DJR Holdings, LLC v. Paul Gordon a/k/a IQ
Management Corporation
Claim Number: FA0301000141813
PARTIES
Complainant is DJR Holdings, LLC, New York, NY
(“Complainant”) represented by Brad D.
Rose, of Pryor Cashman Sherman &
Flynn, LLP. Respondent is Paul Gordon IQ Management Corporation,
Ladyville, BZ (“Respondent”) represented by Ari Goldberger, of ESQwire.com
Law Firm.
REGISTRAR AND DISPUTED
DOMAIN NAME
The domain name
at issue is <defjamsouth.com>,
registered with Key-systems Gmbh.
PANEL
The undersigned
certify that each of them 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.
Anne M. Wallace,
Q.C., James A. Carmody and David Sorkin as Panelists.
PROCEDURAL HISTORY
Complainant
submitted a Complaint to the National Arbitration Forum (the “Forum”)
electronically on January 10, 2003; the Forum received a hard copy of the
Complaint on January 8, 2003.
On January 13,
2003, Key-systems Gmbh confirmed by e-mail to the Forum that the domain name <defjamsouth.com> is registered
with Key-systems Gmbh and that the Respondent is the current registrant of the
name. Key-systems Gmbh has verified
that Respondent is bound by the Key-systems Gmbh 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 January 16,
2003, a Notification of Complaint and Commencement of Administrative Proceeding
(the “Commencement Notification”), setting a deadline of February 5, 2003 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@defjamsouth.com by e-mail.
A timely Response
was received and determined to be complete on February 5, 2003.
Complainant filed
a timely Additional Submission on February 10, 2003. Respondent filed a timely Additional Submission on February 12,
2003.
On February 19, 2003, pursuant to Complainant’s request to have the
dispute decided by a three-member
Panel, the Forum appointed Anne M.
Wallace, Q.C., James A. Carmody and David Sorkin as Panelists.
RELIEF SOUGHT
Complainant
requests that the domain name be transferred from Respondent to Complainant.
PARTIES’ CONTENTIONS
DEF JAM
RECORDINGS (“DEF JAM”) was founded in the early 1980s. DEF JAM’s business in
producing, promoting and releasing rap, hip-hop and “R & B” styles of
music. DEF JAM has launched the careers of some significant performers in the
history of rap music. Complainant owns several DEF JAM marks and has authorized
Universal Music Group the sole and exclusive use of the marks on and in
connection with recorded and live music. The DEF JAM “family” of marks include
DEF JAM, DEF JAM RECORDINGS, DEF JAM SOUTH, DEF JAM SOUTH RECORDINGS, DEF
POETRY JAM, DEF COMEDY JAM and DEF JAM UNIVERSITY. Complainant asserts that
these marks have come to signify Complainant as a source of high quality
entertainment and urban lifestyle products and services. Complainant filed
evidence to show widespread use of the DEF JAM family of marks.
DEF JAM SOUTH was
launched in 1999 as a “Southern division” of DEF JAM, which consisted of
talented rap artists from the South with a unique style of rap music.
Respondent
registered the name <defjamsouth.com> with actual knowledge of
Complainant’s successful and highly publicized entertainment business including
DEF JAM and DEF JAM SOUTH. Respondent has no rights or legitimate interests in
the domain name because its registration infringes Complainant’s family of DEF
JAM marks. At the time of registration of the domain name, Respondent knew of
Complainant’s business, its trademarks, its domain name and website located at
defjam.com and Complainant’s growing label DEF JAM SOUTH.
Complainant
produced evidence of nineteen DEF JAM SOUTH trademark and service mark
applications and registrations filed in the United States Patent and Trademark
Office (“USPTO”). Complainant also produced evidence of trademark registrations
for many of the other marks in the DEF JAM family.
Respondent
registered <defjamsouth.com> on July 23, 2002, two decades after Complainant
first began using and promoting its DEF JAM label and family of DEF JAM marks
and three years after Complainant launched the record label DEF JAM SOUTH at a
time when the DEF JAM SOUTH artists had sold collectively over six million
albums. The domain name is identical to Complainant’s DEF JAM SOUTH mark in
sound, appearance, meaning and overall commercial impression.
