 17 by providing a fuller pallet of possibilities for Complainant. Withdrawal without prejudice is permitted before submission to Panel or receipt of response to the complaint. Withdrawal after submission and appearance is with prejudice unless respondent stipulates.

A similar factual matrix was presented in a WIPO proceeding, Comité Interprofessionnel du vin de Champagne v. Steven Vickers, DCO2011-0026 (WIPO June 21, 2011). Here, the Panel held that termination raises a fairness issue. Complainant requested permission to withdraw its complaint “at this stage” (after submission) but failed to explain what “at this stage” meant. “Did that mean that complainant was reserving the right to refile the Complaint, perhaps with extensive additional evidence, or possibly merely in the hope that a different panel would be appointed? In the Panel’s view, it would not be fair to the Respondent, which had been put to the expense and trouble of filing a substantial response, if it were obliged to go through that process again.”

The Panel in H. Pratt stated that it “believes that the Complainant’s attempt to withdraw the complaint is a clear expression of his lack of interest in the disputed domain name and the administrative proceeding’s outcome.” That is, at this stage of the proceedings, before a decision, withdrawal is acceptable without a formal stipulation signed by respondent because under the Nat. Arb. Forum Rules, 12(c) it is “with prejudice.”

Gmlevine

The “use of a privacy or proxy registration service is not in and of itself an indication of bad faith … [but] the manner in which such service is used can in certain circumstances constitute a factor indicating bad faith.” WIPO Overview 2.0 paragraph 3.9. The second sentence has in mind registrar’s failure after it receives notice of a complaint from the Provider to disclose information about the beneficial owner of the domain name. The “common practice … to which reputable registrars offering such services appear to subscribe … [is to] disclose the details of the underlying registrant to the Center during UDRP proceedings in response to the Center’s verification request.” WSFS Financial Corporation v. Private Registrations Aktien Gesellschaft 2, D2012-0033 (WIPO March 5, 2012). In this case, the registrar identified another privacy or proxy service. The beneficial owner is buried under two layers of privacy. This is unusual but not unheard of.

The consensus view of privacy services set forth in the WIPO Overview is that

Identification by a registrar or privacy or proxy service of another such service as the purported registrant of the domain name may also constitute evidence of cyberflight and bad faith … (although such failure would not prevent a panel from deciding such cases, with the privacy or proxy service typically being regarded as the relevant respondent of record).

As the Panel notes in WSFS Financial, “for this practice to operate at all, it requires a registrar to control the privacy service in question and/or to have access to accurate underlying registrant data.” The procedure

can be defeated if behind the registrar’s service there is merely recorded the name of another third party privacy service (the so called ‘Russian doll’ scenario). Further, there appears to be no legitimate justification for such ‘Russian doll’ registrations. Indeed, panels have concluded that a Russian doll registration is evidence of bad faith.

A single domain name privacy service is more likely to provide the necessary information, and where it does not or the information is clearly fictitious the service itself stands in place of the beneficial owner. PepsiCo, Inc. v. Whois Privacy Protection Service, Inc., Abdulah Shmre, D2011-0016 (WIPO ).

The WIPO Overview includes the “Russian doll” scenario (without dubbing it as such)in the consensus view:

Identification by a registrar or privacy or proxy service of another such service as the purported registrant of the domain name may also constitute evidence of cyberflight and bad faith, as may failure in response to a UDRP provider’s request to timely confirm the identity and contact information of the registrant of the domain name where the registrant listed in the WhoIs is a privacy or proxy service (although such failure would not prevent a panel from deciding such cases, with the privacy or proxy service typically being regarded as the relevant respondent of record).

The Panel in WSFS Financial suggests that the “Russian doll” scenario “should be deemed sufficient to raise a prima facie case of bad faith registration and use.” This makes sense (and, in fact, is the practical realty) where the beneficial owner elects to remain hidden and neither of its proxies explain the owner’s choice of domain name.

Gmlevine

Trademark law recognizes (with some qualification) that two parties can be entitled to use similar, even identical lexical strings where the concurrent user offers the public unrelated goods or services. It has been noted 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). That is, “[a]s a mark’s fame increases, the Act’s tolerance for similarities between competing marks falls.” This principle is carried over into UDRP jurisprudence. In and of itself, a domain name identical or confusingly similar to a trademark is not remarkable.

Owners whose trademarks consist of lexical strings attractive to many users have limited protection, hence the allowance for “similarities between competing marks.” Current, multiple registrations of the same or similar lexical string in different classes undercut a complainant’s allegation that in registering the disputed domain name the respondent is targeting it trademark. Example: “Country Home,” Meredith Corp. vs. CityHome, Inc., D2000-0223 (WIPO May 18, 2000) (“[T]here are at least seven United States trademark registrations for Country Home by others for diverse uses and ‘hundreds’ for common variations thereof, e.g., Home Country. Furthermore, Complainant’s trademark registrations are in classes 16 and 31 for such things as printed materials, magazines and seed. On the other hand, Respondent’s potential use in connection with real estate and mortgage services would be in International Classes 35 and 36.”). No bad faith is imputed for registering a domain name respondent uses to describe the goods or services it offers. Kaleidoscope Imaging, Inc. v. V Entm’t, FA 203207 (Nat. Arb. Forum Jan. 5, 2004) ().

