WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Paul Plumadore, James Tindell, River Road Antiques, Ltd v. William Kilgore
Case No. D2007-1922
1. The Parties
The Complainants are Paul Plumadore, James Tindell, and River Road Antiques, Ltd, Riverdale, New York, United States of America.
The Respondent is William Kilgore, New York City, New York, United States of America.
2. The Domain Names and Registrar
The disputed domain names and are registered with Schlund + Partner.
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on December 22, 2007. On December 27, 2007, the Center transmitted by email to Schlund + Partner a request for registrar verification in connection with the domain names at issue. On December 27, 2007, Schlund + Partner transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).
In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced January 10, 2008. In accordance with the Rules, paragraph 5(a), the due date for Response January 30, 2008. The Response was filed with the Center January 30, 2008. The Center appointed William R. Towns, Diane Cabell and Steven Fox as panelists in this matter on February 27, 2008. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.
Although no provision in the Policy, the Rules or the Supplemental Rules authorizes supplemental filings by either party without leave from the Panel, the Parties submitted unsolicited supplemental filings, both before and after the appointment of the Panel. The Panel addresses the issue of the Parties’ unsolicited supplemental submissions below.
4. Factual Background
The Complainants1 operate Center44, an art and antiques showroom situated in Midtown Manhattan in New York City, at which independent dealers of antiques and art display and offer their work for sale in open room settings. The record reflects that Center44 arose out of a business relationship formed between the Complainants and EUE/Screen Gems Ltd. (“EUE”) in August 2005, following which Center44 formally opened its doors to the public in January 2006. (Complaint, Exh. 3).2 Since that time, the Complainants have maintained a website associated with Center 44 (hereinafter “the Complainants’ website”), to which the disputed domain names and resolve. Insofar as the record reflects, the disputed domain names have been used exclusively with the Complainants’ website.
The Respondent operates BNL Tech Services3, and provides Internet and computer related services in the New York City area, which include website development and web management services. The Complainants and the Respondent were prior acquaintances and by all appearances close friends, and the Respondent was hired by the Complainants in August 2005 to obtain the domain name for use with the Complainant’s website, and to design the Complainants’ website. The Respondent did so, and provided web management, computer and email services to the Complainants.4 There was no written contract between the Parties.
The Respondent registered both of the disputed domain names in his own name.5 The Parties’ views diverge on whether it had been agreed that the Respondent was to own the domain names associated with the Complainants’ website, and it is a point of contention between the Parties as to when the Complainants first became aware that the Respondent had registered the disputed domain names in his own name.6 It appears from the record that, at least until this dispute arose, the Respondent submitted a recurring monthly charge to the Complainants of $60.00 in connection with the following: “Email Server, Webserver, Domain Name Monthly Lease and Maintenance.” (Complaint, Exh. 17; Response, Exhs. 3B & 3C). As far as the record reflects, all such charges as submitted by the Respondent were paid.
Based on the record, the present dispute arose in the latter part of November 2007. On November 28, 2007, the Complainants by email informed the Respondent that EUE had decided that the Complainants’ website should be redeveloped to add e-commerce functionality, and that EUE preferred to use a website development company with which EUE was associated. (Complaint, Exh. 18). In that email, the Complainants inquired as to the ownership of the disputed domain name: “The subject of our domain name came up while we were talking [to EUE] and I wasn’t sure how to answer. Who exactly owns it? It appears from your bills that we are “renting” it from you. Is that true?”
The Respondent answered the Complainants’ question by email on November 29, 2007, as follows: “Yes you’ve been leasing the domain with the option to buy.” (Complaint, Exh. 18). On November 30, 2007, the Complainant Plumadore sent an email to the Respondent asking how much it would cost to buy the domain name. The Respondent replied on November 30, 2007 as follows: “This is not something I wish to discuss by Email or by phone. Linda and I would like to set up a meeting with you. Pick a time and a place and we will be there.” (Complaint, Exh. 19).
A meeting was arranged for December 2, 2007. The Complainants Plumadore and Tindell attended the meeting, as did the Respondent’s wife, Linda Hilbrandt. The Respondent did not attend the meeting. According to the Complainants, Ms. Hildbrant brought a document to the meeting – which the Respondent maintains was fabricated by the Complainants – presenting the Complainants with two options. (Complaint, Exh. 21). The first option was to acquire the domain name for the sum of $200,000.00. The second option was to enter into a new lease arrangement effective January 1, 2008 for $2,000.00 a month.
The day following the meeting, the Respondent denied that any proposal had been made to the Complainants respecting the purchase of the domain names. Ms. Hildbrant followed this with an email informing the Complainants that they could continue the lease at the “new price”. (Complaint, Exh. 23). The Complainants did not accept these terms, and instead, on December 5, 2007, offered to buy the domain name for the sum of $500.00. This offer was not accepted, and the Respondent has retained possession of the disputed domain names.
5. Parties’ Contentions
A. Complainant
The Complainants maintain that they have established common law trademark or service mark rights in CENTER44. The Complainants have submitted evidence of their use of CENTER44 and a corresponding logo, consisting of a two-dimensional facsimile of a wax seal with “C44” impressed thereon, on business cards, post cards, stationary and letterhead, and in print advertisements and other promotional materials, since as early as September 2005. (Complaint, Exhs. 6-10). According to the Complainants, more than a quarter of a million dollars has been spent promoting and advertising the CENTER44 name and mark, including print advertisements on a regular basis in magazines such as “Elle D�cor”, “Veranda”, “The Robb Report”, “Metropolitan Home”, “New York Magazine”, and “The New York Times”, among others. The Complainants assert that the public has come to identify CENTER44 with the Complainants services, as a result of which they have brought about gross sales of approximately five million dollars for their vendors and two million dollars in revenue for Center44.