Respondent is not
known as or doing business as DEF JAM or DEF JAM SOUTH. When unsuspecting
consumers encounter Respondent’s web link, they will erroneously believe that
Complainant has authorized or is sponsoring the auctioning off of its DEF JAM
and DEF JAM SOUTH products on eBay when no such sponsorship or authorization
exists.
Respondent has no
rights or legitimate interests in the domain name because Respondent’s
registration has been and continues to be in violation of Complainant’s prior
and paramount trademark rights. Respondent is using the domain name to compete
with Complainant by selling Complainant’s own products. Since DEF JAM dates
back to 1982 and DEF JAM SOUTH dates back to 1999, Complainant has established
prior and paramount rights.
Respondent’s use
of the domain name cannot be considered legitimate under Policy ¶ 4(c).
Respondent is not using the name in connection with a bona fide offering of
goods or services because Complainant has not licensed use of the trademark to
Respondent. Furthermore, Respondent’s use cannot constitute fair use of the
domain name since Respondent does not use the domain name for purposes of
comparative advertising, news commentary or reporting. Rather, Respondent is
using the domain name to profit from Complainant’s successful products sold
under its famous trademarks by reselling these products on eBay via a domain
name that incorporates Complainant’s DEF JAM SOUTH mark.
Complainant also
points out that in an attempt to resolve the matter amicably, Complainant
contacted Respondent regarding its infringing activities and requested transfer
of the domain name to Complainant. The offer was rejected by Respondent and
Respondent has continued to sell Complainant’s products via its web link.
Complainant asserts that these actions establish that Respondent’s only
interest in the domain name is to capitalize on and profit from the success and
notoriety of Complainant who is the rightful owner of the trademarks DEF JAM
and DEF JAM SOUTH.
When Respondent
registered the disputed domain name on July 23, 2002, Complainant was already
the owner of all of the trade and service mark applications for its family of
DEF JAM marks, including its DEF JAM SOUTH mark, and had already sold millions
of record albums worldwide under those marks. Respondent’s activities reselling
DEF JAM products for inflated prices in eBay, combined with Complainant’s
international publicity, leads to the obvious conclusion that Respondent had
actual knowledge of Complainant at the time Respondent registered the domain
name and that Respondent intended to profit from the success of Complainant and
its famous family of DEF JAM marks. A rudimentary search of the USPTO would
have revealed Complainant’s numerous DEF JAM and DEF JAM SOUTH trademark
registrations and applications. A simple search in the Internet would have
directed Respondent to Complainant’s website and to multiple references to DEF
JAM and DEF JAM SOUTH.
Respondent
is intentionally attempting to profit from its bad faith registration.
Complainant’s marks are valuable commercial assets, Complainant had expended
substantial amounts of money promoting
its DEF JAM SOUTH and DEF JAM record labels, Complainant has applied for
registration of its marks in USPTO and Respondent is using the disputed domain
name to sell Complainant’s products bearing DEF JAM and DEF JAM SOUTH
trademarks without permission.
Respondent assets
that it registered the <defjamsouth.com> domain name for the
purpose of promoting DEF JAM and DEF JAM SOUTH merchandise on the eBay Internet
auction site.
Respondent
asserts that the <defjamsouth.com> domain name registration
predates Complainant’s DEF JAM SOUTH registered mark (registered January 28,
2003), and that Complainant has failed to establish a common law interest in
the mark prior to the domain name registration date. Complainant has no
enforceable rights with respect to DEF JAM SOUTH because the domain name
pre-dated Complainant’s interests.
Respondent
further submits that the DEF JAM mark is generic because it is slang meaning,
“first rate musical performance.” Therefore, Respondent contends that the
Complaint should be dismissed because Complainant has no “protectible” legal
interest in the term.
Respondent argues
that it has a legitimate interest in the domain name to use it to sell
used/second hand genuine goods branded with DEF JAM marks. Respondent contends
use of the domain name to direct traffic to an eBay auction website is a
legitimate use because there is no confusion as to whether the goods are being
directly distributed by Complainant.
Respondent
submits that it does not intend to cause source or sponsorship confusion. It directs
to an eBay auction website that is not in any way connected to Complainant.
