Civic Development Group LLC v. John Paul Schaffer

Claim Number: FA0109000100138


The Complainant is Civic Development Group LLC, Edison, NJ ("Complainant") represented by Randy M. Friedberg, of Olshan, Grundman, Frome, Rosenzweig & Wolosky LLP. The Respondent is John Paul Schaffer, Morgantown, WV ("Respondent").


The domain names at issue are <>, <>, <>, registered with Melbourne IT.


The undersigned certifies that he has acted independently and impartially and to the best of his knowledge, has no known conflict in serving as Panelist in this proceeding.

James Alan Crary as Panelist.


Complainant submitted a Complaint to the National Arbitration Forum ("the Forum") electronically on September 26, 2001; the Forum received a hard copy of the Complaint on September 27, 2001.

On September 26, 2001, Melbourne IT confirmed by e-mail to the Forum that the domain names <>,<>,

<> are registered with Melbourne IT and that the Respondent is the current registrant of the name. Melbourne IT has verified that Respondent is bound by the Melbourne IT registration agreement and has thereby agreed to resolve domain-name disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the "Policy").

On October 1, 2001, a Notification of Complaint and Commencement of Administrative Proceeding (the "Commencement Notification"), setting a deadline of October 22, 2001 by which Respondent could file a Response to the Complaint, was transmitted to Respondent via e-mail, post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts, and to,, by e-mail.

A timely response was received and determined to be complete on October 22, 2001.

On October 25, 2001, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the Forum appointed James Alan Crary as Panelist.


The Complainant requests that the domain names be transferred from the Respondent to the Complainant.


A. Complainant

The Complainant is the owner of common law trademarks Civic Development Group and CDG Telemarketing. Marks had been in use in interstate commerce since 1992 in connection with Complainant’s telemarketing services which include fund raising, direct sales, and other services such as conducting seminars, surveys, and opinion polls. The Respondent is a former employee of Complainant who worked various times for Complainant between late 1996 and the end of the year 2000.

After leaving employment with the Complainant, Respondent began using the domain names at issue to misdirect Internet users seeking information about Complainant.

The web sites contain defamatory rhetoric about the Complainant. It was asserted that Respondent’s primary goal in registering and using the domain names at issue was to taint the opinions of potential and actual clients about Complainant and ultimately to divert business away from the Complainant.

Through it’s attorney a cease and desist letter was forwarded to the Respondent. A return e-mail September 7, 2001 asserted that Respondent was taking down two of the web sites but would continue actively on the remaining site.

Respondent had not chosen the domain names at random but with a clear intent to trade off the name and marks of the Complainant since they incorporate all of Complainant’s corporate name.

It was asserted that Respondent intended to confuse Internet users and lead them to mistakenly believe that Complainant sponsors, endorses, or is affiliated with the Website and to divert Internet users seeking Complainant’s Website to go to Respondent’s Website instead where they become an audience for defamatory and disparaging materials about Complainant.

It was asserted that the Respondent had no right or legitimate interest in the disputed domain names. There had never been any offering of bona fide goods or services. The Respondent had only used the disputed domain names for sites, which disparaged and defamed the Complainant and it’s marks.

The Respondent had never been commonly known by any of the infringing domain names. Respondent was well aware of Complainant’s marks, as he was a former employee of the Complainant.

Complainant has asserted Respondent had been using the disputed domain names in bad faith under Policy 4b(i). It was asserted that the Respondent, a former employee who is fully cognizant of Complainant marks would be aware his conduct would cause Complainant to take action to protect it’s business.

Bad faith under 4b(ii) Complainant contended that Respondent registered the disputed domain names in bad faith so as to preclude Complainant from registering and using the names.

Bad faith was alleged under Rule 4b(iii) Complainant asserted that Respondent admitted registered and used the disputed domain names to disrupt the business of the Complainant by dissuading visitors to the sites from doing business with the Complainant. Complainant generally asserted bad faith in that Respondent was domain name warehousing to coerce the Complainant into negotiating the rental or purchase of the names for valuable consideration.