The Complainants assert that the disputed domain names and are identical or confusingly similar to the CENTER44 mark. The Complainants dispute that the Respondent has rights or legitimate interests in the disputed domain names, maintaining that the Respondent was hired to register the domain names for RRA in connection with the Complainants’ website, and was not authorized to register the domain names in his own name. According to the Complainants, the Respondent has not been commonly known by the disputed domain names and has made no legitimate commercial use of the domain names. The Complainants further deny that the Respondent created the name “Center44”.
The Complainants deny entering into any agreement under which the Respondent would own the disputed domain names or otherwise have any interest in Center44. The Complainants acknowledge that the Respondent charged a monthly fee of $60.00 that appeared to involve the domain names, but claim not to have understood this to mean that the Respondent owned the domain names. The Complainants contend that they did not learn that the Respondent had registered the domain name for himself until November 2007, when they began meeting with pLop, an Internet web design company related to EUE that had been selected to develop a new interactive e-commerce website for the Complainants. It was also at that time, according to the Complainants, that they first learned the Respondent had registered a second domain name, , on October 24, 2006.
The Complainants assert that the Respondent knew of their plans to promote CENTER44 as a trademark for their new business venture when he registered the domain name. The Complainants point out that they had employed the Respondent to work on purchasing of new computers, installing software and networking, performing maintenance, and had asked the Respondent to set up an email account for staff@. According to the Complainants, the Respondent was present and had access to the Complainants’ personal and business computers, and was fully aware of the Complainants’ intent to use CENTER44 as a trademark.
The Complainants contend that the Respondent registered and is using the disputed domain names in bad faith. According to the Complainants, the Respondent registered the domain names in order to force Center44 to conduct its business with the Respondent, and, when the occasion presented itself, to profit from and exploit the goodwill developed in the Complainants’ CENTER44 mark by attempting to rent or sell the disputed domains to the Complainants at an exorbitant price will in excess of the Respondent’s out-of-pocket costs directly related to the domain names.
In view of the foregoing, the Complainants request that the disputed domain names be transferred to RRA.
B. Respondent
The Respondent contends that the disputed domain names were registered in good faith but are currently being used in bad faith by the Complainants, in an attempt to hijack the domain names for Complainants’ personal and business gain. The Respondent further contends that the Complainants have falsified documents and have made numerous false statements in an effort to hijack the disputed domain names.
The Respondent maintains that he created the domain name with the intention of building an online market place to help the Complainants sell their dealers’ merchandize. According to the Respondent, this was an outgrowth of his long held and often expressed concerns about the manner in which the Complainants in the past had conducted business with their dealers at the Lafayette Antiques at the Warehouse (“LAW”), which did not have an e-commerce website. The Respondent asserts it had been his practice to refer to LAW as “The Center”, even though the Complainants did not find it apt, and that it was from this that the domain name was created.
The Respondent maintains that he approached the Complainants following the demise of LAW about creating an e-commerce website, for which he eventually decided on the domain name . According to the Respondent, the Complainants were contemplating calling the new antiques center “The New Lafayette”, but they met with the Respondent to discuss a potential business association to develop sales on a new e-commerce website, for which the Respondent suggested registering the domain name . The Respondent contends that it was agreed at that meeting that he would be the sole owner of the domain name, which the Complainants would lease from him. The Respondent maintains that the Parties entered into an oral agreement or contract to this effect.
According to the Respondent, the Complainants indicated on August 6, 2005 that a website for the “The New Lafayette” would be built and requested that he register the domain name . The Respondent recounts that he asked the Complainants should he buy they domain name and their answer was “Yes”. The Respondent therefore dismisses the Complainants’ claim to have assumed he was buying the domain name on their behalf as false, also noting that the Complainant Plumadore knew how to register a domain name.
The Respondent claims that on August 6, 2005, the Complainants also indicated that the Respondent’s proposed e-commerce site probably would be going forward. The Respondent states that he bought the domain name several days later. The Respondent contends that it was after this that the Complainants informed him they had entered into a business association with EUE to open an antiques center using the business name “Center44”. The Respondent contends that Complainant Tindell suggested that the Respondent register “Center44 Online Antiques” as the Respondent’s business name.
Subsequently, on September 23, 2005, the Respondent claims the Complainants informed him for the first time that they would not be able to finance his building of an online sales site. The Respondent states that he “was furious to say the least”, but that he had no choice at that point but to continue his relationship with the Complainants. According to the Respondent, the Complainants then made use of the disputed domain names under the terms of their “original” oral contract, which they reaffirmed by making 25 monthly payments to the Respondent towards the lease of the domain name.
According to the Respondent, the Complainants’ payment for the disputed domain names never exceeded out of pocket costs. The Respondent claims that the real costs for the email server, web server lease, maintenance and tech support would range from $600 to occasionally $2000 monthly. The Respondent maintains that he provided the Complainants with his “family” rate of $60 monthly, from which he deducted the costs of renewing the disputed domain names. The Respondent asserts that he generally gives huge discounts to family members and very close friends.
