TLT-Babcock, Inc. v. Ventilateur TLT Co-Vent inc.
Claim Number: FA1204001440492
Complainant is TLT-Babcock, Inc. (“Complainant”), represented by James J. McGrath, Illinois, USA. Respondent is Ventilateur TLT Co-Vent inc. (“Respondent”), represented by Mark M. Rosenstein of Lapointe, Rosenstein, Marchand, Melancon, LLP, Canada.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <tltcovent.com>, registered with Tucows, Inc.
The undersigned certifies that he 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.
Fernando Triana, Esq., as Panelist.
Complainant submitted a Complaint to the National Arbitration Forum electronically on April 23, 2012; the National Arbitration Forum received payment on April 23, 2012.
On April 23, 2012, Tucows, Inc confirmed by e-mail to the National Arbitration Forum that the <tltcovent.com> domain name is registered with Tucows, Inc and that Respondent is the current registrant of the name. Tucows, Inc has verified that Respondent is bound by the Tucows, Inc 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 April 26, 2012, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of May 16, 2012 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@tltcovent.com. Also on April 26, 2012, the Written Notice of the Complaint, notifying Respondent of the e-mail 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 May 15, 2012.
On May 22, 2012, pursuant to Complainant's request to have the dispute decided by a single-member Panel, the National Arbitration Forum appointed Fernando Triana, Esq., as Panelist.
Having reviewed the communications records, the Administrative Panel (the "Panel") finds that the National Arbitration Forum has discharged its responsibility under Paragraph 2(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") "to employ reasonably available means calculated to achieve actual notice to Respondent" through submission of Electronic and Written Notices, as defined in Rule 1 and Rule 2.
Complainant requests that the domain name be transferred from Respondent to Complainant.
A. Complainant
According to the Complainant, both Parties are engineering and manufacturing companies serving the power and process fan markets throughout the world. Thus, Complainant states that on January 2000, Complainant entered into a Share Purchase Agreement with Respondent, whereby Complainant acquired a sixty percent (60%) ownership interest in Respondent.
Complainant asserts that after acquiring its ownership interest in Respondent, the latter changed its name to TLT Co-Vent Fans Inc., to take advantage of Complainant’s brand recognition within the power and process fan industry; consequently, under the statements of Complainant, Respondent experienced an increase in sales, which led Respondent to create and register the domain name <tltcovent.com> on or about May 12, 2006.
On February, 2009, Complainant entered into a Share Purchase Agreement with 4501985 Canada Inc. (“Purchaser”), whereby Complainant sold its ownership interest in Respondent to Purchaser. According to Complainant, at that time, Purchaser was, and continues to be owned and controlled by a key employee and officer of Respondent, Joseph Cohen. Complainant states that Mr. Cohen also was the original principal of Respondent before Complainant purchased its 60% interest in 2000.
Complainant quotes Article 9.2 of the Share Purchase Agreement by and between Complainant and Purchases that provides:
“Change of Name of TLT-Co-Vent Fans Inc. Within ninety (90) days of the Closing Date, Purchase shall have caused TLT Co-Vent Fans Inc. to amend its name and change its stationery so as to remove any reference to “TLT”. Within one (1) year of the Closing Date, Purchaser shall have caused the Co-Vent Group Companies to remove any reference to “TLT”, “TLT-Babcock” and/or “New York Blower Company” (collectively the “Names”) from any marketing, sales or related materials in print or electronic form, it being agreed that if the Co-Vent Group Companies prepare any new such materials, such reference will be removed. Except for use of the Names as contemplated within the periods provided above, the Purchaser shall not use and shall cause the Co-Vent Group Companies not to use the Names in association with the business of the Co-Vent Group Companies.” (Emphasis added by Complainant).
Complainant states that the Respondent was required to cease using branding materials containing “TLT” in electronic form on or before February 20, 2009; Closing Date stipulated for the Share Purchase Agreement between Complainant and Purchaser. Therefore, Complainant assures Respondent has no rights or legitimate interest in the domain name <tltcovent.com>. However, Respondent has and continues to use the aforementioned domain name, diverting potential TLT-Babcock customers to its web site by using the “TLT” portion of Complainant’s registered trademark, “TLT Babcock”. Complainant considers this use of the <tltcovent.com> domain name constitutes Respondent’s bad faith.
On August 29, 2011, Complainant requested that Respondent cease its use of the domain name in dispute and transferred the same to Complainant. On September 13, 2011, Respondent indicated that it did not intend to cease the use of the domain name <tltcovent.com>.
In conclusion, Claimant states that any rights or legitimate interest that Respondent may have had in the disputed domain name, were terminated as provided by Article 9.2 of the Share Purchase agreement between Complainant and Purchaser, and that Respondent’s continued use of the domain name after the Closing Date is in bad faith.
B. Respondent
According to the Response, the National Arbitration Forum has no jurisdiction to hear this matter, given the fact that the complaint originates from a dispute that is a contractual interpretation matter rather than an administrative issue in nature. In fact, Respondent states that Section 9.2 of the Share Purchase Agreement should not be interpreted so as to prohibit the Respondent’s limited use of the disputed domain name since it is not being used in the context of stationery, marketing, sales or related materials.
Under the above, Respondent alleges that if Complainant wishes to obtain adjudication of the domain name in dispute, it is subject to a contractual obligation under Section 11 of the Share Purchase Agreement entered into between the Complainant and the Purchaser, which provides:
“(a) All disputes arising under this Agreement shall be settled through binding arbitration in accordance with the provisions of this ARTICLE 11. (…) the party (in this Article the “Claiming Party”) to this Agreement who proposes to have any matter under this Agreement arbitrated in accordance with the provisions of this Agreement, shall give notice (the “Notice”) to the other Party (in this Article the “Defending Party”) specifying particulars of the matter or matters in dispute and proposing the name of the person it wishes to be appointed as the single arbitrator.
