WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Sport Chalet, Inc. v. Ski Chalet, Inc.
Case No. D2000-1834
1. The Parties
The Complainant is Sport Chalet, Inc., a corporation organized in the State of Delaware, United States of America (USA), with place of business in La Canada, California, USA.
The Respondent is Ski Chalet, Inc., a corporation organized in the Commonwealth of Virginia, USA, with place of business in Arlington, Virginia, USA.
2. The Domain Name and Registrar
The disputed domain name is .
The registrar of the disputed domain name is Network Solutions, Inc., with business address in Herndon, Virginia, USA.
3. Procedural History
The essential procedural history of the administrative proceeding is as follows:
(a) The Complainant initiated the proceeding by the filing of a complaint by e-mail received by the WIPO Arbitration and Mediation Center ("WIPO") on December 28, 2000, and by courier mail received by WIPO on December 29, 2000. Complainant paid the requisite filing fees. On January 10, 2001, WIPO transmitted a Request for Registrar Verification to the registrar, Network Solutions, Inc. (with the Registrar�s Response received by WIPO on January 11, 2001).
(b) On January 30, 2001, WIPO transmitted notification of the complaint and commencement of the proceeding to Respondent via e-mail, telefax and courier mail.
(c) On February 16, 2001, Respondent�s response was received via e-mail by WIPO, and on February 20, 2001, Respondent�s response was received via courier mail by WIPO. Respondent also transmitted its response to Complainant.
(d) On February 23, 2001, Complainant transmitted a Reply to Opposition to UDRP Complaint via e-mail to WIPO and Respondent. Such Reply was received by WIPO via courier mail on February 26, 2001.
(e) On February 28, 2001, WIPO invited the undersigned to serve as panelist in this administrative proceeding, subject to receipt of an executed Statement of Acceptance and Declaration of Impartiality and Independence ("Statement and Declaration"). The undersigned transmitted by fax the executed Statement and Declaration to WIPO.
(f) On March 19, 2001, Complainant and Respondent were notified by WIPO of the appointment of the undersigned sole panelist as the Administrative Panel (the "Panel") in this matter. WIPO notified the Panel that, absent exceptional circumstances, it would be required to forward its decision to WIPO by April 1, 2001. On March 19, 2001, the Panel received an electronic file in this matter by e-mail from WIPO. The Panel subsequently received a hard copy of the file in this matter by courier mail from WIPO.
(g) On March 21, 2001, Respondent transmitted an Objection to Complainant�s Reply via e-mail to WIPO and Complainant, and also transmitted that objection via courier mail. Respondent indicated that, should the Panel decide to accept Complainant�s reply, Respondent would request to file a sur-reply.
(h) By e-mail of March 26, 2001, the Panel advised the parties and WIPO that it had determined not to accept Complainant�s reply since that reply principally emphasized legal arguments and facts already put forward in its complaint. Having determined not to accept Complainant�s reply, the Panel did not grant leave to Respondent to file a sur-reply.
The Panel has not received any additional requests from Complainant or Respondent regarding further submissions, waivers or extensions of deadlines, and the Panel has not found it necessary to request any additional information from the parties. The proceedings have been conducted in English.
4. Factual Background
Complainant has registered the word trademark and service mark "SPORT CHALET" on the Principal Register of the United States Patent and Trademark Office (USPTO), reg. no. 1869466, dated December 27, 1994. Such registration is in International Class (IC) 18, covering "all purpose sports bags"; IC 25, covering "boots and jackets"; IC 39, covering "organizing and conducting diving trips and expeditions"; IC 42, covering "retail store services in the fields of skiing equipment and supplies, diving equipment and supplies and sporting goods", and; IC 12, covering "plastic water bottles for attachment to bicycles". The aforesaid USPTO trademark and service registration claims an earliest date of first use in commerce of 1963, and disclaims use of "SPORT" apart from the mark as shown. The aforesaid trademark and service mark is valid and subsisting. Complaint, Annex 4.
Complainant has also registered a combination design and word trademark and service mark for "SPORT CHALET" on the Principal Register of the USPTO, reg. no. 1869465, dated December 27, 1994. This combination mark covers the same classes of goods and services as the word mark referred to above, claims the same earliest date of first use in commerce, and likewise disclaims use of "SPORT" apart from the mark as shown. Id., Annex 5.
Complainant has registered the domain name and maintains an active commercial website at the Internet address (id., para. V & Annex 6). Complainant also conducts business through a substantial number of retail stores in the United States.