The Respondent asserts his intention since August 2005 has been to set up a website using the disputed domain names, and that he has “firm plans” for the use of the domain names. The Respondent denies having registered the domain names in order to prevent the Complainants from doing so, arguing that the Complainants’ business did not even exist when he registered the domain names. He denies any intent to disrupt the Complainants’ business. The Respondent further denies that he registered the disputed domain names primarily for sale or other transfer to the Complainants or to a competitor of the Complainants, and states categorically that “the domain name has never been for sale.”
The Respondent contends that when he registered the disputed domain names he had no actual or constructive notice of the Complainants’ registration of the asserted trademark. The Respondent argues that the name “Center” is a weak and diluted mark because it is a common, descriptive term used extensively in “open market place” related businesses, and asserts that the public does not identify the word “Center” exclusively with the Complainants or their business. He argues that the Complainants cannot claim exclusive rights in a highly generic and descriptive word.
Accordingly, the Respondent concludes that there is no evidence that the registered and has used the disputed domain names in bad faith, and that the evidence instead establishes that the Complainants are engaging in the bad faith practice of reverse domain name hijacking.
6. The Parties’ Supplemental Submissions
As noted above, both the Complainants and the Respondent have adopted a liberal view regarding the submission of unsolicited supplemental filings, both before and after the appointment of the Panel. No provision in the Policy, the Rules or the Supplemental Rules authorizes supplemental filings by either party without leave from the Panel. To the contrary, paragraph 12 of the Rules provides that the Panel may request, in its sole discretion, further statements or documents from either of the parties, and the Policy and the Rules evince a clear preference for single submissions absent exceptional circumstances. See Rollerblade, Inc. v. CBNO and Ray Redican Jr.,WIPO Case No. D2000-0427.
Panels have accepted unsolicited supplemental submissions in limited circumstances, when offered to present new, pertinent evidence not reasonably available until after the party’s initial submission, Top Driver, Inc., v. Benefits Benefits,WIPO Case No. D2002-0972; to bring new and highly relevant legal authority not previously available to the attention of the Panel, Pet Warehouse v. Pets.Com, Inc.,WIPO Case No. D2000-0105; or to rebut arguments of the opposing party that could not reasonably have been anticipated, Radan Corp. v. Rabazzini Winery,WIPO Case No. D2003-0353. Conversely, a mere longing to reargue the same issues already submitted is not a valid reason for additional submissions. World Wrestling Federation Entertainment, Inc. v. Ringside Collectibles,WIPO Case No. D2000-1306.
None of the exceptional circumstances that have prompted prior Panels to accept supplemental submissions are clearly present in this case. Nevertheless, the decision to accept supplemental submissions is committed to the sound discretion of the Panel. In this instance, the Panel has determined that the Parties’ supplemental submissions should be made a part of the administrative record, and it is so ordered. However, the Panel has considered the Parties’ unsolicited supplemental submissions only to the extent of any relevant and non-extraneous information contained therein.
7. Discussion and Findings
A. Scope of the Policy
The Policy is addressed to resolving disputes concerning allegations of abusive domain name registration and use. Milwaukee Electric Tool Corporation v. Bay Verte Machinery, Inc. d/b/a The Power Tool Store,WIPO Case No. D2002-0774. Accordingly, the jurisdiction of this Panel is limited to providing a remedy in cases of “the abusive registration of domain names”, also known as “cybersquatting”. Weber-Stephen Products Co. v. Armitage Hardware,WIPO Case No. D2000-0187. 7 See Report of the WIPO Internet Domain Name Process, paragraphs 169 and 170. Paragraph 15(a) of the Rules provides that the Panel shall decide a complaint on the basis of statements and documents submitted and in accordance with the Policy, the Rules and any other rules or principles of law that the Panel deems applicable.
Paragraph 4(a) of the Policy requires that the Complainant prove each of the following three elements to obtain a decision that a domain name should be either cancelled or transferred:
(i) 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
(ii) The Respondent has no rights or legitimate interests with respect to the domain name; and
(iii) The domain name has been registered and is being used in bad faith.
Cancellation or transfer of the domain names are the sole remedies provided to the Complainant under the Policy, as set forth in paragraph 4(i).
Paragraph 4(b) of the Policy sets forth four situations under which the registration and use of a domain name is deemed to be in bad faith, but does not limit a finding of bad faith to only these situations.
Paragraph 4(c) of the Policy in turn identifies three means through which a respondent may establish rights or legitimate interests in the domain name. Although the complainant bears the ultimate burden of establishing all three elements of paragraph 4(a) of the Policy, panels have recognized that this could result in the often impossible task of proving a negative, requiring information that is primarily if not exclusively within the knowledge of the respondent. Thus, the consensus view is that paragraph 4(c) shifts the burden to the respondent to come forward with evidence of a right or legitimate interest in the domain name, once the complainant has made a prima facie showing. See, e.g., Document Technologies, Inc. v. International Electronic Communications Inc.,WIPO Case No. D2000-0270.
B. Identical or Confusingly Similar
Under paragraph 4(a)(i) of the Policy, the Complainants must demonstrate rights in the mark to which the disputed domain names are identical or confusingly similar. The term “trademark or service mark” as used in paragraph 4(a)(i) encompasses both registered marks and common law marks. See, e.g., The British Broadcasting Corporation v. Jaime Renteria,WIPO Case No. D2000-0050; United Artists Theatre Circuit, Inc. v. Domains for Sale Inc.,WIPO Case No. D2002-0005; The Professional Golfers’ Association of America v. Golf Fitness Inc., a/k/a Golf Fitness Association,WIPO Case No. D2001-0218.
