WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Educational Testing Service v. Netkorea Co.
Case No. D 2000-0087
1. The Parties
1.1 Complainant is a not-for-profit corporation organized and existing under the laws of the State of New York, with a principal place of business located at Rosedale Road in Princeton, New Jersey, United States of America.
1.2 Respondent is a business operating under the name Netkorea Co. in Seoul, Republic of Korea. It is not clear whether Respondent is a corporation or another type of entity doing business under the name Netkorea Co., but the legal status of the Respondent is not relevant in this proceeding.
2. The Domain Name and Registrar
2.1 This proceeding is concerned with the domain name ("Domain Name"):
2.2 The Domain Name is registered with Network Solutions, Inc., of Herndon, Virginia, United States of America.
3. Procedural History
3.1 The proceeding was initiated under and is being conducted pursuant to:
(a) the Uniform Domain Name Dispute Resolution Policy ("Policy") adopted by the Internet Corporation for Assigned Names and Numbers ("ICANN") on August 26, 1999 and approved by ICANN on October 24, 1999;
(b) the Rules for Uniform Domain Name Dispute Resolution Policy ("Rules") adopted by ICANN on August 26, 1999 and approved by ICANN on October 24, 1999; and
(c) the World Intellectual Property Organization Supplemental Rules for Uniform Domain Name Dispute Resolution Policy in effect as of December 1, 1999.
3.2 The Complaint was submitted to the World Intellectual Property Organization ("WIPO") on February 21, 2000. It was received by WIPO on February 22, 2000. WIPO issued an Acknowledgement of Receipt to Complainant on February 24, 2000.
3.3 On February 24, 2000, WIPO sent to Network Solutions, Inc. a Request for Registrar Verification. Network Solutions, Inc. issued verification on February 25, 2000.
3.4 On February 25, 2000, WIPO completed its Formalities Compliance Review and forwarded a Notification of the Complaint to Respondent by courier, facsimile, and e-mail with a copy to Complainant by e-mail.
3.5 No Response was received from Respondent within the time prescribed by Rule 5(a). On March 16, 2000, WIPO dispatched to Respondent a Notification of Respondent Default by facsimile and e-mail, with a copy to Complainant by e-mail.
3.6 On March 22, 2000, WIPO issued a Notification of Appointment of Administrative Panel and Projected Decision Date. Copies of that document were forwarded to Complainant and Respondent by e-mail.
3.7 On March 23, 2000, the Panel issued a request to Complainant under Paragraph 12 of the Rules for:
(a) evidence tending to prove that Respondent has no rights or legitimate interests in the Domain Name; and
(b) evidence supporting the statement in paragraph 27 of the Complaint that
"After receiving a letter from Complainant protesting Respondent's registration of the domain name, Respondent advised Complainant's legal representatives that Respondent would be willing to transfer the domain name to Complainant for the an amount in the range of "several hundred thousand dollars".
The Panel sent a copy of the request to Respondent and invited Respondent to make submissions and provide evidence in response to any evidence to be provided by Complainant pursuant to the Panel's request.
3.8 On March 28, 2000, in response to the Panel's request, Complainant submitted the Declaration of Young-June Yang dated March 25, 2000, which included four exhibits.
3.9 On March 29, 2000, as requested by the Panel, Respondent submitted Comments of the Respondent in the form of a Declaration of Jingsu Han dated March 29, 2000.
3.10 On March 30, 2000, Complainant submitted the Declaration of Lile H. Deinard dated March 30, 2000. Complainant transmitted a copy of that Declaration to Respondent by e-mail, facsimile and courier. That Declaration had not been requested or previously authorized by the Panel. However, the Panel decided to allow the submission of the Declaration. That decision was communicated to the Complainant and Respondent by an e-mail dated March 30, 2000. That communication invited Respondent to provide additional submissions or evidence in reply to the Declaration of Lile H. Deinard dated March 30, 2000.
3.11 On March 31, 2000, Respondent submitted Comments 2 of the Respondent in the form of a Declaration of Jingsu Han dated March 31, 2000.
4. Factual Background
4.1 Complainant is a private not-for-profit educational research and measurement institution. Complainant develops and administers tests, including tests for measuring skills, academic aptitude and achievement, and occupational and professional competency for those seeking preparatory school, college, and graduate school admission, licenses for technical and paraprofessional occupations and teacher's certification.
