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What It Takes to Prove Common Law Rights in UDRP Complaints

The Uniform Domain Name Dispute Resolution Policy now has seventeen years of history. A high percentage of disputes are indefensible and generally undefended. As the history lengthens, early registrants of dictionary word-, common phrase-, and arbitrary letter-domain names have been increasing challenged in two circumstances, namely by businesses who claim to have used the unregistered terms before respondents registered them and later by emerging businesses with no history prior to the registrations of the domain names. I have discussed the latter in earlier essays. Some examples from recently decided cases of the former include “gabs” (the only recent dictionary word case); phrases include “Gotham construction,” “Minute Clinic,” “Stage Coach,” and “Desert Trip” and for random letters (acronyms to complainants) “atc” and other three-character domains. Some of these second level domains are discussed further below. Claiming unregistered rights is a recurring motif, important because it affects whether complainants have standing, discussed in an earlier essay, UDRP Standing: Proving Unregistered Trademark Rights).

Typical complainant allegations of common law rights confess they never registered their marks but their priority in the marketplace ought nevertheless to support abusive registration of the corresponding domain names. However, as a general rule complainants alleging common law rights have to work harder to overcome the distance of time. To prevail in a UDRP proceeding parties have to be alert to their evidentiary demands. When a complainant alleges priority in using a mark currently being exploited by a respondent arguably violating its representations and warranties, it has to prove “reputation in and public recognition of the trademark” prior to the registration of the domain name (the now versus then burden). The quotation comes from the Gotham construction case, Joel I. Picket v. Niyazi Palay / Gotham Constructions, FA1702001717501 (Forum April 10, 2017). Put another way—Stacy Hinojosa v. Tulip Trading Company, FA1704001725398 (Forum May 24, 2017) (<stacyplays.com>):

[A] date of first use alone is not enough to establish common law rights in a mark. In order to have common law rights, a complainant must establish secondary meaning. Secondary meaning requires establishing that the public primarily associates the mark in question with certain goods or services originating from the purported mark holder.”

The underlying rationale is simple: if prior to the registration of the domain name the unregistered mark had no reputation, it follows respondent could not have registered the domain name in bad faith. It’s worse for a complainant who had no reputation in the past, and has none now! But these failures are frequently traceable to complainants not understanding what has to be proved, and argued by pro se disputants.

The term “rights” in paragraph 4(a)(i) of the Uniform Domain Name Dispute Resolution Policy — “[the] domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights” — encompasses unregistered as well as registered rights but whereas a complainant with a registered mark by definition has a “right” complainant with an unregistered right has to prove something more than simple priority. It may indeed have had a market presence, but who knew about it? This is the kind of knowledge only a complainant would have, and if it doesn’t have (or doesn’t offer) documented proof it will be read negatively that silence means there is no proof to offer; and if there is no proof, it loses.

It has been said that Panels generally “approach[] the issue of proof of [unregistered] trademark ‘rights’ … in a slightly more relaxed manner than does the USPTO when it requires proof of secondary meaning.” NJRentAScooter v. AM Business Solutions LLC, FA0909001284557 (Nat. Arb. Forum November 4, 2009). However, “slightly more relaxed” has to be understood in a relative sense. The weaker the mark, the greater the burden of proof.

A sufficient body of precedent has built up to form the consensus noted in the WIPO Overview at Paragraph 1.7.: “The complainant must show that the name has become a distinctive identifier associated with the complainant or its goods and services. Relevant evidence of such ‘secondary meaning’ includes length and amount of sales under the mark, the nature and extent of advertising, consumer surveys and media recognition.” This black letter statement of the law does not expressly include the “reputation, ” but it is necessarily implied.

