DECISION

 

State of Oregon, by and through the Oregon State Lottery v. Patrick Moore d/b/a FreeMachines, Inc.

Claim Number: FA0211000133677

 

PARTIES

Complainant is State of Oregon, by and through the Oregon State Lottery, Salem, OR (“Complainant”) represented by James E. Geringer, of Klarquist Sparkman, LLP.  Respondent is Patrick Moore d/b/a FreeMachines Inc., Sumner, WA (“Respondent”).

 

REGISTRAR AND DISPUTED DOMAIN NAMES 

The domain names at issue are <oregonlottery.com> and <oregonlottery.net>, registered with Network Solutions, Inc.

 

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.

 

Judge Irving H. Perluss (Retired) is the Panelist.

 

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum (the “Forum”) electronically on November 14, 2002; the Forum received a hard copy of the Complaint on November 15, 2002.

 

On November 21, 2002, Network Solutions,Inc. confirmed by e-mail to the Forum that the domain names <oregonlottery.com> and <oregonlottery.net> are registered with Network Solutions, Inc. and that the Respondent is the current registrant of the names.  Network Solutions, Inc. has verified that Respondent is bound by the Network Solutions, 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 November 22, 2002, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of December 12, 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@oregonlottery.com and postmater@oregonlottery.net by e-mail.

 

A timely Response was received and determined to be complete on December 4, 2002.

 

Complainant filed a timely Additional Submission on December 9, 2002.  Respondent also filed a timely Additional Submission on December 10, 2002. 

 

On December 12, 2002, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the Forum appointed Judge Irving H. Perluss (Retired) as Panelist.

 

RELIEF SOUGHT

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

 

PARTIES’ CONTENTIONS

A. Complainant

1.            Oregon Lottery is an agency of the State of Oregon in the United States, established and operated pursuant to the Constitution of the State of Oregon and Oregon statute.  Oregon Lottery has sold and advertised its games and services continuously under the name and mark OREGON LOTTERY since at least 1985.  Annual sales of genuine OREGON LOTTERY games have been in the tens of millions of dollars over a decade, and now exceed $100 million dollars a year.

 

2.            Respondent registered and is using domain names that are identical to Complainant’s famous name and trademark, with full knowledge of its true owner.  Respondent’s transparent purpose in doing so was to benefit from Complainant’s fame, both by selling the resulting traffic and by selling the domain name registrations themselves to Complainant.

 

3.            The use of the dispute domain names has caused substantial actual confusion and injury to Complainant.

 

4.            Respondent has no rights or legitimate interests in the disputed domain names because Respondent’s only use of the names including “Oregon Lottery” has been and continues to be as an infringer.  Respondent did not register the earliest of the disputed domain names until December 4, 1998, more than thirteen years after Complainant began offering its genuine goods and services.  Respondent registered these domain names in full knowledge of the Oregon Lottery’s existence, after playing OREGON LOTTERY games himself.

 

5.            Respondent is not making any legitimate non-commercial or fair use of the domain names.  Rather, Respondent’s use of the disputed domain names is garden-variety trademark infringement creating the impression that the domains are operated under the auspices of, or have the approval of, Oregon Lottery.

 

6.            The disputed domain names were registered and are being used in bad faith.

 

7.            Respondent offered to sell the <oregonlottery.com> domain name registration to Complainant for $250,000, far in excess of the costs he incurred in wrongly registering the Oregon Lottery’s domain name and mark as his own.

 

8.            Respondent has used <oregonlottery.com> and <oregonlottery.net> to make money from gambling related traffic.  By using the name Oregon Lottery, Respondent has created a likelihood of confusion with Complainant (including but not limited to initial confusion) as to the source, sponsorship, affiliation, or endorsement of Respondent’s website and the products, services, and material offered there.  The fact that Respondent deliberately chose Oregon Lottery as its name is itself sufficient evidence of Respondent’s bad faith.

 

B. Respondent

1.            The disputed domain names are not identical to Complainant’s trade name or service mark.  Respondent has applied for and is in the process of obtaining his own unique service mark.  Respondent’s service mark, like Complainant’s service mark, contains both words and a design.  Both Complainant’s and Respondent’s service marks contain the words Oregon Lottery.  It has been determined by the Trademark office that the words alone, “Oregon Lottery,” both for Complainant and Respondent, do not qualify for a trademark.  Furthermore, it has been determined by the United States Trademark Department that “There is no likelihood of confusion” associated with Respondent’s mark.

