WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Schiavello (Vic) Pty Ltd. v. Gaynor Wedley
Case No. D2000-1634
1. The Parties
1.1 The Complainant in this administrative proceeding is Schiavello (Vic) Pty Ltd., a company incorporated in Victoria, Australia, with its registered office at 32 Tullamarine Park Road, Tullamarine, Victoria, Australia, 3043.
1.2 The Respondent is Ms.Gaynor Wedley, owner of a company named Schia Vello Limited incorporated in England, with her address at Asman, Sandhills Road, Salcombe, SD TQ8, UK and at 802 Ghaya, Sheikh Zayeed Road, Dubai, NA 32736, United Arab Emirates.
2. The Domain Name and Registrar
The domain names in dispute are and , registered with R, based in New York, USA.
3. Procedural History
3.1 A complaint was submitted to the WIPO Arbitration and Mediation Center by hard copy on November 23, 2000 and by e-mail on December 7, 2000.
3.2 A request for Registrar verification was transmitted to the Registrar, R, requesting it to: (1) Confirm that the domain names in issue are registered with R; (2) Confirm that the Respondent is the current Registrant of the domain names; (3) Provide the full contact details [i.e., postal address(es), telephone number(s), facsimile number(s), e-mail address(es)] that are available in the Registrar�s WHOIS database for the domain name registrant, technical contact, administrative contact and billing contact; (4) Confirm that the Uniform Domain Name Dispute Resolution Policy (the "Policy") is in effect; and (5) Indicate the current status of the domain name.
3.3 On December 8, 2000, R confirmed by way of facsimile that the domain names in question were registered with R, and were currently in an active state. The Registrar also forwarded the requested WHOIS details and confirmed that the Policy is in effect.
3.4 A Formal Request for amendment of paragraph 15 of the Complaint relating to "Mutual Jurisdiction" was made, whereby the Complainant has to identity which of the two possible jurisdictions has been chosen by it, as set out in Paragraph 3 (b) (xiii) of the Uniform Rules. Request for amendment was sent on December 14, 2000 and the amendment to the complaint was received by e-mail on January 16, 2001 and by hard copy on January 22, 2001.
3.5 The WIPO Center determined that the complaint satisfied the formal requirements of the Policy, the Rules for Uniform Domain Name Dispute Resolution Policy (the "Uniform Rules") and the Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the "Supplemental Rules").
3.6 On January 22, 2001 the Formal Requirements Compliance Checklist was completed and the Notification of Complaint and Commencement of Administrative Proceeding (the "Commencement Notification") was transmitted to the Respondent on January 23, 2001 (with copies to the Complainant, R and ICANN) setting a deadline of February 11, 2001 by which time the Respondent could file a response to the Complaint.
3.7 Having reviewed the communication records in the case file, the Administrative Panel finds that the WIPO Center has discharged all its responsibility under paragraph 2 (a) of the Uniform Rules "to employ reasonably available means calculated to achieve actual notice to the Respondent."
3.8 On February 11, 2001 the WIPO Center received a response from the Respondent by e-mail and by hard copy on February 13, 2001. Acknowledgement of receipt of response took place on February 12, 2001.
3.9 On February 16, 2001 the WIPO Center proceeded to appoint the undersigned to serve as the sole panellist.
3.10 On February 19, 2001, the Complainant made certain additional submissions to counter the Respondent�s response. In view of the fact that this additional submission by the Complainant was taken on record by the panel, the panel on March 2, 2001 permitted the Respondent to respond to the Complainant�s submissions by
March 12, 2001.
4. Factual Background
4.1 The Complainant is Schiavello (Vic) Pty Ltd., a company incorporated in Victoria, Australia. The Complainant is in the business of supplying commercial interior fitout and construction services including data communications facilities and office furnishings and has traded under the name "Schiavello" since 1966. The Complainant holds the registration for .au and maintains a website under that domain name. The Schiavello trademark is registered in Australia, Hong Kong, USA, Japan and Singapore and is displayed on all furniture fittings supplied by the Complainant.
4.2 Mr. James Heaven registered on October 15, 1999 and the Respondent registered on September 9, 2000. The domain names are now used by a hairdressing salon called "Schia Vello Salon Stylists".
