Franzus Company LLC v. James R. Cotner,
Jr.
Claim Number: FA0209000125365
PARTIES
Complainant
is Franzus Company LLC, Beacon
Falls, CT (“Complainant”) represented by Melvin
I. Stoltz. Respondent is James R. Cotner, Northport, AL
(“Respondent”) represented by Jeffrey H.
Greger, of Mason Mason &
Albright.
REGISTRAR AND DISPUTED DOMAIN NAME
The
domain name at issue is <travelsmart.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.
The
Honorable Charles K. McCotter, Jr. (Ret.) as Panelist.
PROCEDURAL HISTORY
Complainant
submitted a Complaint to the National Arbitration Forum (the “Forum”)
electronically on September 18, 2002; the Forum received a hard copy of the
Complaint on September 20, 2002.
On
September 20, 2002, Network Solutions confirmed by e-mail to the Forum that the
domain name <travelsmart.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
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
September 23, 2002, a Notification of Complaint and Commencement of
Administrative Proceeding (the “Commencement Notification”), setting a deadline
of October 14, 2002 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@travelsmart.com by e-mail.
A
timely Response was received and determined to be complete on October 14, 2002.
Complainant
filed a timely Additional Submission on October 18, 2002. Respondent submitted a Supplemental Response
on October 23, 2002.
On October 28, 2002, pursuant to Complainant’s request
to have the dispute decided by a single-member
Panel, the Forum appointed the Honorable
Charles K. McCotter, Jr. (Ret.) as Panelist.
RELIEF SOUGHT
Complainant
requests that the domain name be transferred from Respondent to
Complainant. Respondent requests a
finding that Complainant has engaged in reverse domain name hijacking.
PARTIES’ CONTENTIONS
A.
Complainant
Respondent’s
<travelsmart.com > domain
name is identical to Complainant’s registered TRAVELSMART mark. Respondent does not have any rights or
legitimate interests in the domain name.
Respondent registered and used the domain name in bad faith.
B.
Respondent
Respondent alleges a
legitimate interest based on developing the domain name in the future for use
in the field of travel. Respondent also
made limited preparations to use the website corresponding to the domain name
in connection with a bona fide offering of services in the past but these never
came to fruition. Respondent contends that
he has legitimate rights and interests in respect of the domain name due to the
highly descriptive nature of the terms in the domain name. Respondent contends that he has the right to
commercialize a highly descriptive domain name.
C.
Additional Submissions
Complainant
contends that passive holding of domain names without demonstrable plans to use
the domain is evidence of bad faith and a lack of legitimate interest. Respondent contends he made significant
preparations to use the highly descriptive domain name long before notification
of the dispute and that he never initiated contact nor offered the domain name
registration for sale to anyone.
FINDINGS
Complainant, Franzus Company, LLC
(“Franzus” or “Complainant”), is a worldwide and well-known marketing
and distributing company of travel and travel-related products including
luggage, travel appliances, electrical conversion products, travel convenience
accessories, travel security products, travel healthcare products, and
automobile accessories.
Franzus, through its predecessor company, Franzus, Inc.,
adopted the trademark TRAVEL SMART by using this trademark on travel-related
products. Shortly after this first use,
Franzus sought and obtained six (6) U.S. Trademark Registrations on the
Principal Register for the mark TRAVEL SMART in International Classes 8, 9, 12,
and 19. The earliest U.S. TRAVEL SMART
Registration was issued on February 20, 1990 with use through its predecessor
in title at least as early as April 1988.
Franzus is also the owner of thirty-six (36) Foreign Registrations for
the trademark TRAVEL SMART
In addition to holding the above-identified U.S. and Foreign
Trademark Registrations, Franzus has acquired common law rights to this name
and has made a substantial investment in advertising, public relations, and
promoting its TRAVEL SMART trademarks. Franzus
maintains a web page on the Internet wherein the TRAVEL SMART Trademark is
prominently displayed.
Complainant has invested over $80,000 in obtaining its
trademark rights to TRAVEL SMART.
Substantially greater sums of money have also been expended in promoting
Complainant’s products under the TRAVEL SMART trademark. Through Complainant’s widespread, worldwide use,
its TRAVELSMART mark has become well known and associated with Complainant and
its products.
Respondent obtained the
domain name <travelsmart.com> in 1997 due to a
connection with a then small start-up multilevel-marketing company called
Travel Smart Network Services Inc.
