Mega Shoes, Inc. v. Gregg Ostrick / GNO, Inc.
Claim Number: FA1012001362894
Complainant is Mega Shoes, Inc. (“Complainant”), represented by Jaime Rich Vining of Lott & Friedland, P.A., Florida, USA. Respondent is Gregg Ostrick / GNO, Inc. (“Respondent”), represented by John Berryhill, Pennsylvania, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <megashoes.com> (“the disputed domain name”) which is registered with Moniker Online Services, LLC (“Moniker Online”).
The undersigned, David H Tatham, Carolyn Marks Johnson, and Alan Limbury, 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.
Complainant submitted a Complaint to the National Arbitration Forum (“the Forum”) electronically on December 10, 2010; the Forum received payment on December 10, 2010.
On December 13, 2010, Moniker Online confirmed by e-mail to the Forum that the <megashoes.com> domain name was registered with it and that Respondent is the current registrant of the name. Moniker Online has verified that Respondent is bound by its registration agreement and has thereby agreed to resolve domain disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”).
On December 17, 2010, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of January 6, 2011 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@megashoes.com. Also on December 17, 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, and 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 January 7, 2011.
On January 13, 2011, pursuant to Respondent’s request to have the dispute decided by a three-member Panel, the Forum appointed David H Tatham, Carolyn Marks Johnson, and Alan Limbury as Panelists.
On January 26, 2011 an Order was issued extending the time period within which the Panel’s Decision had to be rendered from January 27, 2011 until February 7, 2011.
Complainant requests that the domain name be transferred from Respondent to Complainant.
A. Complainant
Complainant claims rights in the mark MEGA SHOES by virtue, firstly, of a U.S. trademark registration, number 3,748,641 dated February 16, 2010, in respect of “Wholesale and retail distributorship services in the field of footwear” in Class 35 and claiming first use since October 3, 1994; and, secondly, common law rights acquired through long-standing use over 16 years. Complainant also owns a domain name registration for <www.megashoesinc.com>. Complainant contends that its mark is identical to the disputed domain name, apart from the gTLD “.com” which is not enough to distinguish it.
Complainant further contends that Respondent has no rights or legitimate interest in the disputed domain name because:
· Respondent has neither used it nor is making preparations to use it in connection with a bona fide offering of goods or services.
· Respondent is not commonly known by the name MEGA SHOES.
· Respondent is not making any legitimate noncommercial or fair use of the name without intent for commercial gain.
· The website at the disputed domain name contains links to various footwear products that provide information for a number of businesses which compete with Complainant’s footwear services and this will inevitably result in confusion.
· Respondent directly benefits from the above mentioned links as it is presumably paid when anyone accesses them.
Complainant also contends that the disputed domain name should be considered to have been registered in bad faith because:
· Respondent is diverting users seeking information about Complainant’s footwear services to Respondent’s website where it obtains commercial benefits through pop-up advertisements and/or click-through fees.
· Respondent has intentionally attempted to attract, for commercial gain, internet users to its website by knowingly creating a likelihood of confusion with Complainant’s trademark as to the source of sponsorship, affiliation, or endorsement of Respondent’s website or location.
· Respondent is holding the disputed domain name passively, which can be an indication of bad faith, especially when there are other factors present.
· Respondent has engaged in a pattern of bad faith, and Complainant annexed a copy of a decision in which Respondent was required to transfer the disputed domain name. Complainant also annexed copies of various weblogs in which third parties had written to complain about Respondent’s bad faith conduct and cybersquatting domain names which contain their marks.
B. Respondent
Respondent questions Complainant’s exclusive right to and use of the name MEGA SHOES by pointing out that:
· Although common law rights are claimed in the name, Complainant has provided no evidence for use of it on any goods or in connection with any services, only a self-serving declaration.
· Complainant’s own website does nothing more than display the default GoDaddy parking page and advertisements for shoes. It displays neither Complainant’s trademarked logo, nor any goods or services offered by Complainant.
