National Arbitration Forum

 

DECISION

 

General Media Communications, Inc. v. Daniel Kunkel

Claim Number: FA0508000544991

 

PARTIES

Complainant is General Media Communications, Inc. (“Complainant”), represented by Joshua R. Bressler, Two Penn Plaza, Suite 1125, New York, NY 10121.  Respondent is Daniel Kunkel (“Respondent”), 14150 NE 20th St. Suite F1, Bellevue, WA 98007.

 

REGISTRAR AND DISPUTED DOMAIN NAME 

The domain name at issue is <penthouse-pet.com>, registered with Schlund+Partner Ag.

 

PANEL

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.

 

Dr. Reinhard Schanda as Panelist.

 

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum electronically on August 18, 2005; the National Arbitration Forum received a hard copy of the Complaint on August 18, 2005.

 

On August 22, 2005, Schlund+Partner Ag confirmed by e-mail to the National Arbitration Forum that the <penthouse-pet.com> domain name is registered with Schlund+Partner Ag and that the Respondent is the current registrant of the name.  Schlund+Partner Ag has verified that Respondent is bound by the Schlund+Partner Ag 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 August 24, 2005, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of September 13, 2005 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@penthouse-pet.com by e-mail.

 

A timely Response was received and determined to be complete on September 13, 2005.

 

A Complainant’s Reply to Respondent’s Response was submitted on September 19, 2005. In addition Respondent submitted a Supplemental Response to Complainant’s Addendum on September 21, 2005. Both of the additional submissions were received in a timely manner according to The Forum’s Supplemental Rule Nr. 7.

 

On September 22, 2005 pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the National Arbitration Forum appointed Dr. Reinhard Schanda as Panelist.

 

RELIEF SOUGHT

Complainant requests that the domain name be transferred from Respondent to Complainant.

 

PARTIES’ CONTENTIONS

A. Complainant

Complainant contends that the Complaint is based on Complainant’s famous and internationally recognized PENTHOUSE and PET trademarks and trademark registrations.  Since 1969, Complainant or its licensees, affiliates, parent corporations or predecessors in interest have published Penthouse, the adult entertainment magazine, and distributed it throughout the United States and internationally. Since its first publication, and by virtue of its near-unrivaled popularity, Penthouse has generated many millions of dollars in sales. Since that time, Complainant has used the famous and internationally recognized PET OF THE MONTH and PET OF THE YEAR trademarks for features in Penthouse magazine and elsewhere. As a result, the Complainant and the public have continuously used the term PENTHOUSE PETS to refer to models featured in Penthouse. Complainant subsequently registered the PENTHOUSE PETS trademark in 1984.

 

In addition, Complainant contends that he has leveraged the popularity of Penthouse magazine to expand the PENTHOUSE brand into numerous other product and services segments, including the provision of online adult entertainment services at its PENTHOUSE branded website, accessible at <www.penthouse.com>. Complainant’s PENTHOUSE branded website is extremely popular among Internet users and visited frequently. The Company’s PENTHOUSE branded website, www.penthouse.com, hosted a monthly average of 12.3 million visits for the months of May 2005, June 2005, and July 2005.

 

Complainant further contends that it exclusively owns the following valid and subsisting PENTHOUSE and PET trademarks and service marks, and registrations issued by the United States Patent and Trademark Office (hereinafter, the “PENTHOUSE and PET Marks”) (See Rule 3(b)(viii)): PENTHOUSE; PENTHOUSE PETS; PET OF THE MONTH; PET OF THE YEAR; PENTHOUSE FORUM; PENTHOUSE LETTERS; THE GIRLS OF PENTHOUSE; THE PENTHOUSE CLUB; PENTHOUSE MENS CLUB; PENTHOUSE SELECTION; PENTHOUSE.COM: PENTHOUSEMAG.COM: PENTHOUSE COMIX: PENTHOUSE MEN’S ADVENTURE COMIX; and PETNET,  Several of the registrations for the PENTHOUSE and PET marks are incontestable in accordance with Sections 15 and 33(b) of the Lanham Act, 15 U.S.C. Sections 1065 and 1115(b). Furthermore, Complainant owns over a hundred international trademark registrations and applications for registration for its PENTHOUSE and PET marks, including many containing PENTHOUSE PET(S).

 

According to Complainant it has used its trademarks continuously and extensively in interstate and international commerce in connection with the advertising and sale of Complainant’s products and services many years prior to Respondent’s registration.  Complainant has invested substantial sums of money in developing and marketing its products and services using the PENTHOUSE marks. Furthermore, Complainant has sold and continues to sell many millions of dollars worth of goods and services under and in connection with the PENTHOUSE and PET marks. As a result of Complainant’s long, continuous and extensive use and promotion of its famous PENTHOUSE and PET marks on and in connection with products and services provided in interstate and international commerce, Complainant has built up and owns valuable goodwill which is symbolized by the PENTHOUSE and PET marks. In addition, the Penthouse domain names, including <penthousepet.com> and <penthousepets.com>, have been in continual use by Complainant. Accordingly, the PENTHOUSE and PET marks and the PENTHOUSE branded website are internationally well-known and readily associated exclusively with Complainant as their exclusive source.

