National Arbitration Forum

 

DECISION

 

Kim Laube & Company Inc. v. RareNames, WebReg

Claim Number: FA0910001291282

 

PARTIES

 

Complainant is Kim Laube & Company Inc. (“Complainant”), represented by Glenn J. Dickinson, of Nordman Cormany Hair & Compton LLP, California, USA.  Respondent is RareNames, WebReg (“Respondent”), represented by Erik S. Zilinek, of NameMedia, Inc., Massachusettes, USA.

 

REGISTRAR AND DISPUTED DOMAIN NAMES

 

The domain names at issue are <natureschoice.com> and <natures-choice.com>, registered with Domaindiscover.

 

PANEL

 

The undersigned certify that they have acted independently and impartially and to the best of their knowledge have no known conflict in serving as Panelists in this proceeding.

 

Debrett G. Lyons, Judge Daniel Banks and Terry Peppard as Panelists.

 

PROCEDURAL HISTORY

 

Complainant submitted a Complaint to the National Arbitration Forum electronically on October 26, 2009; the National Arbitration Forum received a hard copy of the Complaint on October 28, 2009.

 

On October 27, 2009, Domaindiscover confirmed by e-mail to the National Arbitration Forum that the <natureschoice.com> and <natures-choice.com> domain names are registered with Domaindiscover and that the Respondent is the current registrant of the name.  Domaindiscover has verified that Respondent is bound by the Domaindiscover 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 November 3, 2009, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of November 23, 2009 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@natureschoice.com and postmaster@natures-choice.com by e-mail.

 

A timely Response was received and determined to be complete on November 23, 2009.

 

On December 8 2009, pursuant to Complainant’s request to have the dispute decided by a three-member Panel, the National Arbitration Forum appointed Debrett G. Lyons (chair), Judge Daniel Banks and Terry Peppard as Panelists.

 

RELIEF SOUGHT

 

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

 

PARTIES’ CONTENTIONS

 

A.     Complainant

 

Complainant asserts trademark rights and alleges that the disputed domain names are identical or confusingly similar to its trademark.

 

Complainant alleges that Respondent has no rights or legitimate interests in the disputed domain names.

 

Complainant alleges that Respondent registered and used the disputed domain names in bad faith.

 

B.     Respondent

 

Respondent broadly denies those allegations.  It does not deny Complainant’s contention that it deals in domain names but submits that the disputed domain names were registered in good faith.  The argument that the domain names are composed of descriptive, non-distinctive terms is Respondent’s retort to all of Complainant’s arguments.  The Response states, for example, that:

 

“Respondent selected the Disputed Domains because they incorporate two short, common words in a common phrase to which no single party has exclusive rights.  Respondent had no knowledge of Complainant’s purported mark, and did not register the Disputed Domains to sell them to Complainant, to disrupt its business, to prevent it from acquiring a domain name reflecting its trademark, or to confuse users.”

 

[ … ]

 

“Complainant alleges that Respondent has violated the UDRP because it offers the Disputed Domains for sale.  However, it is well-established that public offers for sale of a domain name comprised of common words in a common phrase do not constitute bad faith under the Policy but, instead, constitute a bona fide business activity that establishes the Respondent’s legitimate interest. 

Moreover, Respondent offers the Disputed Domains at www.BuyDomains.com, a legitimate business.”

 

[…]

 

“Respondent’s policy is to register and maintain only domain names that incorporate common words or phrases, descriptive terms, and/or words for which the available evidence suggests no single party has exclusive rights.”

       

 

FINDINGS

 

1.      Complainant provides pet grooming products.

 

2.      Complainant is the owner, relevantly, of U.S. Federal trademark registration no. 3,656,830 for NATURE’S CHOICE, filed on July 9, 2008 and issued May 5, 2009.

 

3.      The disputed domain name <natures-choice.com> was registered on July 19, 2002 and the disputed domain name <natureschoice.com> was registered on December 7, 2003.

 

4.      Respondent advertises the disputed domain names for sale and provides links and contact information for purchase. 

 

5.      There is no relationship between the parties.

 

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.”

 

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

 

1.      the domain names registered by Respondent are identical or confusingly similar to a trademark or service mark in which Complainant has rights;

2.      Respondent has no rights or legitimate interests in respect of the domain names; and

3.      the domain names have been registered and is being used in bad faith.

 

Identical and/or Confusingly Similar

 

Policy ¶ 4(a)(i) requires a two-fold enquiry.  First, a threshold investigation of whether a complainant has rights in a trademark, followed by an assessment of whether the trade mark and the domain name are identical or confusingly similar.

 

Complainant has rights in the trademark NATURE’S CHOICE by virtue of its U.S. Federal trademark registration.

