Merchant &
Gould P.C. v. Ezer LG Ratchaga
Claim Number: FA0110000100497
PARTIES
The Complainant is Merchant & Gould P.C., Minneapolis, MN (“Complainant”). The Respondent is Ezer LG Ratchaga, Cheras, Selangor, MY (“Respondent”) Glenn Johnson, of Shuttleworth and Ingersoll.
REGISTRAR AND
DISPUTED DOMAIN NAME
The domain name at issue is <hotmerchant.com>, registered with Network Solutions.
PANEL
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.
Hon. Roger P. Kerans as Panelist.
PROCEDURAL HISTORY
Complainant submitted a Complaint to the National Arbitration Forum (“the Forum”) electronically on October 9, 2001; the Forum received a hard copy of the Complaint on October 12, 2001.
On October 10, 2001, Network Solutions confirmed by e-mail to the Forum that the domain name <hotmerchant.com> is registered with Network Solutions and that the Respondent is the current registrant of the name. Network Solutions has verified that Respondent is bound by the Network Solutions 5.0 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 15, 2001, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of November 5, 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 postmaster@hotmerchant.com by e-mail.
A late response was received and determined to be complete on November 14, 2001. I have considered this response despite the fact it was a few days late because I accept the explanation of the Respondent that he resides in Malaysia, and did not instruct his attorney until about Nov. 10.
On
November 26, 2001, pursuant to Complainant’s request to have the dispute
decided by a single-member Panel,
the Forum appointed Hon Roger P. Kerans as Panelist.
RELIEF SOUGHT
The Complainant requests that the domain name be transferred from the Respondent to the Complainant.
PARTIES’ CONTENTIONS
A. Complainant
The Complainant, MERCHANT & GOULD® P.C., is an Intellectual Property law firm with more than 110 attorneys in offices nationwide, including Minneapolis, Atlanta, Denver, and Seattle. MERCHANT & GOULD® provides a wide range of Intellectual Property services in the areas of patents, copyrights, trademarks, entertainment law, Internet and computer law, trade secrets and unfair competition. It has registered the mark MERCHANT & GOULD® for use in connection with these services.
The mark MERCHANT & GOULD® is famous, particularly in the field of legal services, having established a significant reputation throughout the firm's 100-year history
According to a common convention for law firms, MERCHANT & GOULD® is also regularly referred to as "Merchant," a shortened version of its full name and trademark. Such use has given rise to common law rights in the MERCHANT mark for legal services, as demonstrated by the attached Intellectual Property law web discussion board entries, in which MERCHANT & GOULD® is commonly referred to under the MERCHANT mark.
MERCHANT & GOULD® has operated a website at the <MERCHANT-GOULD.COM> address since 1995.
Respondent is operating a website that makes confusingly similar use of Complainant's MERCHANT trademark. Respondent has no right or legitimate interest in this use, as the primary use of the web site located at its <hotmerchant.com> address is to trade off the goodwill of Complainant MERCHANT & GOULD®, other parties with "Merchant" in their trademarks or trade names, and holders of other famous marks. Such use is not legitimate, and indeed fits squarely within the examples of bad faith conduct listed in the Policy.
<hotmerchant.com>
fully incorporates the MERCHANT™ trademark, supplemented only by the generic
designation "hot." As such,
the requirement of confusing similarity is met.
Respondent has no right or legitimate interest in the <hotmerchant.com> domain name, since the primary use of the site is to trade off the goodwill established by Complainant Merchant & Gould and other trademark and trade name holders, and primarily parties with trademarks or trade names incorporating the term "merchant."
In this case, Respondent is not only failing to make a legitimate use of the domain name, but is affirmatively making illegitimate use of the registration. The dominant portion of the website is composed of pages containing imbedded text of other parties' registered trademarks and domain names. Respondent is blatantly attracting users to the site by trading off the goodwill established in these marks. For example, Respondent maintains a web page at http://www.hotmerchant.com/www-merchant-gould-com-mastercard.htm. This web page consists mainly of the text, "An Intellectual Property Law Firm, including patents, trademarks, copyrights, entertainment law, Internet and computer law, trade secrets and unfair competition. www.merchant-gould.com." This text is repeated ten times and is included in the source code for the site. When a user clicks on the purported link to the true Merchant & Gould website at MERCHANT-GOULD.COM, they are instead directed to the <hotmerchant.com> home page.