· According to the copy of Complainant’s own domain name registration, which was annexed to the Complaint, this is apparently registered, not in Complainant’s name, but by Domains by Proxy Inc.
· Complainant’s trademark registration is a highly stylized logo in which the word “MEGA” (which is normally used to signify “large” or “many”) appears over the smaller sized “SHOES”. Respondent acknowledges that visual elements of a trademark cannot be replicated in a domain name, but contends that what needs to be decided is whether a textual element of a mark is itself distinctive.
· Complainant alleges use of the name MEGA SHOES since 1994 but this use was concurrent with another federal trademark registration for MEGASHOES which issued to a third party in 1996 (alleging first use in 1993) and which was not renewed in 2003.
· The association of the word “MEGA” in relation to shoes is not exclusive to Complainant. For example, Complainant’s registered trademark also coexists with two other figurative registrations for the trademarks SHOE MEGASHOP and MEGA SOLE SYSTEM, as well as with a registration of the word mark MEGA COMFORT. In addition, Respondent annexed copies of pages showing use by Adidas for a MEGA line of shoes, by Reebok for a MEGA PLUS line of shoes, by Sidi for a MEGA line of cycling shoes, and for the MEGA SHOE FACTORY in Anaheim, California.
With regard to legitimate rights or interests, Respondent contends that it acquired the disputed domain name upon its expiration in May 2004 and that it has used the name for advertising purposes in connection with shoes since shortly thereafter, which was well before Complainant filed its trademark application. There is therefore no reason why this use by Respondent should be considered as anything other than bona fide and perfectly legitimate. On the other hand, Complainant has claimed that it has a mere 1,938 wholesale and retail accounts worldwide, despite having allegedly used the name MEGA SHOES for 16 years.
Respondent also vigorously contends that the disputed domain name was not registered in bad faith. There is no evidence that it knew or should have known of either the Complainant or its trademark at the time the domain name was registered or acquired. It was registered prior to the application or registration of Complainant’s logo and Respondent had never heard of Complainant until the filing of the Complaint. Respondent contends that bad faith requires the prior establishment of trademark rights and that the mere assertion of a time of use is insufficient.
Finally, Respondent argues that the doctrine of laches should apply in this case because not only was the disputed domain name available to register in 2004 but an additional 6 years has now gone by during which Respondent has used it, which is several years prior to the time when Complainant sought to register, and obtain, a federal trademark registration.
With regard to Complainant’s allegation of bad faith because of a single adverse decision, Respondent claims that this is unrepresentative of its business practices and refers to four other Decisions in which the Respondent was Gregg Ostrick, or GNO, Inc., or both, and in all of which the Complaint was denied.
C. Additional Submissions
Additional Submissions were filed by both parties and each was found to be timely and in compliance with the Forum’s Supplemental Rule 7.
Complainant
In its Additional Submission, Complainant repeats many of its arguments in the original Complaint but, in addition, asserts:
· Despite Respondent’s criticisms of Complainant’s website, this is in fact presently being redeveloped and updated.
· The fact that a trademark registration is a stylistic design is generally held to be immaterial when making a comparison between a trademark and a domain name.
· Respondent’s argument that Complainant’s trademark registration is not distinctive and descriptive is negated by the fact that a trademark registration is conclusive evidence if its validity.
· “MEGA” is not a common prefix and Complainant was not required by the USPTO to disclaim it. Furthermore, although the word “shoes” is the subject of a disclaimer, this does not preclude a finding of confusing similarity.
· Respondent’s references to third-party use of components of Complainant’s mark are wholly irrelevant.
· The Policy does not require a Complainant to acquire trademark rights prior to the registration of a disputed domain name, and despite Respondent’s claim, proof of secondary meaning is not a requirement in this case because (a) Complainant’s trademark registration is inherently distinctive; and (b) Complainant has used its trademark continuously, extensively, and exclusively for 16 years through extensive promotional efforts and sales revenue. In support of this, Complainant annexed a representative sample of its promotional efforts.
