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When Bad Faith Use Precedes Renewal and Continues After It

Ordinarily, a domain name registered in good faith that is subsequently used in bad faith is invulnerable to a charge of cybersquatting under the UDRP. But, this not altogether true under all circumstances. It is true where the domain name predates the trademark and there is no evidence of unregistered rights to the mark. It is not true where the circumstances compel a different result. The question is, what are the circumstances that justify departure from the expected result of denying the complaint?

The easiest example for finding bad faith registration where the domain name is acquired before a trademark comes into existence is a situation in which a respondent acts opportunistically to register a domain name identical or confusingly similar to an anticipated mark by a party who has a prior right to the domain name. This circumstance is explained in the WIPO Overview Paragraph 3.1; first, there is the consensus, following by the exception:

Consensus view: Generally speaking, although a trademark can form a basis for a UDRP action under the first element irrespective of its date . . . , when a domain name is registered by the respondent before the complainant’s relied-upon trademark right is shown to have been first established (whether on a registered or unregistered basis), the registration of the domain name would not have been in bad faith because the registrant could not have contemplated the complainant’s then non-existent right.

However: In certain situations, when the respondent is clearly aware of the complainant, and it is clear that the aim of the registration was to take advantage of the confusion between the domain name and any potential complainant rights, bad faith can be found.

The consensus construction of the UDRP is essentially a concession to complainants who have a better right to the domain name but are outrun to the registrar. It is “well-established” (notes the Panel in The Old Course Limited v. Patrick Woods, D2010-0682 (WIPO June 6, 2010)) “that a high profile announcement of a new corporate name can generate goodwill in that name … and [is] recognised as sufficient for the purposes of the first element of the UDRP.”

Declaring renewal as a factor in determining abusive registration become increasingly harder where respondents’ registrations of domain names either precede trademark acquisitions or there is good faith registration and subsequent bad faith use. Before I talk about this line of cases in which renewal is a factor—beginning with Eastman Sporto Group LLC v. Jim and Kenny, D2009-1688 (WIPO March 1, 2010)—it should be pointed out that the analytical problem lies in the peculiar requirements of the UDRP, namely that complainants have to prove both registration in bad faith and use in bad faith. Other anticybersquatting regimes such as the Anticybersquatting Consumer Protection Act in the U.S. and various country code policies are modeled on an either/or structure.

Finding renewal of registration a factor in determining bad faith is unusual because it subverts the consensus view which is set forth in the WIPO Overview at Paragraph 3.7 which states that

While the transfer of a domain name to a third party does amount to a new registration, a mere renewal of a domain name has not generally been treated as a new registration for the purpose of assessing bad faith.

Interestingly, the consensus also includes the sentence “Registration in bad faith must normally occur at the time the current registrant took possession of the domain name.” This introduces another concession that there are circumstances in which registration in bad faith can be found at the time of renewal. Thus, a small number of Panels

have begun to consider the renewal of a domain name as equivalent to a new registration in certain circumstances, including where it is found that: the registrant changed its use of the domain name prior to renewal; such use amounts to textbook cybersquatting; and the registrant nevertheless proceeded to renew the domain name registration with intent to benefit from its inclusion of the complainant’s trademark.

Before Eastman Sporto Panels were reluctant to find renewal of registration a triggering factor. For example, in PAA Laboratories GmbH v. Printing Arts America, D2004-0338 (WIPO July 13, 2004) the Panel noted that it did not believe “[t]he benefit of an original good faith registration should [ ] be perpetual to the point where it can cloak successors in title and successors in ‘possession’ long after the original registration would have expired,” but it nevertheless aligned itself with the consensus, “reluctantly”: “[i]n making its finding, the Panel wishes to clarify that its decision under this element is based on the need for consistency and comity in domain name dispute ‘jurisprudence.’”

The factor that triggers a finding of abusive registration after renewal rests on the continuation of bad faith use even if there had been no bad faith registration. In Avenue 81, Inc. V. Karl Payne, D2014-1825 (WIPO January 19, 2015), for example, the Panel explained that “Sporto does not hold that any renewal of a domain name in any circumstances automatically restarts the clock on evaluating registrations in bad faith.” The clock is restarted if the respondent changed its use to infringing before and continues the infringement after renewing registration. It does not apply to a situation in which respondent’s earlier registered domain name is identical or confusingly similar to a later acquired trademark. In alleging cybersquatting for renewing a domain name that corresponded to its later acquired trademark the Panel found Avenue 82 guilty of reverse domain name hijacking.

