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Legitimacy and Good Faith Undermined by Knowledge of Complainant and its Trademark

Speculating, offering to sell and monetizing domain names composed or dictionary words and descriptive phrases without more are not actionable under the Policy even if respondent fails the right or legitimate interest test. The more is proof of intent at the time of registration to take advantage of complainant’s reputation in the marketplace. Bad faith is undermined or bolstered by respondent’s attempt (if it appears) to rebut complainant’s prima facie case. If rebuttal fails, bad faith principally rests on respondent’s knowledge of (or willful blindness to) complainant and its trademark and the content of the domain name. Knowledge is awareness of the complainant and its trademark, but there must also be targeting.

The point about abusive registration is underscored in FACI Industries v., Inventory Management, D2012-0146 (WIPO April13, 2012). FACHI is a registered trademark. The Respondent asserted that it had the right to register and use the domain name for the following reasons:

[1] the term “faci” is “not only a common acronym, but also a common surname and a dictionary term subject to a diversity of third party use” ….

[2] numerous entities unrelated to Complainant have registered and are using domain names containing the term “faci.”

The Panel’s summary of Respondent’s response continues, “[s]ince the term ‘faci’ is ‘no more than a common acronym, a surname, or dictionary term in three languages,’ Respondent [claims it] was entitled to register and use the Domain Name on a ‘first come, first served’ basis.” These arguments beg the issue.

Although in Fachi Industries Respondent’s argument touches the usual stations of defense it is not ultimately persuasive against Complainant’s two-level demonstration that 1) the trademark existed prior to the registration of the domain name and was well-known in the market in which Respondent is located; and 2) the website “speaks” (metaphorically) against Respondent’s good faith by containing links to Complainant’s competitors. To the extent that “fachi” may be generic, strong trademarks are not weakened by their compositions.

The pivotal question is awareness. The Panel concluded that there was sufficient evidence in the record to find that Respondent was aware of Complainant’s FACI mark when it registered the domain name. While it is true that domain name speculation and sale of domain names can be legitimate interests there is always a crucial qualifier. If respondent is unaware, could not have been aware and there is no factual support otherwise, and the website speaks to the truth of respondent’s denial, then complainant fails to demonstrate abusive registration. The Panel noted

the fact that other people and entities make use of the term “faci” in various contexts does not by itself legitimize Respondent’s activities vis-à-vis this Domain Name. Respondent asserts that it has rights and legitimate interests in the Domain Name because “faci” “is no more than a common acronym, a surname, or dictionary term in three languages”, however, as found in prior UDRP decisions, use of a domain name to resolve to a PPC or splash page is not of itself a legitimate use because the Respondent is not using the Domain Name in any way that is related to its generic meaning. “The mere fact that a word identical to the Domain Name exists as a defined dictionary term does not give rise to any rights or legitimate interests in the name on the part of a respondent who uses it in ways like this that are not tied to the generic meaning of that word.”

The underlying premise is clear: “Someone else actually named ‘faci’ or actually using ‘faci’ in some connection might have an easy time establishing rights or legitimate interests in the Domain Name, but Respondent has no such interest.” Legitimacy, and ultimately bad faith, cannot be excused merely because what the respondent does is lawful. Domain names eagerly sought after by trademark owners are assets like any other and the fact that they may be expensive to acquire is not grounds for forfeiture. But, a respondent “may [not] defend against a claim under paragraph 4(b)(i) … by arguing that parties in addition to Complainant were also offered the opportunity to buy the Domain Name,” citing Sabanci v. iu, D2003-0498 (WIPO July 23, 2003). In Sabanci, Respondent purchased the domain name and immediately offered it for sale. One of its arguments was “In any determination of bad faith, the word ‘use’ necessarily refers to an active behavior and the absence of any behavior may not be considered as a ‘use’, neither as a ‘bad faith use’.” This, of course, is not the law. Not resolving to an active website does not redefine the conduct. A “squatter” is using the domain name by squatting. As in real estate, so in cyber law no right is established by trespass.

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