The principle is illustrated in Park ‘N Fly Service Corporation v. Elias Tesfa, FA1202001427761 (Nat. Arb. Forum March 15, 2012). Arguing that a respondent is a competitor – suggesting thereby that it should have had knowledge or been aware of complainant – necessarily requires a threshold analysis of the parties’ business locations and their goods or services. Propinquity strengthens or undercuts a contention of illegitimacy for registering the domain name. In Park ‘N Fly, the parties are located on opposite sides of the United States.

The Respondent prevailed even though it did not appear because the Complainant’s evidence included screenshots that demonstrated what the Respondent would otherwise have presented in its own defense. According to the screenshots,

Respondent’s <ezparkfly.com> domain name resolves to a website that offers competing parking and transportation services under the title “EZ Park Fly” in San Jose, California. Complainant asserts that Respondent directly competes with Complainant’s business. The Panel determines that the terms “park” and “fly” are descriptive terms that describe both Complainant’s and Respondent’s businesses.

A trademark holder does “not have an exclusive monopoly” on common lexical strings (here, “park” and “fly”) in relation to the services to which the terms ordinarily apply. The Panel found that “in relation to airport parking services, and Respondent operates a legitimate business.” The risk in registering a common lexical string is that others, without knowledge of that a string has been registered as a trademark, can choose it for its own business, the only qualification being that the choice is legitimate.

Gmlevine

Domain names are not literally owned, but possessed for variable lengths of time pursuant to registration agreements that must be periodically renewed. The better analogy is with a valuable leasehold interest with unlimited options to renew that can be lost if renewal is not timely exercised. Owners of “strong” trademarks have a higher degree of security from inadvertent lapse because trademarks are property in the full sense of the term. Trademark owners do not lose their statutory priority over respondents registering lapsed domain names. However, holders of trademarks on the lower end of the classification scale and those claiming unregistered rights carry a heavier burden. Although equally protected in theory, in practice complainants’ ability to reclaim lapsed domain names incorporating lesser known and unregistered marks cannot succeed without proof of respondents’ actual knowledge of them and their trademark.

The heavier burden principle is illustrated in Paper Denim & Cloth, LLC v. Pete Helvey, FA1201001425020 (Nat. Arb. Forum March 5, 2012) and Rusta AB v. Daruna, LLC., D2011 -1887 (WIPO February 2, 2012). Although Complainant’s trademark is registered on the Principal Register of the USPTO it is comprised of three common words “paper,” “denim” and “cloth.” The Panel held that

Complainant has provided no evidence that its mark … is sufficiently well-known as to enable the inference to be drawn that Respondent must have had that mark in mind when he registered the Domain Name. Nor is there any other evidence from which the Panel can conclude that Respondent had Complainant or its trademark in mind when he registered the Domain Name.

Panels have taken one of three positions when the complainant fails inadvertently to re-register its domain name: 1) favoring the fanciful and arbitrary and perhaps the suggestive, Donna Karan Studio v. Raymond Donn, D2001-0587 (WIPO June 27, 2001) (); 2) disfavoring the generic and descriptive, Paper Denim & Coth and Rusta; and 3) rejecting excuses altogether, Corbis Corporation v. Zest, FA0107000098441 (Nat. Arb. Forum September 12, 2001) (Three member Panel: “There is an element of ‘finders keepers, losers weepers’ in this decision. We believe that is as it should be.”). In Rusta, the Complainant waited almost 11 years before challenging Respondent’s registration of the lapsed domain name.

The third category, “weepers-losers” has been criticized as a “quaint and classing saying” but “an oversimplification of the underlying law.” World Wide Commerce Corporation v. WebContents, Inc., FA0712001124467 (Nat. Arb. Forum February 13, 2008). The fact that a domain name registration has expired and inadvertently lapsed “does not mean that the respondent has any right to use a well-known trademark as its domain name when such use could cause confusion to consumers and damage to the owner of the trademark.” Donna Karan Studio. The loser’s right is enhanced or undermined by the nature and relative strength of the mark in the context of “rights in the domain name” and “bad faith.”