· The burden to rebut Complainant’s prima facie case that Respondent has no rights or legitimate interests in respect of the dispute domain name shifts to Respondent, but it has been unable to make such a showing.
· Respondent’s bad faith is further evidenced by the fact that the website at the disputed domain name carries a banner headline stating that the domain name is for sale. Furthermore it offered to sell the disputed domain name to Complainant in November 2010 and, in an e-mail from Respondent’s agent, $4,500 was suggested as an appropriate amount.
Respondent
In its Response to Complainant’s Additional Submission, Respondent accepts that a prior trademark registration is not a requirement under the Policy and that if a Complainant’s registered trademark does post date a disputed domain name that Complainant may rely on the proven use of a common law mark. However, Respondent alleges that in this case, Complainant has made no attempt to demonstrate any use of its trademark prior to the registration of the disputed domain name. For example, apart from the Declaration that was annexed to the Complaint, the evidence which has now been filed appears to show sponsorship of two local sports clubs, one of which is dated 2005. In Respondent’s submission, this is insufficient to demonstrate the possession of common law rights in MEGA SHOES.
With regard to the alleged e-mail from Respondent’s “agent” this latter is in fact BuyDomains Inc., which is a company that provides domain name brokerage services to buyers and sellers. However, Respondent was never contacted directly by Complainant with an offer to buy the disputed domain name and, although this may have happened, because it does on occasion receive requests for quotes for its domain names, BuyDomains Inc. does not identify any prospective purchasers. Respondent contends that at no time did it know that a request was being made by Complainant for a quote.
Although Respondent has demonstrated widespread third-party use of MEGA SHOES and variants thereof, Complainant has not produced a single piece of evidence showing use of its trademark on or in connection with any goods or services.
With regard to Complainant’s claim that Respondent’s criticisms of its website should be disregarded because the site is being redeveloped and updated, Respondent annexed a copy of an Internet archived record from March 2008 of Complainant’s domain name which consists of a single page containing only a contact form and several telephone numbers, but not a single reference to Complainant’s trademark.
Complainant (Mega Shoes, Inc.) is a wholesale distributor which, as its name implies, supplies footwear. It registered the name MEGA SHOES as a federal trademark with the USPTO in February 2010.
Respondent acquired the domain name <megashoes.com> in 2004. There is no evidence that, when Respondent did so, it was aware of Complainant.
Paragraph 15(a) of 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 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 Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
(2) 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 a trademark registration of MEGA SHOES, number 3,748,641 registered on February 16, 2010, in respect of “Wholesale and retail distributorship services in the field of footwear” in Class 35 and claiming first use since October 3, 1994. This is in stylized form with the word “MEGA” placed above and rather larger than the word “SHOES”. The latter is actually disclaimed. However, according to a Declaration by Mr. Albert Garcia, Complainant’s Operations Manager, his company has used the name MEGA SHOES continuously since 1994, and although he also claims that this use has been exclusive to Complainant, according to Respondent, Complainant’s use has apparently co-existed with another stylized federal trademark registration for MEGA SHOES, number 1,967,633, which was registered in respect of retail shoe services and which issued in April 1996 claiming use since 1993. This registration lapsed in January 2003.
Paragraph 4(a)(i) requires a Complainant to have rights in an identical or confusingly similar name. There is no doubt that Complainant does have registered trademark rights in MEGA SHOES and this is sufficient proof. As the panel said in Expedia, Inc. v. Tan, FA 991075 (Nat. Arb. Forum June 29, 2007): “As the [complainant’s] mark is registered with the USPTO, [the] complainant has met the requirements of paragraph 4(a)(i) of the Policy.” Also, it cannot be denied that Complainant’s trademark is identical to the disputed domain name, as it is well established that, for the purposes of comparison, one ignores a gTLD such as, in this case, “.com.” See Daedong-USA, Inc Kioti Tractor Division. v. O’Bryan Implement Sales, FA 210302 (Nat. Arb. Forum Dec. 29, 2003) (in which it was said that “Respondent's domain name, <kioti.com>, is identical to Complainant's KIOTI mark because adding a top-level domain name is irrelevant for purposes of paragraph 4(a)(i) of the Policy.”).
