Federal Home Loan Mortgage Corporation v.
Karen Blodgett d/b/a KOG Enterprises, Inc.
Claim Number: FA0509000566605
PARTIES
Complainant is Federal Home Loan
Mortgage Corporation (“Complainant”) represented by David M. Kelly, of Finnegan Henderson Farabow Garrett &
Dunner L.L.P., 901 New York
Ave NW, Washington, DC 20001.
Respondent is Karen Blodgett d/b/a KOG Enterprises, Inc. (“Respondent”), P.O. Box 27740, Las Vegas,
NV 89126.
REGISTRAR AND DISPUTED DOMAIN NAMES
The domain names at issue are <freddiemacmortgages.com>, <freddiemacmortgages.net>, <freddiemacmortgages.org>, <freddymacmortgages.com>, <freddiemacarms.com>, <freddiemacarms.net>, <freddiemacarms.info>, <freddymacloans.com>, and <freddymacloans.net>, registered with Go Daddy Software, Inc.
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.
Alan L. Limbury as Panelist.
PROCEDURAL HISTORY
Complainant submitted a Complaint to the National Arbitration Forum
electronically on September 21, 2005; the National Arbitration Forum received a
hard copy of the Complaint on September 22, 2005.
On September 21, 2005, Go Daddy Software, Inc. confirmed by e-mail to
the National Arbitration Forum that the <freddiemacmortgages.com>, <freddiemacmortgages.net>, <freddiemacmortgages.org>, <freddymacmortgages.com>, <freddiemacarms.com>, <freddiemacarms.net>, <freddiemacarms.info>, <freddymacloans.com>, and <freddymacloans.net> domain names are registered with Go
Daddy Software, Inc. and that the Respondent is the current registrant of the
names. Go Daddy Software, Inc. has
verified that Respondent is bound by the Go Daddy Software, Inc. 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 September 27, 2005 the National Arbitration Forum drew Complainant’s
attention to certain formal deficiencies in the Complaint and that day
Complainant filed an Amended Complaint.
On September 27, 2005, a Notification of Complaint and Commencement of
Administrative Proceeding (the “Commencement Notification”), setting a deadline
of October 17, 2005 by which Respondent could file a Response to the Amended
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@freddiemacmortgages.com,
postmaster@freddiemacmortgages.net, postmaster@freddiemacmortgages.org,
postmaster@freddymacmortgages.com, postmaster@freddiemacarms.com,
postmaster@freddiemacarms.net, postmaster@freddiemacarms.info,
postmaster@freddymacloans.com, and postmaster@freddymacloans.net by e-mail.
A timely Response was received and determined to be complete on October
17, 2005.
On October 24, 2005, Complainant submitted a timely additional
submission in accordance with Supplemental Rule 7.
On October 24, 2005, pursuant to Complainant’s
request to have the dispute decided by a single-member Panel, the National
Arbitration Forum appointed Alan L. Limbury as Panelist.
RELIEF SOUGHT
Complainant requests that the domain names be transferred from
Respondent to Complainant.
PARTIES’ CONTENTIONS
A. Complainant
Complainant, a stockholder-owned corporation chartered by Congress, has
engaged in business since 1970 under the name and mark FREDDIE MAC, purchasing
residential mortgages and issuing mortgage-backed and mortgage-related
securities. The FREDDIE MAC name and
mark exclusively identify Complainant and, through use, have become
internationally famous. Complainant
claims common law rights in the FREDDIE MAC mark.
Complainant is the registered proprietor of United States trademarks
1,312,608 (issued January 1, 1985), 1,664,364 (issued November 12, 1991) and
2,975,533 (issued July 26, 2005 – after registration of the disputed domain
names), each for the mark FREDDIE MAC and covering financial services in
International Class 36. The latter mark
also covers real estate services in that Class.
Respondent registered the disputed domain names in September and
November 2004. Complainant contends
Respondent is in the business of selling domain names and that she registered
all of the disputed domain names for the purpose of selling them for a
profit. Prior to Complainant’s
“cease-and-desist” letter of July 19, 2005 two of them were listed and
advertised for sale on her website, as were domain names comprising the
trademark of Complainant’s competitor, Fannie Mae. Complainant also relies on Respondent’s response to the
“cease-and-desist” letter, which was as follows:
“If this is the route you choose to take – forcibly demanding that the
domains be surrendered – then you have a fight.
