NATIONAL ARBITRATION FORUM

 

DECISION

 

R&G Business, LLC v. Scott Wassermman a/k/a Scott Wassermman

Claim Number:  FA1005001326899

 

 

PARTIES

Complainant is R&G Business, LLC (“Complainant”), represented by John E. Cummerford, of Greenberg Traurig, LLP, Arizona, USA.  Respondent is Scott Wassermman a/k/a Scott Wassermman (“Respondent”), represented by Jeffrey Weiss, of Weiss & Moy, P.C., Arizona, USA.

 

REGISTRAR AND DISPUTED DOMAIN NAME

The domain name at issue is <dabalash.com>, registered with GoDaddy.com, Inc.    

 

PANEL

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

 

            Timothy D. O’Leary as Panelist.

 

PROCEDURAL HISTORY

            Complainant submitted a Complaint to the National Arbitration Forum   electronically on May 27, 2010.           

 

On May 28, 2010, GoDaddy.com, Inc. confirmed by e-mail to the National Arbitration Forum that the <dabalash.com> domain name is registered with GoDaddy.com, Inc. and that the Respondent is the current registrant of the name.  GoDaddy.com, Inc. has verified that Respondent is bound by the GoDaddy.com, Inc. 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 June 11, 2010, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of July 1, 2010 by which Respondent could file a Response to the Complaint, via e-mail to all entities and persons listed on Respondent’s registration as technical, administrative, and billing contacts, and to postmaster@dabalash.com by e-mail.  Also on June 11, 2010, the Written Notice of the Complaint, notifying Respondent of the email addresses served and the deadline for a Response, was transmitted to Respondent via post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts.

 

            A timely Response was received and determined to be complete on July 1, 2010.

 

On July 8, 2010, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the National Arbitration Forum appointed Timothy D. O’Leary as Panelist.

 

RELIEF SOUGHT

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

 

Preliminary Issue: Business/Contractual Dispute Outside the Scope of the UDRP

 

Respondent, Scott Wassermman a/k/a Scott Wassermman, claims to be the founder of Cosmetic Alchemy.  Respondent alleges that it hired third parties, Ms. Herrel and C Coast Labs, to assist in designing a formula for an eyelash stimulator product.  According to Respondent, after designing the product Respondent agreed to an exclusive contract with Ms. Herrel and C Coast Labs for the formula.  Respondent contends that Ms. Dabdoub and Mr. Torres, the founders of Complainant, were hired to distribute Respondent’s eyelash stimulator product in Mexico.  Respondent argues that the distribution agreement with Ms. Dabdoub and Mr. Torres was terminated after Respondent’s discovery that Ms. Dabdoub and Mr. Torres were selling the product at artificially low prices and attempting to create a distribution network for a “copycat” product.  Respondent claims that Complainant was formed to create, market, and sell a copycat version of Respondent’s eyelash stimulator product.  Respondent further argues that Complainant contacted Ms. Herrel and C Coast Labs and convinced them to sell the formula owned by Respondent to Complainant.  According to Respondent, Complainant contracted with Mr. Ríos to design and manage the <dabalash.com> domain name and resolving website.  Respondent alleges that Mr. Ríos was never paid for his services and held the domain name as collateral to ensure payment.  Respondent contends that Mr. Ríos sold Respondent the disputed domain name and all causes of action Mr. Ríos owns against Complainant.

 

Complainant, R&G Business, LLC, claims that Complainant’s founder, Ms. Dabdoub, formerly worked as an independent promoter-distributor for Respondent.  Complainant alleges that Ms. Dabdoub left Respondent’s business due to a wrongful accusation that Ms. Dabdoub misappropriated information from Respondent’s cosmetics business that competes with Complainant.  Complainant asserts that Ms. Dabdoub founded Complainant after leaving Respondent and that Complainant registered the <dabalash.com> domain name to sell its cosmetics products.  Complainant contends that it hired a third-party, Mr. Ríos, to manage and maintain the disputed domain name and the resolving website.  According to Complainant, Mr. Ríos sold the disputed domain name to Respondent in April of 2010.  Complainant argues that Mr. Ríos did not have the legal ability to transfer ownership of the <dabalash.com> domain name.  Complainant further claims that Respondent’s purchase of the disputed domain name is directly related to the wrongful accusations directed at Complainant’s founder, Ms. Dabdoub, and that Respondent purchased the disputed domain name to cause harm to Complainant’s competing business.