The Complainant’s sought transfer of the disputed domain names.

Attached to the complaint was a copy of the cease and desist letter of August 30, 2001 and exchange of e-mail communications. Finally Complainant attached an excerpt from one of the web sites <>. The Respondent’s name, address, and telephone number appear as well as his e-mail address. On the page the Respondent identified himself as having worked with Complainant. The text described Complainant’s activities as unethical and misleading fundraising tactics. Court actions by the Federal Trade Commission and by state agencies were noted in the eight-paragraph commentary. The purpose of the Website was to inform the public about Complainant. The site contained a small banner ad at the bottom for Yahoo Domains.

B. Respondent

The Respondent maintained that currently the only Website in operation was for <>. He had registered the disputed domain names and began to build a Website as a class project and as a public service to provide information about the unethical and misleading tactics by Complainant and to raise funds for non-profit groups. He maintained that there is no defamatory material on the site. His message was directed toward the general public and not groups that might hire Complainant to do fundraising.

As a former employee-telemarketer, he was aware that many people were unaware that the Complainant retained 80% of the donations made through its organization.

On September 7, 2001 Respondent gave up <> and <>. This was done in an attempt to compromise and appease the Complainant and to avoid a lawsuit.

Respondent refused to comply with the September 10, 2001 demand that he transfer all three domain names, asserting his first amendment right to freedom of speech and obligation to inform the public about the truth, which the Complainant didn’t want the public to know.

Respondent denied any offer to sell, transfer, or rent the disputed domain names to the Complainant and denied any intention to derive commercial gain from his endeavor. Respondent asserted that the domain name simply aimed to attract the attention of Internet users who seek information regarding the Complainant.

That the web sites were "clearly intended to confuse Internet users" into believing Complainant sponsored, endorsed, or was affiliated with the site was clearly false. Any rational person who viewed the site would have no doubt that the web sites in question were not sponsored, endorsed, or affiliated with the Complainant in anyway. It was not reasonable to assume that a company would endorse, sponsor, or be affiliated with a Website containing "defamatory rhetoric" about itself. Respondent asserted a personal obligation to inform the public about numerous unethical and misleading tactics used by the Complainant to raise money for non-profit groups in addition to retaining 80% of the donations. The public was informed about other tactics such as seasonal deception, tap programs, and other misleading tactics of the Complainant. Providing the public with this information about Complainant was a bona fide service.

All of the information on the sites was intended to inform the general public not clients of the Complainant. The people had a right to know about the Complainant’s activities and the Respondent had a right to let the people know the truth regarding Complainant. Respondent then reiterated that the domain names he owned have suffixes of and not No commercial gain was intended.

Respondent maintained that there was no evidence to indicate circumstances showing an attempt to sell the disputed domain names to the Complainant or to anyone else.

Respondent noted that <> is owned by a third party not affiliated with either the Complainant or the Respondent. The domain name was for sale. Complainant owned the rights to <> but did not use it as an active site. Respondent noted that all of the disputed domain names have either or suffixes. Considering that Complainant was a for-profit company, Complainant would have no legitimate interest in domain names with suffixes that imply no commercial gain such as and which implied no commercial gain.

Respondent noted he was not a competitor and that his purpose was not to disrupt Complainant’s business in anyway. The Respondent was a student and Complainant was a multi-million dollar company. His purpose was not to disrupt business but to inform the public and to increase public awareness. If a disruption of business resulted this was due to public awareness about the Complainant.

The Respondent asked that the Panel take up the issue of reversed domain name hijacking.

C. Additional Submissions

The Complainant submitted a timely additional submission under the Forum’s Supplemental Rule 7. In the Reply to Respondent’s Response, Complainant sets forth the argument that the Respondent admitted or conceded the essential elements necessary to award the disputed domain names to Complainant.

