National Arbitration Forum

 

DECISION

 

Disney Enterprises, Inc. v. My Computer Tech Corp.

Claim Number: FA1007001335838

 

PARTIES

Complainant is Disney Enterprises, Inc. (“Complainant”), represented by J. Andrew Coombs, of J. Andrew Coombs, A Professional Corporation, California, USA.  Respondent is My Computer Tech Corp. (“Respondent”), represented by Chad M. Altieri, Florida, USA.

 

REGISTRAR AND DISPUTED DOMAIN NAME

The domain name at issue is <clubpenguin.mobi>, registered with GoDaddy.com, 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.

 

Bruce E. O'Connor as Panelist.

 

PROCEDURAL HISTORY

This decision is being rendered in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the National Arbitration Forum’s UDRP Supplemental Rules (the “Supplemental Rules”).

 

Complainant submitted a Complaint to the National Arbitration Forum electronically on July 16, 2010.

 

On July 19, 2010, GoDaddy.com, Inc. confirmed by e-mail to the National Arbitration Forum that the <clubpenguin.mobi> domain name is registered with GoDaddy.com, Inc. and that the Respondent is the current registrant of the name.  GoDaddy.com, Inc. has verified that Respondent is bound by the GoDaddy.com, Inc. registration agreement and has thereby agreed to resolve domain-name disputes brought by third parties in accordance with the Policy.

 

On July 23, 2010, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of August 12, 2010 by which Respondent could file a Response to the Complaint, via e-mail to all entities and persons listed on Respondent’s registration as technical, administrative, and billing contacts, and to postmaster@clubpenguin.mobi.  Also on July 23, 2010, the Written Notice of the Complaint, notifying Respondent of the email addresses served and the deadline for a Response, was transmitted to Respondent via post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts.

 

A timely Response was received on August 12, 2010.  The Forum found the Response to be deficient as it was received without the annexes separated from the Response.  The Forum does not consider this Response to be in compliance with Supplemental Rule 5(a).

 

A timely Additional Submission from Complainant was received and determined to be complete on August 17, 2010.

 

A timely Additional Submission from Respondent was received and determined to be complete on August 23, 2010.

 

On August 23, 2010, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the National Arbitration Forum appointed Bruce E. O'Connor as Panelist.

 

RELIEF SOUGHT

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

 

PARTIES’ CONTENTIONS

A. Complainant

Complainant is a worldwide leading producer of children's entertainment goods and services.  As such, it has been actively engaged in the development, production, marketing and distribution of audio-visual content for various media for more than 60 years. Complainant has also been at the forefront of distribution of media content over the Internet and, among its ventures is the widely known website Clubpenguin.com which uses the domain name <clubpenguin.com>.

 

Since its introduction in October 2005, Club Penguin has gained notoriety as a fun, ad-free, virtual world where children and families can play games and interact safely on the Internet.  Due to great reviews given by its users, Club Penguin quickly became the number one game in March 2006 when it launched on Miniclip, the largest online gaming website.  In 2007, Club Penguin, Inc. joined Complainant and has since opened its first international office in Brighton, England.  In 2008, Club Penguin was awarded the Best Website for 8-11-year-olds by Kidspot.

 

Complainant has obtained registrations with the Australian Government (Registration No. 1,151,975 for CLUB PENGUIN, dated May 13, 2009 and Registration No. 1,151,977 for CLUB PENGUIN and Design, dated May 14, 2009) and has pending applications with the United States Patent and Trademark Office (Application SN 77/358,128 for CLUB PENGUIN, allowed February 17, 2009 and Application SN 77/049,399 for CLUB PENGUIN and Design, last suspended July 29, 2009).

 

Complainant has acquired common law trademark rights due to the distinctiveness and secondary meaning that the public has come to associate with the CLUB PENGUIN trademark.

 

Complainant's use since 2005 and pending registrations for the CLUB PENGUIN trademark, filed on November 22, 2006, before Respondent's registration of the domain name at issue (on January 27, 2007) is sufficient to prove that Complainant has rights in the CLUB PENGUIN trademark.

 

The domain name at issue is confusingly similar

The domain name at issue is identical to the CLUB PENGUIN trademark and thus is confusingly similar under the Policy.  That domain name is distinguished only by the addition of the top-level domain ".mobi."

 

Respondent has no legitimate interest in the domain name

Respondent is not authorized by Complainant to use the domain name at issue.