[1]  For the purposes of Policy ¶ 4(a)(i) it is inconsequential that the trademark registration postdated the registration date of the disputed domain name.[2]

 

The remaining enquiry is whether the domain names <natureschoice.com> and <natures-choice.com> are either identical or confusingly similar to the trademark NATURE’S CHOICE.  In making that assessment it is accepted that the gTLD, “.com”, can be disregarded.[3] Complainant contends that the terms are confusingly similar because, once the gTLD is subtracted, the domain names differ from its trademark only in minor punctuation.[4]

 

In reply, Respondent states that it: 

 

“… does not dispute that the mark NATURE’S CHOICE and the domain names <natureschoice.com> and <natures-choice.com> are essentially identical, but does dispute that Complainant holds exclusive rights in the phrase “nature’s choice” and disputes that the mark NATURE’S CHOICE has any strength as a source indicator.”

 

The Respondent’s argument has been considered many times under the UDRP.  By way of illustration, in the recent case of Russell Frey d/b/a edHelper v. International Services Company SA c/o Administration Dom, FA 1288396 (Nat. Arb. Forum Dec. 9, 2009), the panel said:

 

“Whilst that argument might have merit considered in the context of a question about trademark infringement, it is not a relevant consideration under Policy ¶ 4(a)(i).  Nor has it been considered relevant to Policy ¶ 4(a)(i) for a respondent to assert, as in this case, that confusion is unlikely because the domain name is composed of generic terms.  A respondent’s registration and use of a generic domain name is generally regarded by former panels as a factor to be considered under Policy ¶ 4(a)(ii) and/or 4(a)(iii).”

 

The Panel finds that the disputed domain names are either legally identical, or if not, then confusingly similar, to Complainant’s trademark.

 

Complainant has satisfied the first limb of the Policy.

 

Rights or Legitimate Interests

 

For the reasons which follow, no findings are required.[5]

 

Registration and Use in Bad Faith

 

Policy ¶ 4(b) sets out the circumstances which shall be evidence of the registration and use of a domain name in bad faith.  They are:

 

(i)         circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out of pocket costs directly related to the domain name; or

 

(ii)        you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or

 

(iii)       you have registered the domain name primarily for the purpose of disrupting the business of a competitor;  or

 

(iv)       by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website or other on‑line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location or of a product or service on your website or location.

 

What is noteworthy about Policy ¶ 4(b)(i)-(iv) is that they are all cases of both registration and use in bad faith.  It is logical, therefore, to first consider their possible application to the facts here.

 

There is no cogent evidence before the Panel that Respondent registered the disputed domain names for the reasons elaborated in Policy ¶ 4(b)(ii) or (iii).  Complainant owns the domain names <natureschoiceshop.com> and <natureschoiceshampoo.com> which, albeit that they might not be Complainant’s first choice, nonetheless fully reflect its trademark.  Moreover, Complainant asserts that it has a commercially successful online business coupled, presumably, with use of those names.  There is no evidence that Respondent registered the domain name primarily for the purpose of disrupting Complainant’s business, nor evidence that registration of the disputed domain names has had that result.

 

It is only Policy ¶ 4(b)(i) and (iv) which merit the Panel’s serious attention.

 

Complainant states that:

 

“The Respondent is has (sic) registered these two domain names solely to sell them at a profit to the Complainant, the rightful owner of trademark rights in NATURE’S CHOICE, or to other interested parties. The Respondent appears to have held the domain names since December 2003, but in that time has made no preparations for the bona fide offering of goods and services on the domains.  Passively holding a domain name is evidence of bad faith.”

 

[…]

 

“The Respondent’s explicit offers to sell the domain name are clear and convincing evidence of its bad faith purpose.   Both of the domain names at issue provided links across the top of the page stating “The domain [natureschoice.com/natures-choice.com] is for sale. To purchase, call BuyDomains.com at 781-839-7903 or 866-866-2700.”

 

[…]

 

“BuyDomains.com is directly related to Respondent. … The prices quoted on BuyDomains.com are $18,800 for natureschoice.com and $2,388 for natures-choice.com.     Seeking valuable consideration for the domain name in excess of out-of-pocket costs is additional evidence of bad faith.”

 

 

Turning first to Policy ¶ 4(b)(i), Respondent states that its business is the acquisition then sale of domain names for profit.  The only important issue is whether Complainant can point to circumstances indicating that Respondent registered the names primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to Complainant or to a competitor of Complainant.

 

Likewise, Policy ¶ 4(b)(iv) requires proof that Respondent

§         for commercial gain;

§         intentionally used the disputed domain name to attract web users;

§         to an on‑line location;

§         by creating a likelihood of confusion with Complainant’s trademark as to the source, sponsorship, affiliation, or endorsement of that on-line location, or of a product or service at that location.

 

Once more, the key issue is whether Respondent can be said to have used the domain names in a way which intentionally created a likelihood of confusion with Complainant’s trademark. 

 

The requisite intention for the purposes of Policy ¶ 4(b)(iv) has been the subject of contrary decisions,[6] however this Panel takes the view that what is essential to both Policy ¶ 4(b)(i) and (iv) is evidence that Respondent has targeted Complainant.

