iEstates.com

In a recent decision in the dispute for the domain name Evoq.com, the WIPO panel let the original registrant keep the domain name. However the 3-person panel did not agree how exactly the “bad faith” criteria should be applied. The panel was not clear whether it mattered if a domain name was registered in bad faith when compared to the complainant’s trademark, or if this criteria could be applied against any existing trademark.

From the decision (emphasis added):

Faced with the fact that the Domain Name was registered in 2004, well before the Complainant was formed in 2007, the Complainant argues that the Domain Name was registered in bad faith directed at General Motors, which had announced a concept car called “Evoq” in 1999.

Some members of the Panel are inclined to conclude that, to prove bad faith registration, the Respondent must have had a bad faith intention with respect to the Complainant’s mark. However, the Panel does not need to reach a definitive conclusion on that issue because, even if bad faith directed at third parties could constitute bad faith for the purpose of this requirement, the Panel does not find the existence of any such bad faith on the evidence in this case.

So while the panel clearly thought that the domain owner did not register this domain in order to infringe on the complainant’s brand, at least one panelist thought it may have been infringing on another companies’ brand and thus could potentially constitute a bad faith registration.

In a conversation with DNN, Zak Muscovitch of DNAttorney commented as follows:

Zak Muscovitch at DomainConvergence

The Complainant’s position is absurd. The Complainant argues that the Respondent should be found to have registered the domain name in bad faith, even though the Complainant wasn’t even in existence at the time the domain name was registered, because the disputed domain name was registered after  an unrelated third party; General Motors, acquired trademark rights. The fact that the Complainant was able to adopt EVOQ as a trade name and trademark for its communications and branding business years after General  Motors acquired trademark rights,  in ostensible “good faith”, means that  the Respondent was equally able to register the domain name in good faith notwithstanding General Motor’s limited rights. What is good for the goose is good for the gander. EVOQ is a name that could lend itself to any number of business endeavours. This is a case of attempted domain name hijacking in my opinion, pure and simple.

[Thank you safesys/DBR]

(c) 2010 DomainNameNews.com

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In a WIPO decision issued today a pretty generic domain domain,  7Days.com was awarded to a the owner of a trademark registered in Greece and Portugal.

Although the domain was parked, none of the links were alleged to go to the trademark owners site or competitors site, just a general parking page.

“”The Panel finds on the undisputed evidence of the Complainant that the Respondent has not used or made demonstrable preparations to use the Domain Name for a bona fide offering of goods or services. The Panel considers that the Respondent’s use of the Domain Name for a generic holding page does not constitute an offering of goods or services for this purpose.”

The domain holder did not file a response to the complaint.

In yet another shoot from the hip WIPO decision this one involving the domain SkyWaterSystems.com, the sole panelist found that even though the Complaint and the Domain Holder were in the same type of business,  there is not necessarily any confusion.

“”"As far as the record here reveals, however, the water-related systems offered by the parties here are not strictly, as Complainant asserts, in direct competition with one another. As the Panel understands it, Complainant produces water from the atmosphere and Respondent purifies existing water.”"

Wow

When domainers are involved panels give the domain to the trademark holder if there is any close proximity of the domain to the trademark in question.

Yet when domainers are out of the picture panelist all of a sudden, can make a distinction between companies products that “produces water from the atmosphere and purifies existing water.”"

This is despite that fact that the panel found that the complainant did have a right to the term in question:

“”"Complainant holds rights in the mark SKYWATER through registration and use. The Domain Name incorporates the mark and adds the word “systems.” In the Panel’s view, the addition of the word “systems” does not diminish the confusing similarity between the mark and the Domain Name. This is because the word “systems” actually partly describes what Complainant sells under the mark.

Accordingly, the Panel finds that Policy paragraph 4(a)(i) is satisfied.”"

The panel even found:

“”The Panel believes it conceivable that there could well be consumer confusion as between the source of goods offered via the Domain Name.”

Yet the panel held in favor of the domain holder finding that the very unique term Skywater was NOT distinctive:

“”"On the spectrum of inherent distinctiveness, the trademark SKYWATER to identify a system that produces water from the atmosphere in this Panel’s view can hardly be regarded as fanciful or even arbitrary. It is, for this Panel rather, suggestive at best and even arguably descriptive.”"”

“”"It is not implausible under the circumstances for Respondent to have adopted the term “sky water” as a DBA or a domain name without having any awareness of Complainant or its goods.”"

How can a panel find a domain like Sky Water is not distinctive when they found LH to be distinctive?

Here is the kicker.

Remember all the decisions where domainers are held to be on constructive notice of not just every trademark in the United States but even of those of other countries?