As these renewal cases come down it is becoming increasing clear that where warranted by the facts the Panel in Eastman Sporto was right and the Panel in PAA was wrong. There are in fact circumstances that truly do compel finding renewal as a triggering factor. This reasoning does not contradict the principal first established that renewal is a continuation of ownership, but it goes further in recognizing a distinction that the right to continue holding a domain name can in some circumstances be contingent.

Such is the Panel’s reasoning in Adam Milstein v. Benjamin Doherty, FA1511001647496 (Forum January 11, 2016). There are, the Panel noted in Adam Milstein, two different issues. First, the paragraph 4(c)(iii) defense of fair use commentary and criticism  of Complainant, a noted philanthropist whose politics is on the opposite end of the spectrum from respondent’s (against the counter allegation of disparagement) . Then there is the issue of renewal of registration that continued the alleged bad faith use after renewal. The Panel dealt first with the defense: “What is at issue here is the deliberate creating of a false impression by registering a domain name using the entirety of another person’s name without permission and linking it to a website containing disparaging material about the person whose name has been used to create the domain name [and continuing that use after renewal of registration].”

One has to ask, of course, in what way does a respondent lose its Constitutional right to commentary and criticism of a trademark holder’s services? This is a complicated question when it comes to a trademark of a personal name for services in the field of philanthropy. Is it possible to separate out criticism of the trademark owner and its services (which is protected) and disparagement of the individual (which, arguably at least, is not)? The Panel is acutely sensitive to the Constitutional issue:

This argument of course an important one, as is free speech itself and it is frequently raised in UDRP proceedings, especially where the case concerns American parties and a chosen American jurisdiction. . . . That conflict has been accurately expressed in the decision in Sutherland Institute v. Continuative LLC, WIPO Case No. D2009-0693, where the panelist put it in the following way:

“Freedom of speech or expression is a strongly protected constitutional right in the United States. Yet individuals do not enjoy absolute freedom of expression with respect to terms protected as trademarks or service marks. Rights granted to trademark owners operate as a limited restriction on freedom of speech . . . . The strong free speech right may come into tension with trademark rights, and it is the role of courts and administrative panels to sort out the proper balance.”

Nevertheless, in Sutherland the complaint was denied, whereas in Adam Milstein it was granted. Sorting out the proper balance is no easy matter. The Panel’s “conclusion on the [ ] submissions [in Alan Milstein] is twofold”:

First, the conduct that Respondent engaged in was clearly in bad faith. Respondent registered a domain name, using Complainant’s name as the entirety of the domain name, without his permission and created a domain name which deliberately gave the false impression that it was the domain name of Complainant. [Second] He then linked it to the website of The Electronic Intifada, a website with which he himself was associated and without a disclaimer. It would be naïve to think that Respondent did not know the type of criticism to which Complainant would be subjected and the type of material that would appear about Complainant on that website. . . .

That conduct commenced at the time of the registration of the domain name and has continued to the present. Accordingly, Respondent registered and used the disputed domain name in bad faith in the generally understood meaning of that expression.

Most likely, the balance shifted in Complainant’s favor because Respondent redirected the <> to a website using highly charged (“inflammatory”) language disparaging the trademark owner rather than the services it offered: “The clear intent of Respondent’s use of the domain name is to defame Adam Milstein, tarnish the mark ‘Adam Milstein,’ disrupt the charitable work of Adam Milstein, and deter potential charitable donors.” In reaching this conclusion “ it should be understood that the view taken by the Panel does not in any way negate or limit the right of Respondent, The Electronic Intifada, or for that matter anyone else, subject to the law, to criticize Complainant where it is clear that they are doing so under their own imprimatur. What it limits is the right to do so by registering a domain name that purports to be Complainant himself and using it for criticism that, confusingly, may or may not be genuine and well-founded criticism.”

Sutherland is tamer in comparison; Respondent parodied the Complainant’s views on social matters but not any individuals. Somewhere in the continuum of speech commentary and criticism slides into the vindictive and unacceptable. There are a line of cases that find extreme expression is not protected speech. That line now includes Alan Milstein.

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. (2015, 558 pages). Learn more about the book at Legal Corner Press. Available from Amazon and Barnes & Noble. Ongoing Supplement here.

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