 

Decades subsequent to Complainant’s adoption and first use of the PENTHOUSE and PET marks, and no doubt to trade off of the valuable and extensive goodwill developed and represented by the PENTHOUSE and PET marks, Respondent registered <penthouse-pet.com>. This domain name registration came to Complainant’s attention on or about January 1, 2005, whereupon Complainant discovered that Respondent was using the <penthouse-pet.com> domain to provide links to a variety of Internet services including adult-content services.

 

Respondent’s unauthorized use of the PENTHOUSE and PET marks to market and promote Internet services including adult content services is not merely likely, but certain, to cause confusion in the minds of members of the relevant trade and public, causing them to believe mistakenly that Complainant has licensed, authorized, sponsored or otherwise affiliated itself with Respondent and its goods and services, when this in fact is not the case. Respondent had in fact deliberately registered the <penthouse-pet.com> domain name in bad faith with the calculated intent to (a) illegally capitalize, benefit from and trade on the international reputation and substantial goodwill built up and represented by the PENTHOUSE and PET marks by providing links to Internet services including adult-content services, a clear and flagrant violation of Complainant’s exclusive PENTHOUSE and PET trademark rights; (b) prevent Complainant from using the <penthouse-pet.com> domain name in connection with its own business; and (c) disrupt Complainant’s business.

 

Complainant contends that he notified Respondent on April 5, 2005, Complainant via e-mail and postal mail sent to the address identified in the WHOIS record that Registrant’s use of the subject domain name dilutes the distinctive quality of the PENTHOUSE Marks, violates the Federal Trademark Dilution Act and the Federal Anticybersquatting Consumer Protection Act, and constitutes federal and state trademark infringement, unfair competition, and deceptive trade practices.  Complainant also requested that Respondent agree to transfer immediately the <penthouse-pet.com> domain name to Complainant. 

 

On April 5, 2005 and April 7, 2005 Respondent suggested that the Complainant make a monetary offer to purchase the domain name. Complainant offered Respondent fifty dollars ($50) to compensate Respondent for any out-of-pocket expenses incurred for its registration. Respondent refused this offer and Complainant’s request to transfer the domain name.

 

On June 15, 2005, Complainant called Respondent via the phone number identified in the WHOIS record. Complainant offered two hundred dollars for the domain name and informed Respondent that Complainant would institute a domain name dispute resolution proceeding if he did not transfer the domain name. Respondent inquired if the UDRP filing fee exceeded one thousand dollars and Respondent then refused Complainant’s two hundred dollar offer upon learning that the fee did exceed $1,000. 

 

As a result Respondent’s <penthouse-pet.com> domain name is confusingly similar to Complainant’s PENTHOUSE and PET marks. A determination that a domain name is confusingly similar under the Policy does not require confusion in a trademark infringement sense; rather, the standard is whether the domain name is similar enough in light of the purpose of the Policy to justify moving on to the other elements of a claim for cancellation or transfer of a domain name.  For the purposes of the Policy, when a domain name includes a Complainant’s registered mark regardless of the other terms in the domain name, such inclusion is sufficient to establish confusing similarity. In the present action, Respondent’s <penthouse-pet.com> domain name not only include the PENTHOUSE trademark, but also the <penthouse-pet.com> domain is virtually identical to the PENTHOUSE PETS trademark. As such, Complainant readily satisfies the “confusingly similar” element. 

 

Additionally Complainant contends that he owns the PENTHOUSE PETS trademark and uses the <penthousepet.com> and <penthousepets.com> domain names to promote its PENTHOUSE branded website. The Respondent’s <penthouse-pet.com> domain name is confusingly similar to the Complainant’s PENTHOUSE PETS trademark and the <penthousepet.com> and the <penthousepets.com> domain names. As such, the Respondent’s <penthouse-pet.com> domain name will usurp Complaint’s visitors who misspell the Complainant’s trademark or domain names by inserting a hyphen.

 

As a further result Respondent has no legitimate rights or interests in the <penthouse-pet.com> domain name. Complainant having used one or more of the PENTHOUSE and PET marks continuously for decades, Respondent cannot establish valid rights in a PENTHOUSE or a PENTHOUSE PET designation. Accordingly, Respondent has not used the penthouse-pet.com domain name in connection with the bona fide offering of goods or services and Respondent acknowledged that the domain name is more valuable to the Complainant than to the Respondent.

 

Additionally, Respondent is using the subject domain name to trade on Complainant’s PENTHOUSE and PET marks for commercial purposes, namely to usurp Complainant’s visitors to expose them to banner advertisements and to redirect them to various internet businesses. According to Complainant this is the quintessential specimen of commercial exploitation. 

 

As a final result Respondent has registered and is using the <penthouse-pet.com> domain name in bad faith for the impermissible purposes of usurping website visitors from Complainant’s website for its own commercial gain, obstructing Complainant’s own use of the subject domain, and disrupting Complainant’s business, and with constructive and actual knowledge of Complainant’s exclusive and extensive PENTHOUSE and PET marks and the goodwill represented thereby.