The “relaxed manner” finds particular expression in claims by personalities (in sports, motion pictures, publishing, entertainment, etc.) who are widely known or have achieved fame in their fields. An example is Halle”Berry and Bellah Brands Incorporated v. Alberta Hot Rods, D2016-0256 (WIPO March 15, 2016) (). The Panel “consider[ed] it reasonable to infer that the Respondent was aware of the Complainants’ rights in the common law trademark HALLE BERRY when registering the disputed domain name in 1997, given Ms. Berry’s fame and the substantial goodwill which she had generated in her personal name by that date, commencing in the mid-1980s.” The Panel draws a similar conclusion in Jeffree Star and Jeffree Star Cosmetics LLC v. Lisa Katz / Domain Protection LLC, FA1607001682277 (Forum August 10, 2016) (jeffreestar.com> Transferred); and more recently in Carl Cartee v. Stanley Bell, FA1703001724616 (Forum May 8. 2017) (<carlcartee.com>), but not in Stacy Hinojosa for the reasons already mentioned.

While marks claimed by personalities are on the strong end of the scale, common phrases and dictionary words are on the weak end. Complacency is fatal in claims for weak marks. GOTHAM CONSTRUCTION is hardly in the stratosphere of protected marks! In that case, the Panel pointed out that Complainant “proceeds on the belief that in law, the essential element in the establishment of common law rights is proof of first adoption. It is not. Rather, common law rights are premised upon proof of reputation in and public recognition of the trademark.” It’s very possible Complainant was the first to use the term but that does not prove Respondent registered it for its non-trademark value.

There are of course always dictionary words that ascend to the stratosphere, APPLE, VIRGIN, PRUDENTIAL, ENTERPRISE, and EASY (not an exhaustive list) but they have proved themselves in the market. That is not true of CURVAGE. In Jason Johnson v. Ramesh Mahadevan, FA1704001727694 (Forum May 17, 2017) Complainant asserted it had common law rights in its CURVAGE mark — “[and claimed it had] consistently used the mark since 2007” — but there is contradictory evidence in the record. Complainant could not have consistently used the mark because the prior owner of the business denied it:

Its (sic) pretty obvious to everyone that Ive (sic) basically ignored this site for the last year. Truth be told, I lost my interest long before then. I feel Curvage will continue to languish from my lack of attention paid to it… Ive (sic) got basically two choices: 1. Treat Curvage like a business. This would mean ads and doing things to attract more traffic. 2. Have someone else take it over. Im (sic) leaning strongly towards the latter. Is there anyone interested?

Secondary meaning cannot be established without proving 1) continuous and uninterrupted use in commerce; and 2) reputation predating the registration of the domain name. In DealerX v. Gurri Kahlon, ROiQ.com, D2017-0488 (WIPO May 4, 2017) Complainant “alleges it has used the ROIQ mark in interstate commerce since 2007, but provides no factual support for this claim. Instead, it contradicts the claim by submitting the only evidence relating to Complainant’s use — the U.S. Registration for the ROIQ trademark — which claims first use in commerce on November 2013.” Sunk by its admission!

Prevailing presupposes the right palette of facts properly and persuasively laid out — Leslie Brown v. Peter Auger / adnetagency, FA1703001723736 (Forum May 1, 2017) (<headshopfinder.net>) and CVS Pharmacy, Inc. and MinuteClinic, L.L.C v. Pham Dinh Nhut, FA1703001723633 (Forum April 30, 2017) (MINUTE CLINIC and <minuteclinics.com>) — but insufficient if there is no supporting proof with the allegations ATC Group Services LLC v. BatchMaster Software, Inc., FA1703001722646 (Forum May 15, 2017) (<atc.com>).

In Leslie Brown, Complainant proved its common law right by providing “evidence that its website has had nearly 43 million page views for <headshopfinder.com>, and from this the Panel inferred (Respondent not having appeared) that Respondent “had actual knowledge because the disputed domain name is identical to Complainant’s mark and Respondent’s resolving webpage offers identical services to Complainant’s webpage.”

