One could argue, totally at odds with UDRP precedent, that it is unfair of a domain name registrant to renew registration of a passively held domain name which unfairly prevents a later acquiring trademark owner from using the corresponding domain name for its business. Good faith registration followed by bad faith use and renewal of registration is frequently raised to justify transfer of registration. Complainant made this argument in a recent decision from the Czech Arbitration Court Coffee Bean Direct LLC v. Claude Pope, CAC 100654 (ADR.eu November 12, 2013) (<coffee direct.com>) relying on Benoit Thiercelin v. Medicalexpo.com, CAC 100235 (ADR.eu May 23, 2011) (<medicalexpo.com>). The Panel in Coffee Bean rejected the argument, but the earlier Panel in Benoit Thiercelin accepted it.
The view that an earlier registering domain name holder is vulnerable to having its generic word/descriptive phrase domain name forfeited on evidence of bad faith use followed by renewal of registration is a close relative of the position taken in Eastman Sporto Group LLC v. Jim and Kenny, D2009-1688 (WIPO March 1, 2010) (<sporto.com>). Eastman Sporto has generated little support from panelists and is most likely influenced by the Anticybersquatting Consumer Protection Act (ACPA). UDRP is an “and” model, the ACPA is an either/or model for relief from alleged cybersquatting. Under the ACPA relief is premised on a finding that the domain name registrant has either registered OR is using the domain name in bad faith.
Nevertheless, the Eastman Sporto view continues to have a hold on complainants as evidenced by Complainants’ arguments in Coffee Bean and in Guru Denim Inc. v. Ibrahim Ali Ibrahim Abu-Harb, D2013-1324 (WIPO September 27, 2013) (TRUE RELIGION and <true religion.com>). There is no doubt that in both Coffee Bean and Guru Denim Respondents retooled their websites to take advantage of Complainants’ trademarks. Gur Denim’s complaint was dismissed, but it has challenged th UDRP order by filing a federal action for cybersquatting under the ACPA. This is an important case because the domain name was registered well before the trademark owner acquired its mark.
It is not the first time that an unsuccessful UDRP complainant has taken the federal route, but there are factual differences between the earlier cases and the case of <truereligion.com>. A favorable decision to Guru Denim is likely to reshape Internet business models. Let’s look at an earlier case decided under the ACPA in which the plaintiff/mark owner who had been unsuccessful in an administrative proceeding prevailed in the plenary action. Complainant in Newport News, Inc. V. Vcv Internet, AF-0238 (eResolution July 18, 2000) failed in having the domain name transferred to it, but Respondent subsequently changed its use Complainant commenced an ACPA action rather than re-file a UDRP proceeding and prevailed.
The Court in Newport News Holdings Corporation v. Virtual City Vision, Incorporated, d/b/a Van James Bond Tran, 650 F3d 423 (4th Cir. 2011) found that defendant (previously Respondent in the UDRP proceeding) “shifted its focus away from the legitimate service of providing information related to the City of Newport News” to competing with the plaintiff for Internet traffic. The court held that a domain name holder “cannot escape the consequences of its deliberate metamorphosis.” Plaintiff successfully moved for partial summary judgment on its ACPA claim and obtained in addition to the domain name substantial statutory damages. If the essential facts in Guru Denim v. Ibrahim Ali Ibrahim Abu-Harb, 1:13-cv-12756-DPW (D.Mass. Oct. 30, 2013) match Newport News, then defendant (Respondent in UDRP proceeding) will not find a receptive court to bad faith use.