 

2.            It was brought to the attention of Respondent in April of 1999 that there may be confusion if consumers are not aware of “the source, sponsorship. . .of goods and services.”  Shortly after Respondent received this letter, he placed, and has maintained, a clearly visible disclaimer as to the source and sponsorship of the site.  <oregonlottery.com> automatically redirects to <oregonlottery.net> at which point the disclaimer is present and in plain view 100% of the time on all pages.  The two sites are used in order to facilitate the various services offered such as free mail at <oregonlottery.com>.  Although the disclaimer is located at <oregonlottery.net>, it still reads <oregonlottery.com> and sits directly to the left of Respondent’s famous service mark.

 

3.            There was no offer to sell the <oregonlottery.com> domain name registration for $250,000 because that was a solicited request from Complainant.

 

4.            Respondent has rights and legitimate interests in the disputed domain names.  Respondent registered <oregonlottery.com> in December of 1998 and Complainant did not apply for a service mark until December 1999.  Respondent immediately began using the site for bona fide commercial use, promoting the sale of goods and services of others through the distribution of printed material and promotional contests; contests and incentive award programs to promote the sale of products and services of others.

 

5.            The domain names are not being used in bad faith.  Respondent has been using the site just as his service mark states, promoting the goods and services of others.

 

6.            Respondent has maintained the assumed business names of “Oregon Lottery,” “OregonLottery.com” and “Oregon Lottery.com,” registered with the State of Oregon’s Secretary of State since mid-year 1999.

 

C. Additional Submissions by Complainant

1.            The dispositive facts in this case cannot be disputed.  In particular, Respondent does not dispute the fact that he registered <oregonlottery.com> and <oregonlottery.net> with full knowledge of Oregon Lottery’s pre-existing fame and widespread use of the OREGON LOTTERY mark.

 

2.            Respondent’s registration of “Oregon Lottery,” “OregonLottery,” and “OregonLottery.com” as assumed business names, his registration of the domain names <oregonlottery.biz> and <oregonlottery.info>, and his pending application for a U.S. trademark for a design that includes the words “OregonLottery.com” establish that Respondent’s actions in registering the disputed domain names are part of a deliberate, concerted plan by Respondent to use the words “Oregon Lottery” for his own commercial use, in disregard of the Oregon Lottery’s rights and the adverse impact on a confused public.

 

3.            It is established Oregon law that the registration of assumed business names does not confer any rights or interest in the registered words.

 

4.            An application to register a design mark has no bearing on whether Respondent has the right to register the exact words “Oregon Lottery” as a domain.  In any event, there is nothing in the record to indicate that the Trademark Examiner compared the alleged mark of Respondent’s application to Complainant’s common law OREGON LOTTERY mark, its Oregon Lottery trade name, or the Oregon Lottery and design registration.

 

5.            In La Societe des Loteries du Quebec v.RSA Software, Inc., D2002-0051 (WIPO April 22, 2002), there was specifically rejected the argument that Respondent’s disclaimer can justify Respondent’s domain names that directly mimic the true Oregon Lottery’s famous name and mark.  It was stated therein that such a disclaimer “may be ignored or misunderstood by Internet users and it does not dispel the initial Internet confusion inevitable from Respondent’s actions.  (Citing Madonna Ciccone, p/k/a Madonna v. Dan Parisi, D2000-0847, (WIPO Oct. 12, 2000)).

 

D.  Additional Submissions by Respondent

1.         Respondent denies any claims or allegations that the names <oregonlottery.com/.net/.biz/.info> and any variations were, could have been, or could be registered in bad faith.  Respondent further denies any claims or allegations that Respondent had any knowledge of a trade name or service mark giving Complainant, or anyone, rights to the words “Oregon Lottery” at the time of registration.  Complainant’s trademark design logo was not even applied for until December 1999, a full year after Respondent had registered the domain name <oregonlottery.com>.

 

2.         Respondent also has a trademark logo, not simply an application as the Complainant implies, but a logo, which can be marked and includes the words “Oregon Lottery.”  It has been clearly stated by the U.S. Trademark Office that “the examining attorney has searched the Office records and has found no similar registered or pending mark which would bar registration under the Trademark Act Section 2(d), 15 U.S.C. Section 1052(d).”  Respondent does not deny that its mark is “pending,” but whether the mark has been “officially” placed on the registry does not change the fact that there is “no similar registered or pending mark which would bar registration.”