The main manner in which the site is currently being used is incorporation of other party's marks in text and source code, without the mark holders' permission, in an effort to attract Internet traffic to the site. In all, there are more than 1100 such uses of the marks of other parties, many of which incorporate the term "merchant", throughout the site. The web pages incorporate a wide variety of third party trademarks, including numerous trademarks and trade names that include the term "merchant." In addition to the MERCHANT & GOULD® and MERCHANT™ marks, the web pages also incorporate of a host of other famous trademarks including Wells Fargo and USA Today. As illustration, 100 examples of such use are attached as Exhibit I.
Respondent's extensive use of third party trademarks and trade names occupies the majority of Respondent's cyber real estate located at the <hotmerchant.com> address. Using a website predominantly for the purpose of trading off the goodwill of other parties is not a legitimate use. Indeed, such use is illegitimate and in clear violation of the trademark laws of the United States and International Treaty law. See, e.g., Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Art. 16.1 (delineating the exclusive right of a trademark owner to prevent third party use that results in likelihood of confusion).
Respondent simply has no basis to argue that its alleged use of the <hotmerchant.com> domain name to offer credit card services qualifies as a legitimate interest or use under the Policy. First, it is not enough that a Respondent show some element of legitimacy. Moreover, even a Respondent who uses a site primarily for the purpose of conducting legitimate business can be found in violation of the Policy, where the otherwise legitimate business uses an Internet address and website that trades off the goodwill of other parties' trademarks and trade names. See e.g., Caterpillar, Inc. v. Vine, FA97097 (Nat. Arb. Forum June 22, 2001) (ordering transfer of several domains incorporating the CATERPILLAR trademark in connection with generic words, where the site operator operated an otherwise legitimate business reselling used Caterpillar products from its website).
Similarly, Respondent is clearly not making a legitimate noncommercial use of the domain name, nor has Respondent commonly been known as HOTMERCHANT. There is no evidence that any use has caused Respondent to be known as HOTMERCHANT to a relevant portion of the public. Moreover, any such recognition would be nullified here, where it arose after the registration of the domain name, and in whole or in part from trading off the goodwill of Merchant & Gould and other third party trademark holders.
In summary, Respondent has no rights or legitimate interest in the
<hotmerchant.com> domain name., as its primary use of the site is
to trade off the goodwill established by MERCHANT & GOULD® and other
trademark and trade name holders, and in particular those parties with rights
in words or phrases incorporating the term "merchant."
Here, Respondent has exhibited bad faith conduct under both aforementioned clauses of the Policy as well as general principles of law and fair dealing, by the manner in which the <hotmerchant.com> domain name was registered and has been used.
As discussed in the preceding section, the primary use of the website located at <hotmerchant.com> is to trade off the goodwill of MERCHANT & GOULD®, other companies with "Merchant" as a component of their trademark or trade name, and other owners of famous marks. As such, the domain name was registered, and has been used, "primarily for the purpose of disrupting the business of competitors" and other businesses. For example, in addition to MERCHANT & GOULD®, the <hotmerchant.com> website has also been used in a manner disruptive to various companies in the credit card and banking industries, such as DISCOVER and WELLS FARGO. The <hotmerchant.com> website has also been used with intent to attract Internet users "by creating a likelihood of confusion with the complainant's mark." Para. 4, Sec. b (iii), (iv).
Respondent's intent in this regard is further supported by its extensive use of third party trade names and trademarks, including MERCHANT & GOULD, in its source code and in imbedded text on its website.
In addition to the bad faith actions specifically listed in the Policy, Respondent's registration and use of the <hotmerchant.com> domain name also falls under other overarching principles of bad faith. The primary concerns behind both the Policy specifically, and trademark law generally, are implicated here. Respondent has registered a domain name with the term "merchant" in it, then attempted to attract users to the website by imbedding hundreds of trademarks containing "merchant" into the text of the website and its source codes, thereby creating consumer confusion and explicitly trading off the goodwill established by other parties in their valuable marks. Such activity could not, by any stretch of the imagination, be conducted in good faith or within the confines of established trademark law, not can it be tolerated by the Policy. Accordingly, this Panel should deem Respondent's registration and use of the <hotmerchant.com> domain name to be in bad faith.
B. Respondent
<hotmerchant.com> is not identical nor confusingly similar to MERCHANT & GOULD®
and the term "Merchant" in which Complainant has asserted rights.
Respondent disputes the existence of the common law mark utilizing the term "Merchant" or any claimed entitlement to said term by Complainant
Additionally, an examination of the USPTO database for the term "Merchant" demonstrates that there have been in excess of 100 actual registrations of marks utilizing the term "Merchant" or a derivative thereof in IC (International Class) 36 or in IC42.