That domain name currently resolves to a temporary "coming soon" page not licensed or approved by Complainant.  Respondent's passive holding of the website for over three years evidences a lack of legitimate rights.

 

Respondent must have known when it selected the domain name at issue that the public would incorrectly associate it with Complainant and Complainant's marks.  Given the distinctiveness of the CLUB PENGUIN trademark, there is no plausible explanation for the Respondent's registration of the domain name at issue, other than to trade upon the goodwill the Complainant has developed.

 

Respondent is not commonly known by the domain name at issue.

 

Respondent registered and uses the domain name in bad faith

The fame of the CLUB PENGUIN trademark combined with widespread marketing of Complainant's goods and services and the registration of the trademark put Respondent on notice of the trademark, so that Respondent must have had actual knowledge of the trademark.

 

Respondent breached its service agreement with the registrar because Respondent uses the domain name in a manner, which infringes on the intellectual property rights of another user or any person or entity.

 

Respondent's representative has indicated to Complainant that Respondent intends to use the domain name at issue to attract, for commercial gain, Internet users to websites by creating a likelihood of confusion with the CLUB PENGUIN trademark as to the source, sponsorship, affiliation or endorsement of the websites, while offering non-Complainant-related services through the websites.

 

Registrant failed to check whether the CLUB PENGUIN trademark was registered prior to Respondent's registration of the domain name at issue.

 

Respondent's prolonged period of non-use of the domain name at issue, in addition to evidencing the absence of a legitimate interest, also evidences bad faith.

 

Respondent also evidences bad faith in its failure to cease and desist from wrongful use of the domain name at issue by not transferring the domain name after being notified by Complainant of the unauthorized use.  Respondent failed to respond to Complainant's multiple letters initial almost a year after the original letter was sent.  When Respondent's representative finally did contact Complainant, Respondent refused to transfer without compensation.  Complainant's representative indicated that Complainant would pay for the costs of transfer, but Respondent's representative indicated that Complainant "needed to make a better offer."

 

B. Respondent

Respondent is a small startup technology company having a single employee and owner.  Respondent's main business is the development of websites and marketing strategies and their application to mobile technology.  ClubPenguin.Mobi is in the development stages and its end purpose is to market images of Men's High Fashion and of Miami Beach lifestyle.

 

The domain name at issue is not confusingly similar

Respondent disputes that CLUB PENGUIN is unique to Complainant or that the domain name at issue incorporates a famous, longstanding name or brand.  In Respondent's home city, there are several businesses carrying "Penguin" in their names.  ClubPenguin.Mobi was derived from Respondent's contact with these businesses and was selected as an appropriate name for the development of a mobile site for Men's Designer Fashion.  Clearly, "Club Penguin" is not a unique name or concept.  Furthermore, ClubPenguin.Mobi will not serve to confuse "ClubPenguin.Com" customers since ClubPenguin.Mobi does not intend to target the demographic from which ClubPenguin.Com derives its business.  The latter targets young children through the use of a penguin icon whereas the former is targeted to a demographic group ages 30 through 55.  Respondent does not offer multimedia entertainment not does it use a penguin icon; rather, Respondent offers a look and feel that even young children could not confuse.

 

Respondent has a legitimate interest in the domain name

Respondent obtained the domain name three and half years ago, with foresight that mobile technology would become relevant to marketing and that the domain name would be applicable to the business of marketing Men's Designer Fashion.  Respondent began designing its website in 2008, but suspended that development upon receiving cease and desist letters from Complainant.

 

Respondent has not registered or used the domain name in bad faith

Respondent disputes that he had actual knowledge of the existence of ClubPenguin.Com before his acquisition of the domain name.  Eleven months after Respondent's acquisition of the domain name, Complaint requested the USPTO for an extension in the registration process for the CLUB PENGUIN trademark, which demonstrates that Complainant had not solidified its rights over Club Penguin and that Respondent was first in time in obtaining rights to ClubPenguin.Mobi.

 

Respondent's representative (who asserted that Complainant needed to "make a better offer") is a legal clerk to Respondent's authorized attorney.  That representative investigated Complainant's cease and desist demands and reported to Complainant's attorney that Respondent would not agree to convey the domain name at issue for the offered nominal transfer fees, because Respondent's labor, expenditures, and near two years of design would go uncompensated and that Respondent had not sought a purchaser of the domain name.  Complainant's attorney replied by soliciting an offer to sell the domain name at issue by requesting a "monetary amount that [Respondent] seeks to effectuate transfer.  Complainant is unwarranted in construing bad faith from this response.