The ATC Group Services case is one of those decisions that should be on every parties’ study list. I say this for two reasons: first, the skill with which Respondent’s counsel marshaled the evidence; and second, the Panel’s reasoning in dismissing the complaint. As to the latter (which incorporates Respondent’s counsel’s analysis), while Complainant “submitted proof of use of the letters ATC as part of various corporate names [it submitted] no proof of use of ATC as a trademark brand, let alone sufficient proof of secondary meaning.” Further, “[n]o proof has been submitted establishing how ATC has been used as a trademark by Complainant, the advertising revenue incurred to promote the ATC brand, or the extent to which the ATC brand is associated with Complainant by the relevant public community.

All these decisions (even those I’ve noted only in passing) share some common features. Prevailing parties have organized their evidence to prove their contentions. This generally requires professional assistance; certainly without counsel, parties (I mean on both sides of the caption) lose.

Written by Gerald M. Levine, Intellectual Property, Arbitrator/Mediator at Levine Samuel LLP

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A Lesson from the Environmental Protection Agency (EPA) in Domain Name Disputes

While the U.S. Environmental Protection Agency (EPA) has been making news as the result of controversial changes brought about under the new Trump administration — including the planned removal of “several agency websites containing detailed climate data and scientific information” — the EPA also has generated some (lesser-known) domain name news: The agency won a decision under the Uniform Domain Name Dispute Resolution Policy (UDRP) for the domain name <noattacks.org>.

Although UDRP complaints filed by governmental entities are not unprecedented, they are not common. Indeed, governments don’t even make an appearance on WIPO’s list of the types of trademark owners that file UDRP complaints.

That may be because government agencies are not typically thought of as trademark owners. But sometimes, they are.

In the EPA case, the trademark at issue, NO ATTACKS (which the EPA used in connection with anti-asthma campaigns), apparently was not registered. But as the UDRP panel noted, “There is no requirement under the UDRP that a complainant must show registration of a trademark to demonstrate its rights therein. Rights may be shown by persuasive evidence of common law trademark rights in a mark.”

Fortunately for the EPA, the UDRP panel agreed that it had established common law trademark rights in NO ATTACKS — as the result of its “public use of such mark over a period of 15 years” and an investment of “$450 million in advertising” related to the mark.

Interestingly, the EPA previously had registered the <noattacks.org> domain name but, like many other domain name registrants that find themselves filing UDRP complaints, the EPA allowed it to lapse “[t]hrough inadvertence.” The new registrant used the domain name in connection with a pay-per-click (PPC) website and also offered it for sale for $25,000, according to the UDRP decision. The panel found this sufficient to establish the required bad-faith element.

In many ways, the EPA case is like many other domain name disputes: A domain name owner creates a domain name, invests significant sums of money promoting it, fails to protect it by pursuing a relevant trademark registration, and then lets its expire. The UDRP decision doesn’t explain why any of this happened, but it should be a warning to other trademark owners to take domain name management seriously.

(Interestingly, before the UDRP decision for <noattacks.org> was implemented and the domain name transferred back to the EPA, the “No Attacks” website was posted at a different address, which contained this notice: “Due to technical difficulties with the URL www.noattacks.org, this website is temporarily hosted at http://noattacks.scgcorp.com/”. I’m not so sure “technical difficulties” is the most accurate label.)

Perhaps the EPA could have benefited from one of my previous blog posts, such as this one: “New Year’s Resolution: Renew Your Domain Name! (And Other Best Practices for Domain Name Management).”

Written by Doug Isenberg, Attorney & Founder of The GigaLaw Firm

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Dot-Com is Still King – of Domain Name Disputes

Despite the launch of more than 1,200 new gTLDs, .com remains far and away the most popular top-level domain involved in domain name disputes.

In 2016, .com domain names represented 66.82 percent of all gTLD disputes at the World Intellectual Property Organization (WIPO), the only domain name dispute provider that publishes real-time statistics. And, as of this writing, the rate is even higher so far in 2017, with .com domain names accounting for 69.78 percent of all disputes.