Those domains are not your trademark.
Otherwise Freddie Mac would have registered them long ago. I just registered them last year!
Websites are allowed to use trademarked terms and even copyrighted
material such as logos etc, if said website is a “parody” site or a site that
provides a critique. We still have free
speech in this country. This is why one
can put up a website called www.fucknationalcity.com and National City bank has
no legal recourse. The YourCompanyNameSucks.com issue has already been decided
in court.
So, you can either pay me for the domain names, or I will get my
already-authored sites up a little faster.
They are almost finished. They
will no longer be available for sale to the general public, but I will post my
“critique” of Freddie Mac and make sure it’s nice and legal. I will use the site to critique and write
opinions about recent Freddie Mac scandals!
All in the name of freedom of speech / press, of course.
There is already well established case law in this matter. Don’t try to bully me; the case will never
make it to court. I won’t bother going
into my legal experience with this very thing, but suffice it to say: You
aren’t going to intimidate me.
If you would like to buy the domain names from me BEFORE I put up my
websites, you are welcome to make an offer.
Otherwise, once my site goes up in which I criticize Freddie Mac, it
will never come down. It’s almost done
already.
Thank you,
Karen Blodgett”
Complainant contends that all of the disputed domain names are
confusingly similar to Complainant’s FREDDIE MAC mark, that Respondent has no
rights or legitimate interests in them and that she registered them and is
using them in bad faith. As to bad
faith, Complainant says in particular that Respondent offered to sell some of
the domain names directly to Complainant, offered to sell the others on her
<kogmarketing.com> website, and offered to sell the domain names <freddiemacmortgages.com>
and <freddiemacarms.com> on her websites associated with those
domain names. Respondent’s <freddiemacmortgages.com>
website stated, “when people search for ‘freddie mac’ … this baby will be first
in line,” and her <freddiemacarms.com> website stated, “[i]f you
are a lender … this is a very valuable domain name.”
B. Respondent
Respondent says she is a loan officer/mortgage broker in Arizona,
selling Freddie Mac loans for a living.
She ‘currently has clients that are obtaining
Freddie Mac (Federal Home Loan Mortgage Corporation) loans.’
Many have expressed interest in understanding the difference between
“Freddie Mac loans” and “Fannie Mae loans.” Respondent is in the intellectual
position to post informational sites for the purposes of satisfying the
informational needs of her clients, not to mention the general public.
Respondent personally processes loans using Freddie Mac’s proprietary “LP”
computer system, to which Freddie Mac directly benefits. She originates Freddie Mac loans almost
exclusively.
Since her home address is a federally and state-licensed mortgage
institution, Respondent clearly has a legitimate interest in the disputed
domain names. She chooses to use the
disputed domain names to inform the public and her clients about relevant news
regarding Freddie Mac and, as a mortgage loan officer/broker, has a legitimate
interest to do so.
Respondent chooses not to
profit in any way from the disputed domains.
A former employee of Respondent (since terminated) mistakenly listed the
domains as “for sale.” This was easy
enough to do, as Respondent does own many domain names, and many are for
sale. Respondent says that error on the
website has been corrected and the disputed domain names are no longer
available for sale.
Respondent says she is making a legitimate noncommercial or fair use of
the domain names, without intent for commercial gain misleadingly to divert
consumers or to tarnish the trademark or service mark at issue.
Respondent relies on Bosley Med.
Inst. v. Kremer, 2004 U.S. Dist. LEXIS 8336 (S.D. Cal. April 29,
2004). Respondent is an indirect
customer of Complainant. She originates
Freddie Mac loans for a living. She is
making purely noncommercial use of Complainant’s mark. She is not making attempts to sell the
domain names. Complainant’s claims that the “criticism” website went up only
after the cease-and-desist letter are not true: Respondent’s website was
already authored and ready to be published, as was reported in the response to
that letter. Respondent offered to
“sell” the website to Freddie Mac in good faith, only in an effort to recoup
the money that Respondent had already spent on this project. Because Respondent registered the domain
names nine years after Freddie Mac
registered their mark, Respondent found no merit in the cease-and-desist
letter.