Here the panel said:

“”"In the Panel’s view, constructive notice by itself does not form the basis for a bad faith finding under the Policy.”

This fly’s in the face of a ton of decisions that puts the burden of constructive notice squarely on the shoulders of domainers.

Finally the panelist recognizing he was way over his head just threw up his hands and said:

“”The issues raised in the Complaint and Response are best left to a court of law.”

“This is not a clear case of cybersquatting, which is the type of case the Policy is intended to address.”

“”A court of law is the proper forum to sort out this clash of alleged trademark rights.”

The problem is this case doesn’t involve a “clash of trademarks” as the domain holder doesn’t have one.

To have a “clash of trademarks” wouldn’t both parties have to have one?

In a WIPO decision a sole panelist took away a domain registered by the domain holder in 1997, that’s 13 years ago.

The domain at issue is sporto.com

Over the years, the domain has been used many different ways including as a developed site but also for a period of time as a parked page.

This case again turned on the bad faith issue.

The policy on bad faith is pretty clearly written:

“”"C. Registered and Used in Bad Faith

“”Paragraph 4(a)(iii) of the Policy reads as follows:

“You are required to submit to a mandatory administrative proceeding in the event that a third party (a “complainant”) asserts to the applicable Provider, in compliance with the Rules of Procedure, that:

(iii) your domain name has been registered AND is being used in bad faith.”

However this becomes another panel that interprets the work “And” as “or” and wants to judge “Bad Faith” not only at the time of registration but each year at the time of renewal:

“”Until last year Respondent’s pre-2008 use of the disputed domain name may have established a defense to the charge of no rights or legitimate interest”

“However this provision not only imposes a duty on the part of the registrant to conduct an investigation at the time of registration, but also includes a representation and warranty by the registrant that it will not now or in the future use the domain name in violation of any laws or regulations. This effectively imposes on the registrant a continuing duty to ensure that the domain name is not used in violation of another’s rights and clearly covers intellectual property rights and the laws protecting them, including copyright and trademark. This representation and warranty is not limited to the moment at which the registrant registers the domain name; rather, it extends to any use of the domain name in the future.”

“”in this Panel’s view bad faith registration can be deemed to have occurred even without regard to the state of mind of the registrant at the time of registration, if the domain name is subsequently used to trade on the goodwill of the mark holder, just as bad faith use can occur without regard to the fact that the domain name at issue has not been (or has been ‘passively’) used.”

“”Registrant provides his undertaking “By applying to register a domain name, or by asking [a registrar] to maintain or renew a domain name registration.”

“”Does the renewal of the registration of a domain name amount to a registration for the purposes of determining whether the domain name was registered in bad faith?

“Consensus view: While the transfer of a domain name to a third party does amount to a new registration, a mere renewal of a domain name does not amount to registration for the purposes of determining bad faith. Registration in bad faith must occur at the time the current registrant took possession of the domain name.”

“Here, at the time of its most recent renewal last year Respondent’s use of the disputed domain name had become prototypical cybersquatting and in no way related to any of Respondent’s businesses. The change came about not through intervening circumstances unrelated to Respondent’s prior good faith use but by Respondent’s conscious choice to change website content.”

“To summarize, in this Panel’s assessment:”

“Respondent intentionally changed its use of the disputed domain name.

“The new use is unrelated to Respondent’s earlier business.

“The new use is textbook cybersquatting.

“The new use occurred prior to the renewal held to be a registration.

“There has been no legitimate use since renewal.”

“The Panel deems Respondent’s 2009 renewal of the disputed domain name to be the date on which to measure whether the disputed domain name was registered and used in bad faith for purposes of paragraph 4(a)(iii), and finds that the Respondent registered and used the disputed domain name in bad faith. The Panel further finds that Respondent’s use of it to redirect to a website that includes hyperlinks to Complainant’s competitors not legitimate under paragraph 4(a)(ii).”"

You got to read this part of the opinion:

“”The UDRP does not operate on a strict doctrine of precedent. However panels consider it desirable that their decisions are consistent with prior panel decisions dealing with similar fact situations.”

“This ensures that the UDRP system operates in a fair, effective and predictable manner for all parties”

How can inconsistent opinions be fair effective and predictable. for anyone?

If the UDRP does not operate on a doctrine of precedent which we have noted many times in the past, then there is no consistence and it become unpredictable, as we have called it a crap shoot.

At some point this issue of “And” Vs. “or” is going to have to be decided by a real court which does have to follow Precedent and can’t just make it up as they go like the UDRP panels seem to.