Not surprisingly, the overall trend since the launch of the new gTLDs shows .com appearing in a smaller percentage of cases under the Uniform Domain Name Dispute Resolution Policy (UDRP). For example, in 2012, when the new gTLD applications were unveiled, .com domain names represented 74.84 percent of all gTLD disputes at WIPO.

Of course, some new gTLDs are appearing in UDRP cases, with 13 new gTLDs represented in 10 or more UDRP cases at WIPO in 2016:

  • .xyz
  • .top
  • .club
  • .online
  • .vip
  • .store
  • .website
  • .cloud
  • .site
  • .space
  • .shop
  • .lol
  • .date

But, the discrepancy between .com disputes and others is tremendous (as the chart above shows): WIPO saw 3,120 .com domain names in dispute proceedings last year, but the most-commonly disputed new gTLD — .xyz — appeared only 321 times.

As I’ve written before, the large number of new gTLDs probably contributed to a record number of UDRP disputes in 2016. But it’s clear that new gTLDs are accounting for relatively few disputes.

Trying to understand why new gTLDs don’t appear in more UDRP proceedings is pure speculation, though a couple of explanations seem reasonable:

  • New gTLD registrations account for a small percentage of all domain names. While there were 329.3 million total domain name registrations (with .com accounting for 126.9 million of those) as of the end of 2016, there are currently fewer than 29 million new gTLD registrations. Therefore, there is simply a relatively small number of gTLD registrations that could be subject to a dispute.
  • Trademark owners care more about .com domain name registrations and how they are being used. While new gTLDs are bothersome to many trademark owners, their limited appeal makes them less important to dispute.

Written by Doug Isenberg, Attorney & Founder of The GigaLaw Firm

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Why Cancel a Domain Name in a UDRP Case?

While the most common results of a UDRP proceeding are either transfer of a disputed domain name to a complainant or denial (that is, allowing the respondent to retain it), there is another possible outcome: cancellation.

I’m always surprised to see a UDRP decision in which a domain name is cancelled. True, many trademark owners don’t really want to obtain control of a disputed domain name (and, instead, they simply want to get it taken away from a cybersquatter). Plus, maintaining a domain name incurs an ongoing expense as the result of renewal fees, and many trademark owners already have large (and, therefore, costly) domain name portfolios.

But, the cancellation remedy means that a UDRP victory may be short-lived because cancelled domain names become available for registration by anyone, including another (or even the same) cybersquatter.

A trademark owner that files a UDRP complaint incurs real expense (through filing fees and legal fees) — payments that rightly could be seen as an investment. Allowing a domain name to be cancelled instead of transferred seems like a wasted investment.

Here’s one way of looking at the math:

  • The least amount of money that a trademark owner could expend on a UDRP complaint is about $500 — if it files at the Czech Arbitration Court (the least expensive UDRP service provider) and prepares the complaint itself, without outside counsel. (In reality, most UDRP complaints incur total expenses of thousands of dollars.)
  • A popular registrar such as GoDaddy charges about $15 per year to renew a .com domain name.
  • Therefore, a trademark owner could maintain a transferred domain name for more than 30 years for less than the cost of filing the cheapest possible UDRP complaint.

Under this scenario, why would a trademark owner risk having a domain name fall into the hands of another cybersquatter if it could keep the domain name for itself and avoid having to file a second UDRP complaint?

The risk is real, as domain names cancelled in UDRP proceedings don’t necessarily remain cancelled for long. For example, although the pharmaceutical company Sanofi won a UDRP complaint last year for 21 domain names, 20 were quickly re-registered (by multiple registrants) after they were cancelled and are being used in connection with websites that most trademark owners would consider problematic.

True, not many trademark owners request the cancellation remedy. At WIPO (the most popular UDRP service provider), only 1.69% of all cases have resulted in cancellations. But, the number of cancellations is on the rise, reaching 2.16% in 2015 and 2.09% in 2016.