 

Additionally, Respondent’s bad faith is further evidenced from his offer to sell the domain name for a price that exceeds his out-of-pocket expenses. Respondent suggested Complainant make an offer for the domain name and Respondent refused Complainant’s two hundred dollar ($200) offer after learning that the UDRP filling fee exceeds one thousand dollars ($1,000). Respondent’s discussion of the point with the Complainant evidences not that the Respondent had a right to the domain name but rather that Respondent thought he should be able to extract more money from Complainant for the requested transfer because seeking relief via UDRP would cost the Complainant hundreds of dollars more than the money it was willing to pay Respondent having been pushed to offer it.

 

Based on the foregoing, Complainant finally requests that this Administrative Panel determine that: (a) the <penthouse-pet.com> domain name is confusingly similar to Complainant’s PENTHOUSE and PET marks; (b) Respondent has no legitimate interests or rights in or to the <penthouse-pet.com> domain name; (c) Respondent registered the <penthouse-pet.com> domain name in bad faith for the impermissible purposes of usurping website visitors from Complainant’s website for its own commercial gain, obstructing Complainant’s own use of the subject domain name, and disrupting Complainant’s business, all with constructive and actual knowledge of Complainant’s exclusive and extensive PENTHOUSE and PET marks and the goodwill represented thereby; and (d) Respondent has used the <penthouse-pet.com> domain name in bad faith for the impermissible purposes of usurping website visitors from Complainant’s website for its own commercial gain, obstructing Complainant’s own use of the subject domain, and disrupting Complainant’s business, all with constructive and actual knowledge of Complainant’s exclusive and extensive PENTHOUSE and PET marks and the goodwill represented thereby.

 

B. Respondent

Respondent denies each and every allegation made by Complainant in its Complaint, especially that the domain name at issue is identical or confusingly similar to a trademark or service mark in which Complainant alleges it has rights. Respondent further denies that the domain name at issue has been used in bad faith. Respondent asserts rights and has demonstrated a legitimate business interest in the contested domain name. Respondent finally contends that Complainant’s Complaint was brought in bad faith by Complainant for the purposes of reverse domain name hijacking and in order to harass Respondent.

 

On October 9, 2003 Respondent registered <Fun-Puzzles.com> a website which eventually was created using a custom proprietary Content Management System (CMS). The goal of this system is to provide an easy method of creating websites.

 

During August through October 2004, Respondent registered hundreds of domains for future development, including a number of domains for pets and pet owners, including, but not limited to, <Supplies-Pet.com>, <Dog-Calendar.com>, <K9Toys.com>, and <BreedAnimals.com>. 

 

In October 2004 Respondent hired a consultant, Barbara Bowen to assist in normal business as well as help in developing the content and the CMS. One of her tasks included organizing and renaming thousands of “stock” photographs for use on various websites including <penthouse-pet.com>. A letter from Ms. Bowen is provided as proof of her website development activities occurring prior to Respondent’s contact from Complainant. Invoices from Ms. Bowen detail the transactions.


On October 21, 2004 Respondent registered the
<penthouse-pet.com> domain name in order to provide content for owners of small pets in apartments, townhouses and penthouses. The registered <penthouse-pet.com> domain name as well as almost all of the others were used in internet commerce in order to monetize the sites to defray registration costs during development, and provide valuable information and links for visitors with DomainSponsor. DomainSponsor is an internet parking service provider that automatically optimizes the information and content displayed to maximize the profitability of each domain.)

 

On April 5, 2005 Respondent received an e-mail from Talia T. Page representing Complainant complaining about the unauthorized DomainSponsor content on <penthouse-pet.com>. The DomainSponsor content on <penthouse-pet.com> did not in any way resemble the content found on the homepage of <Penthouse.com> making it virtually impossible that anyone would even consider that Complainant had licensed, authorized, sponsored or was otherwise affiliated with Respondent's website. At no time has Respondent ever had any intent to infringe on the “Penthouse” trademark for adult services, air fresheners, cigars, or other goods and services associated with Complainant.

 

Minutes later, on April 5, 2005 Respondent then made a good faith offer to resolve the domain name dispute with Complainant. In Respondent’s answer, he stated: “Before I put time and energy into checking how protectable the name might be for my purposes as a non adult content site or parked page, I wonder if you would be interested in buying the domain for a nominal sum...  Much less than either of us would pay in time and expenses.” 

 

On April 5th, 6th and 7th, Respondent, not hearing from Complainant, took time and energy to research the situation and determined that a website for pet owners was a completely legal use for the domain name <penthouse-pet.com>.

 

Penthouse International has a trademark on the term “Penthouse Pets” from 1981, but only for Goods and Services related to Air Fresheners. Many other  “Penthouse Pets” trademarks had died per the information displayed at www.uspto.gov. Furthermore, a visit to the <Penthouse.com> website verified that the term “Penthouse Pet” or “Penthouse Pets” was apparently not trademarked.