Respondent asserts that nothing on Respondent’s auction website would cause a
consumer to believe that the DEF JAM related goods are being sold directly by
Complainant.
Respondent
asserts there is no evidence Respondent intended to sell the domain name to
Complainant, to prevent Complainant from reflecting its trademark in a domain
name, to disrupt Complainant’s business or to confuse consumers. There is no
doubt the eBay site is operated by eBay and that no consumer could possibly be
confused that the website is associated with Complainant.
Both Complainant
and Respondent cited numerous cases in their submissions. The Panel has
considered these in coming to our conclusions.
Both Complainant
and Respondent filed additional submissions. The Panel has considered the
Complainant’s additional submission to the extent it is a reply to issues
raised by Respondent, including the fair use defense which the Complainant
could not reasonably have anticipated in the Complaint. The Panel has
considered the Respondent’s additional submission to the extent Respondent
answered Complainant’s allegations with respect to counterfeit merchandise,
again, because Respondent could not reasonably have anticipated those
allegations.
In its additional
submission, Complainant asserts that some of the goods offered at the eBay
auction website are counterfeit merchandise. Complainant says that Complainant
never manufactured, licensed or otherwise authorized the production and/or sale
of any DEF JAM pendants and yet DEF JAM
pendants are available for sale on the eBay site accessible via <defjamsouth.com>.
In addition, the eBay site lists DEF JAM VENDETTA games for sale. Complainant
is in process of creating games under this moniker; however, these items have
not yet been released and in fact are not even finished being manufactured.
Accordingly, these items are either counterfeit or illegally diverted product.
Therefore, Complainant contends Respondent is using Complainant’s trademark to
redirect users looking for genuine DEF JAM or DEF JAM SOUTH products to a site
that auctions off counterfeit DEF JAM merchandise.
Complainant
argues that Respondent does not merely sell DEF JAM SOUTH products, but also
numerous products associated with the DEF JAM family of marks and thus it is
not necessary that Respondent use the registered DEF JAM SOUTH mark for its
domain name. Complainant further argues that Respondent’s sale of goods related
to a variety of DEF JAM marks and to the counterfeit nature of the foods
defeats Respondent’s fair use argument.
Complainant also asserts that Respondent has engaged in a pattern of,
without permission, registering domain names that reflect the trademarks of
others. Complainant cites V & S Vin & Spirit Aktiebolag v. IQ
Management Corp. FA 98440 (Nat. Arb. Forum Sept. 14, 2001) where Respondent
registered the domain name <absolutbeach.com> which is identical to
Complainant’s famous mark ABSOLUT. Similar to this case, Respondent, among
other things, argued that he was making fair use of the German dictionary word
ABSOLUT and the English dictionary word BEACH. The Panel, in ordering the
transfer of the domain name, found that Respondent had no rights or legitimate
interests in the domain name since it was not licensed to use the mark ABSOLUT
nor was currently known by that name.
Complainant also cites Fatbrain.com Inc. v. IQ Management Corp., FA
96374 (Nat. Arb. Forum Feb. 28, 2001), where Complainant filed a complaint to
recover the domain name <clbooks.com>, which was identical to
Complainant’s trademark. In that case Respondent was using the domain name,
much as he is using the disputed domain name in this case, i.e. to redirect
Internet users to a website at search .vu which offered products that were in
direct competition with Complainant’s products. Respondent argues it had rights
and legitimate interests in the domain name because he registered it with the
express intention of operating an e-commerce website relevant to one of the
domain names generic meanings. He also claimed that he did not know of
Complainant’s use of the clbooks.com mark or its registration. The Panel found that “Respondent has no rights
or legitimate interests in the domain name in question because Respondent is
not commonly known by the domain name, nor has Respondent used the domain name
in connection with a legitimate noncommercial or fair use without intent for
commercial gain.” The Panel noted that Respondent registered the domain name to
intentionally deprive Complainant of Internet traffic intended for Complainant
and to attract for commercial gain Internet users to its website or other
online location by creating a likelihood of confusion with Complainant’s mark.