What explains this (slight) increase in cancellations? One reason could be the arrival of cybersquatting in the “new” gTLDs. For example, some recent UDRP decisions that resulted in cancellations involved the top-level domains .support, .xin, .engineer, .istanbul, .host, .accountant and .bid. Perhaps the prevailing trademark owners felt that these domain names would not be attractive to other cybersquatters after they were cancelled.

Whatever the reason, trademark owners should think long and hard about whether to request the cancellation, rather than transfer, of a disputed domain name in a UDRP proceeding. It would seem that a domain name worth pursuing is worth keeping.

Written by Doug Isenberg, Attorney & Founder of The GigaLaw Firm

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In Whose Language? Cybersquatting by Foreigners

There are no gatekeepers to prevent registrants from acquiring domain names incorporating marks that potentially violate third-party rights. Anyone anywhere can acquire domain names composed of words and letters in languages not its own through a registrar whose registration agreement is in the language of the registrant. For example, a Chinese registrant of a domain name incorporating a Norwegian mark as in <statoil.store> in which Complainant requests the proceeding be in English notes that Chinese is not an official language in Norway. Statoil ASA v. Jie Yu / Yu Jie, D2016‑1628 (October 21, 2016) (<statoil.store>).

While the default for challenges to the domain name is the language of the registration agreement, the decision turns on the facts of the case. Nevertheless, the default concept is in keeping with the universality of the Uniform Domain Name Dispute Resolution Policy. Rule 11(a) provides that proceedings are to be conducted in the language specified in the respondent’s registration “unless otherwise agreed by the Parties.” If not “otherwise agreed” (and it is unlikely it ever would be) Panels are given discretion to make that determination “having regard to the circumstances of the administrative proceeding.”

Foremost of the circumstances are the practical consequences, namely costs of translation and time lost in closing the record. In Morgan Stanley v. Domain Admin / Whois protection, this company does not own this domain name s.r.o., FA1701001715021 (Forum March 12, 2017) (<morganstaney.com>) the registration agreement was in the Czech language. The Panel marshaled the usual (sensible) reasons in favor of “mov[ing] forward in English.” Two circumstances (not always present together in language cases) made this an easy call: first, Panels (including the Morgan Stanley Panel) typically infer from default in responding to the complaint that respondent has no objection to proceeding in complainant’s language; and second, Respondent registered a domain name composed of a typographic variant of the mark by omitting a letter. It would take an extraordinarily persuasive argument to prove a mistyped string confusingly similar to a mark is lawful.

Default, as such, is not (and never should be) the determining factor in these cases. Cancellation or transfer must rest on either direct evidence or strong inferences based on the record. The question naturally arises, how does a foreign registrant (presumably not conversant in complainant’s language) learn that a complaint has been filed? The answer is found in the UDRP Rules for satisfying due process. Rule 2(d) instructs Providers to communicate with respondents “in the language prescribed in Paragraph 11”, that is the language of the registration agreement.

Communications in this manner provide foreign respondents notice of the pendency of a proceeding and an opportunity to defend their registrations. WIPO Overview of WIPO Panel Views on Selected UDRP Questions 2.0, paragraph 4.3 states:

in certain situations, where the respondent can apparently understand the language of the complaint (or having been given a fair chance to object has not done so), and complainant would be unfairly disadvantaged by being forced to translate, the WIPO Center as a provider may accept the language of the complaint, even if it is different from the language of the registration agreement.

The sensible reasons I mentioned above for proceeding in the language requested by complainant are set out clearly in Cartier International A.G. v. Zheng Jing, D2017‑0310 (WIPO March 30, 2017) (<cartier.shop>). Respondent appeared and objected to Complainant’s request which after reviewing the facts the Panel granted:

(a) The content of the website resolved by the disputed domain name clearly features knowledgeable use of the English language.

(b) The wording in the content featured in the website resolved by the disputed domain name targets English‑speakers.