Since the disputed domain name <megashoes.com> was registered by Respondent in 2004, which is earlier than Complainant’s trademark registration of 2010, it is necessary to examine Complainant’s assertion that it has a valid claim to earlier use.
There have been many decisions in which it has been held that common law rights are sufficient in this regard. See Jeanette Winterson v. Mark Hogarth, D2000-0235 (WIPO May 22, 2000), but see Artistic Pursuit LLC v. calcuttawebdevelopers.com, FA 894477 (Nat. Arb. Forum Mar. 8, 2007) (in which it was found that paragraph 4(a)(i) of the Policy does not require a trademark registration if a complainant can establish common law rights in its mark); see also Zee T V USA, Inc. v. Siddiqi, FA 721969 (Nat. Arb. Forum July 18, 2006) (which found that the complainant need not own a valid trademark registration for the ZEE CINEMA mark in order to demonstrate its rights in the mark under the Policy).
According to WIPO’s Overview on Selected UDRP Questions (“WIPO Overview”), in order to successfully assert common law rights, a complainant must show that the name has become a distinctive identifier associated with the complainant or its goods or services. Relevant evidence of such a “secondary meaning” includes the length and amount of sales under the mark, the nature and extent of advertising, consumer surveys, and media recognition.
Although the Declaration by Mr. Garcia, Complainant’s Operations Manager, states that Complainant has used the name MEGA SHOES since “at least as early as 1994,” Complainant has provided very little proof to support this assertion. In mitigation, it says that proof of any secondary meaning is unnecessary in this particular case because it owns a trademark registration, which is inherently distinctive. That argument might hold up if the said trademark registration pre-dated the registration of the disputed domain name. But it does not. It actually post-dates it by some 6 years. In addition, the registration contains a disclaimer to the word “shoes,” which comprises about half of this so-called “inherently distinctive” trademark. Therefore, proof of common law rights in this case is essential, but the Panel has looked in vain for any evidence of the type described in the WIPO Overview. This seems extraordinary given that Complainant actually annexed a copy of that Overview to its Additional Submission, so it cannot have been unaware of its contents.
The only actual proof of earlier use that has been provided by Complainant – after prompting by Respondent – consists of only three documents. The first is a copy of a letter addressed to Mr. Albert Garcia of Mega Shoes from an organisation called Soles 4 Souls in which the writer thanks Mr. Garcia for his support for the charity and for his generous (but unspecified) donation; the second is a photograph of the 2000 Miami Karate Team thanking Mega Shoes for its endorsement; the third is a photograph of the Hialeah Athletic League team of 2005, but far from mentioning Mega Shoes, the Complainant, the team actually expresses its appreciation of MEGA CHIEFS. These 3 items are hardly indicative of the “extensive advertising” alleged by Mr. Garcia in his Declaration. This Declaration is not sworn, and in it he claims to have personal knowledge of the use of the name MEGA SHOES since 1994. However, he only became Operations Manager in 2008 and the Declaration says nothing about whether he was actually employed by Complainant in 1994.
None of this proof is a ringing endorsement of Complainant’s claimed common law rights and the Panel has concluded that these have not been proved. However, Complainant does have a registered trademark, and the consensus view of the WIPO Overview is that the registration of a domain name in advance of the acquisition of trademark rights does not prevent a finding of identical or confusing similarity, although in such circumstances it may be difficult to make a finding of bad faith. See Digital Vision, Ltd. v. Advanced Chemill Sys., D2001-0827 (WIPO September 23, 2001)..
The Panel therefore finds paragraph 4(a)(i) has been proved.
In view of the Panel’s finding under paragraph 4(a)(iii), it is not strictly necessary to consider the other elements of paragraph 4(a) of the Policy. However, for the record, the Panel feels inclined to the view that, having regard to the descriptive nature of the disputed domain name, Complainant has failed to establish that Respondent does not have legitimate rights and an interest in it.