According to the Network Solutions� verification response, Respondent is the listed registrant of the disputed domain name . A Network Solutions WHOIS database printout of December 20, 2000, indicates that the record for the disputed domain name was created on August 7, 1996, and was last updated on
August 18, 2000. Complaint, Annex 1.
Respondent has used the disputed domain name to direct Internet users to a web page headed "L" that offers "info about web hosting & design email services [,] secure payment form support" (id., Annex 10, web page printout of
December 20, 2000).
By courier letter of September 24, 1999, Complainant (through counsel) sent a cease and desist and transfer demand to Respondent. Counsel for Complainant and counsel for Respondent subsequently discussed Complainant�s demands. Those discussions did not result in resolution of this matter. Complaint, para. V & Annexes 11 & 12.
Respondent has registered the word service mark "SKI CHALET" on the Principal Register of the USPTO, reg. no. 1524956, dated February 14, 1989. Such registration is in International Class 42, covering "retail store services in the field of ski equipment and clothing". The aforesaid USPTO trademark and service registration claims a date of first use in commerce of 1969, and disclaims use of "SKI" apart from the mark as shown. The aforesaid trademark and service mark is valid and subsisting. Response, Annex 3.
Respondent has registered the domain name and uses that name in connection with an active commercial website at Internet address (id., para. 11 & Exhibit 1). Respondent�s website includes advertisement for goods intended for use in connection with the sports of kayaking and skating, as well as skiing (id.). Respondent also does business through retail stores in the United States. Such retail stores sell bicycles in addition to the other goods indicated on Respondent�s website.
Respondent�s President, Mr. Wilbur McBay, has submitted a sworn declaration that states, inter alia:
"In 1995 and 1996 Ski Chalet, Inc. registered a number of internet domain names, including SKICHALET.COM, SKICHALET.NET and SPORTCHALET.NET. Ski Chalet, Inc. registered those domain names both to create a presence on the internet for Ski Chalet, Inc. and to protect itself from cybersquatters who could register these domain names with a bad faith intent to profit from such domain name registration." Response, Exhibit 2.
Subsequent to receiving Complainant�s initial cease and desist and transfer demand with respect to the disputed domain name, Respondent submitted a petition to the USPTO seeking cancellation of Complainant�s "SPORT CHALET" mark as to International Classes 18, 25 and 42. The asserted basis for such petition is that Complainant�s "SPORTS CHALET" mark is confusingly similar to Respondent�s "SKI CHALET" mark. Respondent in its petition appears to assert that its rights in its mark are senior to those of Complainant in its mark.
The Service Agreement in effect between Respondent and Network Solutions subjects Respondent to Network Solutions� dispute settlement policy, the Uniform Domain Name Dispute Resolution Policy, as adopted by ICANN on August 26, 1999, and with implementing documents approved by ICANN on October 24, 1999. The Uniform Domain Name Dispute Resolution Policy (the "Policy") requires that domain name registrants submit to a mandatory administrative proceeding conducted by an approved dispute resolution service provider, of which WIPO is one, regarding allegations of abusive domain name registration (Policy, paragraph 4(a)).
5. Parties� Contentions
A. Complainant
Complainant asserts rights in the trademark and service mark "SPORT CHALET" as evidenced by registration at the USPTO and based on long and extensive use in commerce (see Factual Background, supra).
Complainant then states in its own words:
"Factual Statement
Complainant is in the business of selling sporting goods and services at SPORTCHALET.COM. It has used the mark SPORT CHALET both for Internet retail sales since 1999 and for brick and mortar retail store services since 1958 and has built up considerable goodwill in the marketplace for its sports products and services, conducting over a million dollars in business in 1999 under such mark. Besides Sport Chalet, Inc., no other company or person in the United States owns a registered trademark or service mark containing the phrase "Sport Chalet." Complainant also is incorporated in the State of Delaware under the name Sport Chalet, Inc., and uses the trade name SPORT CHALET to extensively market its products via the internet. A printout of Complainant�s website downloaded on December 20, 2000 is attached hereto as Annex [hereto]. Further, a search on the internet through Y, AltaV, and M shows the extent to which Sport Chalet is well-known as a provider for sport related goods and services. Copies of these searches conducted December 20, 2000 are attached [as Annexes hereto]
Respondent is in the business of selling ski equipment and clothing, and is a competitor of Sport Chalet. Upon entering the domain name SPORTCHALET.NET, an internet user will see a splash page for L. A printout of Respondent�s website at SPORTCHALET.NET printed on December 20, 2000 is attached hereto as Annex [hereto].