11.4 Commencement of Arbitration. Arbitration shall be commenced (i) in the case of a claim for indemnification under Section 10.2 hereof by the Defending Party (sic) delivering the Complaint to the Claiming Party (sic) describing the Matter and proposing the name of the person it wishes to be appointed as the single arbitrator; and (ii) in all other cases by the Claiming Party giving the Notice to the Defending Party specifying particulars of the Matter and proposing the name of the person it wishes to be appointed as the single arbitrator (…) Any arbitration shall take place in Montreal, Quebec.” (Underlining added by Respondent).
In relation with this point, Respondent has demonstrated it has instituted arbitration proceedings in Quebec in accordance with the aforementioned Share Purchase Agreement, to rule on this contractual interpretation matter, and to determine whether Section 9.2 prohibits the Respondent from continuing its current use of the disputed domain name, all as it appears in the Arbitration Notice sent to the Complainant on May 11, 2012, attached on to the Response as Annex 2.
Respondent also stated that if the National Arbitration Forum declares it is the appropriate forum to decide the Complaint, the manner in which the disputed domain name is not identical of confusingly similar to a trademark or service mark in which the Complainant has rights, mainly because Respondent has developed its product with a distinctive product line that makes no use of the element “TLT” in the context of marketing or sales.
Furthermore, Respondent states it should be considered as having rights or legitimate interest in respect of the domain name <tltcovent.com> , based on the grounds that the domain name was originally registered on May 12, 2006, with the knowledge and consent of the Complainant, which, at the time, held fifty (50%) percent of the Company’s voting shares and sixty percent (60%) of the Company’s equity shares, and appointed fifty (50%) percent of the Respondent’s board of directors.
Finally, Respondent argues that the domain name should not be considered as having been registered and being used in bad faith because it was registered with the knowledge and consent of the Complainant on 2006, and that the disputed domain name was not acquired for the purpose of selling, renting, or otherwise transferring its registration to the Complainant, a competitor of the Complainant, or any other person, nor has the Respondent intentionally attempted to attract, for commercial gain, internet users to its web site or online location by creating likelihood confusion with the Complainant’s trademarks.
Based on the facts and the evidence that has been provided by the Parties, it is outstandingly clear to the Panel that this matter is a business and contractual dispute between two companies that falls outside the scope of the UDRP.
A dispute such as the present one, although referring to issues that could have been decided by the Panel under different circumstances (cybersquatting or abusive domain name registrations), cannot be heard by it, bearing in mind the underlying contractual complexities referring to the contract interpretation disagreement existing between the Parties. Certainly, the Policy’s purpose is to combat abusive domain name registrations[1] and not to resolve contractual issues, which should be raised before a competent court, invested with proper jurisdiction.
Moreover, legitimate contractual or business disputes are not to be decided by the Panel. The UDRP was implemented to address abusive cybersquatting, not to serve as a guideline or alternate mechanism to litigate contract interpretation or breach of contracts regarding domain names, this sort of controversies, it must be clarified, are outside the scope of the Policy. The Panel is not to determine Parties compliance of a contract, but to fight wrongful and abusive domain names use or registration.
Under these circumstances, it is not the Panel’s duty to determine whether the Respondent has right or legitimate interest in the <tltcovent.com> domain name or whether or not the registration and use of the disputed domain name was and is being made in good faith, due to contract interpretation issues.
In addition to the foregoing, Respondent has demonstrated by proper means that a different legal proceeding has been initiated in respect of the contract interpretation issue regarding the use of the domain name in dispute, according to Paragraph 18 (a) of the Policy. Complainant in no way disputed that said arbitration proceeding was commenced and/or was not applicable.
The Panel is of the opinion that it should decline to rule the present domain dispute given the fact that this matter belongs to a more complex contractual disagreement between the Parties that, according to what the Respondent has proven, is to be resolved by a different forum.
In Frazier Winery LLC v. Hernandez, FA 841081 (Nat. Arb. Forum Dec. 27, 2006), the Complainant and Respondent also had a contractual agreement. The Panel ultimately decided that this placed the dispute outside the scope of the UDRP. Specifically, the Panel stated:
“The Complaint does not raise issues of abusive registration of the <frazierwinery.com> domain name, because the disputed domain name was registered and hosted by Respondent pursuant to a business relationship with Complainant (…) The Complaint alleges issues regarding the rightful possession of the domain name registration for the <frazierwinery.com> domain name pursuant to the parties’ agreement. Consequently, this dispute is properly one that arises under state law or common law, but in any event is outside of the scope of the UDRP.”
Additionally, in Discover New England v. Avanti Group, Inc., FA 123886 (Nat. Arb. Forum Nov. 6, 2002), the Panel also found that a dispute centering on a contractual question was outside the scope of the Policy.
Based on the assertions of both parties, the Panel is clearly satisfied that this is not a case of cybersquatting, but rather a business dispute arising from which there is a question concerning the rightful ownership of the disputed domain name.
Accordingly, the Panel finds that it does not have jurisdiction to deal with the Complaint relating to the domain name <tltcovent.com> as the issues in dispute are more properly categorized as a contract dispute. In these circumstances, the Panel makes no finding in relation to this domain name and dismisses the Complaint as the issues are outside the scope of the Policy.
The Panel decides the present dispute falls out of the scope of the Policy and therefore outside of its competence and accordingly the Complaint is DISMISSED.
Fernando Triana, Esq. Panelist
Dated: June 4, 2012.
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