The panel in Fatbrain also noted that Respondent had demonstrated
a pattern of conduct by registering domain names comprised of infringing marks,
which prevents trademark owners from reflecting their marks in corresponding
domain names. Complainant submits that a similar conclusion can be reached in
this case.
Respondent repeats that DEF JAM is a generic term,
that Respondent has a legitimate interest in the domain name by virtue of
pointing it to the eBay site, that no one would confuse Respondent as being
endorsed by Complainant and there is no evidence that Respondent registered or
used the name in bad faith.
Respondent asserts that the link to eBay is a nominative fair use in
connection with the sale of related merchandise. With respect to the
allegations of sale of counterfeit merchandise, Respondent asserts that it has
not counterfeited this merchandise. Respondent makes no certification as to the
authenticity of the products available at eBay. Regardless of Respondent’s use
of the domain name, those foods will continue to be sold by third parties at
eBay, so the nature of the listings on eBay is not something for which
Respondent can be held culpable.
Respondent asserts that the cases cited by Complainant to establish a
pattern of bad faith registration bear no relevance to this matter. Respondent
says the only time other proceedings are relevant is where they can demonstrate
that a respondent engaged in a pattern of registering domain names in order to
prevent the owner of the trademark or service mark from reflecting the mark in
a corresponding domain name. Respondent argues for various reasons that the
panels in the two cases were wrong in their decisions. Respondent asserts that
these cases do not establish the requisite pattern to establish bad faith
registration.
FINDINGS
The
Panel finds as follows:
1.
The domain
name <defjamsouth.com> is identical to Complainant’s mark, DEF JAM
SOUTH.
2.
Respondent
does not have rights or legitimate interests in the domain name.
3.
Respondent
registered and is using the domain name in bad faith.
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 registered rights in the mark DEF JAM. Complainant has filed
nineteen trademark applications for DEF JAM SOUTH, all of which pre-date
Respondent’s registration of the disputed domain name. While Respondent’s
registration of the disputed domain name pre-dated the only registered mark for
DEF JAM SOUTH, the other applications were already filed, and Complainant
submitted sufficient evidence to establish that Complainant has been using the
DEF JAM SOUTH mark since as early as 1999. This Panel is satisfied that for
purposes of the UDRP, Complainant has established common law rights in DEF JAM
SOUTH prior to Respondent’s registration. That being the case, the Panel finds
that the disputed domain name is identical to a trademark in which Complainant
has rights.
Even
if that were not the case, many of Complainant’s registrations for the DEF JAM
mark existed long before Respondent registered the disputed domain name. All
Respondent has done in this case is add the word SOUTH to Complainant’s mark.
In our opinion, DEF JAM SOUTH is, in any event, confusingly similar to DEF JAM.
Respondent has
argued that DEF JAM is a generic term meaning “first rate musical performance,”
and that therefore, Complainant has no “protectible” legal interest in the
term. Suffice it to say here that the USPTO has on numerous occasions in
evidence before us found DEF JAM to be sufficiently distinct to grant trademark
rights in the term to Complainant.
Complainant has
established the first element under the Policy.
While we have noted and considered all of
Respondent’s arguments, the Complainant’s arguments in this case are more
compelling. Applying the tests set out in Policy ¶ 4(c) to this case, we find
that Respondent does not have rights or legitimate interests in the domain
name.
Respondent
is using the disputed domain name to redirect web traffic to eBay, and does not
claim to have contemplated any other use of the name. There is no indication that Respondent has any connection to
either eBay or the sellers of items listed for sale on eBay. Respondent's actions do not qualify as a use
"in connection with a bona fide offering of goods or services."
It is also clear that Respondent has never been
commonly known by the domain name.
Lastly, Respondent has not established that he is making a
legitimate noncommercial or fair use of the domain name, without intent for
commercial gain. Respondent claims that
his sole intent with regard to the disputed domain name is "supporting a
market for the second-hand sale of Def Jam products." The Panel does not find this claim credible.
After considering all of the evidence before it, the Panel believes it to be
more likely than not that Respondent's intentions involve commercial gain,
either by using the domain name to promote his own merchandise (on eBay or
elsewhere); or, more likely, by holding onto the domain name until he receives
a sufficiently profitable purchase offer from Complainant. In either case, the Panel considers
Respondent's present activities to be merely pretextual, and therefore
insufficient to support a finding of rights or legitimate interests.