4.3 In 1999 Mr. Heaven entered into discussions with the Complainant and Konig-Neurath AG, Germany, in an attempt to enter into an UAE/ Middle Eastern distribution agreement with one or both companies. He had registered and in November 1999 so as to facilitate talks with the companies. Since both companies had existing agreements with Middle Eastern companies the talks proved unproductive.
4.4 Realising that the talks with Konig-Neurath were going to be unproductive, he transferred the domain name to them, as he had no further use for it in October 2000. The domain name was freely transferred to Konig Neurath, AG.
4.5 After the talks with the Complainant proved unproductive, on November 26, 1999 Mr. Heaven contacted the Complainant via e-mail and asked him if he was willing to "purchase" the domain name from him. The Complainant did not respond in any form to this e-mail which was sent to them. Mr. Heaven is now an employee of Steelcase Inc.
4.6 The Respondent uses the domain names , and in line with her limited liability business called Schia Vello registered on December 7, 2000 in the UK (Company No. 4103196). In addition she has submitted UK trademark applications in classes 3 and 42. The Respondent has been leasing business premises in Dubai since March 2000. However given the complex administrative and legal requirements to start up a business, the Respondent has not had sufficient time to get her operation up and running. To obtain a trade license in the UAE involves applications to the Economic Department, the Municipality, individual departmental approvals and the payment of specific fees. The Respondent was an employee of Emirates Airlines LLC but due to strict visa laws in the UAE was not able to leave her job immediately. The Respondent is however carrying on an advisory service over the e-mail and is also taking part time hairdressing appointments through her e-mail and website while awaiting a full trading license.
4.7 The domain name was transferred to the Respondent by Mr. Heaven on October 18, 2000. The actual application for transfer was made on September 23, 2000 but due to an error in the proper notarisation of the documents, the transfer took place only after rectification of the mistake. The date of the application to transfer was in advance of the date on which the complaint was instituted. The Respondent initially used the website of an American Salon, "Goulds Salon Stylists", as the template, but has since then changed the construction of the site with a message that a new site was under construction. In between "Goulds Salon Stylists" contacted the Respondent and informed her of the similarity between the sites. Upon this, the Respondent apologised stating that she had been experimenting with her website, and then promptly changed her site.
4.8 On October 6, 2000 Mr. D�Rosario, an agent for the Complainant visited the address given at the website and found it to be a residential apartment. Enquiries were made with Head of Inspection and Control Section of the Department of Economic Development in Dubai, who stated that such a business location was contrary to local planning laws.
4.9 On August 24, 2000 Mr. Heaven was contacted by inquiring whether he wished to sell . Mr. Heaven then referred him to the Respondent stating that he no longer owned the website. On August 28, 2000 the e-mail author asked the Respondent to sell the domain name as he wanted to "build a family tree for his father in law." The Respondent replied on September 9, 2000 stating that the site was not for sale as it was an integral part of her business and suggested an alternate domain name for him to use. Via a subsequent e-mail on September 20, 2000, the e-mail author became abusive.
4.10 On October 5, 2000 the Complainant wrote to R informing them of the dispute and asked them to transfer the domain name to them. On October 12, 2000 the Complainant e-mailed Mr. Heaven disputing his entitlement to the site and stated that they were looking into his claims that the website was no longer belonged to him. Mr. Heaven replied on October 13, 2000 that his solicitors would look into the matter. The Complainant then corresponded with Steelcase Inc. on October 19, 2000 to enquire as to their role in the registration of the domain names. They received a reply on October 23, 2000 which stated that they had no role to play and that the dispute was of a private nature.
4.11 On October 23, 2000 the Complainant received correspondence from Clyde and Co., solicitors indicating that they were acting on behalf of the Respondent and stated that she was using the domain name in connection with her hair dressing business which she was involved in setting up. On October 30, 2000 the Complainant offered to pay cost of transfer and nominal out of pocket expenses. The Respondent refused this offer on November 2, 2000 stating that the website was an integral part of her business.
5. Parties Contentions
A. The Complainants contentions may be delineated into the following three broad headings:
Identical or confusing similarity
5.1 The Complainant has used the name "Schiavello" since 1966 in the connection with its business of supplying commercial interior fitout and construction services including data communications facilities and office furnishings. The Schiavello trademark is registered in Australia, Hong Kong, USA, Japan and Singapore. The Complainant�s contention is that they have established a world-renowned name and hence the use of that name in a domain name by any other party would result in confusion.
