Harvest Dispensaries, Cultivations & Production Facilities, LLC v. Martin Higgins / HARVEST
Claim Number: FA1901001823636
Complainant is Harvest Dispensaries, Cultivations & Production Facilities, LLC (“Complainant”), represented by Jeremy Kapteyn of KW Law, LLP, Arizona, USA. Respondent is Martin Higgins / HARVEST (“Respondent”), represented by Michael S. Dorsi of Ad Astra Law Group, LLP, California, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <harvestshop.com> (the “Domain Name”), registered with GoDaddy.com, LLC.
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.
Clive Elliott QC as Panelist.
Complainant submitted a Complaint to the Forum electronically on January 3, 2019; the Forum received payment on January 3, 2019.
On January 7, 2019, GoDaddy.com, LLC confirmed by e-mail to the Forum that the Domain Name is registered with GoDaddy.com, LLC and that Respondent is the current registrant of the Domain Name. 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 January 10, 2019, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of February 4, 2019 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@harvestshop.com. Also on January 10, 2019, 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 February 4, 2019.
On February 14, 2019, pursuant to Complainant's request to have the dispute decided by a single-member Panel, the Forum appointed Clive Elliott QC 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 Name be transferred from Respondent to Complainant.
A. Complainant
Complainant states it is the registered owner of the mark HARVEST in the United States (“Complainant’s Marks”):
|
Trademark |
Country |
Registration Number |
|
HARVEST |
United States |
5,154,042 |
|
[Visual Representation of the HARVEST mark] |
United States |
5,279,159 |
Complainant asserts that since 2013 it has offered a wide range of goods and services under Complainant’s Marks through its various affiliated business entities, including Harvest Health & Recreation, Inc. and Harvest Enterprises, Inc.
Complainant also states that its primary domain name <harvestoftempe.com>, now resolving to <harvestofaz.com>, has been used since 2013 to extensively promote and advertise its goods and services under Complainant’s Marks. It further states that it also owns the following domain names <harvestinc.com>, <harvestofmd.com>, and <harvestofreading.com>.
Complainant contends that it has established common law trade mark rights in Complainant’s Mark due to its service and the widespread association of Complainant’s Mark with Complainant and accordingly, Complainant’s Marks and its <harvestoftempe.com> domain name are extremely valuable to Complainant.
Complainant goes on to say that it has expanded its business operations with authorized Harvest locations within, and outside, Arizona and continues to expand its business operations into additional states within the United States.
Complainant contends that the Domain Name was originally registered on March 21, 2002 by a third party unrelated to Respondent. Respondent then acquired the Domain Name on March 30, 2015, almost two years after first use of Complainant’s Marks. Complainant asserts that the Domain Name is identical and confusingly similar to Complainant’s Mark, in that it is an exact reproduction of Complainant’s Mark with the generic term “shop” appended to the end.
Complainant submits that the addition of the generic word “shop” is not sufficient to distinguish the Domain Name from Complainant’s Marks. Instead it serves only to create and emphasize a connection in the public mind with Complainant’s Marks in a manner that is confusing and suggests an affiliation with Complainant’s preexisting brand of services in the same field. This is particularly true in this case because Complainant itself uses the word “harvest” in its various domain names with an additional word or words after the word “harvest” to distinguish websites associated with Complainant’s different retail locations.
Complainant asserts that this is causing consumer confusion with Complainant’s Marks and negatively affecting Complainant’s business.
Complainant contends that Respondent has registered and is using the Domain Name in bad faith. Following a meeting with Complainant’s CEO in 2014, Respondent, with actual knowledge of Complainant’s use, then adopted Complainant’s Marks, and also opened two dispensaries in the state of California under the names “Harvest on Geary” and “Harvest Off Mission”.
Complainant states that Respondent is not a licensee of Complainant, nor is Respondent otherwise authorized to use Complainant’s Marks.
Finally, Complainant advises it is separately pursuing civil litigation against Respondent in the state of Arizona for trademark infringement and other claims, although that states that the Respondent’s acquisition of the Domain Name is not a subject of that proceeding.
B. Respondent
Respondent states that it has built a recognized brand under the Harvest mark for the retail trade of cannabis in California.
Respondent points out that unlike almost any other product available for purchase in the United States, legal cannabis is an exclusively territorial product. Federal law and the laws of all U.S. states prohibit transporting cannabis across state lines. The United States Patent and Trademark Office (“PTO”) refuses to issue trademarks for cannabis on the federal register. It is also the consistent practice of federal courts to reject enforcement actions for marks that are not lawfully used in commerce, which means lawful under federal law. Cannabis remains a Schedule I drug under the Controlled Substances Act. All commercial cannabis activity in the United States is illegal under federal law.
Respondent contends that Complainant only obtained federal trademarks by misrepresenting its business to the PTO, claiming that it was in the “botanical medicine” business and omitting the words “cannabis” and “marijuana” from its federal trademark application. At the time Complainant filed its federal trademark application, Complainant knew or should have known that it was applying for a trademark for products that could not be sold lawfully in commerce under federal law. Complainant largely omit the words “cannabis” and “marijuana” from its Complaint.
Respondent obtained state-law registration and common law rights in California, knowing that Complainant had used the name Harvest in Arizona, but also knowing that Complainant had no legal right to the HARVEST mark in California. It argues that state-law trademark rights do not extend beyond the boundaries of the state. Any Arizona-based territorial rights Complainant has from using the name Harvest in commerce in Arizona would not create priority over Respondent’s California state-law rights.
