Sun Ray Chinese School, Inc. v. Hui Chiu / MEI HSU
Claim Number: FA1604001668860
Complainant is Sun Ray Chinese School, Inc. (“Complainant”), represented by S. Roxanne Edwards of Klemchuk LLP, Texas, United States. Respondent is Hui Chiu / MEI HSU (“Respondent”), Texas, United States.
REGISTRAR AND DISPUTED DOMAIN NAMES
The domain names at issue are <dfwsunray.com>, <dfwsunray.org>, <dfwsunrayacademy.com>, <dfwsunrayacademy.org>, <arlingtonsunray.com>, and <arlingtonsunray.org>, registered with GoDaddy.com, LLC and eNom, Inc.
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.
Eduardo Machado as Panelist.
Complainant submitted a Complaint to the Forum electronically on April 4, 2016; the Forum received payment on April 4, 2016.
On April 5, 2016, GoDaddy.com, LLC confirmed by e-mail to the Forum that the <dfwsunray.com>, <dfwsunray.org>, <dfwsunrayacademy.com>, and <dfwsunrayacademy.org> domain names are registered with GoDaddy.com, LLC and that Respondent is the current registrant of the names. GoDaddy.com, LLC has verified that Respondent is bound by the GoDaddy.com, LLC 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 5, 2016, eNom, Inc. confirmed by e-mail to the Forum that the <arlingtonsunray.com>, and <arlingtonsunray.org> domain names are registered with eNom, Inc. and that Respondent is the current registrant of the names. eNom, Inc. has verified that Respondent is bound by the eNom, 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 8, 2016, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of April 28, 2016 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@dfwsunray.com, postmaster@dfwsunray.org, postmaster@dfwsunrayacademy.com, postmaster@dfwsunrayacademy.org, postmaster@arlingtonsunray.com, postmaster@arlingtonsunray.org. Also on April 8, 2016, 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 April 28, 2016.
Additional Submission was received from the Complainant on April 28, 2016, which was found to be compliant.
On May 2, 2016, pursuant to Complainant's request to have the dispute decided by a single-member Panel, the Forum appointed Eduardo Machado as Panelist.
Having reviewed the communications records, the Administrative Panel (the "Panel") finds that the 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 names be transferred from Respondent to Complainant.
A. Complainant
Complainant, Sun Ray Chinese School, Inc., owns extensive common law rights in the trademarks SUN RAY, SUN RAY SCHOOL, and SUN RAY CHINESE SCHOOL (the SUN RAY Marks). Complainant uses the SUN RAY marks in connection with educational services including classes and tutorial classes in the fields of Chinese language and culture, math, English, college preparation, and standardized test preparation, and courses of instruction and supplemental education classes at the primary, intermediate, and secondary level. Additionally, Complainant is the owner of the domain name <sunraychinese.org>, which it registered on January 14, 2000.
Respondent’s disputed domain names are confusingly similar to the SUN RAY Marks, merely adding descriptive and/or geographically descriptive wording such as “academy,” “arlington,” and/or “dfw” to “SUN RAY” to create the disputed domain names. As such, consumers will mistakenly believe that the disputed domain names are affiliated with, sponsored by, or approved by Complainant.
Complainant states that the Respondent has no rights or legitimate interests in the disputed domain names. The domain names are not used for a bona fide offering of goods or services nor a legitimate noncommercial or fair use. Therefore, Respondent is not licensed or authorized to use Complainant’s mark and is not commonly known by the disputed domain names or any variant of Complainant’s mark.
Finally, Complainant argues that Respondent has registered and is using the disputed domain names in bad faith, being aware of Complainant’s application.
From 2005 through June 1, 2011, Respondent Mei Hsu worked for Complainant at its Chinese school in Arlington, Texas and was the administrator until the Arlington campus closed on June 1, 2011, and Respondent Hui Chiu was also an employee of Complainant.
As former employees of Complainant, Respondent is fully aware of Complainant’s substantial rights in the SUN RAY Marks. Despite knowledge of the value of the SUN RAY Marks, Respondent intentionally registered and has used “sunray” in the establishment and operation of the disputed domain names and associated websites. In the light of this, according to Complainant, Respondent’s registration and use of the disputed domain names was to confuse consumers and to divert them to websites associated with the disputed domain names and Respondent.
In addition, Complainant initiated legal proceedings in the District Court for Tarrant County, Texas, against Respondent and others alleging numerous state and federal causes of action based on Respondent’s use of SUN RAY, including its use and registration of domain names that incorporate SUN RAY. Although the causes of action in the pending lawsuit are based on Respondent’s use and registration of SUN RAY, Complainant has only asserted facts in the lawsuit related to two of the disputed domain names, as it only recently discovered the other disputed domain names. Complainant also states that the lawsuit concerns to a different object, not addressing the control or transfer of the disputed domain names but only includes enjoining Respondent from using SUN RAY or any confusingly similar variation thereof as a domain name or domain name component.
