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Disturbing the Careful Balance Between Trademark Owners and Domain Name Registrants

The Panel in Torus Insurance Holdings Limited v. Torus Computer Resources, D2009-1455 (WIPO January 10, 2010) is the first panelist to offer a detailed critique of the “retrospective bad faith” line of cases first announced in City Views Limited v. Moniker Privacy Services / Zander, Jeduyu, ALGEBRAL VE, D2009-0643 (WIPO July 3, 2009) (complaint denied) and Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, D2009-0786 (WIPO August 19, 2009) (transfer granted). See previous Notes for January 6, 2010 and December 22, 2009: if “retroactive bad faith” were to take hold – if it is not a dead end – it represents an entirely new direction for evaluating abusive registration. It means that the respondent either sticks to its original purpose for registering the domain name or is called to account if changing content is seen to cross the line to infringing the complainant’s trademark rights. “The issue which those cases raise is one of considerable substantive importance, so the Panel believes it is appropriate for the Panel to explain those doubts in this decision, even if this case falls to be decided on grounds which do not call for the application of the Octogen approach.”

At the moment, “retroactive bad faith registration” is a construction in search of acolytes. Both the WIPO Final Report and ICANN insist that the complainant prove bad faith in the conjunctive. This is a different model than the Anticybersquatting Consumer Protection Act and Country Code Policies. The WIPO Final Report recommended that “the domain name has been registered and is used in bad faith” (Paragraph 171[1][iii]). The UDRP makes a subtle change. It inserts “being” between “is” and “used.” Bad faith use can be found if the domain name is being used in violation of the Policy at any time after registration, but bad faith registration is different; it is localized in time. It is an intentional act that takes place at a particular moment in past time. Given the “legislative” intent, “this Panel doubts that the framers of the Policy could have intended that proof of bad faith use of the kind described at paragraph 4(b)(iv) of the Policy should always be deemed sufficient proof, on its own, that the disputed domain name has also been registered (possibly many years earlier) in bad faith.” “It rather seems to this Panel that such evidence of bad faith use would need to be found to co-exist with bad faith intent regarding the act of registration in order to satisfy the requirement of paragraph 4(a)(iii) of the Policy.”

While “the [e]volution of panel thinking in response to new developments in the domain name system is no doubt something which should be encouraged” it must be anchored to a persuasive interpretation of the Policy. The point of disagreement in “retrospective bad faith registration” is that it transforms that which was legitimate “when it occurred” to being a breach of the respondent’s warranty, thereby justifying a finding of male fide registration regardless whether it was bona fide at the time of registration. “If that registrant, some years later, decides to put the domain name to an additional use which falls within paragraph 4(b)(iv) of the Policy, the Octogen and Ville de Paris line of cases would appear to require a finding of bad faith registration, in circumstances where the domain name was manifestly not registered in bad faith.” To the Torus Insurance Panel, this “does not seem … to be an attractive answer.”

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