5.2 Also default settings of web browsers like Internet Explorer and Netscape automatically take it to the ".com" domain name when a word is included in the address field. This would lead to a real and substantial likelihood of confusion or diversion of the Complainant�s customers by the improper use of the disputed domain names.
Rights/Legitimate Interests
5.3 The Respondent has no legitimate claim for the use of the Schiavello brand in any field of commerce, as there is no such business in existence. Any use that has taken place is for the purpose of appearance and is in furtherance of the bad faith registration. The Complainant refers to the case of Bragg v. Condon, FA0092538, which is relevant as to the initial intention to sell the domain name in light of the knowledge of the Complainant�s position, and also to World Wrestling Federation v. Bosman, D99-0001 and Ingersoll Rand v. Gully, D2000-0021. The Respondent is using the domain name principally for the purpose of depriving a legitimate trademark holder of use of his trademark.
Bad Faith
5.4 The Complainant submits that the domain name was registered for the purpose of selling it for more than the associated expenses of registration, hence satisfying the bad faith registration and use requirements of the Policy. The Complainant�s refer to World Wrestling Federation v. Bosman, D99-0001 and Ingersoll Rand v. Gully, D2000-0021 where the Panel stated: "If at any time following the registration the name is used in bad faith, the fact of bad faith use is established." Furthermore in light of the association between Mr. Heaven and Ms. Wedley, nothing in the subsequent events operates to mitigate the bad faith registration and use.
5.5 Further the spoiling use of the domain name has been indulged in so as to deprive the Complainant of their rightful use. Here the case of Panavision International L P. v. Dennis Toeppan et al, 141 F. 3d 1316, as cited in World Wrestling Federation was referred to. It is claimed that association of the domain name with a hairdressing business is a sham. They submit that the Respondents lawyers attempted to sell the website at a price over and above the reasonable costs of registration.
5.6 It is claimed that there is no attempt to make a bona fide offering of goods and services through the website and this is evident from the history of the use and registration of both the domain names in dispute. This non-use satisfies the criteria for bad faith laid down in Telstra Corporation Ltd. v. Nuclear Marshmallows, D2000-0003. This is because the original website was merely a copy of a genuine website, unsupported by any real business and remains so. Also that "Schiavello Salon Stylists" is a fiction that has been created for the purpose of holding the domain name from the Complainant.
B. The Respondents contentions may be delineated into the following three broad headings:
Identical or Confusing Similarity
5.7 The Respondent uses the domain name , and in line with her limited liability business called Schia Vello registered in the UK as Company No. 4103196. In addition the Respondent has submitted UK trademark applications in class 3 and 42. The Respondent is carrying on an advisory service over the e-mail and is also taking hairdressing appointments mainly through e-mail.
5.8 The Complainant has not disputed the right of the Respondent to operate her business from the UAE or the UK under the name Schia Vello. The Respondent also has ownership of the website which is also visible in Australia and other places where the Complainant has trademarks. To the same extent .au is visible in the UK where the Respondent has a limited liability company and has applied to register her trademarks. Hence the question of confusion does not arise.
Rights/Legitimate Interests
5.9 The Respondent has a fully incorporated limited liability company in the United Kingdom. Her website has been instrumental in helping her secure business which is proving to be an increasing medium by which to advertise her business. The UAE is a difficult trading environment and these actions are quite normal given the Respondent�s situation.
5.10 Differing from the facts of World Wrestling Federation Inc v. Bosman, D99-0001 the Respondent has a legitimate interest in respect of the domain name. The name itself was not registered in bad faith and is being used to promote a legitimate business interest. In the case of Ingersoll Rand v. Gully, D2000-0021, the Panel reinforced the World Wrestling Federation decision and confirmed that "it is the Complainant�s burden to establish bad faith registration and bad faith use."
Bad Faith
5.11 From the facts it is evident that the Respondent has been using the domain name in good faith and the domain name was not registered by Mr. Heaven in an attempt to sell it for more than the associated expenses of registration. The reason why the domain name was registered was to facilitate a potential UAE distribution agreement.