TechDirt covered a unique twist in domain name disputes last week.  Pet Holdings, Inc, the company behind wildly popular websites such as Icanhascheezburger.com, FailBlog.org and Failbooking.com, sued the owner of the domain name FailBook.com because the owner framed PHI’s FailBooking.com site on his FailBook.com domain and put a for sale banner on the top of the page.

Failbook.com owner Cristian Castillo claims that he made a mistake framing the Failbooking.com content but was using it to demonstrate what the domain could be used for while attempting to sell it. Based on statistics sent to us by Castillo the domain seems to be generating around 10,000 unique visitors a day. Castillo is still offering the domain name for sale for $50,000.

As a result of  the domain owners actions of framing the content of Failbooking.com, Pet Holdings is claiming cybersquatting, trademark infringement, copyright infringement, unfair competition, and breach of contract.  Castillo clearly has the better domain and one that predates FailBooking.com by 3 years, a domain that PHI likely covets but is unwilling to pay $50,000 to acquire.

It’s unclear why PHI sued first and didn’t file a UDRP or simply send Castillo a cease and desist to stop his actions.  Posts on TechDirt and the current Failbook site indicate Castillo believes that suing and not sending a cease and desist was over the top.   We wonder why they didn’t just go with a UDRP instead. Based on several recent bad UDRP decisions, DNN believes Castillo might be lucky that PHI didn’t go that route.  Actions like this seem to be readily pinned as bad faith in a UDRP proceeding, so he’d have lost the domain.  As far as we know, PHI still has the option to file a UDRP.

Techdirt makes the argument that PHI shouldn’t be bothered and that in fact Failbooking.com benefited from the traffic from the Failbook.com framing of their site, but others clearly don’t see it the same pointing out that the action could confuse users in to thinking one site was the other.  The legal battle seems to have continued in the comments section with both sides making additional arguments. Arm-chairing techies also seem to be chiming in on the issue. Debate centers over whether Castillo’s actions were or were not harming PHI and if the actions were more of a defrauding on potential buyers of the domain.

The case is ongoing and will be interesting to follow and see where this leads.  PHI has offered a settlement which calls for Castillo to pay PHI around $8,000, but it doesn’t appear that he is going to accept that any time soon.

(c) 2009 DomainNameNews.com

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According to an ICANN announcement published yesterday, all UDRP providers must accept electonic filings by UDRP claimants and respondents as of March 1st, 2010. The original rules had required UDRP providers such as WIPO to provide hard copies of the entire complaint. As of March 1st they will only be required to forward a hard copy notice that a UDRP complaint has been filed.

ICANN | Announcement Regarding Implementation of Modification to Implementation Rules for Uniform Domain Name Dispute Resolution Policy.

(c) 2009 DomainNameNews.com

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Despite being clearly limited in scope, the purpose of the UDRP continues to be ignored by experienced panelists. The result is an ever-expanding environment for domain disputes that exists completely far from any legislative or judicial oversight.

In the recently decide Deutsche Kreditbank AG v. DKB Data Services (USA), Inc. D2009-1084 (WIPO Sept 30, 2009), the respondent registered a three letter domain name (dkb.com) in 2001. NB: DomainTools (my favorite research tool) shows a record creation date in 1996. During this period the domain had been registered with a single registrar with only 2 name-server changes in seven years. Evidently the domain had not been used recently. The panelist, Mr. Swinson, accepted the statement of the complainant’s private investigator’s that the respondent was dissolved after it had merged with another company in 2002. Mr. Swinson concluded that the dissolution, followed by non-use was sufficient to transfer it to the complainant. (Obviously, the panelist did not know that the company was a client of “The Mill House Inn” in Long Island.  It will also be a disappointment to cfsoftware who will no doubt have lost a customer.) Whether the “investigator’s” statement was a sworn declaration was not disclosed in the decision. Notwithstanding the apparent dissolution, however, the respondent did maintain the registration. Is this “cybersquatting”? According to this panelist, it is.

Respondent’s default meant the complainant’s allegations were not challenged. Nevertheless, an unchallenged complaint does not entitle a panelist to issue decisions that are so obviously contrary to the purposes of the UDRP. In case it has escaped anyone, the UDRP Policy was designed to deal only with the limited problem of “cybersquatting”. “Cybersquatting” is the “deliberate, bad faith, abusive registration of domain names in violation of others rights.” (WIPO Final Report, 1999, p29). Numerous decisions confirm that it is NOT designed to resolve trademark disputes, business disputes, contract disputes, employment disputes etc. Such “complicated” matters fall outside the scope. The Policy is not designed to decide who has a “better” right to a domain, but merely whether a registration is abusive according to certain standards.

