Gary Ensz v. Tax Express Incorporated
Claim Number: FA0510000583079
PARTIES
Complainant is Gary Ensz (“Complainant”),
represented by Heath R. Oberloh, 141 N. Main Ave., Ste 900, Sioux
Falls, SD 57104. Respondent is Tax Express Incorporated (“Respondent”),
represented by Clarence Tucker, 615 Griswold Avenue, Detroit, MI
48207.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <gotaxexpress.com>,
registered with Network Solutions, Inc.
PANEL
The undersigned certifies that they have acted independently and
impartially. To the best of each
Panelist’s knowledge, no Panelist has any known conflict in serving as Panelist
in this proceeding.
Terry F. Peppard and Sandra Jo Franklin as
Panelists; Linda M. Byrne as Presiding Panel Chair.
PROCEDURAL HISTORY
Complainant submitted a Complaint to the National Arbitration Forum
electronically on October 21, 2005; the National Arbitration Forum received a
hard copy of the Complaint on October 24, 2005.
On October 25, 2005, Network Solutions, Inc. confirmed by e-mail to the
National Arbitration Forum that the <gotaxexpress.com>
domain name is registered with Network Solutions, Inc. and that Respondent is
the current registrant of the name. Network
Solutions, Inc. has verified that Respondent is bound by the Network Solutions,
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 October 26, 2005, a Notification of Complaint and Commencement of
Administrative Proceeding (the “Commencement Notification”), setting a deadline
of November 15, 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@gotaxexpress.com by
e-mail.
A timely Response was received and determined to be complete on November
29, 2005.
Complainant’s timely additional submission was received on December 5,
2005.
Respondent’s timely additional submission was received on December 12,
2005.
On December 12, 2005, pursuant to Respondent’s
request to have the dispute decided by a three-member Panel, the National
Arbitration Forum appointed Terry F. Peppard and Sandra Jo Franklin as
Panelists and Linda M. Byrne as Presiding Panel Chair.
RELIEF SOUGHT
Complainant requests that the domain name be transferred from
Respondent to Complainant.
PARTIES’ CONTENTIONS
A. Complainant
Complainant alleges that the disputed domain name <gotaxexpress.com> is identical to Complainant’s registered service mark TAX EXPRESS except for the addition of the prefix “go,” and that <gotaxexpress.com> is confusingly similar to the TAX EXPRESS trademark. Complainant also contends that Respondent has no rights or legitimate interests in respect of the <gotaxexpress.com> domain name in view of the termination of a license agreement that had authorized Respondent’s use of <gotaxexpress.com>.
In addition, Complainant contends that Respondent’s registration and continued use of the <gotaxexpress.com> domain name was in bad faith. The bad faith is evidenced by Respondent’s registration of the domain name after Complainant had denied Respondent’s request for a trademark license several years ago. Complainant argues that Respondent’s website content infringes Complainant’s mark, and that Respondent’s online promotional activities in certain geographic locations constitute a violation of the License Agreement. Complainant further argues that bad faith is demonstrated by Respondent’s failure to surrender the domain name as required by the termination provision of the License Agreement, and by Respondent’s failure to use a disclaimer to the effect that Respondent’s use of the TAX EXPRESS mark is with Complainant’s permission.
B. Respondent
Respondent raises the preliminary issue that this proceeding centers
around a business dispute that is outside the scope of ICANN’s Policies. Underlying the dispute is a License
Agreement that was intended to resolve a 2003 trademark infringement lawsuit
between Complainant and Respondent, and this dispute hinges upon interpretation
of that Agreement.
Assuming that this case is appropriate for consideration in the context
of a UDRP proceeding, Respondent argues that it has used <gotaxexpress.com> to facilitate the operation of a
long-standing business and that Respondent’s good faith is demonstrated by its
willingness to enter into a License Agreement with Complainant. Respondent also maintains that it has
registered and used the <gotaxexpress.com>
domain name in good faith.
C. Additional Submissions
Complainant asserts that it did not receive the payments and
accountings required by the License Agreement, that the breach was not cured,
and that the Agreement is therefore terminated. Complainant sets forth a chain of events leading to the filing of
the instant action and maintains that the instant dispute is a domain name
dispute that is appropriate for the Panel to decide.
Respondent’s license has been terminated so that any legitimate rights
or interests have also terminated, according to Complainant. Respondent is not using the domain for the bona fide offering of services because
it no longer has the right to use the mark in such a manner. Complainant also argues that Respondent is
not commonly known by the domain name, in that all of Respondent’s marketing
activities use the term TAXexpress and not “GoTaxExpress.”