A print out of the Internet search results of the term Merchant utilizing the search engine found at <Turbofind.com> disclosed fifteen references of which ten relate directly to the acceptance, use and/or processing of credit cards in the conduct of e-business and other business applications. No reference is found to the provision of intellectual property law services, nor the other services provided by MERCHANT & GOULD® as set forth in its Complaint.
A Yahoo search was offered with 1249 hits on “merchant”. In reference to the Category Matches, financial business operations are cited in 6 of the 15 listed categories. Legal services is not a listed Category Match to the term "Merchant". Also, of the first 20 hits under the Web Site Matches, it appears that the predominant use of the term "merchant" involves financial/credit card merchant services.
First, the text set forth in <hotmerchant.com> has been protected by copyright since 1999. Secondly, it is clear from the outset that the business of <hotmerchant.com> is the provision of merchant accounts to retail sellers. A header appears at the top of each page which reads:
HOTMERCHANT! Get your own Merchant Account!
The text of the web page provides consumer information and comparative information with other providers of merchant accounts and offers the consumer the advantages of proprietary software written specifically for the owner of <hotmerchant.com>.
<yourfavorite.com> and <merchantwearhouse.com> are web sites which deal in the business of providing merchant accounts in direct competition with <hotmerchant.com>.
Generic terms such as "Merchant" cannot function as trademarks to identify origin or specific source of any goods or services because the term is generic in nature. A primary use of "Merchant" is in conjunction with the term accounts to identify or denote credit card processing accounts available for those who sell various goods and services over the Internet and otherwise. These credit card processing accounts are known as merchant accounts in the credit card industry.
In addition to the generic nature of the term "Merchant", the term is highly descriptive of the services provided, particularly when combined with the term accounts. Marks that are deemed highly descriptive are also incapable of functioning as trademarks.
The only mention of the term "Merchant" purportedly used in commerce or otherwise associated with the provision of the specialized legal services offered by Merchant & Gould PC is the reference by Complainant to discussion board entries relating to Intellectual Property law. First, it is most common for Internet users to use short hand methods of referring to any number of entities. Therefore, the use of "Merchant" to refer to Merchant & Gould PC is not at all surprising.
Secondly, Complainant has not provided survey evidence of any kind relating to any secondary meaning associating the use of the term "Merchant" with the law firm of Merchant & Gould PC.
By reference to the listing of marks registered which use the term "merchant" within Class 42 and the marks which use the term "merchant" within Class 36 it is apparent that the term "merchant" is frequently utilized as a component term of many and varied trademarks.
Respondent has been engaged in the business of providing merchant account services to retail sellers for nearly two years. Respondent has conducted this business operation doing business as <hotmerchant.com> for that entire period of time.
Additionally, by reference to Respondent's website and the other competitors' web sites, it is clear that the provision of merchant account services to retailers is a legitimate and competitive business. In the conduct of this business, Respondent has written proprietary software which simplifies and makes more accurate the operations of its retail merchant clients. Respondent has been providing merchant account services to retailers for nearly two years. Respondent has been engaged in the advertisement of his business through the use of thousands of banners located at websites throughout the World Wide Web. It is therefore respectfully submitted that Complainant cannot prove the second element under ICANN Policy 4 (a).
There is no evidence before this Panel that Respondent registered <hotmerchant.com> in bad faith. From the content of the disputed domain name, as well as the content of the competitive websites, it is evident that the term "Merchant" is used in conjunction with the term "Account" when speaking of credit card processing capabilities of retail merchants. This was the nature of the business in this area of finances in 1998 at the time of registration of the disputed domain name. Further, Respondent did not even know of Merchant & Gould PC at the time of said registration or at the time that the business <hotmerchant.com> began to operate.
FINDINGS
The attorney for the Respondent said that, because of the rush of events, he had not in fact received the exhibits of the Complainant before filing the response. Perhaps this explains why he fails to deal with the complaint that the Respondent has been using the complete name of the Complainant on his website on a subsidiary page in this fashion: http://www.hotmerchant.com/www-merchant-gould-com-mastercard.htm. The statement of the Respondent personally also fails to mention this
I should add that, in the circumstances, I thought it fair to look at the website myself. I found no sub-pages as described by the attorney for the Complainant. I nevertheless accept the truth of the allegation of the Complainant that the Complainant’s full name was employed on such a page, as also were the names of many other firms. I infer that those offensive pages were removed after this Complaint was filed.