4.2 Continuously since 1979, Complainant has offered a test for evaluating the ability of prospective employees to communicate in the English language in the business context. The full name of the test is "Test of English in International Communication". Complainant uses the acronym of that name, TOEIC, as a trademark in association with the test. Complainant's TOEIC test is used by private companies worldwide.
4.3 Complainant has registered TOEIC as a trademark in several countries around the world, including:
Country
Mark
Class
Reg. No.
Reg. Date
United States
TOEIC
42
1,191,669
March 9, 1982
Korea
TOEIC
52 (Kor.)
83993
September 21, 1982
Korea
TOEIC
112 (Kor.)
3521
January 14, 1983
4.4 No evidence or other information has been provided by Respondent or Complainant on the nature of Respondent's business, products and services.
4.5 Respondent registered the Domain Name with Network Solutions, Inc. on October 17, 1998.
4.6 At some point prior to January 23, 1999, Respondent also registered the domain name . The materials submitted by Complainant, particularly Exhibits 1 and 2 appended to the Declaration of Young-June Yang dated March 25, 2000, indicate that TOEFL is a registered trademark of Complainant.
4.7 By a letter dated March 24, 1998, a letter was sent to Respondent on behalf of Complainant requesting Respondent to cease use of domain names that infringe on Complainant's rights. It is not clear from the evidence which domain names were specifically mentioned in that letter.
4.8 Respondent has not used the Domain Name as a uniform resource locator (URL) for any website since it was registered in October of 1998.
4.9 On January 23, 1999, Young-June Yang, a lawyer at the Korean law firm, Kim & Chang, wrote to Respondent on behalf of Complainant and demanded that Respondent abandon its registration of the Domain Name and , cease all use of the Domain Name and , and provide written confirmation that it will not use the Domain Name and in the future. That letter was written in the Korean language. The Declaration of Young-June Yang dated March 25, 2000 provided a translation of that letter into English. The Panel is assuming the accuracy of that translation.
4.10 There followed a few communications between Respondent and Complainant's Korean legal representative and Respondent about the Domain Name and . Those communications included a letter from Respondent to Young-June Yang dated February 9, 1999. The letter was written in the Korean language. The Declaration of Young-June Yang dated March 25, 2000 provides a translation of that letter into English. The Panel is assuming the accuracy of that translation.
4.11 Respondent's letter to Young-June Yang of February 9, 1999, asserted that Respondent is not required to abandon the Domain Name at all. In that letter, Respondent also made the following statement:
"However, I recognize that ETS has more pressing need for the domain names in relation to conducting internet business and therefore I am prepared to assign the domain name rights if ETS will pay an appropriate price."
4.12 On February 20, 1999, there was a telephone conversation between Complainant's Korean legal representatives and Mr. Jingsu Han, who represents the Respondent. In that telephone conversation, there was some discussion about Complainant paying Respondent for a transfer of the Domain Name to Complainant.
4.13 The evidence of the parties diverges on the monetary amounts that were discussed in the telephone conversation of February 20, 1999. In her Declaration of March 25, 2000, Young-June Yang says that Complainant offered pay to Respondent a nominal amount of money not to exceed US$500 to cover Respondent's expenses incurred in registering, maintaining, and transferring to Complainant the Domain Name and . In the Declaration of Jingsu Han dated March 29, 2000, Mr. Han denies that the price of US$500 was mentioned. However, Mr. Han agrees that Complainant's representative indicated that Complainant would not pay more than a "minimal cost for maintaining domain names".
4.14 In her Declaration of March 25, 2000, Young-June Yang says that during the same telephone conversation, Mr. Han rejected Complainant's proposal and made a counter-proposal that would require the payment of "several of hundreds of thousands of dollars". Mr. Han denies having made that statement. As Young-June Yang did not personally participate in the telephone conversation, her evidence about the statement made by Mr. Han is being given minimal weight by the Panel.
4.15 In the Declaration of Jingsu Han dated March 29, 2000, Mr. Han says that in the telephone conversation of February 20, 1999, he told Complainant's Korean legal representatives that he would call them back after thinking about the appropriate price "because it couldn't be immediately concluded". Mr. Han says that he has not called Complainant's legal representatives back.
4.16 In Paragraph 5 of the Declaration of Jingsu Han dated March 29, 2000, Mr. Han says:
"It would be very possible if Complainant contact me with normal processing the situation would be settled down with minimal costs for the transferring".