Complainant asserted that Respondents allegation that the domain names were "ambiguous" was an old and discredited argument that one can avoid being an infringer by changing one or two letters of a trademark.

Complainant asserted that Respondent was not legitimately exercising any First Amendment right by defaming Complainant on his web site.


    1. The Complainant does business under the names Civic Development Group and CDG Telemarketing in connection with its telemarketing business services, which include fund-raising, direct sales, conducting educational seminars, surveys, and opinion polls.
    2. The Respondent is a former employee of the Complainant who is currently a student.
    3. The Respondent registered the domain name <> and <> on May 2, 2001 and <> on May 8, 2001.


Paragraph 15(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") instructs this Panel to "decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable."

Paragraph 4(a) of the Policy requires that the Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:

(1) the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

(2) the Respondent has no rights or legitimate interests in respect of the domain name; and

(3) the domain name has been registered and is being used in bad faith.

Identical and/or Confusingly Similar

The Complainant failed to meet the burden of proof as to this element. Complainant asserts common law trademark rights in the names in which it does business. But the record will not support such a finding. The words "civic", "development" and "group" are all generic words. While it may be true that the Complainant has conducted business since 1992 under the name Civic Development Group, there was no allegation or evidence that the name had acquired secondary meaning sufficient to distinguish Complainant’s services from others. Complainant’s alleged trademark is not fanciful or arbitrary and the Complainant has submitted no evidence to establish fame or secondary meaning that would established consumers were likely to associate <>, <>, or <> only with the Complainant. See Filmnet, Inc. v. Onetz FA 96196 (Nat. Arb. Forum) Feb. 12, 2001.

The Complainant is a large commercial telemarketing operation. The Respondent registered the disputed domain names with "org", and "net" suffixes. The top-level domain "org" customarily is in usage by non-profit or "miscellaneous" entities and not by a large commercial enterprise such as Complainant’s. See Pueblo International, Inc. v. Pueblo On-line FA 95250 (Nat. Arb. Forum Aug. 24, 2000).

From materials submitted by both the Complainant and the Respondent consisting of page excerpts from Respondent’s web sites (Complainant’s Exhibit E and Respondent’s Exhibit A) it was apparent that a person surfing the Internet would instantly recognize the website not as the Complainants’. From the pages it is readily apparent that the site contained materials critical of Complainant’s business activity and practices. It was concluded based on the materials submitted by the parties and based on the authority cited above that the disputed domain names were not identical or confusingly similar to Complainant’s business name.

Rights or Legitimate Interests

Policy 4(c) sets forth the manner in which a Respondent may establish rights to and legitimate interests in a domain name. The circumstances under 4(c)(i) do not apply since the Respondent clearly is not engaged in offering goods or services of a commercial nature. The service provided is an informational service available to the public using the Internet at no charge. The Respondent admits that he has not been known by any of the domain names, Policy 4(c)(ii). The evidence supported the finding that Respondent had established rights and legitimate interests in the domain name. There was no evidence to rebut the Respondent’s assertion that the public’s right to know and the Respondent’s right to freedom of speech were the motivating factors in his registration of the domain names and subsequent establishment of web sites. The Respondent worked for the Complainant between late 1996 and approximately the end of 1998 and was subsequently rehired by the Complainant for a period that apparently ended in late 2000. The Complainant did not offer any evidence that the Respondent was acting on a grudge or in retaliation. It was merely alleged that Respondent was somehow "disgruntled". The domain name dispute resolution process is not designed to resolve other disputes that may exist between the parties. The Complainant retains any rights it may have to proceed against the Respondent for alleged defamation or disparagement.

It was concluded that the evidence supported a finding that the Respondent had rights and legitimate interests in the disputed domain names.