B. Respondent
Respondent defends that Arlington Sunray Chinese School, Inc. & DFW Sunray Academy are not confusing to consumers regarding any possible affiliation with the Complainant. The Complainant closed most of its campuses across the DFW metroplex, except for Carrollton, and all of this information is well known in the Chinese school community. Consequently, Respondent argues that it is virtually impossible to confuse the public and target customers with a company that has consolidated itself into a single location over the past decade and has made no effort or plans to expand or reopen into its previous locations.
Further, Respondent alleges that the Complainant is attempting to assert priority right over the mark of SUN RAY with a denied application from the USPTO, which reviewed the federal trademark registration for the SUN RAY mark and denied it for being too generic to be protected.
Respondent also argues that the domain names <arlingtonsunray.org> and <arlingtonsunray.com> have been in use for Arlington Sunray Chinese School for more than five years, being commonly known by the domains, which is a legitimate entity registered with the Texas Secretary of State, and which performs its own confusion check in the registration process. Respondent pleads that the registration with the Texas Secretary of State would have failed if there was sufficient similarity and likelihood of confusion as to the source, sponsorship, affiliation, or endorsement of Respondent’s organization.
Respondent states that consumers are not mislead to its school’s website by using Respondent’s domain name.
According to the Respondent, the domain names were obtained for active use by Arlington Sunray Chinese School and DFW Sunray Academy, with no purpose of selling or renting it to the Complainant.
Finally, regarding to the lawsuit pending in US Federal District Court (N.D Tex.), Respondent argues that, with the absence of an agreement between the parties or motion by the court, the filing of a complaint and service of lawsuit over directly related trademark issues that involve trademark validity does not automatically grant the Complainant’s right to Respondent’s registered domain names.
Defendant alleges that the Complainant is wrongfully asserting priority right over the mark of Sun Ray when it has already been informed and denied registration by the USPTO for a significant number of reasons, including being too generic.
C. Complainant’s Additional Submissions
Complainant alleges that Respondent misrepresents facts regarding Complainant’s operation of its schools, and states that the number of campuses Complainant operates in the Dallas-Fort Worth area and plans for expansion are irrelevant in the present case, because it has submitted sufficient evidence of its ownership of extensive rights in the trademarks SUN RAY, SUN RAY SHOOL, and SUN RAY CHINESE SCHOOL.
Complainant also argues that Respondent misrepresents the facts related to the registration of its business names with the Texas Secretary of State (the “SOS”). This registration does not provide rights to use a name in commerce, but only prevents the SOS from registering a legal name that it determines is the same as or deceptively similar to a previously registered name. The certificate issued by the SOS states that it does not authorize the use of the entity name in violation of the trademark rights of another party.
Furthermore, the SOS’s analysis to determine whether entity names are similar for the purpose of registration of business names differs from the analysis performed when determining a likelihood of confusion for trademarks. The SOS does not consider facts beyond the names themselves and will generally allow registration of business names provided that they names are not identical or include other wording, even when such additional wording is not distinctive.
Complainant defends that Respondent’s statements regarding Complainant’s federal trademark application for SUN RAY are false and misleading, arguing that its application for SUN RAY was not denied registration and neither found generic or even merely descriptive, but was only initially refused registration based on a prior registration and is expected to proceed to registration in due course.
Complainant alleges that Respondent’s comments in Paragraph [3][b][iii] of its Response supports Complainant’s position, because it claims rights and a legitimate interest in the Disputed Domain Names based on its unauthorized and infringing use of SUN RAY. However, no claim to rights or legitimate interests can be found where respondent has notice that its domain is confusingly similar to complainant’s mark or where Respondent registered or used the domain name in bad faith.
Finally, Complainant states that the Respondent’s comments regarding the use of the domain name in bad faith are immaterial and/or false. According to the Complainant, Respondent registered and is using the domain names in bad faith, which causes confusion with the SUN RAY Mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s web site or services advertised on Respondent’s web site.
In the instant proceedings, Complainant has alleged that the entities which control the domain names at issue are effectively controlled by the same person and/or entity, which is operating under several aliases. Paragraph 3(c) of the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”) provides that a “complaint may relate to more than one domain name, provided that the domain names are registered by the same domain name holder.” Complainant contends that the domain registrants, Hui Chiu and Mei Hsu, are married and are both directors and/or directly participate in and operate the entities that control the domain names and the websites to which they resolve. As further evidence, the Panel notes that Complainant asserts that the registrants have identical addresses and phone numbers, as reflected in the WHOIS information.