5.12 In the Ingersoll Rand decision, the Complainant has failed to meet the burden as to any of the four circumstances set out in Paragraph 4 (b). This is because:
(a) Mr. Heaven did not "acquire the domain name primarily for the purpose of selling, renting or otherwise transferring the domain name registration to the Complainant." As has been stated the sole purpose of registering the domain name was to facilitate a potential distribution agreement in the UAE.
(b) Mr. Heaven did not register "the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name."
(c) It is impossible for the Complainant to maintain that the domain name was registered "primarily for the purposes of disrupting the business of a competitor." This is because the domain name was in fact registered by the Mr. Heaven to promote the Complainant�s goods and services in the event that a suitable agreement cold be reached, thereby donating a legitimate business interest to both Mr. Heaven and the Complainant.
(d) The Respondent�s ongoing use of the domain name has not intentionally attempted to "attract for commercial gain, internet users to the Respondent�s website or other online location by creating a likelihood of confusion with the Complainant�s mark as to the source, sponsorship, affiliation or endorsement of the Complainant�s website or location or of a product or service on the Complainant�s website or location." In line with the Ingersoll Rand decision it is impossible for Internet users to confuse the website of an Australian furniture company with that of hairdressing services being offered in the UAE.
5.13 At no point did the Respondent�s lawyers attempt to sell the domain name to the Complainant and this is evident from the correspondence between the parties. Also at no point did Mr. Heaven represent that he was representing a company called International Branding as the e-mail referred to the international branding of the Complainant. Finally the Respondent did use the domain name for a bona fide offering of goods and services as she has been using the website and the associated business in good faith all along. The Telstra Corporation v. Nuclear Marshmallows, D2000-0003, decision is not relevant as there has been use of the website.
6. Discussions and Findings
6.1 Paragraph 4(a) of the Policy requires the Complainant to prove the following:
a) that the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and
b) that the Respondent has no right sor legitimate interests in respect of the domain name; and
c) that the domain name has been registered and is being used in bad faith.
Each of these requirements will be dealt with separately.
A. Complainants� trademark rights; identical/confusing similarity
Trademark Rights
6.2 The Complainant has trademark registrations for the trademark SCHIAVELLO in several countries including Australia and USA and has been using it in connection with its goods/ services for the last 35 years. The panel therefore finds that the Complainant has trademark rights in the word SCHIAVELLO.
Identical/Confusing similarity
6.3 The domain names and are identical to the Complainants trade/service mark SCHIAVELLO.
B. Bad faith
6.4 While I am aware that the Policy is meant for clear-cut cybersquatting cases and may not be applicable to cases involving complex questions, which are best left for a civil court to determine, the panel is convinced that the policy applies to this case, despite the voluminous facts. In sum and substance, it is a case involving a person, who knew about another�s trademark, sought a business relationship and when the relationship failed to go through, decided to use a domain name comprising of a known mark through his wife, albeit for an activity different from the Complainant�s business.
6.5 I intend at this stage to emphasize, that the Respondent�s conduct lacks good faith, and to show that this is a central feature of the decision. Although the Respondent has through its additional response dated March 12, 2001 attempted to claim that her relationship with Mr. James Heaven had no bearing on this case, the panel is inclined to conclude otherwise; the clear connection between Mr. Heaven and the Respondent as husband and wife strengthens the inference that they ought to be treated as one entity for the purpose of this decision. By the Respondent�s very own admission, the website was activated by the Respondent in November 1999, almost a year prior to the domain name actually having been transferred from Mr. Heaven to the Respondent.
6.6 First, let�ss examine if the domain name had initially been registered in bad faith. There is no evidence on record or even an averment that "Schiavello" is a common surname, or commonly known or used, and given this fact, it is a distinctive trademark. It is also registered in several countries of the world, by the Complainant. How could the Respondent justify registering it without the Complainant�s initial authority to do so? Is a person seeking a business relationship from another, entitled to register a domain name incorporating the other�s trademark without authority? I don�t think so. In fact in The Stanley Works and Stanley Logistics, Inc. vs. Camp Creek Co., Inc. Case No. D2000-0113, the panel held in the context of a reseller�s rights to an owner�s trademark categorically that "Even if the Respondent is a retail seller of the Complainant�s products, the collateral trademark use necessary to allow resell of Complainant�s products is not enough to give the Respondent proprietary rights in the Complainant�s products and certainly not enough to confer the right to use these trademarks as domain names". In this case, Mr. Heaven had not even been appointed as the distributor by the Complainant. Mr. Heaven, by seeking out a business relationship with the Complainant in the Middle East obviously knew of the business potential of the Complainant in the Middle East and intended to capitalize on the same. Thus the initial registration itself was without authority and in bad faith.
