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Timing, Geographic Distance and Knowledge of Trademark

How does a trier determine that the respondent registered a disputed domain name in bad faith when the respondent fails to make an appearance in the proceeding? Whereas in a court of law a defendant’s default in answering a complaint is an admission of liability, in an ICANN proceeding the complainant prevails only if it proves all three elements of the Policy. The rules of the Policy allow for inferences to be drawn from evidence both apparent and hidden. The Panel notes in La Quinta Worldwide, L.L.C v. Rudi Seiberlich, D2011-0385 (WIPO April 11, 2011), “it is possible to draw inferences from the evidence that has been submitted and in some cases from silence.” Rule 14(b) of the Policy reads: “If a Party, in the absence of exceptional circumstances, does not comply with any provision of, or requirement under, these Rules or any request from the Panel, the Panel shall draw such inferences therefrom as it considers appropriate.”

Bad faith use of the domain name is easier to establish because content speaks loudly. But bad faith registration is more difficult, significantly so where the parties reside geographically distant from each other and easier where the complainant does business in the market of respondent’s domicile. In La Quinta Worldwide, Complainant owns the LA QUINTA mark; the disputed domain name is <la-quinta-hotels.com>.The undisputed facts show that

Complainant is a large and well-known United States company operating in the hotel industry. It has been involved in that industry since 1969 and operates some 65,000 hotel rooms. It is the registered proprietor of many trademarks for LA QUINTA and variants of that trademark both within the United States and internationally, including in Italy where the Respondent is domiciled.

So, in La Quinta Worldwide it is more probable than not that the respondent had actual knowledge of the complainant’s trademark. Dashes or any minor variation of the trademark are a clue to intention. Adding grammatical indicators does not distinguish the domain name but calls attention to the mark. Why would a respondent acquire a domain name identical or confusingly similar to a trademark unless it can explain an innocent purpose? The La Quinta respondent is holding the domain name passively, but that also speaks loudly. Since there is no content from which bad faith use can be deduced it can be inferred from certain absences of information within respondent’s sole control.

It has long been established that where the trademark precedes the registration of the domain name and the parties are geographically congruent passive use amounts to the Respondent acting in bad faith. TheTelstra Corporation Limited v. Nuclear Marshmallows, D2000-0003 (WIPO February 18, 2000). The Panel in that case stated

The question that then arises is what circumstances of inaction (passive holding) other than those identified in paragraphs 4(b)(i), (ii) and (iii) can constitute a domain name being used in bad faith? This question cannot be answered in the abstract; the question can only be answered in respect of the particular facts of a specific case. That is to say, in considering whether the passive holding of a domain name, following a bad faith registration of it, satisfies the requirements of paragraph 4(a)(iii), the Administrative Panel must give close attention to all the circumstances of the Respondent’s behaviour. A remedy can be obtained under the Uniform Policy only if those circumstances show that the Respondent’s passive holding amounts to acting in bad faith.

He then articulated the following test for a remedy in complainant’s favor:

(i) the Complainant’s trademark has a strong reputation and is widely known …, (ii) the Respondent has provided no evidence whatsoever of any actual or contemplated good faith use by it of the domain name, (iii) the Respondent has taken active steps to conceal its true identity, by operating under a name that is not a registered business name, (iv) the Respondent has actively provided, and failed to correct, false contact details, in breach of its registration agreement, and (v) taking into account all of the above, it is not possible to conceive of any plausible actual or contemplated active use of the domain name by the Respondent that would not be illegitimate, such as by being a passing off, an infringement of consumer protection legislation, or an infringement of the Complainant’s rights under trademark law.

The first and fifth prongs of the test carry the greatest weight and are generally conclusive.

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