UDRP complainants are expected to get it right the first time, and if they don’t there’s a narrow window for a second filing. Evidence previously available but overlooked will not support a new complaint, although this does not preclude the possibility of one being accepted on evidence of new facts. In Haru Holding Corporation v. Michael Gleissner / NextEngine Ventures LLC, FA1607001685263 (Forum August 30, 2016), to take one example, the Panel concluded that the time between registration of the domain name and the filing of the complaint was too short for bad faith use to develop and held that “[s]uch a short time may be insufficient to launch a proper website.”

While Respondent technically prevails in Haru Holding, the Panel found it lacks rights or legitimate interests, so its win is inconclusive. The value of the decision lies in its implicit warning for complainants not to jump the gun; the complaint is not so much defective (or getting it wrong!) as premature, which is the reason in Haru Holding and other cases that panelists invite complainants to refile “[i]f in the future the relevant circumstances materially change, Complainant may address such circumstances in a fresh complaint.”

In Soluxury Hmc, Accor v. Federico Guillemaut Despecher, D2015- 2371 (WIPO March 5, 2016) (<mybeds.com>) the Panel concluded there was sufficient uncertainty in the record to deny the complaint “without prejudice.”  Instead of giving Respondent a clean bill of health in affirmatively finding it had rights or legitimate interests the Panel was “unable to find that the First Complainant has established that the Respondent does not have rights or legitimate interests in the disputed domain name.”  This leaves the issue open for another day.

This is not to suggest that premature filings lack strategic value; there’s always a possibility respondents will  default, but if they appear the complaint flushes out respondents’ narratives and declared explanations for the registrations. Respondents in both Haru Holding and Luxury Hmc appeared and made appropriate declarations of innocence (which has to accepted on face value); defaults may very well have produced different results. As it is, I expect both websites will be monitored for use, and since the Complainants in both cases have priority the question of bad faith registration remains open and disputable.

It should also not be thought that invitations to refile or awards “without prejudice” are necessary predicates for refiling. No such phrase has to be uttered (they are, in fact, gratuitous) for the simple reason that respondents’ warrantees and representations that their registrations were lawful can outlive dismissed UDRP complaints. That was certainly the message in Bridgewater Associates, LP v. Private Registration, FA1511001650226 (Forum January 18, 2016) which I’ll get to in a moment. Dismissal in situations in which the limitations of the UDRP process prevent full discovery favor appearing respondents holding generic names, but is not necessarily secure from further arbitration or litigation.

Taking one example without predicting the future. The fact that a three-member Panel in KGP Telecommunications, Inc. v. KGP International Limited, FA1607001685573 (Forum September 7, 2016) (<kgp.com>) dismissed the complaint for a three-letter domain name passively held is a win, but also not conclusive.  Why?  Because, as the Panel correctly notes it is

not in a position to second-guess Respondent’s assertions as to its knowledge and its intentions, because “the Policy and the Rules do not provide the Panel with any authority to ascertain the Respondent’s credibility given the limitations on filings, the absence of discovery and the procedural efficiencies that are a part of (although admittedly occasionally detrimental to) this process” (Citing Google Inc. v. Blue Arctic LLC, FA1206001447355 (Forum July 25, 2012).

Respondent in KGP Telecommunications prevails for negative reasons, not for proof positive in its favor. It wins because 1) “it is obvious that Respondent is not using the Disputed Domain Name in a manner that creates a likelihood of confusion with Complainant or the KGP Trademark, because Respondent is not using the Disputed Domain Name in connection with an active website” (emphasis added); and 2) “the disputed domain name is comprised of a generic acronym, consisting only of three letters, which in theory may stand for several different things, with the addition of a gTLD” citing Perpetual Motion Interactive Systems Inc. v. NameBubble LLC, FA0806001212590 (Forum August 13, 2008).