Complainant, upon discovery of the registration of the internet domain name SPORTCHALET.NET, sent Respondent a letter requesting that the domain name not be used and be transferred to Complainant, as any use by Respondent of the SPORTCHALET.NET domain would confuse and deceive the public as to the source of goods and services provided at the SPORTCHALET.NET website. In its telephonic response, Respondent refused to pull the website, and frivolously threatened to file a cancellation action for SPORT CHALET's mark. Copies of such correspondence from Complainant is attached [as Annex hereto].
A declaration from Complainant's previous counsel setting forth the telephonic response of Respondent is attached hereto as Annex [hereto].
Complainant then requested that Network Solutions, Inc. ("NSI") invoke its domain name dispute policy to prevent the continued registration of the SPORTCHALET.NET domain name. However, NSI refused to become involved in the dispute as the timing schedule would have conflicted with the date of relinquishing domain name dispute resolution to ICANN. Therefore, under NSI�s Dispute Policy at that time, Complainant could not, absent an expensive lawsuit, seek to remove Respondent�s confusingly similar domain name or prevent any future use on a competing website to prevent public confusion and sales diversion. A copy of the letter from SPORT CHALET to NSI is hereto attached as Annex [hereto]. A copy of NSI's response is hereto attached as Annex [hereto].
Importantly, the mark SPORT CHALET has been used by Complainant for 42 years and the mark SKI CHALET has been co-existing and in use by Respondent for 31 years. Only after receiving Complainant's cease and desist letter concerning Respondent's registration of the .NET top level domain of Complainant's own trade name and trademark, Respondent filed a cancellation action in the United States Patent and Trademark Office on December 23, 1999. While that proceeding is still ongoing, Complainant wants to emphasize that it will still be the owner of the SPORT CHALET trade and service mark federal registration number 1869466 in two classes as well as the SPORT CHALET with design trade and service mark federal registration number 1869465 in all 5 International Classes. A copy of Respondent's cancellation petition is attached hereto as Annex [hereto]. A copy of Complainant's response is attached hereto as Annex [hereto]. A copy of the schedule of the proceedings in the cancellation action is attached hereto as Annex [hereto].
Respondent has no legitimate basis for its use and registration of the domain name SPORTCHALET.NET. Respondent neither owns nor uses a trademark, trade name, or service mark incorporating the phrase "SPORT CHALET." Further, Respondents' own trade name, Ski Chalet, is already linked to the domain names for SKICHALET.COM and SKICHALET.NET. Copies of the Network Solutions' WhoIs database for SKICHALET.COM and SKICHALET.NET are attached hereto as Annexes [hereto]. Copies of SKICHALET.COM 's and SKICHALET.NET's web pages downloaded on December 20, 2000 are attached hereto as Annexes [hereto].
Respondent may have actually diverted customers by confusing them into believing SPORT CHALET does not have a presence on the web by having SPORTCHALET.NET lead into a splash page for L. Moreover, Respondent's registration of the SPORTCHALET.NET domain name wrongfully precludes Complainant, as the lawful owner of the SPORT CHALET trade name and trademark, from owning the SPORTCHALET.NET domain name. Furthermore, Respondent has its own name SKICHALET.COM and SKICHALET.NET up and running. Thus, through Respondent's lack of use since August, 1996 but its continued ownership of the domain name SPORTCHALET.NET, it is clear that Respondent has maintained this domain name in bad faith." Complaint
Complainant requests the Panel to direct the registrar to transfer the disputed domain name to it.
B. Respondent
Respondent states in its own words:
"8. � Respondent does not dispute that the domain name at issue is identical to a trademark or service mark in which the Complainant is the registered owner in the U.S. Patent and Trademark Office; however, Respondent does dispute Complainant�s claims that Respondent has no rights or legitimate interests in respect to the domain name and that the domain name was registered and is being used in bad faith.
9. Respondent is without sufficient knowledge to either admit or deny the allegations in Paragraph 12 of the Complaint, except to admit that Complainant is listed as the registered owner of the listed registrations.
II. STATEMENT OF FACTS
10. Respondent is unable to admit or deny Complainant�s factual allegations concerning Complainant�s business, the use of Complainant�s marks and the alleged internet searches discussed in the first paragraph of Complainant�s �Factual Statements�. Therefor, Respondent denies all of these factual allegations.