 

C. Additional Submissions

 

Complainant

Complainant began using the CLUB PENGUIN trademark in 2005, long before Respondent's registration of the domain name.  By September 2006, Club Penguin had nearly doubled its users to over 2.6 million users and continued to grow steadily.  Complainant refers to an article in the Globe and Mail on November 13, 2006.  Thus, Complainant holds common law rights in the CLUB PENGUIN trademark going back to 2005.

 

Complainant filed its first registration application for the CLUB PENGUIN trademark in 2006, before Respondent's registration of the domain name at issue.  The fact that Complainant later, on a completely separate registration application for the CLUB PENGUIN trademark, requested an extension, is irrelevant to determining Complainant's rights in the CLUB PENGUIN trademark.

 

Respondent attempts to point to others' use of the trademark to nullify Complainant's rights.  Each of the businesses that Respondent points to, however - Penguin Hotel, Original Penguin, Fly Penguin - does not incorporate the trademark in its entirety but rather uses one word common to the trademark combined with a descriptive word.

 

Respondent misunderstands the test for confusing similarity.  The Policy limits analysis to an objective consideration of the trademark as compared to the domain name, without reference to outside issues such as the target audience of the websites.

 

Respondent misleadingly asserts others' rights in a portion of the trademark, but nowhere does it point to its own alleged legitimate interest in the trademark or the domain name.

 

Respondent effectively admits bad faith by acknowledging its awareness of the partial trademark rights of other prior to registration of the domain name at issue. 

 

Respondent also demonstrates bad faith by failing to conform its Response to the requirements of the Policy, the Rules, and the Supplemental Rules.

 

Respondent

Complainant could have avoided this problem by purchasing the domain name in dispute prior to Respondent's unknowing purchase on January 27, 2007.  A proper time to do so would have been in September 2006, when Club Penguin allegedly rose to "world-fame."  Complainant seeks to remedy its failure and lack of due diligence by tormenting a small business owner with cease and desist letters, and bullying him to convey the domain name with offensive offers of nominal transfer fees, and with disregard to Respondent's prior work and plans to launch his men's fashion mobile website.

 

Complainant's 2.6 million online members in 2006 is a minuscule and insignificant number.  Facebook.com, which was created in 2004, today enjoys 500 million users.  Twitter.com, which like ClubPenguin.Com came online in 2006, enjoys membership of 105 million, and of 180 million unique visitors.

 

In contrast, ClubPenguin.Com's meager membership portfolio is more similar to the popularity of Internet video and video total viewership.  Examples are Dramatic Channel - 23 million views, Starwars Kid - 18 million views, Afro Ninja - 11 million views, It's Peanut Butter Jelly Time - 7 million views, and Monkey Smells Finger - 1 million views.  These sites, like ClubPenguin.Com, have a steady following and cater to a small unique demographic, and have not attained "world famous" status because they do not harness colossal viewership numbers as do Facebook.Com, Twitter.Com and others.

 

Respondent does not intend to piggyback upon Complainant's goodwill or misdirect users to his website, because Complainant's audience is predominated by children and Respondent's audience is adult, fashion-oriented.

 

Respondent had no knowledge of the existence of ClubPenguin.Com prior to its purchase of the domain name at issue.

 

Complainant ignores that it made two offers in order to obtain the domain name, and when it did not obtain the domain name, it retaliated by making shameful accusations of bad faith and dishonesty.

 

FINDINGS

 Deficient Response

The Respondent electronically and timely filed the Response, but violated the Supplemental Rules by including the Annexes in the body of the Response rather than separately as required by Supplemental Rule 5(c)(iii).   The Panel finds that Respondent’s technical violation of the Rules as recently amended should not bar consideration of the Response. See J.W. Spear & Sons PLC v. Fun League Mgmt., FA 180628 (Nat. Arb. Forum Oct. 17, 2003) (finding that where the respondent submitted a timely response electronically, but failed to submit a hard copy of the response on time, “[t]he Panel is of the view that given the technical nature of the breach and the need to resolve the real dispute between the parties that this submission should be allowed and given due weight”).

 

Policy

The Panel finds that Complainant has rights in the CLUB PENGUIN trademark and that the disputed domain name is confusingly similar to that trademark.  The Panel finds that Respondent has no rights or legitimate interests in and to the disputed domain name.  Finally, the Panel finds that Complainant has failed to establish that Respondent registered and used that domain name in bad faith.