DISCUSSION
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
In my respectful view, a person is
most unlikely to think that the domain name “hotmerchant” describes a law firm,
let alone Merchant & Gould. This
is a much stronger case than Bruce
Springsteen v. Jeff Burgur and Bruce Springsteen Club, D2000-1532 (WIPO
Jan. 25, 2001) (finding no likelihood of confusion between common law mark
Bruce Springsteen and <brucespringsteen.com> because even the relatively
unsophisticated Internet user would realize that not every domain bearing the
name Bruce Springsteen is an official site.
And it is very unlike those where the addition of a meaningless term, if
"hot" is meaningless, would
not defeat a claim of confusing similarity.
See Infospace.com, Inc. v.
Delighters, Inc., D2000-0068 (WIPO May 1, 2000) (finding that the domain
name “myinfospace.com” is confusingly similar to Complainant’s mark); see also NIIT Ltd. v. Parthasarathy Venkatram, D2000-0497 (WIPO Aug. 4,
2000) (finding that the “domain name ‘myniit.com,’ which incorporates the word
NIIT as a prominent part thereof, is confusingly similar to the Complainant’s
trade name and trademark NIIT”). This
is because “merchant” alone is not confusingly similar with Merchant &
Gould.
The Complainant fails to meet this threshold test.
It is important to keep in mind that this test applies to the domain name, not the contents of the web pages employed on the site given that name. Had the Complaint sought relief respecting the name www.hotmerchant.com/www-merchant-gould-com-mastercard.htm a different issue would arise.
Rights or Legitimate
Interests
I accept that – as claimed – lawyers often will refer to Merchant & Gould simply as “Merchant”. But the firm has not made out any right to the exclusive use of this common noun.
I also accept the evidence of the Respondent that there is a business activity commonly called merchant accounting that is about handling credit card transactions. It is not surprising that such a business would attempt to use the word “merchant” as part of a business name, and such a business would have a legitimate interest in that use. But I agree with the Respondent that the term “merchant” likely cannot be used exclusively by any one company without some reasonable qualifier. See Successful Money Mgmt. Seminars, Inc. v. Direct Mail Express, FA 96457 (Nat. Arb. Forum Mar. 7, 2001) (finding that seminar and success are generic terms to which Complainant cannot maintain exclusive rights); see also Tough Traveler, Ltd. v. Kelty Pack, Inc., D2000-0783 (WIPO Sept. 28, 2000) (finding that the Complainant could not establish a secondary meaning with the domain name, <kidcarrier.com>, because of the generic nature of the terms).
This case is not like those where the name of another domain name is used with the addition only of a meaningless qualifier. The facts are in this case very unlike cases like Sony Kabushiki Kaisha v. Inja, Kil, D2000-1409 (WIPO Dec. 9, 2000) (finding that bad faith registration and use where it is “inconceivable that the respondent could make any active use of the disputed domain names without creating a false impression of association with the Complainant”); see also EthnicGrocer.com, Inc. v. Unlimited Latin Flavors, Inc., FA 94385 (Nat. Arb. Forum July 7, 2000) (finding that the minor degree of variation from the Complainant's marks suggests that the Respondent, the Complainant’s competitor, registered the names primarily for the purpose of disrupting the Complainant's business); see also Hewlett Packard Co. v. Full Sys., FA 94637 (Nat. Arb. Forum May 22, 2000) (finding that Respondent registered and used the domain name primarily for the purpose of disrupting the business of the Complainant by offering personal e-mail accounts under the domain name <openmail.com> which is identical to Complainant’s services under the OPENMAIL mark).
I also accept that merchant accounting is the business of the Respondent. Even the Complainant admits this, because the substance of the Complaint is that the Respondent has wrongfully used Complainant’s protected name in order to attract customers to that business. Of course, the Respondent was quite wrong to do that. But the UDRP is about the regulation of domain names, not web pages. One often looks at web-sites to determine intentions, because intention can have a bearing on whether the name is in exercise of a right or legitimate interest – or used in bad faith. That is not the issue here.
Registration and
Use in Bad Faith
To use the domain name of another business to attract visits to a site is bad faith within the meaning of the rule. For success, however, the Complainant must make out all three grounds, and has failed on the first two.
To use a name like www.hotmerchant.com/www-merchant-gould-com-mastercard.htm is clearly a breach of the bad faith rule.
The Complaint is denied.
Hon. Roger P. Kerans, Panelist
Dated: December 3, 2001.
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