Respondent’s use of a disclaimer on her website avoids confusion with
Complainant’s mark.
Respondent denies registration and use in bad faith. She seeks a finding of Reverse Domain Name
Hijacking against Complainant.
C. Additional Submission
Complainant
in reply says that nothing in the Response changes the basic facts that entitle
Complainant to the requested relief: Complainant has prior, protectable rights
in its FREDDIE MAC mark, which Respondent directly acknowledges with her statement
that she “registered the domain names nine
years after Freddie Mac registered their mark”; the domain names are
confusingly similar to that mark, a fact Respondent does not dispute;
Respondent’s websites associated with the <freddiemacmortgages.com> and
<freddiemacarms.com> domain names offered to sell those domain
names and described them as “premium,” “expensive,” and “very valuable”;
Respondent also offered to sell the domain names directly to Complainant in
response to the cease-and-desist letter; Respondent concedes she is a reseller
of domain names; and Respondent has registered and offered for sale other
trademark-related domain names ─ <fanniemaearm.com>, <fanniemaearms.com>,
and <fanniemaemortgages.net>.
Complainant
does not sell mortgages or loans to home buyers, through brokers or
otherwise. Rather, it purchases
mortgages from brokers and/or lenders, and packages the loans into securities
that it sells to investors.
Accordingly, Respondent’s claims that she sells “Freddie Mac mortgages”
and originates “Freddie Mac loans” are incorrect.
Respondent’s
registration and use of the domain names is not a nominative fair use of the
FREDDIE MAC mark because use of another’s brand name or trademark in a domain
name communicates information as to the source of the website, not the source
of the services or products being sold on the site. For this reason, courts and UDRP Panels have held that resellers
of trademarked goods and services have no right to register and use domain
names containing the trademark, especially where the trademark is combined with
generic or descriptive terms that relate to the trademark owner’s
business.
Respondent’s
alleged intended use of the domain names for an informational website was made after Respondent received notice of the
dispute via Complainant’s cease-and-desist letter and after Complainant filed
its UDRP Complaint.
Unlike
the plaintiff in Bosley who actually
purchased services from the trademark owner, Respondent is not a customer of
Complainant, admittedly has not had a bad business experience with Complainant,
and her use of the domain names is not “purely noncommercial” as was the
plaintiff’s criticism site in Bosley.
Respondent’s current use of the domain names for an overtly commercial
“pay-per-click” website─made at or about the same time she filed her
Response─ completely undermines her claim that she registered and intends
to use them for a noncommercial, informational website. Specifically, Respondent changed the website
associated with the domain names, and currently uses the domain name <freddiemacmortgages.com>
for a “pay-per-click” website displaying sponsored links for mortgage-related
products and services, links for “popular searches,” and advertisements for the
registrar GoDaddy.com. Respondent uses
the remaining domain names to redirect to the <freddiemacmortgages.com>
pay-per-click website.
The Response
confirms that Respondent registered the domain names solely for their
association with Complainant and its FREDDIE MAC mark, which clearly constitutes
bad faith.
Respondent’s threat to
put up a criticism website if Complainant did not buy the domain names
constitutes extortion and evidences a clear intent to seek more than
reimbursement of her out-of-pocket expenses.
Respondent’s offer to
sell the domain names on her <kogmarketing.com> site is not mitigated by
her claim that some unnamed employee, not Respondent, was responsible for those
offers. First, Respondent is
responsible for the domain names because she is the registrant. Second, Respondent is an individual, so her
claim that an unnamed employee is responsible for offering to sell the domain
names on a website owned by Respondent has no credibility. Third, regardless of who listed the domain
names for sale of her website, Respondent is responsible for her employee’s
actions, and Respondent, not her employee, would have gained had one or more of
the domain names been sold after the offers were posted on Respondent’s
kogmarketing.com website. In any event,
Respondent does not deny that she offered to sell the domain names in her July
19, 2005 e-mail to Complainant and on her <freddiemacmortgages.com>
and <freddiemacarms.com> websites.
FINDINGS
Complainant has established all elements of
its case entitling it to relief.
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.
It is common ground that Complainant has
rights in the trademark FREDDIE MAC.