Although trademark owners do not lose their statutory priority over respondents registering lapsed domain names, FBomb Clothing c/o Joel Jordan v. Domainly.com, FA0902001245522 (Nat. Arb. Forum March 16, 2009), argument that registration alone is sufficient to put respondents on notice of third party rights has been rejected: the UDRP does not embrace the doctrine of “constructive knowledge.” As the Panel explains in Paper Denim and Cloth,

Despite some Panel decisions to the contrary, there is no place for the concept of constructive knowledge under the Policy, the essence of the complaint being bad faith targeted at the complainant, necessarily involving the cybersquatter having actual knowledge of the existence of the complainant, the trade mark owner: Way Int’l Inc. v. Peters, D2003-0264 (WIPO May 29, 2003).

As prior Panels have also explained: “The Policy was not intended to permit a party who elects to register or use a common term as a trademark to bar others from using the common term in a domain name, unless it is clear that the use involved is seeking to capitalize on the goodwill created by the trademark owner”. Harvard Lampoon, Inc. v. Reflex Publishing Inc., D2011-0716 (WIPO July 26, 2011), citing Match.com, LP v. Bill Zag and NWLAWS.ORG, D2004-0230 (WIPO June 2, 2004).

Gmlevine

Combinations of letters are either acronyms or abbreviations for a company’s name – protectable or not against domain name registrants depending on the trademark’s strength – or simply a string of random letters (“random” that is to respondents) that are capable of use (when acronymic) by many third parties other than complainant trademark holders. Panels have noted that domain names composed of few letters are “extremely prized” Deutsch Welle v. Diamondware Capital Ltd, D2000-1202 (WIPO January 2, 2001); the Panel in Physik Instrumente GmbH. & Co. v. Stefan Kerner and Jeremy Kerner and Magic Moments Design Limited, D2000-1001 (WIPO October 3, 2000) rejected Complainant’s analogy of “pi” with “vw” or “ibm.” They can be attractive to many persons other than trademark owners of identical or confusingly similar strings. Louis Vuitton Malletier S.A. v. Manifest Information Services c/o Manifest Hostmaster, FA0609000796276 (Nat. Arb. Forum November 7, 2006); more recently, Rocky Mountain Health Maintenance Organization, Incorporated v. Domain Administrator / PortMedia, FA1112001418881 (Nat. Arb. Forum January 27, 2012) ( which the Panel found not to be a true acronym.).

The line dividing good from bad faith, what respondents call random letters (unprotected) and complainants acronyms deserving of protection is difficult to calibrate. This is illustrated in CEAT Limited, CEAT Mahal, v. Vertical Axis Inc. / Whois Privacy Services Pty Ltd., D2011-1981 (WIPO February 20, 2012) in which the majority noting that this was a close case held in Complainant’s favor over a vigorous dissent. “It is” (the majority pointed out)

by now well established that PPC parking pages built around a trademark (as contrasted with PPC pages built around a dictionary word and used only in connection with the generic or merely descriptive meaning of the word) do not constitute a bona fide offering of goods or services pursuant to paragraph 4(c)(i) of the Policy, nor do they constitute a legitimate non-commercial or fair use pursuant to paragraph 4(c)(iii).

The majority rests its conclusion of abusive registration on awkward logic, namely that if there “is no dictionary meaning for the term ‘ceat’ … [t]he value of the disputed domain name to the Respondent is, therefore, its value as a trademark.” The evidence of opportunism and willful blindness (it must be admitted) has some foundation. The Complainant, an Indian corporation in the business of manufacturing tires (or “tyres”) has a trademark registration in Canada, the location of Respondent’s domicile.

Nevertheless, the dissent offers a persuasive analysis that the Respondent’s use of “ceat” for the contents displayed on its website supports a finding of safe harbor. There is, for example, evidence that the combination of letters as an acronym can be claimed by four or five other third parties.(There may be a question here as to how many other third parties may claim a string before it can be declared generic. The greater the pool of use the heavier the burden to prove targeting. Trans Continental Records, Inc. v. Compana LLC., D2002-0105 (WIPO April 30, 2002) (“LFO, among other uses, is an acronym for ‘Low Frequency Oscillation,’ and, according to Respondent, the initials of numerous organizations and individuals”).

The dissent in CEAT notes:

The majority claims that such a principle [i.e. using the domain name in a non-trademark sense] cannot apply “where the domain name is a trademark and has no dictionary meaning…” and that such an exclusion applies in the present case because “(t) here is no dictionary meaning for the term ‘CEAT’.” It is clear from previous decisions that the first part of that statement is, with respect, not correct, as an acronym may give rise to a right or legitimate interest even if it is a trademark. Nor is it a requirement of the Policy or any relevant law that an acronym must have a dictionary meaning; many, if not most, acronyms would have no dictionary meaning, some have many meanings, some have whatever meaning the user gives to them and others have value simply because they are short, catchy and easy to remember.

The point being made by the dissent is an important reminder that combinations of letters that to some are acronyms of well-known trademarks may to others be no more than “short, catchy and easy to remember” strings that can properly be used by the first to recognize their non-trademark value. The majority noted that this was a close case.

Gmlevine