Complainant also argues that Respondent’s claim to an oral license in
2000 is false, and that the parties failed to reach any type of agreement until
2004 in settlement of a lawsuit. Prior
to 2004, no license payments were made by Respondent to Complainant pursuant to
any agreement.
Respondent contradicts Complainant’s account of events that allegedly
resulted in a breach of the License Agreement.
An internet search of “tax express” does not reveal Respondent’s website,
but Complainant’s site is listed fourth or fifth behind other “Tax Express”
entities. Respondent is Complainant’s
only licensee and is one of hundreds of other entities that use the words “tax
express.”
Respondent acknowledges moving locations, which could have interfered
with its receipt of communications from Complainant. Respondent argues that Complainant is attempting to reverse
hijack Respondent’s domain and take advantage of Respondent’s substantial
investment. Respondent’s business name
is Tax Express Incorporated, and it was
created before any knowledge of Complainant’s existence. Respondent uses the domain name for a bona fide offering of services and is
well known by the domain name.
Respondent cites case law to the effect that the termination of a
license agreement should not equate to a holding that the domain name is being
used in bad faith. Respondent argues
that it is not using Complainant’s mark in a competitive manner or in a manner
that is likely to cause confusion.
The questioned testimonials on Respondent’s website are from people
located in Respondent’s permitted geographic area who are listed with their
hometown addresses in order to enhance Respondent’s marketing appeal. Further, Respondent has acknowledged Complainant’s
mark in Respondent’s website and references Complainant in the “Legal Notes and
Disclaimers” link on Respondent’s website.
FINDINGS
Complainant’s mark TAX EXPRESS, Reg. No. 1,391,832, was registered with the U.S. Trademark Office on April 29, 1986. The registration will be due for renewal on April 29, 2006. In addition to Complainant’s service mark, TAX EXPRESS, Complainant registered the domain <taxexpress.com> on or about June 1, 1986, and has used <taxexpress.com> in relation to tax preparation and accounting services since that date.
Respondent began using the “Tax Express” name in 1991, and incorporated under the name “Tax Express Incorporated” in 1994. Respondent has made preparations dating back to 1994 for its corporate logo and marketing strategy. In 1998, Respondent hired an attorney to conduct a trademark search for “TAX EXPRESS,” and the search uncovered Complainant’s registration.
Respondent contacted Complainant in July 1999, requesting a license from Complainant for use of the TAX EXPRESS mark. Complainant alleges that it refused Respondent’s request, but a letter dated July 21, 1999, from Respondent to Complainant summarized the license arrangement and provided for the payment of royalties. There is no evidence that Complainant thereafter refuted the contents of the letter, nor is there evidence that Respondent paid Complainant a licensing fee after July 21, 1999 according to the terms of the letter.
Respondent registered the <gotaxexpress.com> domain name on
June 23, 2000, for tax preparation services.
Complainant discovered Respondent’s use of the <gotaxexpress.com> domain name in early 2002, and sent
several cease-and-desist letters to Respondent. Complainant has not produced copies of these letters.
Complainant sued Respondent for trademark infringement in federal district court in the district of South Dakota on October 17, 2002. The litigation was resolved by a License Agreement dated January 30, 2004. In the License Agreement, Complainant granted Respondent an exclusive license to use the TAX EXPRESS mark in the areas surrounding Detroit, Michigan and Cincinnati, Ohio, and a non-exclusive license to use the TAX EXPRESS in the area surrounding Chicago, Illinois. In exchange, Respondent agreed to pay Complainant $5000 per year in semi-annual payments. The Agreement’s term was three years, at which time the Agreement was automatically renewable unless terminated at some earlier point. The Agreement contained no representation from Complainant as to the extent of its trademark rights or its legal right to enter into the Agreement.
Complainant had the right to
terminate the Agreement in accordance with the terms of Paragraph 13: [T]his
agreement will terminate upon [Complainant’s] determination that any of the following
events have occurred and are not cured within 30 days of notice from
[Complainant] (i) failure of [Respondent] to pay any amount due under this
agreement...Upon termination of this
Agreement, all rights granted hereunder shall automatically revert to
[Complainant], [Respondent] shall destroy or deliver to [Complainant] all
materials evidencing [Respondent’s] use of the mark, [Respondent] shall cease
all use of the mark and shall assign its registration of www.gotaxexpress.com
to [Complainant]”.