Registration and Use in Bad Faith

The following discussion on Bad Faith is offered for completeness. The Complainant has failed on elements 1 and 2 and therefore taking up the issue of bad faith is unnecessary but a consideration of bad faith was relevant to the determination of elements 1 and 2 and so it was felt worthwhile to set forth the Panel’s reasoning. The evidence completely failed to demonstrate bad faith registration and use. The Complainant argued and asserted that the Respondent was somehow attempting to sell, rent, or extract anything of value from the Complainant. There was no evidence Respondent attempted to sell rent or extract. Under Section 4(b)(ii) there was no evidence to establish that the Respondent engaged in a pattern of registering domain names in order to prevent owners of trademarks or service marks from reflecting mark in a corresponding domain name.

Regarding Policy 4(b)(iii) the Complainant asserted that the Respondent registered the domain name primarily for the purpose of disrupting the business of the Complainant but does not assert that the Respondent was a competitor. The Respondent identifies himself as a college student who plans to attend law school someday. Complainant does not assert nor was there any evidence that Respondent was a competitor.

The Panel is aware of cases (Mission KwaSizabantu v. Benjamin Rost D2000-0279 (WIPO June 7, 2000)) and other cases since which have adopted a sweeping definition for the word competitor as used in Policy 4(b)(iii), in that case the Panel held that since neither business nor competitor were defined by the Policy.

…the Panel holds that the expression "business" must be liberally construed to cover activities concerning the supply of some goods or services and in respect of which a reputation may be gained. The activities of the Complainant (a religious organization with missionary activities) are held to come within the ambit of this term.

Regarding the word "competitor" similarly, the Panel holds that this term naturally should be read as relating to the "competitor" of the domain name owner. (a former member of Complainant’s sect)

The natural meaning of the word "competitor" is one who acts in opposition to another and the context does not imply or demand any restricted meaning such as a commercial or business competitor. (emphasis added)

The Panel holds that the Respondent (an individual who is a former member of the religious sect and now a critic) meets this definition and therefore Paragraph 4(b)(iii) now turns upon whether the Complainant has established that the activity of the Respondent was "primarily for the purpose of disrupting" the activities of another.

The Panel herein rejected that unwarranted expansion of both the terms "business" and "competitor". The terms were given their ordinary common sense dictionary meanings in this decision. The word "competitor" is defined as follows:

competitor n. [L.] a person who competes, as a business rival. Webster’s New World Dictionary 2d college edition, Simon & Schuster.

The Panel could find no authority for a "natural" meaning of the word competitor. The Respondent who is a college student and who does not engage in business and is not a competitor. Although Respondents efforts to inform the public about Complainant’s activities may indeed be disruptive of Complainant but that does not entitle Complainant to relief under the Policy.

Disciplined construction of the UDRP is appropriate for another reason. The Policy should not be used to shut down robust debate and criticism. Allowing trademark owners to shut down sites that obviously are aimed at criticism of the trademark holder does just that. See Wal-Mart Stores, Inc. v. and Kenneth J. Harvey D2000-1104 (WIPO Nov. 23, 2000).

Regarding 4(b)(iv), the evidence did not support a finding that the Respondent was engaged in any commercial activity. The fact that the web site contained a banner ad for Yahoo domains was insufficient to establish that the purpose of the site was for commercial gain. There was little likelihood of confusion by Internet users visiting the site as to the source, affiliation, or endorsement of the site. Since it clearly set forth materials critical of the Complainant’s business activities.


Although the Respondent seeks a reverse domain name hijacking finding, none was warranted by the facts of this case. Complainant’s attempt to seek transfer of the disputed names appeared to be in good faith. Respondent does not allege any particularized bad faith conduct. So Respondent’s claim fails because the Respondent has not met the burden of proof.


For all the reasons set forth above, the Panel concluded that the Complainant has failed to meet the burden or proof to establish any of the elements required to establish an abusive domain name registration under the Policy. It is therefore ordered that the Respondent shall retain the disputed domain names.


James Alan Crary, Panelist

Dated: November 7, 2001


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