It is evident that the Complainants have adopted “Center44” as a business or trade name. It is well settled that the Policy does not extend to trade names per se. See Final Report of the Second WIPO Internet Domain Name Process, WIPO Publication No. 843, Paragraph 306-320 (“WIPO Report”). Nevertheless, a trade or business name also may serve as a trademark or service mark, if the trade name is sufficiently used to identify goods or services.8 Common law rights in a trademark or service mark may be established by extensive or continuous use sufficient to identify particular goods or services as those of the trademark owner. See United Drug Co. v. Theodore Rectanus Co., 248 U.S. 90 (1918). Thus, a complainant may rely on an unregistered word, phrase or string of characters, even if it also functions as a trade name, provided that the chosen name performs the function of a trademark, which is to distinguish the goods and services of one person in trade from the goods or services of any other person in trade. See, e.g., Sydney Markets Limited v. Nick Rakis trading as Shell Information Systems,WIPO Case No. D2001-0932. See also T.A.B. Systems v. Pactel Teletrac, 77 F.3d 1372 (Fed.Cir. 1996).
Applying these principles in this case, a majority of the members of the Panel are persuaded from the Complaint and its Exhibits that the Complainants have made sufficient use of CENTER44 in advertising and promotion dating back to September 2005, including print advertisements, a monthly newsletter, and references in newspaper articles, to distinguish the Complainants’ goods and services in the relevant trade from the goods and services of others in the same trade. In short, the name is performing the function of a trademark. The Complainants’ use of the corresponding logo also is indicative of use sufficient to satisfy paragraph 4(a)(i) of the Policy. See Sydney Markets Limited v. Nick Rakis trading as Shell Information Systems, supra. Accordingly, said Panelists conclude that the Complainants have established common law rights in the unregistered CENTER44 mark.9
There is no question from the record that the Complainants’ rights in the CENTER44 mark first arose after the Respondent had registered the disputed domain names. However, Paragraph 4(a)(i) embodies no requirement that a complainant’s trademark rights must have arisen before the disputed domain name was registered. The Policy refers to the complainant’s ownership of trademark rights in the present tense, and it is the consensus view of WIPO Panelists that a complainant can have rights in a trademark or service mark corresponding to the disputed domain name even where those rights first arose after the registration of the domain name. See, e.g., Digital Vision, Ltd. v. Advanced Chemill Systems,WIPO Case No. D2001-0827; Kangwon Land, Inc. v. Bong Woo Chun (K.W.L. Inc),WIPO Case No. D2003-0320; AB Svenska Spel v. Andrey Zacharov,WIPO Case No. D2003-0527; Iogen Corporation v. Iogen,WIPO Case No. D2003-0544; Madrid 2012, S.A. v. Scott Martin-MadridMan Websites,WIPO Case No. D2003-0598.10
In the Internet context of paragraph 4(a)(i) of the Policy, the question of identity or confusing similarity is evaluated based solely on a comparison of the complainant’s mark and the alphanumeric string constituting the domain name at issue. Magnum Piering, Inc. v. The Mudjackers and Garwood S. Wilson,WIPO Case No. D2000-1525. Thus, the Panel compares the mark and the domain name alone, independent of the use factors usually considered in a traditional trademark infringement action. See Banconsumer Service, Inc. v. Mary Langthorne, Financial Advisor,WIPO Case No. D2001-1367; InfoS, Inc. v. Delighters, Inc. d/b/a Cyber Joe’s Internet Caf�,WIPO Case No. D2000-0068. Based on such a comparison, a majority of the Panel members conclude that the disputed domain names and are identical to the CENTER44 mark, in which the Complainants have established common law rights.
A majority of the Panel members therefore find that the Complainants have satisfied the requirements of paragraph 4(a)(i) of the Policy.
C. Rights or Legitimate Interests
The record reflects that the Respondent has registered two domain names that are identical to the Complainants’ CENTER 44 mark. The Respondent registered the domain name at or near the time the Complainants entered into a business venture with EUE to open Center44, which the Respondent was aware of because of his close relationship with the Complainants. According to the Complainants, the Respondent was not authorized to register in his own name the two domain names reflecting the Complainants’ mark, and the Complainants believed the Respondent was acting on their behalf and in the capacity of their agent when he registered the domain names at their request. Nevertheless, the Respondent has refused to transfer the disputed domain names to the Complainants, as a result of which the Complainants have been unable to register .com and .net domain names corresponding to their mark. Further, the Respondent is demanding that the Complainants make recurring monthly payments of $2000 in order to continue using the disputed domain names.
Given the foregoing, the Panel finds that the Complainant has made a prima facie showing under paragraph 4(a)(ii) of the Policy. The circumstances as set forth and documented in the Complaint and its Exhibits, as described above, are sufficient to require the Respondent to come forward with evidence under paragraph 4(c) of the Policy demonstrating rights to or legitimate interests in the disputed domain names. See Compagnie de Saint Gobain v. Com-Union Corp.,WIPO Case No. D2000-0020.
Pursuant to paragraph 4(c) of the Policy, the Respondent may establish rights to or legitimate interests in the disputed domain name by demonstrating any of the following:
(i) before any notice to him of the dispute, the Respondent’s 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) the Respondent has been commonly known by the domain name, even if he has acquired no trademark or service mark rights; or
(iii) the Respondent is 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.