It is undisputed that Respondent
made the first several payments required by the License Agreement. However, it appears that Complainant did not
receive the next required payment for the 2004-2005 time period. Despite Complainant’s failure to receive the
payment, Respondent states that it sent Complainant the required check and
accounting. Respondent became aware of Complainant’s non-receipt of the payment and
accounting only when this UDRP action
was filed. Respondent then resubmitted
these items to Complainant on November 29, 2005.
This Panel concludes that Complainant has not complied with the License
Agreement and the Agreement has not terminated. Complainant failed to provide notice of termination as required
by the Agreement.
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.
Preliminary Issue
Both Complainant and Respondent note that they have disputed the TAX
EXPRESS mark in federal court, although the litigation was settled before any
judgment was rendered. To resolve the
litigation, Complainant licensed Respondent to use the TAX EXPRESS mark. Both parties reference this License
Agreement when making arguments as to the resolution of the dispute over the <gotaxexpress.com> domain name.
Respondent
argues that this case is outside the scope of the Policy because it concerns a
legitimate trademark dispute. See 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.”);
AutoNation Holding Corp. v. Rabea Alawneh, D2002-0581 (WIPO May 2, 2002) (“[A]ssertions [of
trademark infringement] are entirely misplaced and totally inappropriate for
resolution through an ICANN proceeding. The scope of an ICANN proceeding is
extremely narrow: it only targets abusive cybersquatting, nothing else.”).
The Panel disagrees and recognizes the dispute as one of domain name
ownership that is within the scope of the Policy. See Brando v. thewordbank TWB, FA 505502 (Nat. Arb. Forum
Aug. 16, 2005) (“Respondent cannot divest this Panel of jurisdiction by
attempting to characterize this matter as simply a ‘trademark dispute.’ Trademark issues are not only routinely
considered in the context of Policy matters, but these issues must be
considered in all Policy matters under the terms of the Policy. If Complainant did not have rights in some
mark, the inquiry must end there and the requested relief cannot be granted.”); Hutchinson v. Fairbairn, FA 149172
(Nat. Arb. Forum May 19, 2003) (“Although Respondent questions the jurisdiction
of ICANN in this dispute as it revolves around a dispute about trade and
service marks, the Panel has determined that it has jurisdiction.”); Tees.com
LLC v. Emphasys Techs., Inc., FA 206362 (Nat. Arb. Forum Dec. 27, 2003)
(“The presence of an agreement between the parties does not preclude a
determination that the panel has jurisdiction over the dispute.”) In view of this Panel’s conclusion that it
has jurisdiction, the Panel’s analysis of the three UDRP factors is set forth
below.
Complainant has rights in the TAX EXPRESS mark by
virtue of U.S. Registration No. 1,391,832. 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.”); Vivendi Universal Games v. XBNetVentures Inc., FA 198803
(Nat. Arb. Forum Nov. 11, 2003) (“Complainant's federal trademark registrations
establish Complainant's rights in the BLIZZARD mark.”).
It is arguable that Respondent’s <gotaxexpress.com> domain name is confusingly similar to Complainant’s TAX EXPRESS mark because the only difference is the addition of the word “go,” which does not significantly distinguish the domain name from the mark. See Sony Kabushiki Kaisha v. Inja, Kil, D2000-1409 (WIPO Dec. 9, 2000) (finding that “[n]either the addition of an ordinary descriptive word . . . nor the suffix ‘.com’ detract from the overall impression of the dominant part of the name in each case, namely the trademark SONY” and thus Policy ¶ 4(a)(i) is satisfied); L.L. Bean, Inc. v. ShopStarNetwork, FA 95404 (Nat. Arb. Forum Sept. 14, 2000) (finding that combining the generic word “shop” with the complainant’s registered mark “llbean” does not circumvent the complainant’s rights in the mark nor avoid the confusing similarity aspect of the ICANN Policy).
Respondent does not dispute
Complainant’s rights to the TAX EXPRESS mark and has not disputed the
similarity between the domain name <gotaxexpress.com> and Complainant’s
TAX EXPRESS mark.
Complainant owns a long-standing federal registration for TAX EXPRESS,
which carries a presumption of validity. Moreover, Respondent’s execution of a license agreement with
Complainant is an implicit acknowledgement that the Complainant owns a valid
trademark and that the domain name is confusingly similar to the TAX EXPRESS
mark.
This Panel finds that Complainant has satisfied Policy ¶
4(a)(i).