4.17 To explain why Respondent chose the Domain Name and , Mr. Han made the following statement in paragraph 3 of his Declaration dated March 24, 2000:
"...I simply registered domain names and in the late of 1996 or beginning of 1997 for the purpose of setting up english information sites for the Korean people. At that time, I didn't know whether ETS even exists or not on the earth. I've simply thought the and were the famous english examination for the Korean people and every english study group or small academy clubs use these marks so the domains must have been useful for Koreans in the future."
4.18 To explain why Respondent has not yet begun to operate a website using the Domain Name, Mr. Han says in his Declaration dated March 31, 2000:
"Furthermore the reason I said "I do not establish web sites" is the purpose to contest the "threatening letter" ("cease-and-desist" letter from Young-Jung Yang dated January 23, 1999) (Exhibit 1)) because it claimed that I had registered and "had managed" the web site and infringed ETS's Trademark. (See my former Comments on 4, (1)) and also the reason I didn't establish web sites was mostly resulted from another threatening letter on 24, 1998 uttered in 4 dated January 23, 1999 on Exhibit 1. I couldn't open web site after that letter for fear of possible litigation problems."
5. Parties' Contentions
Complainant's Contentions
5.1 Complainant asserts that:
(a) the trademark TOEIC is famous and enjoys a prestigious worldwide reputation and renown among professional, occupational, economic, governmental, institutional, and industrial sectors;
(b) Respondent has no rights or legitimate interests in the Domain Name;
(c) Respondent registered the Domain Name in a blatant attempt to capitalize unfairly on the goodwill of the TOEIC mark;
(d) Respondent offered to sell the Domain Name and to Complainant for several hundreds of thousands of dollars; and
(e) Respondent had no other purpose for registering the Domain Name other than to make a sale of the Domain Name at a price that far exceeds Respondent's out-of-pocket costs.
Respondent's Contentions
5.2 Respondent has focussed its comments on Paragraph 4(a)(iii) of the Policy, contending that it has not acted in bad faith. Respondent has not made any submissions or tendered any evidence regarding the other two elements of Paragraph 4(a) of the Policy.
5.3 Respondent asserts that Respondent has not registered and used the Domain Name in bad faith because:
(a) Respondent registered the Domain Name for the purpose of setting up English information sites for the Korean people;
(b) Respondent did not know that one could sell domain names for a profit at the time the registration was made and did not expect to sell the Domain Name to Complainant;
(c) Respondent has not actually operated any website using the Domain Name, even though that was Respondent's original intention;
(d) Respondent did not request payment for the Domain Name in excess of a nominal amount; and
(e) Respondent is still open to transferring the Domain Name to Complainant for minimal costs.
6. Discussion and Findings
Complainant's Burden of Proof
6.1 Paragraph 4(a) of the Policy places a burden on Complainant to prove that three separate elements are present. The three elements can be summarized as follows:
(i) the Domain Name is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
(ii) Respondent has no rights or legitimate interests in the Domain Name; and
(iii) the Domain Name has been registered and is being used by Respondent in bad faith.
The First Element
6.2 The first element of the test established by Paragraph 4(a) of the Policy has two components, namely:
(a) the complainant must establish that it has rights in a particular trademark or service mark; and
(b) the complainant must establish that a domain name being used by the respondent is identical or confusingly similar to the complainant's mark.
6.3 The Complainant has established rights in the trademark TOEIC by virtue of use and registration. This is not contested by Respondent. Complainant asserts that its rights are particularly strong and worldwide in scope. That assertion is confirmed by Respondent in Paragraph 3 of the Declaration of Jingsu Han dated March 29, 2000, where Mr. Han says that the acronym TOEIC represents:
"...the famous English examination for the Korean people and every English study group or small academy clubs use these marks...".
6.4 In the Declaration of Jingsu Han dated March 31, 2000, Respondent expressly admits knowing the fame of the TOEIC mark at the time Respondent registered the Domain Name.
6.5 No specific submissions were made by either party as to whether or not the Domain Name is identical or confusingly similar to Complainant's trademark. However, it is self-evident that the second level domain name is identical to Complainant's trademark.
6.6 Given the generic nature of the top level domain name , the identical and confusing nature of the second level name is not diminished when it is combined with . The full Domain Name is confusingly similar to Complainant's trademark TOEIC. This is consistent with Respondent's understanding and intended use of the Domain Name.