The Respondent’s claim to have rights or legitimate interests in the disputed domain names, based on the Response, appears to rest largely on the following arguments:
(1) That the Complainants and the Respondent had entered into an oral agreement or contract under which the Respondent would be the sole owner of the domain name and would develop an e-commerce website from which online sales of the Complainants’ dealers’ merchandize would be made, with the Complainants leasing the domain name from the Respondent;
(2) That the Respondent registered the disputed domain names prior to the Complainant’s establishment of trademark rights in CENTER44 and without actual or constructive notice of the Complainants’ registration of the mark; and
(3) That the Complainants do not have trademark rights in CENTER 44 because “center” is a common, descriptive word, the use of which is prevalent in the relevant trade.
The Respondent alleges that the Complainants agreed in late July 2005 that the Respondent would own outright the registration for the disputed domain name and lease it to the Complainants. The Respondent’s claim is based on unsubstantiated allegations set forth in the Response. The alleged contract is not supported by any contemporaneous writings, and is not referred to in any discernable way in any of the exhibits submitted by the Parties.
The Complainants deny any agreement with the Respondent under which the Respondent would become the owner of the disputed domain name registrations outright. The Complainants’ position is tenable; it strains credulity that the Complainants would have voluntarily relinquished all control over the domain name registrations, particularly in the days immediately following the culmination of the agreement between the Complainants and EUE, which is the period in which the Respondent obtained the domain name registration for . Moreover, under the purported oral agreement, as described in the Response, a business relationship would have been formed between the Complainants and the Respondent akin to a partnership or joint venture, pursuant to which the Respondent would have developed his own e-commerce website for online sales of the Complainants’ dealers’ merchandize.
The record does not reflect that this business relationship that the Respondent alleges the Complainants agreed to ever came about. In August 2005 the Complainants formed a business relationship with EUE to create the antiques center now known as Center44. The Respondent did not develop an e-commerce website from which online sales of the Complainants’ dealers’ merchandize could be made. Based on the record, he has never done so, nor has he provided evidence of any demonstrable preparations to do so. The Respondent registered the domain name on August 17, 2005, six days after the Complainants and EUE had entered into their agreement. The Respondent did not register the domain name until some fourteen months later, in October 2006.
The record reflects that the relationship between the Respondent and the Complainants respecting Center44 remained the same as had previously been the case respecting LAW: The Respondent provided Internet services to the Complainants, who were his clients. It is notable that the Respondent claims he has always registered the domain names that he manages for his clients in the clients’ names because he is required by law to do so. Nowhere in the Response does the Respondent express any belief that it was within his rights as an Internet service provider to acquire the registrations of the disputed domain names outright. In fact, throughout the Response, the Respondent refers to only one oral contract – namely, the contract he alleges was verbally agreed to in July 2005, which is not substantiated by any contemporaneous writings, which the Complainants deny, and which otherwise finds no credible support in the record.11 In view of the foregoing, a majority of the Panel members conclude that the Respondent has no contractual basis upon which to assert rights or legitimate interests under paragraph 4(a)(ii) of the Policy.
The Panel next considers the Respondent’s claim of rights or legitimate interest in the domain name based on his registration of the domain name before the Complainants had begun to use CENTER44 either as a trade name or as a mark. The primary rule in relation to domain name registrations is “first come, first served”, to which the Policy provides a narrow exception. See Macmillan Publishers Limited, Macmillan Magazines Limited and HM Publishers Holdings Limited v. Telepathy, Inc,WIPO Case No. D2002-0658. Nevertheless, once the Complainants establish a prima facie case under paragraph 4(a)(ii) of the Policy, the Respondent must come forward with evidence of rights or legitimate interests in the disputed domain name under paragraph 4(c). The registration of a domain name in and of itself does not establish rights or legitimate interests under paragraph 4(a)(ii) of the Policy. See Asia Pacific Breweries Limited v. Chris Kwan,WIPO Case No. D2003-0920; Educational Testing Service v. TOEFL, WIPO Case No. D2000-0044; Pharmacia & Upjohn Company v. Peoples Revolutionary Suicide Jazz Band, WIPO Case No. D2000-0816; AT&T Corp. v. Swarthmore Associates LLC,WIPO Case No. DBIZ2002-00077.
When considering whether the Respondent has rights or legitimate interests in the disputed domain names, it is necessary to consider the relationship between the Parties, their previous dealings and any knowledge that the Respondent may have of the Complainants’ services. Emmanuel Vincent Seal trading as Complete Sports Betting v. Ron Basset,WIPO Case No. D2002-1058. Good faith is a key issue as to whether use is bona fide under the Policy. See Wrestling Federation Entertainment, Inc. v. Rift,WIPO Case No. D2000-1499, (“not all use prior to notice of the dispute can qualify as bona fide use”).
In this case, the record shows that the Respondent registered the domain names with the intent to rent (or possibly sell) the domain names to the Complainants. The registration of a domain name in order to rent or sell it to a third-party is not a violation per se of the Policy, provided that the Respondent is not seeking to capitalize on the goodwill created by the trademark owner. See M, LP v. Bill Zag and NWLAWS.ORG,WIPO Case No. D2004-0230. As a general rule, when a domain name is registered before any trademark rights are established, the registration of the domain name is not in bad faith since the registrant could not have contemplated the complainant’s non-existent right. In certain situations, however, when the respondent is aware of the complainant and the circumstances indicate that the aim of the registration was to take advantage of potential complainant rights, bad faith can be found. See, e.g., General Growth Properties, Inc., Provo Mall L.L.C. v. Steven Rasmussen/Provo Towne Centre Online,WIPO Case No. D2003-0845.