11. Respondent admits that it is in the business of selling ski equipment and clothing. However, Respondent�s business is not limited to the selling of ski equipment and clothing. Respondent also sells other sports equipment, such as in-line skates, scooters, kayaks and related clothing and accessories. Attached as Exhibit [hereto], please find copies of Respondent� s web-page, www. advertising some of the other sports equipment offered for sale in Respondent�s retail stores.
12. Respondents is unable admit or deny Complainant�s factual allegations that Respondent is a competitor of Complainant. On information and belief, all of Complainants retail stores are located in the State of California. All of Respondent�s stores are located in the Commonwealth of Virginia and the State of Maryland. As Complainant has alleged in the �Factual Statement� of the Complaint, there have been no instances of actual confusion despite the long standing concurrent use of the marks. Therefor, Respondent lacks sufficient knowledge to admit or deny this factual allegation.
13. Respondent admits that Respondent is not currently using the domain name, SPORTCHALET.NET.
14. Respondent admits that Complainant sent Respondent a letter requesting that the disputed domain name not be used and be transferred to Complainant. Respondent denies that any use by Respondent of the domain name at issue would confuse and deceive the public as to the source of goods and services provided at the SPORTCHALET.NET web-site. Further, Respondent denies that Respondent �frivolously threatened to file a cancellation action for Sport Chalet�s mark.� As is a matter of record in this proceeding, Respondent has filed a Petition to Cancel Complainant�s mark because there is a likelihood of confusion between Complainant�s mark and Respondent�s incontestible registration. (See, Complaint, Paragraph 21(A).) Respondent filed the Petition to Cancel Complainant�s mark with the U.S. Patent and Trademark Office on December 23, 1999 (See, Complaint, Annex �), and intends to cancel Complainant�s registration for international Classes 18, 25 and 42.
15. Respondent lacks sufficient knowledge to admit or deny any information concerning Complainant�s communications with Network Solutions, Inc., and therefor, denies all allegations related thereto.
16. Respondent lacks sufficient knowledge to admit or deny whether Complainant has used its trademark for forty-two (42) years. Respondent admits that Respondent has used its mark for at least thirty-one (31) years. Further, Respondent admits that Respondent did not file its Petition to Cancel Complainant�s mark until after Complainant contacted Respondent concerning the disputed domain name. Respondent further admits that Complainant will still own its marks for certain classes if Plaintiff�s Petition to Cancel is granted.
17. Respondent denies that it has no legitimate basis for its registration and use of the disputed domain name. Respondent will address this issue in �Respondent�s Statements of Facts,� infra.
18. Respondent denies that it may have actually diverted customers by confusing them into believing Complainant does not have a presence on the web by having SPORTCHALET.NET lead into a splash page for LOOK.NET. Based on the speculative nature of this allegation, and the absence of any evidence offered by Complainant in support of this allegation, Respondent requests that it not be considered by the Panel.
19. Respondent denies that Respondent�s registration of the disputed domain name wrongfully precludes Complainant from owning this domain name.
20. Respondent�s use of the domain names, SKICHALET.COM and SKICHALET.NET, is not relevant to this proceeding. Respondent admits that it is not currently using the disputed domain name, SPORTCHALET.NET.
21. Respondent denies that it has maintained the disputed domain name in bad faith.
III. RESPONDENT�S STATEMENT OF FACTS
22. Respondent adds the following statement of facts, along with documentary evidence, which includes the Declaration of Wilbur McBay (Exh. [hereto]), to the record in this proceeding:
A. Respondent has been using the mark, SKI CHALET, for retail store services in the field of ski equipment and clothing since at least as early as 1969. Respondent is the owner of U.S. Registration No. 1,525,956 for the mark, SKI CHALET, for the same services. (Exh. [hereto]). Respondent�s mark was registered on the Principal Register in the U.S. Patent and Trademark Office on February 14, 1989. Respondent�s registration with the U.S. Patent and Trademark Office is incontestible.
B. For at least fifteen (15) years, Respondent has used the mark, SKI CHALET, for retail store services featuring additional sporting goods, including snow boards, in-line skates, and related equipment and clothing. For at least three (3) years, Respondent has used the mark, SKI CHALET, for retail store services featuring further sporting goods, including kayaks, and related equipment and clothing. Respondent has also used the mark, SKI CHALET, for retail store services featuring bicycles, for a limited period of time, approximately fifteen (15) and thirty (30) years ago. Respondent has never abandoned its SKI CHALET mark and Respondent�s business has grown to the extent that Respondent has five (5) retail stores in the Commonwealth of Virginia and the State of Maryland.