Respondent was recruited as agent for the new company. Respondent found the then current owner of
the <travelsmart.com> domain name and
acquired the domain name for considerably more than the cost of a new,
un-acquired domain name. Subsequently,
Respondent engaged in developing an interactive website which was reduced to a
beta version on computer disk. However,
the initial version was never launched due to a dispute with the principals
that started the Travel Smart Network Services Company. Shortly after Respondent acquired the domain
name, the Travel Smart Network Services Company ceased doing business
On several
occasions, Complainant has monitored the <travelsmart.com>
website. In attempting to open this
website, the only information provided is that “This Page cannot be Opened”.
Recently, a
representative of Complainant contacted Respondent in an attempt to purchase
the domain name. Although Respondent
has not developed this website for a period of over five years, Respondent
indicated that a “six-figure amount” was needed for the purchase of this domain
name.
Respondent
has not used the domain name <travelsmart.com> or developed an
operating website under this designation, regardless of Respondent’s claim that
the domain name would be used in the future.
Respondent
says that since acquiring the domain name in 1997, his intentions have been to
commercialize the domain name in connection with travel-related services.
Complainant does not
have exclusive rights to the descriptive domain name <travelsmart.com>. There are other Federal registrations for
the identical mark TRAVEL SMART owned by entities other than Complainant. Respondent’s search of the Google™ database
for "travel smart" revealed about 17,900 results. Further, others have registered domain names
using the term TRAVEL SMART. Numerous
other TRAVEL SMART formative domain names remain unused in the available pool
of domain names.
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.
Complainant has established that it has
rights in the TRAVELSMART mark through registration and continuous use. Respondent’s domain name <travelsmart.com>
is identical to Complainant’s TRAVELSMART trademarks.
Accordingly,
the Panel finds that Policy ¶ 4(a)(i) has been satisfied.
Rights or Legitimate Interests
Respondent admits that he has not used, or made any
preparation to use, the domain name or a name corresponding to the domain name
in connection with a bona fide offering of goods or services since 1997; is not
commonly known by the domain name; and is not making any legitimate
non-commercial or fair use of the domain name.
Respondent asserts the intent to use the domain name at some
unspecified time in the future.
However, a Respondent’s “unsupported, self-serving allegations alone are
insufficient to establish that [the] Respondent has rights or legitimate
interests in respect to the domain name at issue.” Twentieth Century Fox Film Corp. v. Benstein, FA 102962
(Nat. Arb. Forum Feb. 27, 2002) (finding the Respondent’s assertion that she
registered the domain name <foxstudios.biz> in order to get a website
address for her planned dance studios, without evidentiary support, was
insufficient to establish that she had rights or interests in respect to the
domain name at issue); see also Travel in A Moment, Inc. v. F.S. Janco,
FA 96821 (Nat. Arb. Forum April 9, 2000) (Respondent failed to show rights or
legitimate interests in <momentsnoticetravel.com> where Respondent’s
contended that domain name was registered for future use in connection with an
“undisclosed business venture”); Camper, S.L. v. DPR USA a/k/a Global DNS
Services, FA 118188 (Nat. Arb. Forum Oct. 22, 2002) (Respondent failed to
establish legitimate interests in the domain name <camper.us> through
mere statement of intent to market campers).
“Respondent
may fairly use descriptive or generic terms as a commercial domain name.” Eastbay Corp. v. VerandaGlobal.com, Inc.,
FA 105983 (Nat. Arb. Forum May 20, 2002); see also Energy Source Inc. v.
Your Energy Source, FA 96364 (Nat. Arb Forum Feb. 19, 2001) (Respondent has
rights and legitimate interests in the domain name where “Respondent has
persuasively shown that the domain name is comprised of generic and/or
descriptive terms, and, in any event, is not exclusively associated with
Complainant’s business”). The mark
TRAVELSMART is a “common generic expression in which the Complainant cannot
have exclusive rights.” See Do The Hustle, LLC v. Tropic Web, D2000-0624
(WIPO Aug. 21,2000). However,
Respondent is not using the domain name <travelsmart.com> but has
been passively holding the domain for over five years for the only purpose of
selling the domain name for an amount in excess of its out-of-pocket costs of
registration. See HomeFinishers,
Inc. v. Tom Schutz, FA 123928 (Nat. Arb. Forum Oct. 10, 2002) (The passive
holding of the domain name <homefinishers.com> for over two years without
providing any demonstrable plans or preparations to use the domain name fails
to show rights or legitimate interests).