In this case, the relationship between the Parties, their previous dealings and the Respondent’s obvious knowledge of the Complainants’ services are critical factors. The Respondent clearly was privy to the Complainants’ plans to launch a new antiques center after the demise of LAW. He was aware that the Complainants had formed a business relationship with EUE to create this center, and he was aware that the Complainants were considering several possible names for the new venture, including “The New Lafayette” and “Center 44”. The Respondent was knowledgeable of the manner in which the Complainants had advertised and promoted their prior antiques center under the name “Lafayette Antiques at the Warehouse”, and he was aware that the Complainants had registered a corresponding domain name, , for use with the LAW website.
The relationship that existed between the Respondent and the Complainants was that of an Internet service provider and a client. The Response leaves little doubt that the Respondent was not happy about his prospects after the business relationship between the Complainants and EUE was established; he had “visualized a lifetime association with the Complainants” with “the potential for an abundance of sales.” Against this backdrop, the Respondent registered the domain name on August 11, 2005, a date corresponding to the culmination of the agreement between the Complainants and EUE. (See Response, Exh. 1). On August 17, 2005, five days after the agreement between the Complainants and EUE had been reached, the Respondent registered . And notwithstanding that paragraph 2 of the Policy implicitly requires some good faith effort to avoid registering and using domain names corresponding to trademarks in violation of the Policy,12 some fourteen months later the Respondent registered .
In view of the circumstances as described above and as reflected in the totality of the record, a majority of the Panel members find that the aim of the Respondent in registering the disputed domain names was to take advantage of the Complainants’ potential rights in CENTER44. A careful reading of the Response reveals that the Respondent has not denied being aware of these potential Complainant rights; he claims only to have had no actual or constructive notice of the Complainants’ registration of the mark. Prior Panels have held that an Internet service provider’s decision to appropriate a customer’s trademark for its own use belies any plausible claim of legitimacy. See Primedia Magazine Finance Inc. v. Next Level Productions,WIPO Case No. D2001-0616; NIKE Inc. v. Granger and Associates, WIPO Case No. D2000-0108.
The Respondent also appears to base his claim of legitimacy on the argument that the Complainants cannot assert exclusive rights in the common, descriptive word “center”. This argument ignores the fact that the Respondent has registered two domain names that are identical to the Complainants’ mark, and that the Complainants’ mark does not consist merely of the word “center”. In any event, it is only when a respondent registers a domain name consisting of a “dictionary” word because the respondent has a good faith belief that the domain name’s value derives from its generic or descriptive qualities, and not because of its value as trademark, that the use of the domain name is consistent with such good faith belief and thus may establish a legitimate interest. See Mobile Communication Service Inc. v. WebReg, RN,WIPO Case No. D2005-1304. See also Media General Communications, Inc. v. Rarenames, WebReg,WIPO Case No. D2006-0964. The circumstances of this case do not support the Respondent’s argument.
For the foregoing reasons, a majority of the Panel members find that the Complainants have satisfied the requirements of paragraph 4(a)(ii) of the Policy.
D. Registered and Used in Bad Faith
Paragraph 4(b) of the Policy states that any of the following circumstances, in particular but without limitation, shall be considered evidence of the registration or use of a domain name in bad faith:
(i) circumstances indicating that the respondent registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant (the owner of the trademark or service mark) or to a competitor of that complainant, for valuable consideration in excess of documented out-of-pocket costs directly related to the domain name;
(ii) circumstances indicating that the respondent 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;
(iii) circumstances indicating that the respondent registered the domain name primarily for the purpose of disrupting the business of a competitor; or
(iv) circumstances indicating that the respondent intentionally is using the domain name in an attempt to attract, for commercial gain, Internet users to its website 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 the respondent’s website or location or of a product or service on its website or location.
The examples of bad faith registration and use set forth in paragraph 4(b) are not meant to be exhaustive of all circumstances from which such bad faith may be found. See Telstra Corporation Limited v. Nuclear Marshmallows,WIPO Case No. D2000-0003. The overriding objective of the Policy is to curb the abusive registration of domain names in circumstances where the registrant is seeking to profit from and exploit the trademark of another. M, LP v. Bill Zag and NWLAWS.ORG,WIPO Case No. D2004-0230.
Paragraph 4(a)(iii) of the Policy requires proof that the Respondent registered the disputed domain name in bad faith and is using the domain name in bad faith. Telstra Corporation Limited v. Nuclear Marshmallows,WIPO Case No. D2000-0003. The issue of bad faith registration generally is to be determined with reference to the time the Respondent took possession of the domain name. HSBC Finance Corporation v. Clear Blue Sky Inc. and Domain Manager,WIPO Case No. D2007-0062. See also The Motley Fool, Inc. v. Domain Works, Inc.,WIPO Case No. D2006-1625. In that regard, the prevailing view of WIPO Panelists is that the Policy was not designed to prevent situations of good faith registration followed by bad faith use. See Substance Abuse Management, Inc. v. Screen Actors Modesl [sic] International, Inc. (SAMI),WIPO Case No. D2001-0782; Teradyne Inc. Teradyne, Inc. v. 4tel Technology,WIPO Case No. D2000-0026.