C. In 1995 and 1996, Respondent recognized the importance and value of the internet and the effect that it could have on Respondent�s business. Accordingly, Respondent created a web-site and registered a number of different domain names that were identical to or likely to cause confusion with Respondent�s federally registered service mark. Respondent registered these domain names to protect itself from unrelated parties who could register the identical or similar domain names with a bad faith intent to profit from the registrations or to interfere with Respondent�s business.
D. One of the domain names Respondent registered was the disputed domain name, SPORTCHALET.NET. Respondent registered this domain name because Respondent believes that the domain name is confusingly similar to Respondent�s federally registered service mark.
IV. RESPONDENT�S SERVICE MARK IS CONFUSINGLY SIMILAR TO THE DISPUTED DOMAIN NAME
23. Respondent�s mark is SKI CHALET. Respondent�s business originally consisted of the sale of ski equipment, accessories and clothing, so the word �SKI� in Respondent�s mark is descriptive of Respondent�s services, and is therefor the weak portion of the mark. The strong portion of Respondent�s mark is the word �CHALET�.
24 As discussed above, Respondent�s business has grown to include equipment, accessories and clothing for other sports, including snow boarding, kayaking, and in-line skating. Therefor, the term �SPORT CHALET� contains a more accurate description of Respondent�s services than Respondent�s federally registered service mark. Because the strength of Respondent�s mark is the word �CHALET� and Respondent is in the business of selling clothing and equipment for various sports and activities, there is a likelihood of confusion between the term �SPORT CHALET� and Respondent�s mark. Respondent�s registration of the disputed domain name was necessary to protect Respondent from cybersquatters. Respondent has maintained the disputed domain name registration to continue protecting itself from cybersquatters.
V. COMPLAINANT HAS FAILED TO PROVE TWO (2) OF THE THREE (3) ELEMENTS REQUIRED FOR COMPLAINANT TO OBTAIN A REMEDY
25. According to the Policy, the Complainant must prove three (3) elements in order to obtain a remedy in this proceeding.
26. The first element that Complainant must prove is that the domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights. Respondent admits that the domain name is identical to the service mark, SPORT CHALET, in which Complainant alleges it has rights.
27. The second element that Complainant must prove is that Respondent has no rights or legitimate interests in respect of the domain name.
28. The facts in this case do not support a conclusion that Respondent has no rights or legitimate interests in respect of the domain name. Respondent is the owner of U.S. Registration No. 1,525,956 for the mark, SKI CHALET. Respondent uses this mark in connection with retail store services featuring equipment and clothing for various sports activities. The strong portion of Respondent�s mark is the word �CHALET�. The first word in Respondent�s registered mark, SKI, and the first word in the disputed domain name, SPORT, are both descriptive words used in connection with the fanciful term �CHALET�. Adding the word �SPORT� to the strong portion of Respondent�s mark is a reflection of the natural expansion of Respondent�s business. This expansion has occurred as Respondent began featuring other sports equipment in its retail stores in at least fifteen (15) years ago. Respondent�s current business activities and ownership of U.S. Registration No. 1,525,956 for the mark, SKI CHALET, give Respondent rights and a strong interest in the disputed domain name.
29. Respondent�s most significant right and interest in the disputed domain name is to prevent cybersquatters from using the internet domain name against Respondent. Due to the likelihood of confusion between the domain name and Respondent�s federally registered service mark, as discussed in Paragraphs 22 - 23, supra, it is possible that a cybersquatter could register and use the disputed domain name with a bad faith intent to profit from Respondent. Respondent registered and maintains the disputed domain name to prevent such an attack on Respondent and Respondent�s business.
30. The third element that Complainant must prove is that the domain name has been registered and is being used in bad faith. The Policy lists four (4) circumstances which shall be evidence of the registration and use of a domain name in bad faith. Respondent will first address these four (4) circumstances and then address the issue of bad faith in general.
31. The first element of bad faith is that Respondent has registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant for valuable consideration in excess of Respondent�s documented out-of-pocket costs directly related to the domain name. Complainant did not allege, nor offer any evidence that such circumstances exist. This element is not present in this case.
32. The second element of bad faith is that Respondent has registered the domain name in order to prevent Complainant from reflecting the mark in a corresponding domain name, provided that Respondent has engaged in a pattern of such conduct. Complainant did not allege, nor offer any evidence that such circumstances exist. This element is not present in this case.