 

3.         None of the cases cited by Complainant are similar to this matter aside from the fact that the domain names are similar.  Complainant has shown no evidence that it has exclusive, trademark rights to the words “Oregon Lottery.”  In all of the cases cited by Complainant the respondents have passively held, not developed, or simply not responded to a dispute request, and there is no basis for any comparison.

 

4.         With respect to Complainant’s charge of Respondent’s “reliance” on a disclaimer, Respondent has not tried to “justify” retaining the domain name based on a disclaimer.  The disclaimer was voluntarily placed simply to appease any concerns by the State of Oregon that it might be possible that people may get confused if they do not know the source and sponsorship of the goods or services being offered.

 

FINDINGS AND CONCLUSIONS

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.

 

If ever a case deserved summary disposition, it is this.

 

Identical and/or Confusingly Similar

It is evident that the disputed domain names are identical and confusingly similar to Complainant’s name.

 

Respondent contends, however, that it registered the disputed domain names prior to Complainant’s registration of its mark in the United States Patent and Trademark Office.

 

Respondent cannot prevail on its contention.  This is because Complainant could and did acquire common law trademark rights based on its use of the name since 1985.  It is the actual use that creates legal rights to the mark, not a race to the Patent and Trademark Office.  See, 4 McCarthy, Trademarks and Unfair Competition (updated 2000), § 25:74.2; see also Passion Group, Inc. v. Usearch, Inc. (eResolution Aug. 10, 2000) (Complainant established sufficient rights by virtue of its distribution and advertising to enable it, at common law, to prevent another magazine by the same name from being passed off as that of Complainant.)[1]  A trademark examining attorney obviously could only ascertain whether there would be “confusion with current registrations or prior pending applications,” not as to conflict with common law trademark rights as here.

 

The name Oregon Lottery is not generic, but very specific, and if it were not, it would have no value to Respondent as a domain name.[2]

 

Rights or Legitimate Interests

As determined, infra, the Panel has found that Respondent registered and used the disputed domain names in bad faith.  It follows, accordingly, that he has no rights or legitimate interests in the disputed domain names.

 

Respondent is using <oregonlottery.com> and <oregonlottery.net> in part to offer free e-mail service addresses.  It is not unlawful to conduct an e-mail service (except in instances like here), but Respondent would not have registered the disputed domain names but for the obvious connection they have with Complainant and its operations.  Were it not for the well-known name of the Oregon agency, the registration and use of these domains would be valueless as an e-mail service and for any other purpose to both the Respondent and his customers.  It is not the same at all as the use of a common surname for e-mail businesses, where the purpose is for people with the same name to have a shared domain.  Here, the Panel finds that Respondent registered and uses the domain names solely because of their clear and obvious connection with the operations of the Oregon agency holding the trademark.

 

Registration and Use in Bad Faith

The Panel finds that Respondent was fully aware and was on actual notice of Complainant’s rights in the OREGON LOTTERY mark when he registered the disputed domain names.  The registration of a domain name despite actual or constructive notice of Complainant’s mark is evidence of bad faith.[3]

 

Respondent knew when he registered the disputed domain names that the State of Oregon had this long-standing agency name and with its association in the minds of the public.  He registered the disputed domain names solely because he felt he could create a business that made use of the trademark of another and the association of these domains had with the Oregon agency.

 

Although Respondent has placed a disclaimer on his websites, such disclaimers are not sufficient to prevent initial interest confusion in cases such as this.  See Madonna v. Parisi, D2000-0847 (WIPO Oct. 12, 2000) (citing Brookfield Comm., Inc. v. West Coast Entertainment Corp. (9^th Cir. 1999) 174 F.3d 1036, “[r]espondent’s use of a disclaimer on its website is insufficient to avoid a finding of bad faith.  First, the disclaimer may be ignored or misunderstood by Internet users.  Second, a disclaimer does nothing to dispel initial interest confusion that is inevitable from Respondent’s actions.  Such confusion is a basis for finding a violation of Complainant’s rights”).

 

It is overwhelmingly clear and the Panel so finds and concludes that the only value of the disputed domain names to Respondent is because of their association with Complainant and its operations.

 

DECISION

Based upon the above findings and conclusions and pursuant to Policy ¶ 4(i), it is decided that the following domain names registered by Respondent Patrick J. Moore shall be and the same are TRANSFERRED to Complainant State of Oregon, by and through the Oregon Lottery:  <oregonlottery.com> and <oregonlottery.net>.

 

 

 

 

JUDGE IRVING H. PERLUSS (Retired), Panelist
Dated: January 9, 2003

 

 

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