Moreover, as well noted by the Complainant, Paragraph 18(a) of the Rules states that when legal proceedings are concurrently pending, the Panel has discretion whether to suspend, terminate, or continue with the administrative proceeding.
In the present case, the Panel finds that the parties provide evidence of ongoing litigation between Complainant and Respondent involving the SUN RAY trademark and some of the disputed domain names.
In fact, the Complainant clearly states that “on December 17, 2015, it initiated legal proceedings in the District Court for Tarrant County, Texas, against Respondent and others alleging numerous state and federal causes of action based on Respondent’s use of SUN RAY, including its use and registration of domain names that incorporate SUN RAY”. The Panel finds that in accordance to the complaint the case was subsequently removed to the U.S. District Court for the Northern District of Texas, Fort Worth Division.
Respondent confirms this information by asserting that “currently there is an open lawsuit pending in US Federal District Court (N.D. Tex.) between Complainant's and Respondent’s schools in dispute over trademark protection. Case NO. 4:16-CV-00059-A”. It adds “absent an agreement between the parties or motion by the court, the filing of a complaint and service of a mere lawsuit over directly related trademark issues that involve trademark validity does not automatically grant the Complainant’s right to Respondent’s registered domain names. The Complainant has the burden of proof to demonstrate rightful ownership of the mark, valid registration, and all elements the claims alleged against the Respondent’s school. Currently, the Complainant is wrongfully asserting priority right over the mark of SUN RAY when it has already been informed and denied registration by the USPTO for a significant number of reasons, including being too generic.”
In situations where concurrent court proceedings are pending, as is the situation in the present case, certain panels have chosen to proceed with the UDRP proceeding. However, the Panel verifies that other panels have chosen not to proceed with the UDRP proceeding because of the pending litigation. See AmeriPlan Corp. v. Gilbert FA105737 (Nat. Arb. Forum Apr. 22, 2002) (Regarding simultaneous court proceedings and UDRP disputes, Policy ¶ 4(k) requires that ICANN not implement an administrative panel’s decision regarding a UDRP dispute “until the court proceeding is resolved.”).
After analyzing the facts as well as the evidences brought by the parties, the Panel finds that it seems more reasonable to defer to the concurrent court case. The rationale for this decision is that a panel should not enter a decision when there is a court proceeding pending because no purpose is served by the panel rendering a decision on the merits, whether to transfer the disputed domain names, or otherwise. In fact, in the present situation it is hard to properly adjudicate a dispute where two parties claim to be entitled to the disputed domain names and rights over the SUN RAY trademark and where little opportunity is given in a forum such as this to adequately test and assess the wide-ranging and conflicting assertions made by the parties.
Furthermore, the Panel finds that the case seems to present a legitimate trademark dispute. In this sense, the Panel finds that previous panels have chosen to dismiss UDRP complaints which centered upon legitimate trademark disputes. See, e.g., Abbott Labs. v. Patel, FA 740337 (Nat. Arb. Forum Aug. 15, 2006) (holding that assertions of trademark infringement are “entirely misplaced and totally inappropriate for resolution” in a domain name dispute proceeding because the UDRP Policy applies only to abusive cybersquatting and nothing else); see also Stevenson Indus., Inc. v. CPAP-PRO Online, FA 105778 (Nat. Arb. Forum Apr. 25, 2002) (“If the existence of [rights or legitimate interests] turns on resolution of a legitimate trademark dispute, then Respondent must prevail, because such disputes are beyond the scope of this proceeding.”).
Therefore, the Panel concludes the best course of action is to defer to the U.S. Court, and accordingly to terminate the present UDRP proceeding, without prejudice of any filing of a future UDRP complaint as appropriate after conclusion of the proceedings in the U.S. District Court. See AmeriPlan Corp. v. Gilbert FA105737 (Nat. Arb. Forum Apr. 22, 2002) (Regarding simultaneous court proceedings and UDRP disputes, Policy ¶ 4(k) requires that ICANN not implement an administrative panel’s decision regarding a UDRP dispute “until the court proceeding is resolved.” Therefore, a panel should not rule on a decision when there is a court proceeding pending because “no purpose is served by [the panel] rendering a decision on the merits to transfer the domain name, or have it remain, when as here, a decision regarding the domain name will have no practical consequence.”).
For the reasons set forth above, the Panel ORDERS that the Complaint be DISMISSED, WITHOUT PREJUDICE.
Accordingly, it is Ordered that the <dfwsunray.com>, <dfwsunray.org>, <dfwsunrayacademy.com>, <dfwsunrayacademy.org>, <arlingtonsunray.com>, and <arlingtonsunray.org> domain names REMAIN WITH Respondent.
Eduardo Machado
Dated: May 16, 2016
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