33. The third element of bad faith is that Respondent has registered the domain name primarily for the purpose of disrupting the business of Complainant. The only facts Complainant alleged that these circumstances exist are that �Respondent may have actually diverted customers by confusing them into believing Sport Chalet does not have a presence on the web by having SPORTCHALET.NET lead into a splash page for LOOK.NET.� (Complaint, �Factual Statement.�) Respondent has previously asked that this allegation not be considered because of the speculative nature and language of the allegation and the absence of any evidence supporting the allegation. Further, Complainant is the registered owner of the internet domain name, SPORTCHALET.COM, which is currently being used by Complainant on the internet. (See, Complaint, �Factual Statement� and Annex �.) Customers who are searching for Complainant on the internet, knowing that Complainant is a commercial business entity, would probably look for SPORTCHALET.COM, not SPORTCHALET.NET, in an attempt to find Complainant. If such customers are more inclined to use a search engine to find Complainant, they would easily find Complainant by searching for �Sport Chalet� with any number of search engines, as Complainant alleged in the Complaint. (See, also, Complaint, Annexes �.) This evidence supports the conclusion that Complainant has a strong presence on the internet and that Complainant�s business has not been disrupted in any way. Therefor, this element is not present in this case.
34. The fourth element of bad faith is that Respondent has intentionally attempted to attract, for commercial gain, internet users to its web-site or other on-line location, by creating a likelihood of confusion with the Complainant�s mark as to the source, sponsorship, affiliation, or endorsement of Respondent�s web-site or location or of a product or service on Respondent�s web-site or location. Complainant alleged in the Complaint, and Respondent admitted that Respondent is not currently using the disputed internet domain name for any purpose. The domain name is merely a splash page to LOOK.NET. It follows that Respondent cannot be intentionally intending to attract, for commercial gain, internet users to its web-site by creating a likelihood of confusion with the Complainant�s mark as to source, sponsorship, affiliation, or endorsement, because Respondent is not intentionally attempting to attract, for commercial gain, internet users in any way. If Respondent intended to attract, for commercial gain, internet users to the disputed domain name, Respondent would use the disputed domain name for some commercial purpose. Therefor, this element is not present in this case.
35. On the issue of bad faith in general, previous WIPO Arbitration and Mediation Center opinions have found that the Complainant must prove both registration and use of the domain name in bad faith. (Telstra Corporation Limited v. Nuclear Marshmallows, Case No. D2000-0003.) Complainant has failed to show either registration or use of the disputed domain name in bad faith. Respondent has already discussed the reason Respondent registered the disputed domain name, which shows that the domain name was not registered in bad faith. Respondent will not repeat this argument. For the same reasons that Respondent registered the domain name, Respondent has maintained the registration, which in this case is Respondent�s use of the registration. Accordingly, Respondent neither registered nor is using the domain name in bad faith.
36. Respondent�s non-use of the domain name is not by itself, evidence of bad faith. (Telstra; ARN Broadcasting Pty Ltd. v. Bonoel Products Pty Ltd., D2000-1601.) If there is no other evidence of bad faith, previous panels have refused to find bad faith based solely on the non-use of the domain name. Because Complainant has failed to show any evidence of bad faith registration or use of the disputed domain name, this Panel should not find bad faith in this case, based solely on Respondent�s non-use of the domain name.
VII. CONCLUSION
37. Complainant has failed to prove two of the necessary elements to obtain a remedy in this proceeding. First, Complainant has filed to show that Respondent has no right or legitimate interests in respect of the domain name. Second, Complainant has failed to show any bad faith intent on the part of Respondent in connection with the registration or use of the domain name. None of the factors evidencing bad faith, listed in the Policy, are present in this case.
38. Based on the foregoing, Complainant is not entitled to the remedy requested in Paragraph 13 of the Complaint, and Respondent should maintain registration of the disputed domain name." Response
6. Discussion and Findings
The Uniform Domain Name Dispute Resolution Policy (the "Policy") adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) on August 26, 1999 (with implementing documents approved on October 24, 1999), is addressed to resolving disputes concerning allegations of abusive domain name registration. This sole panelist has in an earlier decision discussed the background of the administrative panel procedure, and the legal characteristics of domain names, and refers to this earlier decision for such discussion. (Footnote 1) The Panel will confine itself to making determinations necessary to resolve this administrative proceeding.
