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Untying Registration and Use in Construing Bad Faith

The two letter combination “hz” is not by itself confusingly similar to “Hertz” (the automobile rental company) despite the aural similarity, but can become so when coupled with “car,” as in <hzcar.com>, Hertz System, Inc. v. Kwan-ming Lee, D2009-1165 (WIPO October 14, 2009). Asserting purity of intention for future use as proof of right or legitimate interest is insufficient to establish a paragraph 4(c)(i) defense. “A virtually unbroken line of Policy precedent holds that more than merely an intent to use the disputed domain name for a proper purpose [is necessary to] meet this standard.” This leaves open the question of bad faith. A respondent can have no right or legitimate interest in the disputed domain name, yet win on default of the complainant proving bad faith in the conjunctive.

So, the question in Hertz is, Notwithstanding the confusing similarity and the lack of rights or legitimate interests could the Registrant have been pure of heart in registering the disputed domain name? It takes some legerdemain but the Panel concluded that on balance he could not tell about the purity of heart, which is fatal for the Complainant who has to prove impurity. The path to this extraordinary decision is, I believe, idiosyncratic, but interesting. The Panel implies that if the Respondent had been a domainer the result would have been different. “Complainant has not shown that Respondent is a domainer, to whom certain presumptions and obligations might apply, among them knowledge of what a registrar or internet service provider might be permitted to do with a dormant domain name.” While there is precedent for a different standard for domainers the facts from which inferences are drawn for non-domainers are considered from a different perspective. The combination of “hz” and “car” in a case involving Hertz car rental service is not an inconsiderable fact. It carries a strong inference that the Respondent was not unaware of his choice’s association with the Complainant.

Paragraph 4(a)(iii) of the Policy requires the complainant to show bad faith in the conjunctive. However, paragraph 4(b) 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” (emphasis added). Paragraph 4(b)(i), (ii) and (iii) refer only to registration, while 4(b)(iv) refers only to use. Strictly construed, if any of these instances of violation are found, whether registration or use, they satisfy paragraph 4(a)(iii) of the Policy. It is this that the Panel dubs the “unified concept”and traces back to Telstra Corp. v. Nuclear Marshmallows, D2000-0003 (WIPO February 18, 2000).

Applying the “unified concept”, the Hertz Respondent is guilty of abusive registration for violating paragraph 4(b)(iv) of the Policy, but “[t]his Panel is not presently prepared to read the few unified concept approach cases to say that any use in bad faith, even occasional conduct that fits squarely within one of the examples of bad faith in paragraph 4(b) of the Policy, as automatically establishing bad faith for purposes of paragraph 4(a)(iii)” (emphasis in the original). This view is not inconsistent with past decisions that hold, for example, that good faith registration followed by bad faith use does not satisfy the complainant’s burden of proof unless, of course, there is proof sufficient to infer bad faith registration from such use. The temporal distinction, the respondent’s intent at the date of registration, if mala fide, must be proved.

The difference with Hertz is that the Respondent’s addition of “car” to “hz” is a clue to his motivation, the Panel’s rejection of the implications notwithstanding. Instead, the Panel focused on the acronym “hz” (the common abbreviation of the radio frequency unit for Hertz). “The touchstone of bad faith … turns on whether Respondent chose the disputed domain name for its value as an acronym or as an aural imitation of [Complainant’s] mark.” This analysis, however, is overly contrived. It would be appropriate if the domain name were <hzswitch.com>, but is questionable for <hzcar.com>. This is a case in which the Respondent who lives in the United States and would be dumb and blind not to have heard of Hertz car rental business benefits from the Panel’s doubt.

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