Passive use of generic terms is not unlawful; it becomes unlawful if the use is infringing. Thus, while the decision in KGP Telecommunications is correct, it’s not conclusive for the same reason pointed out in the Google decision, namely there’s no way of testing credibility even though Panels may be skeptical of Respondent’s narrative. That’s the reason I think that the Panel in KGP Telecommunications decided not to rule on the issue of rights or legitimate interests.

But if any of these Complainants return to battle it must be with new facts. The point is illustrated in the first Bridgewater complaint (noted in the link above) in which Complainant’s applied-for trademark was subsequently accepted for registration after having its first complaint dismissed. In the earlier decision, the panelist denied the complaint for lack of trademark rights even though it had found Respondent lacked rights or legitimate interests and was (in fact!) liable for abusive registration, Bridgewater Associates, LP v. Private Registration, FA1509001637996 (Forum October 19, 2016): “Respondent’s registration and use of the disputed domain name for what appears to be a fraudulent phishing scheme aimed at Complainant’s clients or potential clients is evidence of bad faith under paragraphs 4(b)(iii) and 4(b)(iv).” The maturation of the trademark application to registration was the new fact supporting the refiling.

In contrast, there is no second chance for complainants whose complaints are denied because respondents are affirmatively found to have rights or legitimate interests even if they later begin using them in bad faith. Federal courts have weighed in on this issue in a couple of notable decisions. While trademark registrations represent the kinds of new facts that support refiling, changed use does not. For example, if Respondent in KGP Telecommunications develops its own business and later pivots to infringement, the claim will be nonactionable under the UDRP but actionable under the ACPA and the Lanham Act.

This is because the warranty and representation provisions of the registration agreement and UDRP have been construed by panelists to mean that registrants didn’t have any unlawful intention at the time of registration. If the registration was not in bad faith and is used conformably with a business but registrant only later commences bad faith use, there could not have been (by definition) any breach of the warranty.

However, if the same argument were made in federal court under the ACPA, change of use later in time to a good faith registration will be a factor in finding cybersquatting. This result follows because the ACPA is a disjunctive model of liability. The Complainant in Superiority, Inc. d/b/a Just Bulbs v. none/ Motherboards.com, D2003-0491 (WIPO October 9, 2003) and Bulbs 4 East Side Inc., d/b/a Just Bulbs v. Fundacion Private Whois/ Gregory Ricks, D2013-1779 (WIPO January 13, 2014) lost the first time because the phrase “Just Bulbs” (and Respondent’s use of it) was too generic to support cybersquatting. The refiled complaint also failed because there was no new evidence undermining good faith registration (conjunctive model of liability), but Complainant prevailed in federal court on summary judgment for the statutory claim, Bulbs 4 East Side Inc. V. Gregory Ricks, 14-CV-3672 (S.D. Texas Houston Div. August 10, 2016) (previously discussed in “Challenging UDRP Awards in Courts of Competent Jurisdiction.”)

Whether to refile or sue in a court of competent jurisdiction depends on the record.  For the UDRP, there has to be the right alignment of facts postdating the original complaint. The right alignment does not include factual circumstances in which respondents were found to have rights or legitimate interests; successful refilings most likely include the missing facts that only become known after the award. Complainants’ whose trademarks postdate respondents’ rights have no actionable under the UDRP; if they have any sustainable claim it would have to be for trademark infringement. On the other hand, priority of right remains a critical factor so that if complainants’ trademarks predate registrations of domain names previously passively held and subsequently used in bad faith, that fact alone is sufficient to support  an inference of bad faith registration.

Mr. Levine is the author of a treatise on trademarks, domain names, and cybersquatting, Domain Name Arbitration, A Practical Guide to Asserting and Defending Claims of Cybersquatting under the Uniform Domain Name Dispute Resolution Policy. (Legal Corner Press, 2015). Learn more about the book at Legal Corner Press. Available from Amazon and Barnes & Noble.  Ongoing Supplement and Update here.  Supplement and Update through August 2016 in pdf format will be available without charge. See forthcoming announcement.