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Abusive Registration Solely by Bad Faith Use

Can there be abusive registration solely by bad faith use? The circumstances  under paragraph 4(b)(iv) are different from those of paragraphs 4(b)(i-iii) in that 4(b)(iv) refers only to “use” while the other three refer only to registration. Paragraphs 4(b)(i) and (ii) expressly condemn registering domain names where the “primary purpose” is to take advantage of the goodwill and reputation of the trademark. Although paragraph 4(b)(ii) does not incorporate the phrase “primary purpose”, it implies it. However, the different phrasing raises this question: Does bad faith use imply bad faith registration?  This is turning out to be a matter of controversy. The analysis begins with the phrasing of the preface to paragraph (4)(b), which reads that “[f]or the purposes of Paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith.” Read together paragraphs 4(a)(iii) and 4(b) have traditionally been construed to require that the complainant prove both registration and use in bad faith.

The disjunctive model found in the ACPA and country code policies has been said “not [to be] importable into the UDRP,” Editions Milan v. Secureplus, Inc., D2010-0606 (WIPO June 10, 2010), but the conjunctive model is nevertheless under challenge, the latest entry being Jappy GmbH v. Satoshi Shimoshita, D2010-1001 (WIPO September 28, 2010), drawing oxygen from Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, D2009-0786 (WIPO August 19, 2009); Ville de Paris v. Salient Properties LLC, D2009-1278 (WIPO December 3, 2009) <wifiparis.com>) and one or two other decisions. Refutation of this “retroactive bad faith” construction appears in Torus Insurance Holdings Limited v. Torus Computer Resources, D2009-1455 (WIPO January 10, 2010). Torus and other cases essentially hold (as summarized by the Panel in Jappy) that

the complaint must fail if it cannot establish that the initial registration by the respondent occurred in bad faith. Put in summary form, the reasoning of those panels is that the ‘ordinary meaning’… of the phrase “domain name has been registered and is being used in bad faith” shows “unequivocally” [citing Torus] that the complainant must show bad faith registration of the domain name by the respondent as well as bad faith use of the domain name by respondent.

Further, according to those panels, the word “and” is used conjunctively not disjunctively; thus, it is plain and unequivocal that initial registration in bad faith by the Respondent is a prerequisite to success under the Policy.” The Jappy Panel is of the view that “and” and “or” are interchangeable and offers in support what I previously termed a W.S. Gilbert quip from Lord Salmon (Note of November 1). The plain meanings of the words, however, as defined in The Third International Dictionary are: “and” means “along with” or “together with” as opposed to “or” which means “alternative to.”

The Jappy Panel would reconfigure the UDRP to be more like the ACPA and country code policies in which a defendant/respondent is statutorily liable for cybersquatting when it violates Paragraph 4(b)(iv) of the Policy regardless whether it registered the domain name in good faith. While it is true that the precedential construction under the Policy leads to anomalous verdicts in which the respondent prevails despite its egregious bad faith use of the domain name it is (and for the last 11 years has been considered to be) the “policy” choice determined by ICANN as recommended by WIPO.

There are two hooks to the Jappy and Octogen construction. The linguistic hook is the absence of the word “registration” in paragraph 4(b)(iv) which yields the conclusion that bad faith use is abusive regardless of good faith registration. This (according to the Octogen Panel) is reinforced by Paragraph 2 of the Policy which reads: “[Y]ou will not knowingly use the domain name in violation of any applicable laws or regulations.” According to the Octogen Panel “this provision not only imposes a duty on the part of the registrant to conduct an investigation at the time of registration, but also includes a representation and warranty by the registrant that it will not now or in the future use the domain name in violation of any laws or regulations.” It is the lynchpin for the construction.

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