 

Respondent believes that a site for pet owners living in small homes, apartments, townhouses and penthouses is a legal, legitimate and fair use of the domain name <penthouse-pet.com> as it would not infringe upon Complainant’s trademark rights for adult content sites or other product categories covered in their many trademarks to the best of Respondent's knowledge. Respondent therefore decided to erect such a site for pet owners. Respondent used the pictures Barbara Bowen had organized, as well as a new and improved version of the proprietary CMS system he had developed to erect the site for pet owners. Please note that the website has special appeal to pet owners in that many of the pictures are randomly displayed making it fun to view the same page repeatedly, a feat only possible through the organizational efforts of Barbara Bowen.

 

On April 7th, Respondent heard from Complainant with a $50 offer for the domain name.

 

By April 11, 2005 Respondent in an incredible display of good faith, had largely completed the site for pet owners, with the intent that such a detailed and informative site would clearly communicate to the Complainant that the site would not display adult material henceforth.

 

On April 17, 2005 Talia T. Page again contacted Respondent to inquire about their offer, and received the following reply clearly indicating Respondent's intent to keep the domain for site for pet owners: “Unfortunately, I am not prepared to accept your offer at this time. I believe penthouse-pet.com will make a wonderful website for pet owners in small homes, and intend to take steps to keep the domain for that purpose. ...”

 

On June 15, 2005, Respondent spoke with Joshua R. Bressler, General Counsel for Complainant. During the conversation Mr. Bressler offered $200 for the domain. After determining that Complainant’s next action would be use of the UDRP to arbitrate this matter, a path that included little or no additional costs nor liability for the Respondent, instead of going directly to court the Respondent refused the offer. Respondent then reaffirmed his intent to keep the site for animal pet owners, and verified that Mr. Bressler was aware of the changes in website content on <penthouse-pet.com>.

 

The basis for this decision and reasoning is further born out when examining the invoices from Sandi Meuir another BioWaves consultant who wrote additional material for the Penthouse-Pet.com website in April and May, 2005. Respondent invested thousands of dollars developing the Penthouse-Pet.com including hundreds of dollars of out-of-pocket domain in April and May, and would not sell it for $200 in June.

 

Therefore, and based on the facts of the decision, Complainant’s conclusion in his complaint is harassing, baseless, unfounded, irresponsible, and quite possibly libelous.

 

Complainant’s claims that <penthouse-pet.com> may be causing confusion in any measurable way simply does not stand up under scrutiny. During the period of time <penthouse-pet.com> was connected with DomainSponsor from October 2004 to early April 2005, a total of 7 visitors were recorded by DomainSponsor. As <penthouse-pet.com> starts to get more visitors, it will solely be by Respondent’s marketing efforts and not from any association with the generic terms claimed by Complainant.

 

Respondent finally contends that Complainant has repeatedly failed to take steps to protect the term “Penthouse Pet” or “Penthouse Pets.” Furthermore Complainant clearly states they became aware of the adult content on <penthouse-pet.com> around January 1, 2005, and yet they did not even e-mail Respondent until April 5, 2005 to request that the content be removed. The website <penthousepets.net> has displayed adult content since approximately 1999. The website, “<penthousepet.net>” still contained links to adult sites not related to Complainant as recently as September 13, 2005. 

 

Respondent contends that the mark claimed by the Complainant arises from common law and it does have the presumption of validity, inherent distinctiveness or a constructive notice presumption; consequently, Complainant has the burden of proof to establish with a preponderance of evidence that its mark has acquired distinctiveness or secondary meaning before any rights under common law are enforceable. Respondent is of the view that Complainant has failed to provide evidence within the Complaint of any established secondary meaning such that consumers are likely to associate penthouse pet solely with the Complainant.

 

Respondent further contends that an offer during negotiations for the sale of the domain name is not evidence of bad faith pursuant to Policy . Furthermore the phrase penthouse pet is compromised entirely with generic terms to which Complainant cannot maintain exclusive rights.

Finally, Respondent contends that he is using the domain name,
<penthouse-pet.com> in a literal way, for pets and pet owners in small homes, a legal, legitimate and fair use of the generic terms, Penthouse and Pet. Furthermore, this use does not infringe on Complainant’s company, goods, services, or trademarks in any way. This literal use of the generic terms does not misleadingly divert consumers or tarnish the trademark or service marks at issue.

 

Respondent was developing a Content Management System and organizing photos for the website since before becoming aware of the Complaint. He was contacted by the Complainant first, and has shown no bad faith in attempting to profit from the domain name to the detriment of the Complainant. Respondent has not registered the domain name to prevent the Complainant from using the generic term, nor has the Respondent engaged in such a pattern. Respondent has not registered the domain name to in any way disrupt the business of the Complainant. Respondent has not registered the domain name to confuse the  Complainant’s customers and/or the general public about the source, sponsorship, affiliation or endorsement of the informational pet website.

 

Based upon the foregoing, Respondent finally requests the Administrative Panel to deny Complainant’s request to transfer the penthouse-pet.com domain name to Complainant.

