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Lacks Rights or Legitimate Interests, But No Bad Faith Registration

The Anticybersquatting Consumer Protection Act is more friendly to trademark holders than the UDRP in that proof of bad faith is in the disjunctive and satisfied by proof that the respondent either “registers, traffics in, or uses a domain name,” 15 U.S.C. 1125(d)(1)(A) (ii).” However, the plenary route is considerably more costly and time consuming to prosecute. Nevertheless (assuming jurisdiction), it may be the only way to shut down a respondent taking advantage of the complainant’s trademark. Under the UDRP a respondent who registers the disputed domain name in good faith and then opportunistically changes its model to take advantage of the trademark holder’s reputation is free to continue the exploitation – but not so transferees or subsequent purchasers. Typically, the complainant is sent on its way, as seen in FPI Fireplace Products International Ltd. v. Rick Eudaley c/o New Energy Distributing, Inc., FA0910001289623 (Nat. Arb. Forum December 15, 2009) (respondent did not appear). However, if the complainant is lucky enough to have its complaint assigned to the panelist who decided Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, D2009-0786 (WIPO August 19, 2009) (See Notes for November 12 and December 4, 2009) the registrant might be found retroactively in bad faith for its subsequent use.

In FPI Fireplace the Respondent registered <> before the “Complainant began using the REGENCY mark to promote its fireplace products.” Black letter law holds that there can be no bad faith where the respondent registered the domain prior to the complainant’s use of the trademark. There are panelists who are now questioning this reading of the UDRP, but it is the “consensus” view as noted in the WIPO Overview 3.1, “Normally speaking, when a domain name is registered before a trademark right is established, the registration of the domain name was not in bad faith because the registrant could not have contemplated the complainant’s non-existent right.”

Although the Panel found that the Respondent in FPI is currently using the disputed domain name to promote a competitor of the Complainant, therefore lacks any right or legitimate interest in it, it nevertheless prevails under the UDRP because it registered the domain name earlier than the Complainant acquired its trademark rights. In these cases, the UDRP is more effective for the complainant against a second generation registrant, as discussed in Friday’s Note. A respondent is not immunized from liability because its predecessor acquired the domain name in good faith, HSBC Finance Corporation v. Clear Blue Sky Inc. and Domain Manager, D2007-0062 (WIPO June 4, 2007) (<> ).

The parties in FPI Fireplace appear to be located respectively in British Columbia, Canada and Iowa, USA. For an ACPA action, the complainant does not have to be a citizen of the U.S. The parties in The Heathmount A.E. Corp. v., 2000 U.S. Dist. LEXIS 10591 (E.D. Va. July 24, 2000) were both Canadian citizens. The defendant’s only connection to the U.S. was that it had registered the domain name with Network Solutions, Inc., which is located in Virginia.

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