6.7 For the Complainant to succeed, he must show that not only has the domain name in question been registered in bad faith, but its use is also in bad faith. Since the Respondent has gone to great lengths to establish a business concern under the name Schiavello Salon Stylists (now changed to Schia Vello) and has activated a website accordingly, it becomes important to ask the question-"Despite the domain name having been registered in bad faith, can it be said that its use has been in good faith?" In this regard, I would like to rely upon J.R. Parkington and Coy Ltd. v. Frederick Robinson Ltd, 63 RPC 171, 181 (1946), (Court of Appeal) where Bennet, J. had stated "In my judgement the circumstances which attend the adoption of a trademark in the first instance are of considerable importance when one comes to consider whether the user of that mark has or has not been an honest user. If the use in its inception was tainted, it would be difficult in most cases to purify it subsequently." The finding in Parkington has to a certain extent been echoed in Gonvarri Industrial, S.A. v. Gon Varr I Ano Sexo a Domicilio D2000-0637, where the panel had held �He who acts in bad faith in registering a domain name will also use it in bad faith given that the concept of �bad faith� must be linked to the knowledge held at the time of registration that a third party�s rights were being damaged, even though subsequently, the domain name in question may not be used.�
6.8 It therefore, appears to be a legal principle, that if the use of a trademark is mala fide in its inception, then it is difficult to cure it subsequently. I am not sure if this principle is of universal application, but it appears to be based upon justice, equity and fair business practices and I can see no reason to depart from it. Far from having cured the initial bad faith, the panel finds that in the present case, the subsequent use of the domain name has also been in bad faith. The reasons are as follows:
i) Implicit in the Respondent�s email dated November 26, 1999 to the Complainant seeking to transfer the domain name to the Complainant, is the demand for money. The e-mail had stated "As you expand globally, would you be interested in purchasing www. for your main web page? It would be more instantly recognisable in America and Europe". This e-mail makes a reference to the expansion and global presence of the Complainant and uses the word "purchase", and it is therefore reasonable to infer from this e-mail that Mr. Heaven sought a compensation for the domain name higher than his out of pocket costs associated with the registration thereof. As opposed to this e-mail, the letters to Konig Neurath AG (Konig) were of a more friendly nature and appeared to indicate that the transfer would be free of cost. The Respondent in fact guided Konig through the transfer process. Besides, the offer to transfer the domain name to Konig was made at a much later point of time. Whereas the offer to transfer to the Complainant was made in November, 1999; the offer of Konig was made in October 2000. This suggests a discrepancy of sorts and it is reasonable to infer that at the time of offer to Konig, the Respondent had become aware or at least had an inkling that the Complainant was contemplating action against it. The Respondent by its very own admission states that negotiations with both Konig and the Complainant were held between May and December 1999. Why then was an offer made to the Complainant in November 1999 (when the negotiations with the Complainant had not even been completed) and to Konig only in October 2000.
ii) Even apart from the above, the Respondent had proceeded to activate the website in November itself, when the negotiations with the Complainant hadn�t yet failed. Paradoxically, the Respondent while claiming that it should be treated as separate from Mr. James Heaven, has admitted to activating the website in November 1999 (almost a year prior to the domain name actually having been transferred from James Heaven to the Respondent). Thus the Respondent�s contention that it actually sought to voluntarily transfer the domain name to the Complainant does not hold much ground.
iii) If having knowledge of a proprietary right, title, or interest in a trademark, one acts in a manner that causes that right, title, or interest to be taken away, diminished, damaged, or in some way rendered less useful, then the elements of bad faith are present. To apply this principle here, the mark "Schiavello" is registered fairly extensively and has been in use since 1966. The Respondent knew about the reputation and did something, which would deprive the Complainant of its ability to use the domain name and which may tarnish the distinctiveness of the "Schiavello" trademark in Dubai or other places affected by the Respondent�s use of the said domain name, web site or trademark. By the Respondent�s very own admission, the Complainant seems to already have some kind of presence in Dubai, which is why the Respondent was not successful in obtaining the distributorship rights there.