Registration and Use in Bad Faith
According to the above mentioned WIPO Overview, the consensus view among panelists is that “when a domain name is registered before a trademark right is established, the registration of the domain name was not in bad faith because the registrant could not have contemplated the complainant’s non-existent right.” Of course prior use may overcome this but, as we have seen above, Complainant has been unable to prove this element. Accordingly, there is no basis for finding that Respondent had Complainant or its mark in mind when registering the domain name.
However, Complainant goes further and claims that bad faith is proved by the fact that Respondent offered to sell the domain name to it. According to paragraph 4(b)(i) of the Policy, bad faith is indicated if there are “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” (emphasis added).
There is no indication here that this was Respondent’s primary aim when it registered the disputed domain name. As the panel said in Manchester Airport PLC v. Club Club Limited, D2000-0638 (WIPO Aug. 21, 2000): “It is not contested that respondent has attempted to sell the contested domain name to the respondent for an amount well in excess of the registration fees. But selling a domain name is not per se prohibited by the ICANN Policy (nor is it illegal or even, in a capitalist system, ethically reprehensible). Selling of domain names is prohibited by the ICANN Policy only if the other elements of the ICANN Policy are also violated, namely trademark infringement and lack of legitimate interest.”
In the opinion of the Panel, the so-called offer to sell is nothing of the sort. It is not uncommon for a domain name site of the type operated by Respondent to be prefaced by a banner advertisement offering the domain name in question for sale. Anyone replying to this is automatically directed to a broker, such as in this case DomainDirect Inc., who will often reply specifying a price without referring the offer to the owner of the domain name. It would seem, from Respondent’s Additional Submission, when it denies any knowledge of any offer to purchase, that this is exactly what occurred on this occasion. The Panel therefore dismisses Complainant’s assertion that Respondent attempted to sell it the domain name.
Finally, Respondent contends that the disputed domain name is comprised entirely of common terms that have other meanings apart from use in Complainant’s MEGA SHOES mark, and that the registration and use of domain name comprising such common terms is not necessarily done in bad faith. It is the Panel’s view that a Respondent is free to register a domain name consisting of common terms, and that in this case the disputed domain name does contain such common terms.
In Zero International Holding v. Beyonet Services., D2000-0161 (WIPO May 12, 2000), it was said that “Common words and descriptive terms are legitimately subject to registration as domain names on a 'first-come, first-served' basis.” Also, in Target Brands, Inc. v. Eastwind Group, FA 267475 (Nat. Arb. Forum July 9, 2004), it was held that the respondent’s registration and use of the <target.org> domain name was not in bad faith because the complainant’s TARGET mark is a generic term. While in Miller Brewing Co. v. Hong, FA 192732 (NAF December 8, 2003), the panel found that because the respondent was using the <highlife.com> domain name, a generic phrase, in connection with a search engine, the respondent did not register and was not using the disputed domain name in bad faith.
In conclusion, the Panel finds that Complainant has failed to establish that the disputed domain name was registered and is being used in bad faith.
Doctrine of Laches
Finally, the Panel will consider briefly the question of laches, which has been raised by Respondent.
It is true that six years have gone by since Respondent registered and began using the disputed domain name, but the trademark was only registered ten months before the Complaint was filed. Although laches by itself is not a defence to a complaint brought under the Policy, it was held in Square Peg Interactive Inc. v. Naim Interactive Inc., FA 209572 (Nat. Arb. Forum Dec. 29, 2003), that “Complainant's delay in seeking relief is relevant to a determination of whether Respondent has been able to build up legitimate rights in the Domain Name in the interim, and whether it is using the Domain name in bad faith.”
In the circumstances, the Panel makes no finding on the question of laches.
Having failed to establish all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.
David H Tatham, Carolyn Marks Johnson, and Alan Limbury, Panelists
Dated: February 1, 2011
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