A majority of the Panel members conclude for the reasons set forth under the preceding heading that the Respondent’s aim in registering the disputed domain names was to capitalize on potential complainant rights. The Panel majority further finds there to be insufficient evidence on the present record to demonstrate the existence of an agreement between the Parties under which the Respondent was authorized to acquire the disputed domain name registrations outright and lease the domain names to the Complainants. Even before registering the domain name, the Respondent made representations to the Complainants that are inconsistent with the contention that the Complainants knew and had agreed to the Respondent’s exclusive ownership of the disputed domain names. The Respondent suggested to the Complainants that the domain name they chose should be registered on a year-by-year basis “until you are sure this is the domain you are going to use for life. When you find the domain for life I can get you a very good deal for 5 and 10 year subscriptions”. (Complaint, Exh. 4) (emphasis added).
This statement conveys the impression that the Respondent was offering to serve as an agent for the Complainants. Since the Respondent maintains that he always registers his clients’ domain names in the name of the clients, it would not be unreasonable for the Complainants to expect that such would be the case. The Respondent’s email certainly does not convey the impression that the Respondent intended to acquire the domain name registrations outright so as to maintain sole control over the Complainants’ chosen “domain name for life”.
The Respondent asserts that the disputed domain names were never for sale, and were not registered in order to sell them to the Complainants or to a competitor of the Complainants. Nevertheless, when the Complainants finally confronted the Respondent in late November 2007 regarding the status of their domain names, the Respondent told the Complainants that they had been leasing the domain names with an “option to buy”.13 This statement cannot be reconciled with the Respondent’s claim that he did not register the disputed domain names in order to sell them to the Complainants. Perhaps realizing this somewhat belatedly, within a few days the Respondent recanted this statement, informing the Complainants instead that their sole “option” was to continue leasing the domain names, albeit at a “new price” of $2000 monthly, a figure more than 30 times the original monthly “rent” that the Respondent had charged and collected during the preceding twenty-five months. Nevertheless, the original monthly “rent” can scarcely be described as inconsequential. The Complainants paid $1500 of “rent” over a twenty-five month period in order to use the domain name, while the Respondent’s own evidence reveals he registered the domain name at an annual cost of $5.99. (Response, Exh. 1).
Based on all of the foregoing, the majority of the Panel members conclude that the Respondent registered the disputed domain names primarily for the purpose of renting or selling the domain name registrations to the Complainants or to a competitor of the Complainants, for valuable consideration in excess of documented out-of-pocket costs directly related to the domain names. This constitutes evidence of bad faith registration and use under paragraph 4(b)(i) of the Policy. Indeed, some Panels have considered this to conclusively establish that the disputed domain name has been registered and is being used in bad faith. See CBS Broadcasting, Inc. v. Gaddor Saidi,WIPO Case No. D2000-0243.
Given the totality of the circumstances in the record, and mindful of the dissenting opinion of our fellow Panelist,14 the Panel members comprising the majority find that no agreement between the Parties has been proven that would support the Respondent’s claim of rights or legitimate interests in the disputed domain names. The Respondent registered the disputed domain names in his own name in order to capitalize on potential complainant rights, and the Respondent has used the disputed domain names in bad faith to exploit and profit from the goodwill created by the Complainants’ in the CENTER44 mark.
A majority of the Panel members find therefore that the Complainants have satisfied the requirements of paragraph 4(a)(iii) of the Policy.
E. Reverse Domain Name Hijacking
Paragraph 1 of the Rules defines reverse domain name hijacking as “using the Policy in bad faith to attempt to deprive a registered domain name holder of a domain name”. To prevail on such a claim, a respondent must show that the complainant knew of the respondent’s unassailable rights or legitimate interests in the disputed domain name or the clear lack of bad faith registration and use, and nevertheless brought the complaint in bad faith. Sydney Opera House Trust v. Trilynx Pty. Ltd.,WIPO Case No. D2000-1224 and Goldline International, Inc. v. Gold Line, WIPO Case No. D2000-1151. In the opinion of the Panel, the Respondent has not made the necessary showing to prevail on its claim of reverse domain name hijacking.
8. Decision
For all the foregoing reasons, in accordance with Paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain names and be transferred to the Complainant River Road Antiques, Ltd.
William R. Towns
Presiding Panelist
Steven Fox
Panelist
Diane Cabell
Panelist (Dissenting)
Dated: March 12, 2008
DISSENTING OPINION
The Complainant has neither alleged nor provided evidence of a trademark claim in its trade name. This Panelist believes that the UDRP sets minimal requirements on a Complainant in regard to establishing its mark rights which the Complainant failed to meet. Complainant may have been using the name as a mark, but may not. I am not willing to make that presumption without more assistance from the Complainant.
The Respondent was clearly authorized to acquire the domain name for the use of the Complainant. When the first domain was registered, the Complainant’s had not even established a legal entity in the name of which the domain could be registered. Respondent in fact provided such use and still does. Respondent billed Complainant transparently for that service for several years. The monthly rate of $60 included website and email hosting services. In my personal experience, this is hardly enough of a markup to qualify as bad faith. There is plenty of evidence that the registration was not itself in bad faith.
I conclude from the record that neither of the parties gave much thought to trademark or domain ownership matters at the time the domain was registered. The client was quite happy with Respondent’s services until recently, as both parties attest. Now that Complainant no longer wishes to utilize Respondent’s services, Respondent has been less than cooperative in transferring the domain names to his client. This reluctance may, indeed, be bad faith use of the domain names, but I cannot find that the initial registration itself was in bad faith. The UDRP requires that both be proven and that mark rights exist.
There are too many missing links in the pleadings. Further, this appears to be to be simply a contract dispute that would be best decided by a court of law.