With respect to this element,
paragraph 4(b) of the Policy reads:
“For the purposes of Paragraph 4(a)(iii), the
following circumstances, in particular but without limitation, if found by the
Panel to be present, shall be evidence of the registration and use of a domain
name in bad faith:
(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
Complainant filed no fewer than 19 trademark applications for
the DEF JAM SOUTH mark which mark Complainant has been using since 1999 and in
relation to which mark more than six million albums have been sold. Shortly after the trademark applications
were filed, Respondent registered <defjamsouth.com> and
began using it to link to the eBay auction site. While Respondent argues that
the intent in registering the disputed domain name was to create a link to a
place where DEF JAM fans could buy DEF JAM second hand or used DEF JAM products
at less than regular prices, this Panel has concluded that we can reasonably infer
from the circumstances of this case that Respondent registered the disputed
domain name primarily for the purpose of selling it at a premium to Complainant
or a competitor of Complainant. On this basis, we find bad faith registration
and use under Policy ¶ 4(b)(i).
Two members of the panel also find that Complainant has
established that Respondent has engaged in a pattern of registering domain
names that reflect trademarks owned by others. In spite of Respondent’s
arguments to the contrary, Respondent has been found to be deliberately
choosing famous marks to incorporate into domain names. In this case he chose a
mark that has been used extensively by Complainant for several years and which
is the subject of at least 19 trademark applications. He obviously knew about
the trademark since the sale on eBay of DEF JAM and DEF JAM SOUTH products is
his alleged purpose in registering the disputed domain name. The other two
cases demonstrate that Respondent has done this on at least two other
occasions. From this pattern of conduct, we can infer that his purpose in so
doing is to prevent the owner of the trademark from reflecting that mark in a
corresponding domain name. This conclusion is also consistent with our
conclusion that the purpose was also to sell the domain name. On this basis,
two members of the Panel find bad faith under Policy ¶ 4(b)(ii).
Lastly,
while this case does not fall within Policy ¶ 4(b)(iii) or (iv), the Panel
finds bad faith on another basis. Under the UDRP, the Panel is entitled to conclude
that there is bad faith for some reason other than the four enumerated
circumstances in which a finding of bad faith is required. On our reading of
the Policy, each panel is responsible to determine whether there has been bad
faith. The four examples enumerated in Policy ¶ 4(b) are situations where, if
the evidence exists, the Panel must find bad faith. This does not, however,
preclude the Panel finding that other circumstances amount to bad faith in a
particular case. The paragraph says, "in particular but without
limitation."
In this
case, the Panel finds it difficult to accept that Respondent could register and
make any use of the disputed domain name in the manner in which he is using the
name without creating a false impression of some association with Complainant.
While Respondent argues that no one would be confused because the domain name
connects directly to eBay, we do not agree. A reasonable person using the
Internet could easily get the false impression that the DEF JAM and DEF JAM
SOUTH products offered on eBay are being offered for sale by Complainant. This
definitely creates confusion as to the affiliation of the eBay website with the
Complainant. Furthermore, Complainant submitted unrefuted evidence that
Internet users diverted to the eBay webpages in question are being exposed to
counterfeit DEF JAM and DEF JAM SOUTH products, with the result that some
members of the public may be confused as to the sponsorship of the site and the
goods, thereby tarnishing Complainant’s reputation because of the counterfeit
products.
By
using <defjamsouth.com>, Respondent is essentially making a false
representation that the consumer is being led to legitimate DEF JAM and DEF JAM
SOUTH products when in fact this is not the case. This means the web surfer is
being presented with a site that is not one hundred percent what the domain
name suggests. This is in fact false advertising whether or not Respondent is
one of the sellers on eBay.
By
registering and using the disputed domain name in this fashion, Respondent is
engaging in bad faith. For all the reasons outlined, therefore, Complainant
succeeds on this element as well.
DECISION
We find in favor of the Complainant in this case
and order that the domain name <defjamsouth.com> be transferred to
Complainant.
Anne M. Wallace, Q.C., Panel Chair
Dated: March 4, 2003
James A. Carmody
David Sorkin
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