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Former Employees Registering Domains in their Own Names Without Employer’s Knowledge and Contrary to Instructions

An employee charged to attend to his employer’s intellectual property assets can have no right or legitimate interests in domain names he registers in his own name. The former employee in SIELTE S.p.A. v. Salvatore Gueci, FA1109001408629 (Nat. Arb. Forum November 7, 2011) offered to return the domain name for consideration, a violation under paragraph 4(b)(i) of the Policy, but even had it made no explicit proscribed offer, simply refusing to transfer the domain name is itself a violation. It implies a quid pro quo, but is silent on the quo. In acting against instructions, there is a presumption of bad faith. (The act of registration may also as a civil law action be a breach of fiduciary duty, but that is not the determinative theory under the Policy). In Sonic-Crest Cadillac, LLC v. Hayes, FA 212652 (Nat. Arb. Forum Jan. 14, 2002) the Respondent “registered the disputed Domain Names on behalf of and with instruction from Complainant, but registered them in the name of Respondent’s entity.” Presumption of bad faith does not apply to an employee who holds registrations in his own name but acquired his right or legitimate interest in a different relationship prior to his current employment. ITMetrixx, Inc. v. Kuzma Productions, D2001-0668 (WIPO August 2, 2001).

Registration of domain names identical or confusingly similar to a former employer’s trademark is presumptively bad faith. In Cap Gemini v. Anant Goel, D2011-1310 (WIPO September 23, 2011) the Respondent alleged that it had created a venture for “consulting services in Indian Investments … under the nomenclature ‘CAP.G.E.M INI Consulting’.” That is, “Cap[ital] [] G[rowth in] E[merging] M[arkets] I[ndian] I[nvestments] Consulting.” Even if only by coincidence acronymic letters match the complainant’s trademark and respondent genuinely operates a business under that badge (neither of which was the case in Cap Gemini) the registration violates the Policy.

Former employees (including directors and officers, Simple Abilities Inc. v. Jeff Hoogveld and Adaptivies Abilities Inc., D2006-0143 (WIPO June 4, 2006) have devised various arguments in support of their right or legitimate interest and against forfeiture of the disputed domain name. Arguments without merit include: 1) registering domain names to enhance alleged ownership interest in the complainant, Automobile Atlanta, Inc. v. Treadway Solutions, FA0910001292305 (Nat. Arb. Forum December 18, 2009) (“[W]hatever the motives, there is no excuse for [inactivating domain names or retaliating for perceived slights] … both are clear evidence of bad faith” and 2) keeping control of the domain name because it is respondent’s “one and only protection” for recovering on unpaid invoices, Nova Banka v. Iris, D2003-0366 (WIPO June 30, 2003) (“Even if the Respondent never tried to sell or rent the Domain Names to the Complainant for an amount of money exceeding the Respondent’s out-of-pocket costs, it continuously exercises pressure over the Complainant.”). A meritorious argument is fair use of the domain name for commentary or criticism, Spokane Civic Theatre v. James Ryan, FA1109001409107 (Nat. Arb. Forum November 1, 2011), where the emphasis is on the use to which the domain name is put.

Whether a former employee while employed had no corrupt intention when registering the domain name is irrelevant. His refusal to transfer on termination of employment or on request if registration is later (assuming no paragraph 4(c) defense) allows the inference that he had an ulterior motive in registering the domain name in his own rather than his employer’s name. Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, D2009-0786 (WIPO August 19, 2009) (“Respondent registered the domain name at issue under his own name in connection with the business of Complainant in full contemplation of Complainant’s assertion of rights in the OCTOGEN mark. The subsequent use of the domain name has been principally in connection with Complainant’s business.”).

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