All of the disputed domain names wholly incorporate that mark or a
slight misspelling thereof, together with ordinary descriptive words (at least
two of which, ‘mortgages’ and ‘loans’ are associated with Complainant’s
business) which do nothing to distinguish the domain names from the mark: see
Victoria’s Secret v. Zuccarini, FA 95762 (Nat. Arb. Forum Nov.
18, 2000) (finding that, by misspelling words and adding letters to words, a
respondent does not create a distinct mark but nevertheless renders the domain
name confusingly similar to the complainant’s marks); see also Space
Imaging LLC v. Brownell, AF-0298 (eResolution Sept. 22, 2000) (finding
confusing similarity where the respondent’s domain name combines the
complainant’s mark with a generic term that has an obvious relationship to the
complainant’s business).
The gTLDs “.com,” “.info,” “.net” and “.org”
are inconsequential: see Gardline Surveys Ltd. v. Domain Fin.
Ltd., FA 153545 (Nat. Arb. Forum May 27, 2003) (“The addition of a
top-level domain is irrelevant when establishing whether or not a mark is
identical or confusingly similar, because top-level domains are a required
element of every domain name.”).
Many cases have established that the test of confusing similarity under the Policy is confined to a comparison of the disputed domain name and the trademark alone, independent of the other marketing and use factors, such as the "Sleekcraft factors," AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 346 (9th Cir. 1979), usually considered in trademark infringement or unfair competition cases. See BWT Brands, Inc. and British Am. Tobacco (Brands), Inc v. NABR, D2001-1480 (WIPO Mar. 26, 2002); see also Britannia Bldg. Soc’y v. Britannia Fraud Prevention, D2001‑0505 (WIPO July 12, 2001); see also Wal-Mart Stores, Inc. v. MacLeod, D2000-0662 (WIPO Sept. 21, 2000); see also Koninklijke Philips Electronics N.V. v. In Seo Kim, D2001‑1195 (WIPO Nov. 12, 2001); see also Energy Source Inc. v. Your Energy Source, FA 96364 (Nat. Arb. Forum Feb. 19, 2001); see also Vivendi Universal v. Sallen, D2001-1121 (WIPO Nov. 7, 2001), and the cases there cited. See also the similar approach adopted by the U.S. Federal court in Northern Light Tech., Inc. v. N. Lights Club, 2000 U.S. Dist. LEXIS 4732 (D. Mass. Mar. 31, 2000).
Applying this test, it is clear that each of the disputed domain names is confusingly similar to Complainant’s trademark FREDDIE MAC. Complainant has established this element of its case.
Once the Complainant establishes a prima facie case against the Respondent, the burden is on the Respondent to provide evidence of its rights or legitimate interests: see Cassava Enters. Ltd., Cassava Enterprises (Gibraltar) Ltd. v. Victor Chandler Int’l. Ltd., D2004-0753 (WIPO Nov. 11, 2004). The evidence establishes that Complainant’s mark is distinctive and well known, and was known to Respondent before she registered the disputed domain names; that Respondent is a reseller of domain names (even though she is also a loan officer/mortgage broker) and that the only use by Respondent of any of the disputed domain names prior to Complainant’s cease-and-desist letter was to advertise two of them for sale in terms indicating that ‘premium’ prices in excess of registration expenses were expected. This suffices to shift the burden of proof to Respondent.
Respondent’s business as a loan officer/mortgage broker is insufficient to give her a legitimate interest in the disputed domain names, in the proprietorial sense in which that word is used in the Policy.
Respondent’s reliance upon the U.S. 9th Circuit District Court decision in Bosley is misplaced. The facts were different in that Mr. Kremer was a dissatisfied customer of Bosley who set up his site to warn potential customers of the company’s wrongdoings. Here Respondent was not a customer of Complainant at all and she used her sites to offer two of the domain names, along with other, unrelated domain names, for sale at a premium, until she received the cease-and-desist letter, whereupon she offered to sell most of them (those nominated in the cease-and-desist letter) to Complainant. Her claim that two of the names were put up for sale on the website by a mistaken employee cannot be accepted in light of her response to the cease-and-desist letter.