In Deutsche Kreditbank, the panelist first found a lack of legitimate interest because none of the paragraph 4(c) descriptions of a possible legitimate interest could apply and, of course the Respondent, who was no longer in business, obviously had not provided any evidence of a bona fide use. The most troubling aspect, however, was the panelist’s fabrication of bad faith registration based on the Telstra decision. The panelist concluded that the current use was “passive” thus supporting a presumption of original bad faith intent.

The panelist’s application of Telstra leaves much to be desired. He openly doubted whether the complainant’s mark was well-known, holding that it was reasonable to conclude that the U.S. located respondent did not know about the German bank. Normally, if a respondent is unaware of the complainant, much more is required to show the kind of deliberate intent required for a finding of “cybersquatting”. The panelist then concluded that despite the fact that the respondent once was an existing company, it was not possible to conceive the respondent using the domain in any legitimate way. Finally, the panelist held that although the respondent may not have intentionally concealed its identity, it was not possible to contact him on a given address and respondent did not provide a response. Ultimately, Mr. Swinson justified his illogical decision by pointing out that the respondent “in all likelihood” was dissolved and thus the domain name would be of limited value to its operation as a business. This final point clarifies the inappropriateness of the entire decision.

The fact that the respondent had existed when the time the domain was registered is conclusive evidence of the absence of bad faith registration. The statements by the complainant’s investigator – that the respondent had been dissolved – are an admission that the respondent had in fact existed. The continued registration clearly indicates that a valid property right remained in the hands of the respondent. Dissolution does not cause property rights to evaporate – they transfer to the proper successor in interest. The lack of use here is irrelevant.

This decision typifies the continued expansion of the UDRP well beyond its intended scope. Without judicial oversight it is impossible to effectively challenge such wayward panelists and guide the UDRP process so that it is truly equitable. While Telstra may have been created to deal with a particular difficult factual situation, that decision itself went beyond the bounds of the UDRP. While the rationale of Telstra may be justified by the limited circumstances it was intended to address, the Deutsche Kreditbank decision shows the danger of a system where panelists with little or no judicial sense apply “precedent” to justify a decision to award a domain name to the person with a “better” use.

Decisions like Deutsche Kreditban only encourage trademark owners to try to use the UDRP to obtain domains that they are not in any manner entitled to but desire nevertheless. They are but another reason to encourage the establishment of an appeals process (or at least an ombudsman) or to require a regular peer review of panelists.

Author Paul Keating, ESQ. is a California attorney who is lucky enough to both live and work in Barcelona, Spain.

(c) 2009 DomainNameNews.com

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Karen Bernstein, a New York City domain dispute attorney, is urging domainers to fight back and protect their rights after seeing business owners use the UDRP process to force domain transfers time and time again.

In one of Ms. Bernstein’s recent cases she was able to defend WeDirect Inc.’s ownership for www.CheapAutoInsurance.com despite the complainant having a federally registered trademark for CHEAP AUTO INSURANCE. The Panel held that WeDirect - and anybody else - is entitled to register a commonly used phrase as long as it is being used in a descriptive fashion. However, while WeDirect was financially able to defend its rights, its request for the panel to acknowledge that the arbitration complaint was brought in bad faith was declined - causing Ms. Bernstein to publicly question the flaws in the UDRP system which make it difficult for domainers with less funds to defend their domains.

“The National Arbitration Forum Panel’s decision to decline a finding of reverse domain name hijacking for my client is yet another example of how business owners are using the UDRP [Uniform Domain Name Resolution Policy to strong arm domainers into transferring their profit-making domains with no repercussions," argued Ms. Bernstein.

"The average cost to file a domain dispute is low compared to the enormous sums that must be shelled out to bring a federal trademark infringement lawsuit and that's why so many companies opt to go through the UDRP process. On the other hand, the average domainer does not necessarily have the financial resources or the time to fight the domain dispute and either does not respond to the arbitration complaint (allowing in most cases the domain to be transferred) or spending the time and money to fight it.

Ms. Bernstein speculates that since domain arbitrations are relatively inexpensive, many business owners decide to take advantage of the system by filing complaints for minimal fees without facing any legitimate threat of being found guilty of reverse domain name hijacking.

"There needs to be strong efforts by the domain community to lobby ICANN to change its arbitration complaint intake policy and not to permit the URS [Uniform Rapid Suspension System Policy] to take effect,” Ms. Bernstein concluded.

[via PRWeb]

Note: Paul Keating, a Barcelona-based (but California licensed) lawyer specializing in intellectual property, has suggested a way to modify UDRP domain arbitration as to avoid rapid domain suspensions. Check it out here…