Relevantly, Respondent states that there are three ongoing disputes between Complainant and Respondent or their related entities: a challenge at the Trademark Trial and Appeals Board for the PTO (“TTAB”) to Complainant’s federal trademark registrations, a lawsuit in Maricopa County Superior Court in Arizona concerning Arizona-law rights, and a lawsuit in San Francisco County Superior Court concerning California-law rights. Respondent therefore submits that the best decision that Forum could make would be to abstain and allow those proceedings to go forward, as authorized by Rule 18(a) of the Rules.
Respondent points out that both Complainant and Respondent are residents of the United States, and neither makes a claim that their rights are protected by a treaty or other international agreement. Their rights at issue here arise under United States law.
Respondent indicates that the American federal system often requires tribunals to consider both federal and state law. In trademark disputes, federal marks may preempt state marks, but federal trademark law does not occupy the field in a way that would displace state law. Respondent engages in a range of arguments about which law has primacy or otherwise pre-empts the other and cautions that the Forum would be unwise to step into the fray. In doing so it refers to Rule 18(a), which states that “the Panel shall have the discretion to decide whether to suspend or terminate the administrative proceeding” when legal proceedings were initiated prior to the domain name dispute. Respondent notes of course that in the present case, there are three separate proceedings: the TTAB, Arizona state court, and California state court.
Further, respondent submits that each of those tribunals is acting within its core competence: the Arizona court is deciding Arizona-law claims, the California court is deciding California-law claims, and the TTAB is deciding federal trademark rights. The results of those cases will determine the extent of the rights that this Forum would need to consider to determine whether Complainant or Respondent should prevail.
Respondent advises that there are three on-going disputes between Complainant and Respondent and/or their related entities, including:
(a) a challenge at the Trademark Trial and Appeals Board for the PTO (“TTAB”) to Complainant’s Federal trademark registration;
(b) a lawsuit in Maricopa Country Superior Court in Arizona concerning Arizona-law rights; and
(c) a lawsuit in San Francisco Country Superior Court concerning California-law rights.
The net effect of this is that that Complainant and Respondent are engaged in pending litigation in the states of Arizona and California to resolve issues of trademark registration and infringement. Complainant argues that the Domain Name is not specifically at issue in the co-pending proceedings identified above and is thus properly before the Panel. Complainant provides a copy of the complaint it filed with the Superior Court of Arizona on September 15, 2017.
On the other hand, Respondent argues the Panel should abstain from reaching a decision on the merits to allow the parties to continue with the legal proceedings in both state courts, as well as with the federal trademark authority. Specifically, Respondent contends that each of those tribunals is acting within its core competence. Respondent submits that the results of those cases will determine the extent of the rights that this Forum would need to consider to determine whether Complainant or Respondent should prevail. Respondent provides various documents from the Court proceedings to substantiate its position.
In situations where concurrent court proceedings are pending, as is the situation with respect to the instant Complaint, some panels have chosen to proceed with the UDRP filing. Equally, other panels have chosen not to proceed with the UDRP because of the pending litigation. See AmeriPlan Corp. v. Gilbert FA105737 (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.”).
Preliminary Issue: Trademark Dispute Outside the Scope of the UDRP
In deciding whether this dispute is properly within, or outside the scope of, the UDRP it is necessary to analyze the true nature of the dispute. Complainant asserts rights in Complainant’s Marks based on its registration of the marks with the United States Patent and Trademark Office (“USPTO”) along with its common law rights in the marks. It is common ground that currently, Complainant and Respondent are engaged in a dispute in two different State courts along with a trademark opposition proceeding in with the USPTO. In all of these proceedings the HARVEST mark is involved, if not central to, those proceedings.
Respondent asserts rights in the HARVEST mark based on its state trademark registrations of the mark, along with common law rights in the mark. Further, Respondent claims that Complainant only obtained a USPTO registration by misrepresenting its use of the HARVEST mark to comport with Federal law. For these reasons Respondent argues the Panel should abstain from reaching a decision on the merits.
In sum, Complainant and Respondent both assert rights to the HARVEST mark. Upon consideration, the Panel is of the view that this dispute falls outside the scope of the Policy, and therefore dismisses the Complaint. In Commercial Publishing Co. v. EarthComm, Inc., FA 95013 (Forum July 20, 2000), the panel indicated that legitimate disputes should be decided by the courts:
The adopted policy establishes a streamlined, inexpensive administrative-dispute resolution procedure intended only for the relatively narrow class of cases of “abusive registrations.” Thus, the fact that the policy’s administrative dispute-resolution procedure does not extend to cases where a registered domain name is subject to a legitimate dispute is a feature of the policy, not a flaw. The policy therefore indicates that “legitimate disputes” should be addressed by the courts and that only cases of abusive registrations are intended to be subject to the streamlined administrative dispute-resolution procedures.
Previous panels have resolved to dismiss UDRP complaints which centered upon apparently legitimate trademark disputes. See, e.g., Abbott Labs. v. Patel, FA 740337 (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 (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.”). This thinking supports the Panel’s view that it should dismiss the instant Complaint.
In this Panel’s view, it should not rule on a domain name dispute 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, when as here, a decision regarding the Domain Name will have no or insufficient practical consequence and where ultimately the fate of the Domain Name will depend, whether directly or indirectly, on the outcome of the proceedings relating to the HARVEST mark.
The Panel therefore dismisses the Complaint on the basis that the parties have concurrent legal actions covering the same or substantially the same issues, or otherwise in relation to issues which touch on the Domain Name dispute. The parties should pursue those legal proceedings. That is not to say that the Complaint lacks merit. That is an issue on which the Panel expresses no view.
Accordingly, the Panel makes no comment or finding on the merits of the Complaint, dismisses the Complaint and Orders that the status quo with regard to the Domain Name REMAINS.
Clive Elliott Q.C., Panelist
Dated: February 26, 2019
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