Further, although the U.S. Court of Appeals for the 9th Circuit upheld the District Court’s finding in Bosley that the noncommercial use of a trademark as the domain name of a website — the subject of which is consumer commentary about the products and services represented by the mark — does not constitute infringement under the Lanham Act, that court considered that Bosley Medical’s cybersquatting claim was another matter. The Court of Appeals noted that the issue under the Anticybersquatting Consumer Protection Act (left unresolved by the District Court) was whether Mr. Kremer had a “bad faith intent to profit” from the use of the trademark in his domain name, “such as by making an extortionate offer to sell the BosleyMedical.com site to Bosley.”
There is a parallel
between the Policy and the Anticybersquatting Consumer Protection Act in that
the three elements a Complainant needs to establish in order to secure relief
under the Policy likewise do not require a finding of trademark infringement.
There are conflicting views amongst Panels generally and between Panels adjudicating between U.S. parties as to whether a respondent can have a legitimate interest in a domain name consisting solely of the complainant's trademark plus a top-level domain if the website is used solely for bona fide, non-commercial criticism. The issue is fully and succinctly discussed in Howard Jarvis Taxpayers Assn. v. McCauley, D2004-0014 (WIPO Apr. 22, 2004).
Apart from the fact that here the domain names do not consist solely of the trademark plus a top-level domain, it is not necessary to enter the debate on this occasion because Respondent’s response to the cease-and-desist letter is rightly characterized by Complainant as extortion. Respondent threatened to create a “critique” website if Complainant did not purchase from her the domain names. There is no evidence that such a site was “already-authored” and “almost finished” nor even started. The conclusion is inescapable, on the evidence before the Panel, that prior to the cease-and-desist letter (which constituted notice to respondent of this dispute, for the purposes of paragraph 4(c)(i) of the Policy) there were no such preparations and that the whole idea of a criticism website was a stratagem devised in response to that letter to contrive a “free speech” defense in order to avoid an adverse finding in any proceedings Complainant might bring. Cf. Nat’l. Hockey League v. Krusz, D2001-0234 (WIPO Apr. 4, 2001).
Respondent has not sought to assert that she was known by any of the disputed domain names.
As at August 2, 2005 Respondent was using all the disputed domain names to link to a website at <freddiemacmortgages.com> headed “Freddie Mac Scandal,” disclaiming any relationship with Complainant and containing criticism of Complainant and references to the content of the cease-and-desist letter (Ex.4 to Complaint). As mentioned, the Panel finds this was not a genuine criticism site.
As at October 19, 2005
Respondent was using all the disputed domain names to link to a “pay-per-click”
website at <freddiemacmortgages.com> displaying sponsored links
for mortgage-related products and services, links for “popular searches,” and
advertisements for the registrar GoDaddy.com.
(Ex. A to Complainant’s Supplemental submission). This is not
noncommercial or fair use without intent for commercial gain misleadingly to
divert consumers, who would believe they were about to reach a site run by
Complainant. This last observation is all the more apposite in relation to the
“typosquatted” domain names in which the name “Freddie” is spelled
“Freddy.” Respondent offers no explanation
as to why these names are not intended to attract people mistyping
Complainant’s mark.
Accordingly
the Panel finds that Respondent has not shown any circumstances which
demonstrate her rights or legitimate interests in any of the disputed domain
names.
Complainant
has established this element of its case.
Paragraph 4(b)(i)
of the Policy provides it is evidence of bad faith registration and use if
there is proved registration primarily for the purpose of profiting from sale,
rent or transfer at a profit to the trademark owner or its competitor. An offer, subsequent to registration, to
sell at a profit may evidence registration for that purpose. The
Panel is satisfied that Respondent registered the disputed domain names in
order to profit from their sale to anyone, including Complainant if the
opportunity arose. She actively pursued
this course even after receipt of the cease-and-desist letter. In threatening to set up a criticism site if
Complainant did not buy the names from her, she revealed her bad faith in
having registered them and in her subsequent use of them.
Complainant has established this element of
its case.
Reverse
domain name hijacking
Complainant having succeeded, there is no
basis for any such finding.
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 <freddiemacmortgages.com>, <freddiemacmortgages.net>, <freddiemacmortgages.org>, <freddymacmortgages.com>, <freddiemacarms.com>, <freddiemacarms.net>, <freddiemacarms.info>, <freddymacloans.com>, and <freddymacloans.net> domain names be TRANSFERRED from
Respondent to Complainant.
Alan L. Limbury, Panelist
Dated: November 4, 2005
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