 

C. Additional Submissions

In the Complainant’s Reply to the Respondent’s Response, Complainant contends that Respondent has failed to introduce any evidence whatsoever which conclusively establishes that he registered the subject domain name with the intent of providing content to owners of small pets. As such, Respondent did not and does not have a legitimate business interest in the subject domain name. At the time when Complainant first contacted Respondent about the illegal use of the subject domain name on April 5, 2005, there was no content provided on the subject domain relating to pets, or anything else for that matter. Rather, the subject domain provided links to a variety of Internet services including adult-content services. Complainant contends that it was not until after he contacted Respondent that Respondent removed the links to adult-content services and added content relating to pets. Respondent registered the subject domain name on October 21, 2004. Because non-adult content was not added to the domain until after Complainant complained to Respondent (and after six months had expired), it is clear Respondent did not register the subject domain name for the alleged legitimate business purpose of providing content to owners of small pets. Due to Respondent’s statements in its Response it is evident for Complainant, that Respondent registered the subject domain with the intention of profiting from its use in connection with adult-content links without Complainant’s consent.

 

Complainant further contends, that Respondent is using the subject domain name to trade on Complainant’s PENTHOUSE and PET marks for commercial purposes, namely, to usurp Complainant’s visitors and redirect them to various adult-content internet businesses. Otherwise, why did Respondent include links to adult-content services on his website which he claims was registered to provide content for owners of small pets? For Complainant this is the quintessential specimen of commercial exploitation. As a result Respondent has no rights or legitimate interests in the subject domain name. 

 

In addition the Respondent’s argument that “DomainSponsor is an Internet parking service provider that automatically optimizes the information and content displayed to maximize the profitability of each domain” fails as it is Respondent’s responsibility to monitor the activities, content and links on his domain and he cannot hide behind an innocent third party’s actions.

 

Complainant contends that there was and is no need for Respondent to include the PENTHOUSE mark in his domain name as the term “penthouse” would seem to imply a large dwelling unit rather than a small dwelling unit. As such, there were other terms clearly more applicable and/or appropriate for Respondent to use to attract visitors to a website for pet owners in small homes, i.e., “<apartmentpets.com>.” Instead, Respondent chose to use the well-known, famous and internationally recognized PENTHOUSE and PET marks for the purpose of diverting customers of Complainant to Respondent’s website, capitalizing on the goodwill and reputation of Complainant and its various trademarks and service marks and  maximizing  the number of visitors to his website for financial gain. As a result Respondent has failed to demonstrate a legitimate business interest in the subject domain name and/or that he has any rights in the domain name. Further, it is clear for Complainant Respondent’s site promote links to adult content on its home page, which is more than sufficient to create a likelihood of confusion in the minds of the public and violate Complainant’s exclusive rights.

 

Complainant further states that it has satisfied this requirement as the domain name <penthouse-pet.com> is not merely confusingly similar to the PENTHOUSE and PET marks owned by Complainant but, rather, virtually identical to the following marks owned by Complainant: “PENTHOUSE PET” and “PENTHOUSE PETS” and the following domain names owned by Complainant: “<www.penthousepet.com>” and <www.penthousepets.com>.

 

Regarding Respondent’s allegations Complainant’s “PENTHOUSE PETS” trademarks have died and that the terms “Penthouse Pet” and “Penthouse Pets” are not trademarked, Complainant contends, that the mark “PENTHOUSE PETS” is currently registered in the following countries: Brazil, Japan, Spain, United Kingdom and the United States, and the mark “Penthouse Pet” is currently registered in Switzerland. As such, Respondent’s allegation that these trademarks have died and are not protected is untrue. In addition the Policy does not require a trademark to be registered by a governmental authority for such rights to exist. A person can claim common law trademark or service mark rights.  Because Complainant has been using the PENTHOUSE and PET marks since 1969 and Respondent only registered the subject domain name in 2004, Complainant has common law trademark rights in the PENTHOUSE and PET marks which are superior to any rights Respondent could claim. As such, Complainant has satisfied the requirement that the domain name be identical or confusingly similar to a trademark or service mark in which the Complainant has rights in order for the subject domain name to be transferred to Complainant. In this regard the evidence is clear that the term “penthouse pet” is exclusively associated with Complainant’s business as it refers to the models featured in Penthouse Magazine and has no other meaning outside of Complainant’s business. As a result it is clear that Complainant has proved that the subject domain name is not only confusingly similar but identical to trademarks or service marks in which Complainant has rights.

 

Regarding the bad faith argument it is clear for Complainant that Respondent rejected the $200 offer because Respondent was hoping to receive closer to the sum of  $1,000 (since it was going to cost Complainant a minimum of $1,000 to file a UDRP Complaint anyway). This evidences Respondent’s bad faith in registering and using the subject domain name. Although tendering an offer alone may not be evidence of bad faith, the fact that domain registrants may legitimately and in good faith sell domain names does not imply a right in such registrants to sell domain names that are identical or confusingly similar to trademarks or service marks of others without their consent. As such, Respondent’s actions as described above are sufficient to constitute bad faith. Based on the above, it is clear for Complainant that Respondent registered the subject domain name primarily for the purpose of selling it to Complainant for valuable consideration in excess of Respondent’s documented out-of-pocket costs directly related to the domain name and, as such, registered and is using the domain name in bad faith.