 

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

The Panel finds that Complainant has established rights in the CLUB PENGUIN trademark through registration of the trademark with the Australian Patent Office (e.g., Registration No. 1,151,975, May 13, 2009.  It is immaterial that Complainant's rights have been established only in Australia. See Koninklijke KPN N.V. v. Telepathy Inc., D2001-0217 (WIPO May 7, 2001) (finding that the Policy does not require that the mark be registered in the country in which the respondent operates; therefore it is sufficient that the complainant can demonstrate a mark in some jurisdiction); see also Wal-Mart Stores, Inc. v. Stork, D2000-0628 (WIPO Aug. 11, 2000) (finding the complainant has rights to the name when the mark is registered in a country even if the complainant has never traded in that country).

 

Although registration of the domain name at issue predates Complainant’s alleged rights in the CLUB PENGUIN trademark, the Panel finds that such a determination is not necessary under Policy ¶ 4(a)(i).  See AB Svenska Spel v. Zacharov, D2003-0527 (WIPO Oct. 2, 2003) (holding that the UDRP does not require a complainant to have registered its trademark prior to the respondent’s registration of the domain name under Policy ¶ 4(a)(i) but may prevent a finding of bad faith under Policy ¶ 4(a)(iii)); see also Clear!Blue Holdings, L.L.C. v. NaviSite, Inc., FA 888071 (Nat. Arb. Forum Mar. 5, 2007) (“Although the domain name in dispute was first registered in 1996, four years before Complainant’s alleged first use of the mark, the Panel finds that Complainant can still establish rights in the CLEAR BLUE marks under Policy ¶ 4(a)(i).”).

 

Complainant further asserts that, in addition to its registered trademark, it also has  common law rights in the CLUB PENGUIN trademark.  The Panel finds that Complainant has not established such common law rights. No evidence of use, advertising, or recognition of the trademark has been introduced by Complainant, other than the allegations in the complaint, with the exceptions of a single web page dated July 9, 2010, using the CLUB PENGUIN trademark and the domain name <clubpenguin.com>, and a single article from a secondary source (the Globe and Mail) discussing use of the CLUB PENGUIN trademark as of November, 2006.  This evidence is insufficient to show acquisition of trademark rights[1].  See Kip Cashmore v. URLPro, D2004-1023 (WIPO Mar. 14, 2005) (finding no common law rights where the complainant did not present any credible evidence establishing acquired distinctiveness); see also Build-A-Bear Workshop, Inc. v. Pallone, FA 874279 (Nat. Arb. Forum Mar. 1, 2007) (finding that the complainant did not establish common law rights in the BEAR BUILDER or BEAR BUILDERS marks because the evidence it submitted was insufficient to show the mark had acquired any secondary meaning).

 

Complainant argues Respondent’s domain name is identical to its CLUB PENGUIN trademark.  Prior panels have found the omission of a space between terms in a mark does not distinguish a disputed domain name from a mark.  For example, in George Weston Bakeries Inc. v. McBroom, FA 933276 (Nat. Arb. Forum Apr. 25, 2007), the panel held that eliminating the space between terms of a mark still rendered the <gwbakeries.mobi> domain name identical to the complainant’s GW BAKERIES mark.  Additionally, it is well established precedent that the affixation of a generic top-level domain (“gTLD”) is irrelevant for the purposes of  Policy ¶ 4(a)(i) analysis.  See Vanderbilt Univ. v. U Inc., FA 893000 (Nat. Arb. Forum Feb. 19, 2007) (finding the <vanderbilt.mobi> domain name to be identical to the VANDERBILT mark because it did not add anything except the generic top-level domain “.mobi”).  Here, Complainant argues Respondent has merely deleted the space between the two words in Complainant’s CLUB PENGUIN mark and added the gTLD “.mobi.”  The Panel finds these changes do not render Respondent’s domain name distinct from Complainant’s mark.  The Panel decides that the domain name at issue is identical to the CLUB PENGUIN trademark.