Respondent
has produced some evidence that he acquired the domain name in 1997 for use in
a business venture. Respondent began
developing an interactive website which was reduced to a beta version on
computer disk, but was never activated on
the <travelsmart.com> site or any other
website. In view of the failure to
develop the website, the subsequent passive use, and the offers to sell its
rights for more than the registration costs, Respondent’s evidence fails to
show demonstrable preparations to use the domain name in connection with a bona
fide offering of goods and services. See Flor-Jon Films v. Larson, FA
94974 (Nat. Arb. Forum July 25, 2000) (finding that Respondent’s failure to
develop the site demonstrates a lack of legitimate interest in the domain
name). Respondent has failed to show
rights or a legitimate interest in the domain name.
Accordingly,
the Panel finds that Policy ¶ 4(a)(ii) has been satisfied.
Registration and Use in Bad Faith
During the last five years, Respondent has passively held
the disputed domain name with the only activity being entertaining offers to
purchase the domain name registration .
Respondent was and continues to be willing to sell this domain name
registration for a “six-figure offer”. Bad faith exists where Respondent registered
the domain name for the purpose of selling its rights in the domain name to
Complainant for an amount in excess of out of pocket costs associated with the
registration of the domain name and Respondent has made no other use of the
domain name. See Educ. Testing Serv.
v. TOEFL, D2000-0044 (WIPO Mar. 16, 2000) (finding that a general offer of
sale combined with no legitimate use of the domain name constitutes
registration and use in bad faith); see also Am. Anti-Vivisection Society v.
“Infa dot Net” Web Serv., FA 95685 (Nat. Arb. Forum Nov. 6, 2000) (finding
that “general offers to sell the domain name, even if no certain price is
demanded, are evidence of bad faith”); see also Grundfos A/S v. Lokale,
D2000-1347 (WIPO Nov. 27, 2000) (finding that a failure to use the domain name
in any context other than to offer it for sale to Complainant amounts to a use
of the domain name in bad faith).
Respondent
has made no use of the domain name other than to offer its rights for sale at a
price that is likely to substantially exceed its costs of registration. See Educ. Testing Serv. v. TOEFL,
D2000-0044 (WIPO March 16, 2000).
Registration of a domain name primarily for sale, rent, or transfer is
evidence of bad faith use and registration pursuant to Policy ¶ 4(b)(i). See Matmut v. Tweed, D2000-1183 (WIPO Nov. 27, 2000) (finding bad
faith under Policy ¶ 4(b)(i) where Respondent stated in communication with
Complainant, “if you are interested in buying this domain name, we would be
ready to sell it for $10,000”).
Moreover, the passive holding of the domain name for over five years is
bad faith use. See
DCI S.A. v. Link Commercial Corp.,
D2000-1232 (WIPO Dec. 7, 2000) (concluding that Respondent’s passive holding of
the domain name satisfies the requirement of ¶ 4(a)(iii) of the Policy).
However, Complainant must also show bad faith
registration. Under Paragraph 4(b) of
the Policy, Complainant must show both registration and use in bad faith. Respondent has produced some evidence that
he acquired the domain name in 1997 for use in a legitimate business venture,
which ultimately did not materialize.
However, Respondent’s passive holding of the domain name creates an
inference of bad faith registration and use, which Respondent’s limited showing
fails to overcome. See also Caravan Club v. Mrgsale, FA 95314 (Nat. Arb.
Forum Aug. 30, 2000) (finding that Respondent made no use of the domain name or
website that connects with the domain name, and that passive holding of a
domain name permits an inference of registration and use in bad faith); see also Cruzeiro Licenciamentos Ltda v.
Sallen,
D2000-0715 (WIPO Sept. 6, 2000) (finding that mere passive holding of a domain
name can qualify as bad faith if the domain name owner’s conduct creates the
impression that the name is for sale).
The Panel finds that Policy ¶ 4(a)(iii)
has been satisfied.
Complainant has not engaged in reverse
domain name hijacking.
DECISION
Having established all three elements
under ICANN Policy, the Panel concludes that relief shall be hereby GRANTED.
Accordingly, it is Ordered that the <travelsmart.com> domain name be TRANSFERRED
from Respondent to Complainant.
The Honorable Charles K. McCotter, Jr.
(Ret.), Panelist
Dated: November 7, 2002
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