6.7 The Panel finds that the Complainant has satisfied its burden regarding Paragraph 4(a)(i) of the Policy.
The Second Element
6.8 The second element of the test set out in Paragraph 4(a) of the Policy requires Complainant to prove that Respondent has no rights or legitimate interests in respect of the Domain Name.
6.9 It is relatively difficult for any complainant to prove beyond a shadow of a doubt that a respondent has no rights or legitimate interests in a domain name. By and large, such information is known to and within the control of the respondent. Accordingly, the burden on a complainant in respect of this element must, by necessity, be relatively light. In any event, Paragraph 4(c) of the Policy gives respondents ample opportunity to rebut any evidence tendered by complainants.
6.10 Complainant's legal representatives in Korea have conducted a search of the official records of the Trademark Office of the Republic of Korea, which is Respondent's home jurisdiction. In her Declaration dated March 25, 2000, Young-June Yang confirms that the search revealed no trademark registrations or pending applications for TOEIC. The Panel finds that this evidence is sufficient to satisfy Complainant's burden regarding Paragraph 4(a)(i) of the Policy.
6.11 Paragraph 4(c) of the Policy gives respondents the opportunity to adduce evidence which, if accepted by a Panel, will demonstrate a respondent's rights or legitimate interests in a domain name. Respondent has not introduced any evidence or made any submissions directed to paragraph 4(c) of the Policy. However, some of the statements made by the Respondent in the Declaration of Jingsu Han dated March 29, 2000, are worth considering in the context of Paragraph 4(c) of the Policy.
6.12 Specifically, some of the assertions made in paragraph 3 of the Declaration of Mr. Jingsu Han dated March 29, 2000 are relevant to a consideration of the principle set out in section 4(c)(iii), namely, whether the Respondent is "making a legitimate non-commercial 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."
6.13 The Panel is of the view that the assertions made by Mr. Han in his Declaration dated March 20, 2000 are consistent with Respondent having the intention to misleadingly divert consumers for commercial gain. If Mr. Han's assertions are taken at face value, it is clear that:
(a) at the time that Respondent registered the Domain Name, Respondent knew that TOEIC was a famous trademark used in association with an internationally used English examination; and
(b) Respondent intended to use the Domain Name for websites that would be of interest to people in Korea who are seeking to learn English.
6.14 Hence, Respondent's stated intention was to use for its own commercial gain a domain name that was identical or confusingly similar to Complainant's trademark with full knowledge that the Complainant's mark was famous in Korea and used by Complainant in association with a service that was similar to the one that Respondent intended to offer in connection with the domain name. Such use would be likely to misleadingly divert consumers and would not be legitimate. The Panel finds that Respondent cannot take the benefit of Paragraph 4(c) of the Policy.
The Third Element
6.15 The third element of the test set out in Paragraph 4(a) of the Policy requires Complainant to prove that Respondent has registered and is using the Domain Name in bad faith.
6.16 Paragraph 4(b) of the Policy sets out four different circumstances which constitute evidence of registration and use of a domain name in bad faith. However, those enumerated circumstances are not an exhaustive listing of all factors that might constitute bad faith registration and use.
6.17 Both Parties directed their submissions on the issue of bad faith to the situation contemplated in paragraph 4(b)(i) of the Policy, namely:
"Circumstances 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".
6.18 While the parties disagree with each other on specific monetary amounts that may have been discussed, it is clear from the submissions and evidence of both Parties that:
(a) At least as early as February of 1999, Respondent understood that Complainant had a "pressing need for the domain names in relation to conducting internet business";
(b) At least as early as February of 1999, Respondent wanted to transfer the Domain Name to Complainant for "an appropriate price";
(c) On February 20, 1999, there was a telephone conversation between Respondent and Complainant's Korean legal representatives in which Complainant offered to acquire the Domain Name and from Respondent for a "minimal cost" for those domain names;
(d) During the telephone conversation of February 20, 1999, Respondent told Complainant's Korean legal representatives that Respondent would call Complainant's representatives back after thinking about the appropriate price; and
(e) Since the telephone conversation of February 20, 1999, Respondent has failed to take any steps to communicate "an appropriate price" to Complainant or do anything else in response to Complainant's offer.
6.19 It is difficult to establish with one hundred percent certainty the motivation of any domain name registrant in this type of proceeding. As well, it is not common for any domain name registrant to admit that it registered and is using a domain name in bad faith. In most cases, a respondent's intention must be inferred from the respondent's conduct and knowledge.