Diane Cabell
Panelist (Dissenting)
1 The individual Complainants Plumadore and Tindell maintain they are the sole shareholders in River Roads Antiques, Ltd. (“RRA”), formed in 1997, and also named as a Complainant. The Respondent has not contested that Plumadore and Tindell are sole shareholders of RRA.
2 Exhibit 3 to the Complaint is a letter dated December 17, 2007, from Mitchell Brill, head of Corporate Development for EUE. This letter describes the course of dealings between the Complainants and EUE which resulted in the creation of the venture between EUE and RRA that became Center44. According to Mr. Brill, the task of determining the name, logo and other creative details of the venture was left to the Complainants. According to the Complainants, there is no formal written agreement reflecting the professional relationship formed between EUE and RRA, which the Complainants characterize as a “handshake” agreement.
3 It appears from the record that the Respondent’s wife, Linda Hilbrandt, also is involved in this business.
4 The Complainants previously had managed another antiques center known as “Lafayette Antiques at the Warehouse” (referred to herein as “LAW”), and had hired the Respondent to purchase, set up and perform maintenance on their computer system, provide email services, and design an informational website similar to the one the Respondent designed for “Center44”. Before deciding on the “Center44” name, the Complainants had contemplated using the name “The New Lafayette”. The record reflects that the Respondent registered the domain name on August 12, 2005 (Response, Exh. 1).
5 The Respondent registered the disputed domain name on August 17, 2005. The Respondent did not register the disputed domain name until October 24, 2006.
6 The Parties’ respective positions are discussed in greater detail in the “Parties’ Contentions” section below.
7 The Panel is divided on whether this dispute falls within the purview of the Policy. For the reasons set forth in the Panel’s decision, two members of the Panel believe that this case raises sufficient issues regarding cybersquatting to bring it within the jurisdiction of the Panel, requiring the Panel to reach a decision under the Policy. For the reasons set forth in the dissenting opinion, one member of the Panel believes that this is a contract dispute beyond the scope of the Policy, and would deny the Complaint on that basis.
8 A trade name is the designation adopted by a commercial enterprise to describe itself and to distinguish it from other businesses and enterprises. However, a trade name may also be separately protected as a trademark. See WIPO Report, supra. In that regard, the record reflects that the corporate name Center44, LLC was not registered until several months after the Complainants began independently using “Center44” as an identifier.
9 The Complainants have filed an application with the United States Patent and Trademark Office (“USPTO”) seeking to register CENTER44 as a mark. This application was not filed, however, until after the commencement of this proceeding. In any event, an application for a trademark in and of itself is not sufficient to establish rights in a mark for purposes of paragraph 4(a)(i) of the Policy.
10 While not relevant in determining whether a complainant has established rights in a mark to which the domain name is identical or confusingly similar, when the trademark rights arose may be relevant for purposes of Paragraphs 4(a)(ii) and (a)(iii) of the Policy. See, e.g., N�ofumomais, Cl�nica de Homeopatia Antitab�gica, Lda. v. Re-Surgir - Consultores em Desenvolvimento Individual e Organizacional, Lda.,WIPO Case No. D2004-0399.
11 The Respondent maintains that domain name lease payments in the invoices he began to send to the Complainants beginning in December 2005 were part of the alleged July 2005 oral agreement with the Complainants. Because the Complainants paid these invoices, the Respondent contends they are bound by the alleged July 2005 oral agreement.
12 Paragraph 2 of the Policy, “Your Representations”, is incorporated by reference in the registration agreements of ICANN-approved registrars, and provides as follows:
“By applying to register a domain name, or by asking us to maintain or renew a domain name registration, you hereby represent and warrant to us that (b) to your knowledge, the registration of the domain name will not infringe upon or otherwise violate the rights of any third party; (c) you are not registering the domain name for an unlawful purpose; and (d) you will not knowingly use the domain name in violation of any applicable laws or regulations. It is your responsibility to determine whether your domain name registration infringes or violates someone else’s rights. (emphasis added).”
See Media General Communications, Inc. v. Rarenames, WebReg,WIPO Case No. D2006-0964
13 As a contractual term, the phrase “option to buy” connotes a legally binding agreement under which a person, in consideration of a fee, obtains the right to buy something within a specified time frame at a specific price.
14 The Dissenting Opinion concludes that this matter involves a contractual dispute more appropriately decided by traditional means. However, this is not a case, such as Clinomics Biosciences, Inc. v. Simplicity Software, Inc.,WIPO Case No. D2001-0823, in which the respondent, a web developer, asserted that it had rights or legitimate interests under the Policy based on an asserted lien against the domain name registration to secure unpaid invoices in excess of $100,000 allegedly owed by the respondent’s former client. No allegation is made here that the Complainants have not paid all past invoices. Further, a contractual or lien right in a domain name registration is extinguished once the outstanding amount allegedly owed by the complainant is paid. See, e.g., Trade Pals Inc. c/o Tino Buntic v. Natour Global / Sam Natur,WIPO Case No. D2005-0144.
The Panel in Clinomics denied the Complaint on the grounds that the matter involved a commercial dispute outside the scope of the Policy, noting that a decision would require a determination whether it was the intent of the Parties that the respondent would have the right to enforce its contractual rights through the exercise of a lien on the domain name registration, and an evaluation of the commercial law of liens. A majority of the Panel members in this case view Clinomics as inapposite, as this Panel is not required to navigate complex issues of commercial law in reaching a decision under the Policy.
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