 

Complainant contends that Respondent has no legitimate business interest in the subject domain name and could have used any other of a number of domain names to attract people to his website who are pet owners in small homes. The only logical conclusion for using the term “penthouse” in his domain name was to capitalize on the goodwill and reputation of the PENTHOUSE and PET marks, attract people to his website and divert users from Complainant’s websites for his own commercial gain by creating a likelihood of confusion with the PENTHOUSE and PET marks as to the source, sponsorship, affiliation and/or endorsement of Respondent’s website. This is sufficient evidence to show bad faith on the part of Respondent in registering and using the subject domain name.     

 

Finally Complainant contends that Respondent’s argument of reverse domain name hijacking is unfounded and without merit. Reverse domain name hijacking occurs in cases where someone uses the Policy in bad faith in an attempt to deprive a registered domain name holder of a domain name, whereas  Complainant has a legitimate business interest in the subject domain name as it incorporates the PENTHOUSE and PET marks exclusively owned by Complainant.  Furthermore, Complainant has an interest in preventing infringing uses of its marks and, as such, has an interest in capturing this domain name.  As such, Respondent has failed to prove that Complainant has instituted these proceedings in bad faith in an attempt to deprive it of its domain name.

 

Respondent denies in his Supplemental Response to Complainant’s Addendum that it has failed to introduce any evidence whatsoever which conclusively establishes that it registered the subject domain name with the intent of providing content to owners of small pets.

 

Regarding the adult-content argument, Respondent contends that non-adult content was not added after the Complainant complained, but before at some unknown time, since the content was not added by the Respondent. The adult content was immediately removed as soon as the Respondent was made aware of the situation.

 

Furthermore Respondent has spent months and tens of thousands of dollars and time preparing to efficiently produce content for his many domains. It is a process that has taken many months and has yet to be completed. This is supported by the fact that most of his other domains continue to host DomainSponsor.com parked pages rather than the content he intends for the pages. This does not, however, diminish in anyway his proven efforts to raise content on all of these sites, both before and after April 5, 2005.

 

Respondent further denies any intention of utilizing Complainant’s trademarks without consent to profit from the domain name. As a point of fact, Respondent parked all of his unused domains with DomainSponsor.com, not just particular domains that might benefit from their automatic optimization system, and did not even realize there was a trademark issue until contacted by Complainant. Furthermore, Respondent asserts his intention to be responsive to Complainant’s trademarks as evidenced by his immediate removal of the DomainSponsor.com linkage upon notification on April 5, 2005.

 

Respondent further contends that he did not provide any links to adult-content sites, but instead only a link to DomainSponsor.com so that they could provide content and links for the page. The linkage to DomainSponsor.com was removed immediately upon learning of the Complainant’s trademark concerns. Respondent has had a site up for small pet owners since April 11, 2005. More than four months prior to Complainant filing this complaint for the sole purpose of “Reverse Domain Name Hijacking.” The current <penthouse-pet.com> clearly shows that great time and effort has been expended in making it a real and viable domain name for Respondent. Furthermore Complainant’s assertion that: “It is clear that Respondent has no rights or legitimate interests in the subject domain name” is therefore patently false. Respondent has created a valuable site pertinent to the literal meaning of the generic phrase, “Penthouse Pet.”

 

Regarding Complainant’s argument that Respondent could easily have chosen another domain name, Respondent contends, that he firmly desires to keep the “<penthouse-pet.com>” domain name for his intended use, especially as it is a complimentary term for owners of small homes, often living in a city. A penthouse, although sometimes being large, is normally located in the city, and usually does not have a yard for pets to play, and is therefore completely appropriate for the Respondent’s target market. Furthermore Complainant still has not provided proof as to the common law trademark status for the generic term “Penthouse Pet.”

 

Respondent again points out that Respondent’s clear and documented proof of his website for pet owners which has been up and functional since April 11, 2005 and that does not infringe on Complainant’s trademarks makes this a clear case of Reverse Domain Name Hijacking. Respondent has had his pet website running for more than four months prior to Complainant’s filing of this Reverse Domain Name Hijacking case. This is clearly evidence of Complainant’s intent to use these proceedings to wrest control of the <penthouse-pet.com> domain name from Respondent.

Finally Respondent contends that he is using the domain name in its literal translation, for pets and pet owners in small homes, this use does not infringe on Complainant’s company, goods, services, or tarnish their trademarks in any way. Respondent was developing a Content Management System and organizing photos prior to contact from the Complainant. Respondent does not want to sell it to the Complainant, nor was the domain name registered for the primary purpose of selling it to the Complainant. Respondent has not registered the domain name to prevent the Complainant from using the term in business. Respondent has not registered the domain name to in any way disrupt the business of the Complainant.