 

Complainant states that:

 

“there is little doubt that the Respondent knew or should have known of the Complainant’s trademark rights in NATURE’S CHOICE at the time it registered the domain.(sic)  The Complainant’s predecessor in interest began using the trademark NATURE’S CHOICE mark in commerce in 1986 and secured U.S. trademark registrations in 1987 and 1997. These registered marks were in full force and effect when the Respondent registered the domain names on December 7, 2003.  Any simple search of the USPTO database or other database incorporating U.S. registrations would have returned the Complainant’s marks.”

 

The prevailing consensus of opinion under the Policy is that proof of actual knowledge of a complainant’s trademark rights is necessary.[7]  The Panel is not prepared to fetter Respondent with constructive knowledge of Complainant’s trademark rights.  It looks, instead, to evidence of whether it is more likely than not that Respondent had actual knowledge of Complainant’s rights.  Complainant must establish all three elements under the Policy and so it can not be assumed that just because Complainant has successfully proved trademark rights, it follows that Respondent has acted in bad faith because it was aware of those rights.  Knowledge of Complainant’s rights is essential and for that reason a complainant must be assiduous to prove its reputation in, and the public awareness of, its trademark even when it has registered trademark rights.  That onus rises when the trademark consists of descriptive elements, as in this case.

 

Complainant claims that “separate and apart from the Complainant’s registrations and applications, it has developed common law rights from its extensive use of the mark.”  It states that “Complainant and its predecessor in interest have been using the trademark NATURE’S CHOICE continuously for more than 22 years, since at least as early as November 21, 1986.”  It states that it acquired the trademark in 2007, at which time the estimated value of the goodwill in the mark was approximately US$500,000.  Complainant asserts that “since 1986, the mark has acquired significant consumer recognition in the field of animal and pet products.   Tens of millions of dollars in NATURE’S CHOICE products have been sold since the mark was adopted.”

 

Respondent’s reply is that Complainant’s evidence of reputation is unconvincing and that its arguments are laced with conclusory statements.  The Panel is in broad agreement with those comments.  There is no documentary support for the claim that in 2007, the value of the goodwill in the trademark was an estimated $500,000.  There is no proof of the “tens of millions of dollars” of product sold. There are no other indicia that the trademark has “acquired significant consumer recognition”.  The Panel is mindful of what was said in Weatherford Int’l, Inc. v. Wells, FA 153626 (Nat. Arb. Forum May 19, 2003):

 

“Although Complainant asserts common law rights in the WELLSERV mark, it failed to submit any evidence indicating extensive use or that its claimed mark has achieved secondary source identity . . . [Complainant’s claim that it is well known] is a finding that must be supported by evidence and not self-serving assertions.”[8]

 

 

 

Moreover, it is unclear to the Panel in which trademark Complainant is claiming long and continuous use. The earlier registrations, all lapsed, are for composite trademarks where in each case the mark includes a prominent and distinctive device element.[9]  By Complainant’s admission, it is only since the purchase of the name rights that it attempted to register the word mark NATURE’S CHOICE.  Complainant’s statement that “although the Complainant discontinued the use of the prior logos, and thus allowed those U.S. trademark registrations to expire, at no time did the Complainant cease or otherwise alter its use of NATURE’S CHOICE” does not give the Panel any reliable indication of the level of secondary meaning that might have come to attach to the words NATURE’S CHOICE solus.

 

For the purposes of the Policy, it is unnecessary for the Panel to decide whether or not Complainant has done enough to show the level of use which would be necessary to establish common law trademark rights under Policy ¶ 4(a)(i).  Rather, the Panel must balance the evidence of reputation against all of the circumstances and decide whether it is more likely than not that Respondent had Complainant’s trademark in mind when it registered and used the domain names.

 

Taking account of the inherently descriptive character of both the trademark and the disputed domain name, the degree to which either very similar domain names or identical domain names with different extensions have been registered/used by others,[10] the lack of evidence that Respondent has habitually abused third party trademark rights, and all of the circumstances, the Panel finds that neither Policy ¶ 4(b) (i) or (iv) is made out.

 

With that conclusion, it remains for the Panel to decide whether, taking the evidence as a whole and drawing on its own reasoning, there is evidence independent from the scenarios laid out in Policy ¶ 4(b), that the disputed domain name was registered in bad faith and used in bad faith.

 

The Panel first notes the timing issue.  In particular, the registration of the domain names   predates both the filing dates and registration dates of Complainant’s federally registered trademarks by many years.  Panels have generally found that the registration of a domain name prior to the establishment of trademark rights will negate a claim of bad faith registration[11] and there is nothing in this case to cause this Panel to depart from that general position.

 

Since the registration was not in bad faith the Complainant has not established the third element under the Policy.

 

DECISION

 

Having failed to establish at least one of the elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.

 

 

 

Debrett G. Lyons, Panel Chair

 

Judge Daniel Banks and Terry Peppard, Panelists

 

 

Dated: December 22, 2009

 

 

 

 

 

 

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