6.20 The Panel finds that Respondent's behaviour and knowledge are consistent with Respondent having registered or otherwise acquired the Domain Name primarily for the purpose of selling or otherwise transferring the Domain Name to Complainant for consideration greater than Respondent's out-of-pocket costs related to the Domain Name.
6.21 However, even if the Panel was to accept Respondent's assertions that Respondent had no intention of selling or otherwise transferring the Domain Name to Complainant at the time it was registered, the Panel is of the view that Respondent's submissions demonstrate that Respondent registered the Domain Name in bad faith for other reasons.
6.22 In Paragraph 3 of his Declaration dated March 29, 2000, Mr. Han asserts that Respondent registered the Domain Name with the primary intention of setting up English information sites using a domain name that incorporated the famous trademark TOEIC, which Respondent knew to be associated with an internationally used English examination. Hence, Respondent's stated motivation for registering the Domain Name was to engage in the type of activity identified in Paragraph 4(b)(iv) of the Policy.
6.23 The Panel is of the view that registering a domain name for the purpose of setting up a website in which the domain name will be used in the manner contemplated in Paragraph 4(b)(iv) constitutes registration of the domain name in bad faith. This is not to say that the behaviour of Respondent falls squarely within all of the requirements of Paragraph 4(b)(iv). As Respondent has never operated a website using the Domain Name, it appears that Respondent's conduct technically falls outside Paragraph 4(b)(iv). However, bad faith intentions should not be ascertained exclusively by reference to technical definitions. If one registers a domain name for the purpose of engaging in any of the activities identified in Paragraph 4(b) of the Policy, how could that not constitute registration in bad faith?
6.24 It is not sufficient that Respondent may have registered the Domain Name in bad faith. Paragraph 4(a)(iii) requires that Respondent also be using the Domain Name in bad faith.
6.25 The Panel is satisfied that the element of "use" that is required for a finding of bad faith does not have a narrow, technical meaning as is usually the case with the definitions of "use" applied when determining whether someone has "used" a trademark under a particular trademark statute. The breadth of Paragraph 4(b) makes it clear that the term "use" can include any kind of activity through which the owner of a domain name derives or attempts to derive economic benefit.
6.26 In his Declaration dated March 31, 2000, Mr. Han says that he has refrained from establishing a website after having received threatening letters from Complainant in 1998 and 1999 "for fear of possible litigation problems". That being the case, one would have expected Respondent to have cancelled the Domain Name or transferred it to Complainant by now. That has not happened even though Complainant has been waiting for approximately one year to hear Respondent's response to Complainant's monetary offer.
6.27 The only logical explanation for Respondent's behaviour is that Respondent has maintained ownership of the Domain Name for the purpose of procuring from Complainant payment for the Domain Name in excess of Respondent's out-of-pocket costs related to the Domain Name. Whether or not that was Respondent's primary motivation at the time it registered the Domain Name, the evidence is consistent with that being the Respondent's motivation over the last year. Having regard to all of the other circumstances in this case, the Panel finds that by maintaining the registration for the Domain Name for this purpose, Respondent is using the Domain Name in bad faith.
6.28 No matter how one analyses the facts and submissions of both Parties, it is clear that Respondent registered the Domain Name in bad faith and is now using the Domain Name in bad faith. That conclusion is unavoidable even though Respondent may have registered the Domain Name for one bad faith purpose and is now using the Domain Name for a different bad faith purpose.
6.29 The Panel finds that the Respondent has registered and is using the Domain Name in bad faith because either:
(a) Respondent registered the Domain Name primarily for the purpose of selling or otherwise transferring the Domain Name to Complainant for valuable consideration in excess of Respondent's documented out-of-pocket costs directly related to the Domain Name; or
(b) Respondent:
(i) registered the Domain Name for the purpose of establishing a website and attracting Internet users to that website for commercial gain by creating a likelihood of confusion with Complainant's trademark TOEIC as to the source, sponsorship, affiliation, or endorsement of the website or of a product or service on the website, and
(ii) is maintaining the Domain Name registration for the purpose of selling the Domain Name to Complainant for valuable consideration in excess of Respondent's documented out-of-pocket costs directly related to the Domain Name.
7. Decision
7.1 For the reasons given above, the Panel orders that Respondent's domain name registration of be transferred to Complainant.
Robert A. Fashler
Presiding Panelist
Dated: April 4, 2000
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