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Selling Domain Name For More Than Out-of-Pocket Costs

A respondent violates the Policy when “circumstances indicat[e] that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant who is the owner of the trademark or service mark or to a competitor of that Complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name,” Paragraph 4(b)(i) of the Policy. There are two points of emphasis, “primarily for the purpose” and “valuable consideration in excess of,” etc. The first is illustrated by MediaTrac, LLC v. eNet Buzz Inc., FA0908001281461 (Nat. Arb. Forum October 16, 2009) (<loyaltytrac.com>); the second by Sunset Bronson Entertainment Properties LLC v. Jon Winston Hauer & J Winston & Company, FA0906001268209 (Nat. Arb. Forum July 31, 2009) (Note for August 11, 2009).

Selling a domain name is not prohibited by the Policy, Teradyne, Inc.Teradyne, Inc.[sic] v. 4Tel Technology, D2000-0026 (WIPO May 9, 2000) . “Were that the case, trade in domain names would of itself be objectionable, which it is not,” The Monticello Group, Ltd. v. Teletravel, Inc., D2002-1157 (WIPO April 16, 2003), and “responding to an unsolicited offer to sell a domain name does not exhibit bad faith,” Mirama Enterprises Inc, d/b/a Aroma Housewares Company v. NJDomains, Abuse Contact: abuse@mail.com c/o Gerald Gorman, FA0510000588486 (Nat. Arb. Forum January 16, 2006).

If a respondent has a right or legitimate interest in the domain name it cannot be taken away and given to the complainant. The right in MediaTrac is based on the Respondent “marketing and selling the ‘Loyalty Trac’ computer program since at least as early as 2001.” The Complainant’s trademark rights date back to October 2005. To prevail it would then have to show an earlier date of use in commerce, but it “failed to submit any additional evidence that it has rights in the mark predating Respondent’s registration of the disputed domain name.” Timing is undoubtedly the most significant factor in these cases. The Complainant also argued superiority of rights based on Respondent’s renewal of registration with knowledge of the Complainant’s trademark. “They have continued to renew the domain in order to maintain control of it, yet serve no content on the site. This all points to the fact that Respondent maintained control to disrupt the business of Complainant and profit from Complainant’s desire to use its federally trademarked name.” However, renewal as distinguished from registration is not an apposite fact. The original registrant does not lose its priority. “[M]ere renewal does not amount to registration,” BMEzine.com, LLC. v. Gregory Ricks / Gee Whiz Domains Privacy Service, D2008-0882 (WIPO August 21, 2008).” This consensus view is set forth in WIPO Overview paragraph 3.7.

Gerald M. Levine <udrpcommentaries.com>

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