It is essential to dispute resolution proceedings that fundamental due process requirements be met. Such requirements include that a respondent has notice of proceedings that may substantially affect its rights. The Policy, and the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules"), establish procedures intended to assure that respondents are given adequate notice of proceedings commenced against them, and a reasonable opportunity to respond (see, e.g., paragraph 2(a), Rules).
In this proceeding, Respondent has furnished a detailed response to the complaint in a timely manner. There is no issue as to whether Respondent received adequate notice of these proceedings.
Paragraph 4(a) of the Policy sets forth three elements that must be established by a complainant to merit a finding that a respondent has engaged in abusive domain name registration, and to obtain relief. These elements are that:
(i) respondent�s domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and
(ii) respondent has no rights or legitimate interests in respect of the domain name; and
(iii) respondent�s domain name has been registered and is being used in bad faith.
Each of the aforesaid three elements must be proved by a complainant to warrant relief.
Complainant is the holder of valid and subsisting trademark and service mark registrations in the United States for the word, and combination word and design, mark "SPORT CHALET" (see Factual Background, supra). Complainant�s registration of the "SPORT CHALET" mark on the Principal Register at the USPTO establishes a presumption of its validity in U.S. law. (Footnote 2)
Respondent has submitted a petition at the USPTO challenging Complainant�s right to the "SPORT CHALET" mark on the apparent basis that such mark is confusingly similar to Respondent�s "SKI CHALET" mark. Although the matter is not entirely clear from Respondent�s response in this proceeding, Respondent presumably requests the Panel to determine that Complainant does not have rights in the "SPORT CHALET" mark on the same basis, although Respondent acknowledges that is has not sought the cancellation of Complainant�s mark as to all classes of goods and services for which it is registered.
The Panel refuses to find that Complainant�s mark "SPORT CHALET" is confusingly similar to "SKI CHALET". When Complainant registered its mark, it disclaimed exclusive rights in the word "SPORT" other than as used in the mark. When Respondent registered its mark, it disclaimed exclusive rights in the word "SKI" other than as used in the mark. Both Complainant�s and Respondent�s rights in their respective marks are based on the combination of terms that the USPTO has determined to be distinctive. There is a substantial difference between the visual impression conveyed by the words "SPORT CHALET" and the words "SKI CHALET". Moreover, to the extent that each mark combines a descriptive term that has obtained distinctiveness in combination with another term, there is a substantial difference between the meaning of the descriptive word "sport" and the meaning of the descriptive word "ski". The Panel finds that "SPORT CHALET" and "SKI CHALET" are not confusingly similar from the standpoint of affirming Complainant�s rights in its "SPORT CHALET" mark. (Footnote 3) The Panel determines that Complainant has rights in the trademark and service mark "SPORT CHALET".
Respondent has conceded that if Complainant has rights in the "SPORT CHALET" mark, then the disputed domain name is identical to that mark (Response, para. 8). The Panel determines that the disputed domain name "" is identical to a mark in which Complainant has rights.
Complainant has established the first of the three elements necessary to a finding that Respondent has engaged in abusive domain name registration.
The second element of a claim of abusive domain name registration is that the respondent has no rights or legitimate interests in respect of the domain name (Policy, paragraph 4(a)(ii)). The Policy enumerates several ways in which a respondent may demonstrate rights or legitimate interests:
"Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, shall demonstrate your rights or legitimate interests to the domain name for purposes of Paragraph 4(a)(ii)
(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or
(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or
(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue." (Policy, paragraph 4(c)).
Respondent makes two claims of rights or legitimate interests in the disputed domain name. The first is that "chalet" is the strong part of its "SKI CHALET" mark and Complainant�s "SPORT CHALET" mark, and in essence that the weak or descriptive part of each mark ("ski" and "sport") should be ignored as a feature of the marks and the disputed domain name. In Respondent�s view, the extension of its business from "ski" to "sport" was a natural evolutionary process, and this gives it the right to transform its own business identifier from "SKI CHALET" to "SPORT CHALET".
As noted earlier, Complainant is the holder of a combination mark that is distinctive, and includes the word "sport". The Panel may not simply disregard a significant part of Complainant�s mark because, standing alone, it is descriptive. The Panel rejects Respondent�s hypothesis that when its own business evolved this authorized it to adopt Complainant�s trademark and service mark. Having a good reason for wanting to adopt another party�s trademark is not the same thing as having the legal right to do it. Respondent does not have rights or legitimate interests in Complainant�s mark because it believes that Complainant�s mark is well-suited to its business.