 

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.

 

Identical and/or Confusingly Similar

 

Complainant asserts rights in the PENTHOUSe PETS mark through registration of the mark with the United States Patent and Trademark Office (“USPTO”) (Reg. No. 1,289,736 issued August 14, 1984).  See Innomed Techs., Inc. v. DRP Servs., FA 221171 (Nat. Arb. Forum Feb. 18, 2004) (“Registration of the NASAL-AIRE mark with the USPTO establishes Complainant's rights in the mark.”); see also U.S. Office of Pers. Mgmt. v. MS Tech. Inc., FA 198898 (Nat. Arb. Forum Dec. 9, 2003) (“[O]nce the USPTO has made a determination that a mark is registrable, by so issuing a registration, as indeed was the case here, an ICANN panel is not empowered to nor should it disturb that determination.”).

 

Complainant contends that Respondent’s <penthouse-pet.com> domain name is confusingly similar to Complainant’s PENTHOUSE PETS mark, as the domain name merely removes the letter “s” from the end of Complainant’s mark, replaces the space between the terms of the mark with a hyphen and adds the generic top-level domain “.com.”  The Panel is of the view that such minor changes are insufficient to negate a finding of confusing similarity pursuant to Policy ¶ 4(a)(i).  See Universal City Studios, Inc. v. HarperStephens, D2000-0716 (WIPO Sept. 5, 2000) (finding that deleting the letter “s” from the complainant’s UNIVERSAL STUDIOS STORE mark did not change the overall impression of the mark and thus made the disputed domain name confusingly similar to it); see also Nintendo of Am. Inc. v. This Domain Is For Sale, D2000-1197 (WIPO Nov. 1, 2000) (finding <game-boy.com> identical and confusingly similar the complainant’s GAME BOY mark, even though the domain name is a combination of two descriptive words divided by a hyphen); see also Nev. State Bank v. Modern Ltd. – Cayman Web Dev., FA 204063 (Nat. Arb. Forum Dec. 6, 2003) (“It has been established that the addition of a generic top-level domain is irrelevant when considering whether a domain name is identical or confusingly similar under the Policy.”).       

 

As a result the Panel finds that the domain name <penthouse-pet.com> is confusingly similar to the Complainant’s mark cited above.

 

Rights or Legitimate Interests

 

According to the majority of Panel decisions this Panel also takes the position that while Complainant has the burden of proof on this issue, once the Complainant has made a prima facie showing, the burden of production shifts to the Respondent to show by providing concrete evidence that it has rights to or legitimate interests in the domain name at issue. See Document Technologies, Inc. v. International Electronic Communications, Inc., D2000-0270 (WIPO June 6, 2000); see also Inter-Continental Hotel Corporation v. Khaled Ali Soussi, D2000-0252 WIPO July 5, 2000); see also Do The Hustle, LLC v. Tropic Web, D2000-0624 (WIPO Aug. 21, 2000) (holding that, where the complainant has asserted that the respondent has no rights or legitimate interests with respect to the domain name, it is incumbent on the respondent to come forward with concrete evidence rebutting this assertion because this information is “uniquely within the knowledge and control of the respondent”); see also G.D. Searle v. Martin Mktg., FA 118277 (Nat. Arb. Forum Oct. 1, 2002) (“Because Complainant’s Submission constitutes a prima facie case under the Policy, the burden effectively shifts to Respondent.”).

 

Complainant asserts that Respondent’s <penthouse-pet.com> domain name resolves to a website that features links to various commercial third-party websites, through which Respondent presumably earns referral fees.  The Panel finds that such diversionary use of a confusingly similar domain name is neither a use in connection with a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i) nor a legitimate noncommercial or fair use of the disputed domain name pursuant to Policy ¶ 4(c)(iii).  See WeddingChannel.com Inc. v. Vasiliev, FA 156716 (Nat. Arb. Forum June 12, 2003) (finding that the respondent’s use of the disputed domain name to redirect Internet users to websites unrelated to the complainant’s mark, websites where the respondent presumably receives a referral fee for each misdirected Internet user, was not a bona fide offering of goods or services as contemplated by the Policy); see also Disney Enters., Inc. v. Dot Stop, FA 145227 (Nat. Arb. Forum Mar. 17, 2003) (finding that the respondent’s diversionary use of the complainant’s mark to attract Internet users to its own website, which contained a series of hyperlinks to unrelated websites, was neither a bona fide offering of goods or services nor a legitimate noncommercial or fair use of the disputed domain names).

 

Furthermore, Complainant contends that Respondent is neither commonly known by the disputed domain name nor authorized to use any variation of Complainant’s PENTHOUSE PETS mark. Thus, the Panel concludes that Respondent has not established rights or legitimate interests in the disputed domain name pursuant to Policy ¶ 4(c)(ii).  See Tercent Inc. v. Lee Yi, FA 139720 (Nat. Arb. Forum Feb. 10, 2003) (stating “nothing in Respondent’s WHOIS information implies that Respondent is ‘commonly known by’ the disputed domain name” as one factor in determining that Policy ¶ 4(c)(ii) does not apply); see also Compagnie de Saint Gobain v. Com-Union Corp., D2000-0020 (WIPO Mar. 14, 2000) (finding no rights or legitimate interest where the respondent was not commonly known by the mark and never applied for a license or permission from the complainant to use the trademarked name).   