 

The Panel finds that the allegations made by Complainant and Respondent set out several business relationships and several contractual disputes that require resolutions that are outside the scope of the UDRP.  In Love v. Barnett, FA 944826 (Nat. Arb. Forum May 14, 2007), the panel was concerned with possible causes of action for breach of contract.  In this case, however, Respondent points out that its corporation, Cosmetic Alchemy, has filed suit in Federal court in Arizona against Complainant.  See Cosmetic Alchemy, LLC v. R&G, LLC, Case No. 2:10-cv-01222-GMS.  Respondent claims that Complainant has made a counter claim in this case which incorporates the arguments made in the Complaint.  Respondent further contends that Complainant’s founder, Ms. Dabdoub, has filed a lawsuit against Mr. Ríos which also includes many of the issues before the Panel.  See Dabdoub v. Ríos, Case No. C20103947 (Arizona Superior Court).  Respondent argues that the case involving Mr. Ríos directly relates to the case at hand as Respondent’s rights in the disputed domain name are tied to Respondent’s purchase of the disputed domain name from Mr. Ríos.  According to Respondent, Respondent has also filed a case against Ms. Herrel and C Coast Labs in Federal court in Arizona that incorporates much of the dispute that is included in the Complaint and Response.  See Cosmetic Alchemy, LLC v. Herrel et al, Case No. 2:10-cv-01046-SRB.  These cases are currently active cases that are pending with the courts.  According to the panel in Love, complex cases such as the one presented here may be better decided by the courts than by a UDRP panel:

 

When the parties differ markedly with respect to the basic facts, and there is no clear and conclusive written evidence, it is difficult for a Panel operating under the Rules to determine which presentation of the facts is more credible.  National courts are better equipped to take evidence and to evaluate its credibility.

 

The panel in Luvilon Industries NV v. Top Serve Tennis Pty Ltd., DAU2005-0004 (WIPO Sept. 6, 2005) concurred with this reasoning:

 

[The Policy’s purpose is to] combat abusive domain name registrations and not to provide a prescriptive code for resolving more complex trade mark disputes .…  The issues between the parties are not limited to the law of trade marks.  There are other intellectual property issues.  There are serious contractual issues.  There are questions of governing law and proper forum if the matter were litigated.  Were all the issues fully ventilated before a Court of competent jurisdiction, there may be findings of implied contractual terms, minimum termination period, breach of contract, estoppels or other equitable defenses.  So far as the facts fit within trade mark law, there may be arguments of infringement, validity of the registrations, ownership of goodwill, local reputation, consent, acquiescence, and so on.

 

Based upon the reasoning outlined in the aforementioned cases and the record, the Panel concludes that the instant dispute contains questions of contractual interpretation, and legal issues that fall outside the scope of the UDRP.  See Everingham Bros. Bait Co. v. Contigo Visual, FA 440219 (Nat. Arb. Forum Apr. 27, 2005) (“The Panel finds that this matter is outside the scope of the Policy because it involves a business dispute between two parties.  The UDRP was implemented to address abusive cybersquatting, not contractual or legitimate business disputes.”); see also Fuze Beverage, LLC v. CGEYE, Inc., FA 844252 (Nat. Arb. Forum Jan. 8, 2007) (“The Complaint before us describes what appears to be a common-form claim of breach of contract or breach of fiduciary duty.  It is not the kind of controversy, grounded exclusively in abusive cyber-squatting, that the Policy was designed to address.”); see also Frazier Winery LLC v. Hernandez, FA 841081 (Nat. Arb. Forum Dec. 27, 2006) (holding that disputes arising out of a business relationship between the complainant and respondent regarding control over the domain name registration are outside the scope of the UDRP Policy).

 

DECISION

The Panel concludes that this matter involves a number of contractual and other legal issues arising out of a business relationship and thus falls outside the scope of UDRP.  Accordingly, it is Ordered that the Complaint is DISMISSED.

 

 

 

 

Timothy D. O’Leary, Panelist

 

July 16, 2010