Respondent�s second contention is that it has a right or legitimate interest in the disputed domain name because: (a) Respondent�s service mark is confusingly similar to Complainant�s trademark and service mark, and (b) a third party might have registered Complainant�s mark as a domain name and then used it to take advantage of Respondent. (Footnote 4) The Panel does not consider that Respondent�s registration of Complainant�s mark as a domain name for purposes of Respondent�s self-protection against potential third party cybersquatters provides a sufficient basis for rights or legitimate interests in the disputed domain name. Respondent�s action has the effect of precluding Complainant from reflecting its own mark in the disputed domain name, and because of this preclusive effect does not constitute a limited fair use of Complainant�s mark. The Panel rejects Respondent�s second claim to rights or legitimate interests in the disputed domain name.
Respondent has failed to establish rights or legitimate interests in the disputed domain names. Thus, Complainant has established the second element necessary to prevail on its claim that Respondent has engaged in abusive domain name registration.
The Policy indicates that certain circumstances may, "in particular but without limitation," be evidence of bad faith (Policy, para. 4(b)). Among these circumstances are: (1) that the domain name has been registered or acquired by a respondent "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 [respondent�s] documented out-of-pocket costs directly related to the domain name" (id., para. 4(b)(i)); (2) that a respondent has registered the domain name "in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that [the respondent has] engaged in a pattern of such conduct" (id., para. 4(b)(ii)); (3) that a respondent has "registered the domain name primarily for the purpose of disrupting the business of a competitor" (id., para. 4(b)(iii)); and (4) that a respondent "by using the domain name, � [has] intentionally attempted to attract, for commercial gain, Internet users to [its] web site or other on-line location, by creating a likelihood of confusion with the complainant�s mark as to the source, sponsorship, affiliation, or endorsement of [respondent�s] web site or location of a product or service on [its] web site or location" (id., para. 4(b)(iv)).
There is no indication that Respondent registered the disputed domain name with the intention to sell it. Likewise, although Respondent�s registration and use of the disputed domain name may to some extent have disrupted Complainant�s business, there is no evidence that Respondent deliberately set out to accomplish this objective, and the Panel will not impute such a motive to Respondent.
However, Respondent�s registration and use of Complainant�s mark has caused harm to Complainant�s interests by precluding it from using its mark in the ".net" top level domain, even though Respondent does not appear to have engaged in a practice of registering the marks of others.
Respondent also has used the disputed domain name incorporating Complainant�s mark to direct Internet users to a commercial website in a line of business distinct from Complainant�s. Respondent is using Complainant�s mark in a manner that diverts those users who may be seeking Complainant�s website away from a website maintained by Complainant, and to a commercial website identified by Respondent.
Finally, Respondent has indicated that it has a legitimate interest in the disputed domain name as a consequence of the expansion of its line of business, and that it may permissibly use the disputed domain name to identify its business location on the Internet. The Panel disagrees. Because the disputed domain name and Complainant�s mark are identical, Respondent could not use that domain name in connection with its own business.
Respondent by its registration and use of the disputed domain name has prevented Complainant from using its mark in that name, and Respondent has used the name to direct Internet users to a commercial website other than Complainant�s. Respondent has no rights or legitimate interests in the name such as would allow it to use that name in connection with its business. The Panel finds that this combination of factors constitutes bad faith registration and use of the disputed domain name within the meaning of paragraph 4(a)(iii) of the Policy.
Complainant has established the third and final element necessary for a finding that the Respondent has engaged in abusive domain name registration and use.
The Panel will therefore request the registrar to transfer the domain name to the Complainant.
7. Decision
Based on its finding that the Respondent, Ski Chalet, Inc., has engaged in abusive registration and use of the domain name within the meaning of paragraph 4(a) of the Policy, the Panel orders that the domain name be transferred to the Complainant, Sport Chalet, Inc.
Frederick M. Abbott
Sole Panelist
Dated: April 2, 2001
Footnotes:
1. See Educational Testing Service v. TOEFL, Case No. D2000-0044, decided March 16, 2000.
2. 15 USCS � 1057(b). See, e.g., Avery Dennison v. Sumpton, 189 F.3d 868 (9th Cir. 1999).
3. The Panel notes that it has made no finding regarding which party is the first user of its mark, and does not intend to imply that if Respondent had demonstrated confusing similarity, it would be entitled to cancellation of Complainant�s mark.
4. The Panel appreciates that Respondent used different language to express this argument, but does not consider itself constrained to adopt Respondent�s language.
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