 

Moreover, the Panel interprets Respondent’s willingness to sell the disputed domain name registration as evidence that Respondent lacks rights and legitimate interests in the <penthouse-pet.com> domain name pursuant to Policy ¶ 4(a)(ii).  See Am. Nat’l Red Cross v. Domains, FA 143684 (Nat. Arb. Forum Mar. 4, 2003) (“Respondent’s lack of rights and legitimate interests in the domain name is further evidenced by Respondent’s attempt to sell its domain name registration to Complainant, the rightful holder of the RED CROSS mark.”); see also Wal-Mart Stores, Inc. v. Stork, D2000-0628 (WIPO Aug. 11, 2000) (finding the respondent’s conduct purporting to sell the domain name suggests it has no legitimate use).   

 

The Panel finds Complainant has established this element. Respondent has no rights or legitimate interests in the disputed domain name.

 

Registration and Use in Bad Faith

 

Complainant contends that Respondent’s suggestion to Complainant that Complainant make a monetary offer to purchase the <penthouse-pet.com> domain name registration is evidence that Respondent registered and used the disputed domain name in bad faith pursuant to Policy ¶ 4(b)(i).  See Bank of Am. Corp. v. Nw. Free Cmty. Access, FA 180704 (Nat. Arb. Forum Sept. 30, 2003) (“Respondent's general offer of the disputed domain name registration for sale establishes that the domain name was registered in bad faith under Policy ¶ 4(b)(i).”); see also Am. Anti-Vivisection Soc’y v. “Infa dot Net” Web Serv., FA 95685 (Nat. Arb. Forum Nov. 6, 2000) (“[G]eneral offers to sell the domain name, even if no certain price is demanded, are evidence of bad faith.”).    

 

Furthermore, Complainant asserts that Respondent has used the disputed domain name to operate a website that features links to various third-party commercial websites, through which Respondent earns referral fees.  Since the Panel finds that Respondent is taking advantage of the confusing similarity between its domain name and Complainant’s PENTHOUSE PETS mark to divert Internet users to various third-party websites, the Panel is of the view that such commercial use constitutes bad faith registration and use pursuant to Policy ¶ 4(b)(iv).  See Drs. Foster & Smith, Inc. v. Lalli, FA 95284 (Nat. Arb. Forum Aug. 21, 2000) (finding bad faith where the respondent directed Internet users seeking the complainant’s site to its own website for commercial gain); see also G.D. Searle & Co. v. Celebrex Drugstore, FA 123933 (Nat. Arb. Forum Nov. 21, 2002) (finding that the respondent registered and used the domain name in bad faith pursuant to Policy ¶ 4(b)(iv) because the respondent was using the confusingly similar domain name to attract Internet users to its commercial website).

 

Moreover, the Panel finds that Respondent registered the <penthouse-pet.com> domain name with constructive knowledge of Complainant’s PENTHOUSE PETS mark due to Complainant’s registration of the mark with the USPTO.  The Panel is further of the view that Respondent registered the domain name with actual knowledge of the mark because the mark has acquired great fame, both nationally and internationally.  Thus, the Panel concludes that Respondent’s registration of a domain name that is confusingly similar to Complainant’s mark, despite actual or constructive knowledge of Complainant’s rights in the mark, is evidence of bad faith registration and use pursuant to Policy ¶ 4(a)(iii).  See Samsonite Corp. v. Colony Holding, FA 94313 (Nat. Arb. Forum Apr. 17, 2000) (finding that evidence of bad faith includes actual or constructive knowledge of a commonly known mark at the time of registration); see also Victoria’s Cyber Secret Ltd. v. V Secret Catalogue, Inc., 161 F.Supp.2d 1339, 1349 (S.D.Fla. 2001) (noting that “a Principal Register registration [of a trademark or service mark] is constructive notice of a claim of ownership so as to eliminate any defense of good faith adoption” pursuant to 15 U.S.C. § 1072); see also Nintendo of Am. Inc v. Pokemon, D2000-1230 (WIPO Nov. 23, 2000) (finding that the respondent, at the time of registration, had notice of the complainant’s POKÉMON and PIKACHU trademarks given their extreme popularity).     

 

As a result the Panel finds that Respondent has acted in bad faith both in registration and use of the disputed domain name. Complainant has established this element.

 

DECISION

Having established all three elements required under the ICANN Policy, the Panel concludes that relief shall be GRANTED.

 

Accordingly, it is Ordered that the <penthouse-pet.com> domain name be TRANSFERRED from Respondent to Complainant.

 

 

 

 

 

 

 

Dr. Reinhard Schanda, Panelist
Dated: October 12, 2005

 

 

 

 

 

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