(c) Based on this evidence, using English as the language of the Complaint/proceedings would not place an undue burden on Respondent.

(d) Complainant is not acquainted with the Chinese language, and being forced to translate the materials of the proceedings into Chinese would disadvantage Complainant.

Respondent objected to the use of English as the language of the proceeding for the following reasons:

(a) Respondent is a Chinese legal citizen, and Respondent=s native language is Chinese.

(b) Respondent does not understand any other languages.

(c) Respondent cannot read or understand anything which has been written in English either in emails or attachments.

In resolving this preliminary dispute, the Panel took into account “the fact that the disputed domain name includes Latin characters and is registered in the new generic Top‑Level Domain … space comprise[d] of the English word ‘shop.'” Further,

On the record, Respondent appears to be a Chinese individual and is thus presumably not a native English speaker, but the Panel finds persuasive evidence in the present proceeding to suggest that Respondent may have sufficient knowledge of English. In particular, the Panel notes that, based on the evidence provided by Complainant; (a) the disputed domain name <cartier.shop> is registered in Latin characters and an English word, rather than Chinese script; (b) The gTLD of the disputed domain name is ‘.shop’. It is an English term; (c) The disputed domain name resolves to a website that includes both English and Chinese language content. It targets both Chinese‑ and English‑speakers; (d) Although Respondent submitted the Response in Chinese, Respondent has shown his/her capability to understand and use English.

Moreover,

In the Response, Respondent referred to the WIPO Overview of WIPO Panel Views on Selected UDRP Questions as well as a few of previous UDRP decisions, which were written in English; (e) The three Annexes to the Response are all in English language; (f) the Center has notified Respondent of the proceeding in both Chinese and English; (g) the Center informed Respondent that it would accept a response in either English or Chinese.

Considering these circumstances, the Panel finds the choice of English as the language of the present proceeding is fair to both Parties and is not prejudicial to either one of the Parties in his or her ability to articulate the arguments for this case.

Similarly in Riemann Trading ApS v. Ba Nguyen Thi Kim Hoang, CAC 101418 (ADReu April 5, 2017) (<perspirex.shop>) although here the challenged domain name is identical to the mark of a pharmaceutical product owned by a Swiss company distributed in the U.S. market. Where a respondent is offering the product (or competing products) in the English language, it will be inferred not only that English speakers are the intended target of the domain name, but the respondent is familiar with the language of the content. The Panel noted that “the Respondent is aware of the Complainant´s business language in English by using similar information in [ ] the disputed domain names.”

This does not mean foreign registrants are prejudiced by failing to appear only that the non-appearance may factor into the language decision. To take a further example: in K & N Distributors LLC v. enjoymagic, FA1701001712422 (Forum February 25, 2017) the “Registration Agreement is in the Japanese language, thus making the language of the proceedings Japanese.” However,[p]ursuant to Rule 11(a), the Panel determines that the language requirement has been satisfied through the Japanese language Complaint and Commencement Notification, and, absent a Response, determines that the remainder of the proceedings may be conducted in English.”

Deciding to conduct the hearing in English does not predict the outcome of a case. It can’t because even if the respondent fails to appear there are the other factors to consider. In K & N Distributors, Complainant lost because the “[r]egistration of the domain name [<7days magic.com>] predates both the filing date and date of first use in commerce of the trademark by many years.” Respondent had a superior right by priority.

As a general rule, then, regardless of the language of the registration agreement, proceedings will go forward on the merits which means examining (first) priority and if priority favors complainant then the strength or weakness of the mark and the contents of the website to which the domain name resolves. It is important that the language finally decided by the Panel not be prejudicial to either one of the parties in their ability to state their positions for and against cancellation or transfer. In essence, providing an opportunity to participate for respondent satisfies the due process requirements.

Written by Gerald M. Levine, Intellectual Property, Arbitrator/Mediator at Levine Samuel LLP

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