Once Complainant
makes a prima facie case to establish
that Respondent has no rights or legitimate interests, then the burden of proof
shifts to Respondent to prove that it owns rights or legitimate interests in
the domain name <gotaxexpress.com>. This Panel concludes that Complainant made a prima facie case with its argument that Respondent is in breach of
the parties’ License Agreement for failure to submit the royalty payments
required by the License Agreement. See
G.D. Searle v. Martin Mktg., FA 118277 (Nat. Arb. Forum Oct. 1, 2002)
(holding that where Complainant has asserted that Respondent has no rights or
legitimate interests with respect to the domain name, it is incumbent on 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 Do The Hustle, LLC v. Tropic Web, D2000-0624 (WIPO Aug. 21, 2000)
(finding that once Complainant asserts that Respondent has no rights or
legitimate interests with respect to the domain, the burden shifts to
Respondent to provide credible evidence that substantiates its claim of rights
and legitimate interests in the domain name).
Complainant acknowledges that Respondent had
legitimate rights in the domain name for so long as the License Agreement was
in effect. The issues are: 1) whether
the License Agreement was terminated by Complainant such that it is no longer
in effect, and 2) whether Respondent has legitimate rights even in the absence
of a License Agreement.
Respondent provided a copy of a letter dated
May 12, 2005, that accompanied the required payment (copy of the check
provided) and accounting (copy provided).
Respondent claims not to have received any notice of termination of the
Agreement and instead only learned of the possibility when served with this
action. Upon learning of this action,
Respondent faxed a copy of the accounting and offered to courier a check to
Complainant. Respondent sent a
replacement check and emailed an accounting to Complainant on November 29,
2005.
Complainant maintains that he notified
Respondent of the breach of the License Agreement via at least an email dated
June 6, 2005, and a letter dated June 21, 2005, which indicated that failure to
provide the required payment and accounting would lead to an escalation of the
matter. However, Respondent never
received the June 6, 2005 e-mail or the June 21, 2005 letter. In addition, both communications failed to
expressly state that the License Agreement would terminate if the payment and
accounting were not received within 30 days.
Without deciding whether the License Agreement was breached, it was at a
minimum not terminated because no notice of termination was provided by
Complainant to Respondent.
Because the License Agreement has not been properly terminated, and because Respondent has operated its business under the name TAXExpress for many years, this Panel concludes that Complainant has failed to prove that Respondent lacks any rights or legitimate interest in the <gotaxexpress.com> domain name.
Although the failure of Complainant to satisfy the above element is determinative in this Proceeding, the Panel notes the following with respect to the final element.
Respondent claims that it is in
compliance with the License Agreement with Complainant and, therefore, is using
the disputed domain name in good faith.
As discussed above, the License Agreement has not been terminated. See Hewlett Packard Co. v. Napier, FA
94368 (Nat. Arb. Forum Apr. 28, 2000) (finding that “Complainant failed to
establish that Respondent registered the domain name ‘<openview.org>’ in
bad faith” where the complainant acquiesced to the
respondent’s registration and use of the domain name).
Moreover, no evidence has been
provided to show that Respondent uses the domain name to compete with
Complainant or to confuse Complainant’s customers. See Goldmasters
Precious Metals v. Gold Masters srl, FA 95246 (Nat. Arb. Forum Aug. 21,
2000) (finding no bad faith use, even though the respondent’s ownership and
purported use of the domain name frustrated the complainant’s business efforts,
because nothing indicated that the respondent intended to prevent the
complainant from reflecting its mark in a corresponding domain name, to disrupt
the complainant’s business, or to intentionally attract the complainant’s
customers to the respondent’s site by creating a likelihood of confusion); Energy Source Inc. v. Your Energy Source,
FA 96364 (Nat. Arb. Forum Feb. 19, 2001) (finding that the respondent
successfully rebutted the complainant’s averments that it registered and used
the domain name at issue in bad faith and that the complainant produced no credible
evidence of bad faith on the part of the respondent).
For the above reasons, this Panel concludes that Respondent has not registered and used the <gotaxexpress.com> domain name in bad faith.
DECISION
Having failed to establish all three elements required under the ICANN
Policy, the Panel concludes that relief shall be DENIED.
Accordingly, it is Ordered that the <gotaxexpress.com>
domain name remain with Respondent.
Terry F. Peppard, Panelist
Sandra Jo Franklin, Panelist
Linda Byrne, Panel Chair.
Dated: January 4, 2006
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