I know that the line of activity of the Respondent is different from that of the Complainant, but I don�t think this factor affects this case, as the mark used by the Respondent, viz: (i) Schia Vello Limited in the corporate name; (ii) Schiavello Salon Stylists (now changed to Schia Vello) in connection with the website; and (iii) S in the domain name, would definitely cause some harm, whether by way of confusion or by way of dilution or tarnishment to the present or future business of the Complainant.
The Respondent has contended in its response that the name SCHIAVELLO is pronounced differently by the Complainant and the Respondent. The fact that the pronunciation of the same word may be different to different people hardly strengthens the Respondent�s case. This is for three reasons:
a) The relevant class of persons who may be confused or in whose mind the distinctiveness of the word "Schiavello" is diluted stretches far beyond the employees of the Complainant Company or even persons in Australia.
b) When a word is difficult to pronounce, people remember it in different ways such as by a visual recollection of the word structure. Upon seeing the competing words of the Complainant and the Respondent, a person having no clue as to its pronunciation would find them visually and structurally similar.
c) The fact that the Respondent has used "Schiavello" in the form "SCHIA VELLO" is unlikely to alter this visual structural impression to a potential consumer. In any case, the gap is filled up where the word appears as a domain name i.e. .
6.9 I, therefore feel that this is a case where the original registration was obtained in bad faith and the use was continued in bad faith and for this reason, even apart from the principle laid down in the case J.R. Parkington and Coy Ltd. v. Frederick Robinson Ltd, 63 RPC 171 (1946), I am compelled to find in favour of the Complainant. In this regard, I would like to stress the fact that the list of bad faith factors in para 4(a) of the UDRP is not exhaustive, but merely illustrative.
6.10 The findings as above mentioned would equally apply for the domain name as well, although this domain name was registered at a later point in time.
C. Rights/Legitimate Interest
6.11 At the outset, I would like to stress the fact that the policy uses the word "legitimate interest" and not any "mere" interest. The Respondent has gone to great lengths to create some kind of interest, by incorporating a company, applying for trademark registrations, leasing premises in Dubai, etc. However, the interest that is sought to have been created in the word Schiavello is not a "legitimate" one, especially since all this has been done with full knowledge of the Complainant�s exclusive rights in its trademark Schiavello.
6.12 As has been stated above, the activation of the Respondent�s website took place even prior to the discussions between the Complainant and Mr. Heaven came to an end (see Respondent�s response-page 3, which states that serious discussions took place with Schiavello and Konig between May and December 1999; page 7, which states that the Respondent had a fully active website in November 1999). The panel would like to stress the fact that there is nothing to indicate that SCHIAVELLO is a common surname and the Respondent has not indicated as to why it chose this particular name. The Respondent suggests that it activated the website, since the Complainant showed no interest in the domain name and had not replied to Mr. Heaven�s email, in which he had offered to transfer the domain name. "Silence" on the part of the Complainant does not cleanse the tainted intention of the Respondent. In any case, as has already been stated under the findings on "bad faith", the letter to the Complainant, far from evidencing a bona fide intent to transfer, carries with it the implicit demand for money. Further, after having written to the Complainant, the Respondent did not wait long enough for the domain name to have been treated as res nullius. On the contrary, the facts seem to suggest that the website activation took place even prior to the letter having been written.
6.13 For the reasons as above mentioned, the panel concludes that the Respondent does not have a legitimate interest in the domain names and .
7. Decision
Under Paragraph 4 (i) of the Policy, the Panel finds in favour of the Complainant. The disputed domain names and are identical or confusingly similar to a trademark in which the Complainant has rights; the Respondent lacks rights or legitimate interests in the said domain names; and the domain names have been registered and used in bad faith. Therefore, the Panel decides that the disputed domain names and should be transferred to the Complainant.
Pravin Anand
Sole Panellist
Dated: March 21, 2001.
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