 

While Respondent contends that its domain name is comprised of common and generic terms and as such cannot be found to be identical to Complainant’s mark, such a determination is not necessary under Policy ¶ 4(a)(i) as this portion of the Policy considers only whether Complainant has rights in the mark and whether the disputed domain name is identical or confusingly similar to Complainant’s mark.  See Vance Int’l, Inc. v. Abend, FA 970871 (Nat. Arb. Forum June 7, 2007) (finding that because the complainant had received a trademark registration for its VANCE mark, the respondent’s argument that the term was generic failed under Policy ¶ 4(a)(i)); see also David Hall Rare Coins v. Tex. Int’l Prop. Assocs., FA 915206 (Nat. Arb. Forum Apr. 9, 2007) (“Respondent’s argument that each individual word in the mark is unprotectable and therefore the overall mark is unprotectable is at odds with the anti-dissection principle of trademark law.”).

 

The Panel finds that Complainant has carried its burden of proof under ¶ 4(a)(i) of the Policy

 

Rights or Legitimate Interests

Complainant must first make a prima facie case that Respondent lacks rights and legitimate interests in the disputed domain name under Policy ¶ 4(a)(ii), and then the burden shifts to Respondent to show it does have rights or legitimate interests.  See Hanna-Barbera Prods., Inc. v. Entm’t Commentaries, FA 741828 (Nat. Arb. Forum Aug. 18, 2006) (holding that the complainant must first make a prima facie case that the respondent lacks rights and legitimate interests in the disputed domain name under Policy ¶ 4(a)(ii) before the burden shifts to the respondent to show that it does have rights or legitimate interests in a domain name); see also AOL LLC v. Gerberg, FA 780200 (Nat. Arb. Forum Sept. 25, 2006) (“Complainant must first make a prima facie showing that Respondent does not have rights or legitimate interests in the subject domain names, which burden is light.  If Complainant satisfies its burden, then the burden shifts to Respondent to show that it does have rights or legitimate interests in the subject domain names.”).

 

The Panel finds that Complainant has made such a prima facie showing.  Respondent intends to use the domain name in dispute for services within the scope of those for which Complainant has secured rights in the CLUB PENGUIN trademark. Respondent’s intent to market men's fashions via the Internet includes the "jackets" and "pants" for which the CLUB PENGUIN trademark been registered in Australia. 

 

Paragraph 4(c) of the Policy lists three circumstances in particular, without limitation, that demonstrate rights or legitimate interests of a domain name registrant to a domain name, for the purposes of Policy ¶ 4(a)(ii):

 

(i)         before any notice of the dispute, the Respondent’s use of, or demonstrable preparations to use the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods and services; or

(ii)        the Respondent, as an individual, business, or other organization, has been commonly known by the domain name, even if no trademark or service mark rights have been acquired; or

(iii)      the Respondent is making a legitimate non‑commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

 

Respondent does not contend that it can avail itself of the defenses in Policy ¶ 4(c)(ii) or Policy ¶ 4(c)(iii).  Respondent is not known by the domain name at issue and intends to use that domain name for commercial purposes.

 

The record shows that Respondent did not receive actual notice of the dispute until its receipt of Complainant's first cease and desist letter in July 2009.  Prior to this time, Respondent contends that it acquired the domain name at issue with the

 

foresight that mobile technology would become relevant to marketing and that the domain name would be applicable to the business of marketing Men's Designer Fashion.  Respondent began designing its website in 2008, but suspended that development upon receiving cease and desist letters from Complainant.

 

Respondent does not provide any evidence, such as declarations of Respondent or others, or any contemporaneous documents, as to the specific steps being taken in the development of a website based on the domain name at issue, supporting this intent and these actions.  Without such support, the Panel finds that Respondent has not shown the "demonstrable preparations" required to be established under ¶ 4(c)(i).[2]

 

Respondent's passive holding of the domain name for over three years is also evidence of its lack of legitimate rights or interest in the domain name. See Bloomberg L.P. v. SC Media Servs. & Info. SRL, FA 296583 (Nat. Arb. Forum Sept. 2, 2004) (“Respondent is wholly appropriating Complainant’s mark and is not using the <bloomberg.ro> domain name in connection with an active website.  The Panel finds that the [failure to make an active use] of a domain name that is identical to Complainant’s mark is not a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i) and it is not a legitimate noncommercial or fair use of the domain name pursuant to Policy  ¶ 4(c)(iii).”); see also Hewlett-Packard Co. v. Shemesh, FA 434145 (Nat. Arb. Forum Apr. 20, 2005) (finding that a respondent’s non-use of a domain name that is identical to a complainant’s mark is not a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i) or a legitimate noncommercial or fair use pursuant to Policy ¶ 4(c)(iii)).

 

The Panel finds that Complainant has carried its burden of proof under ¶ 4(a)(ii) of the Policy.

 

Registration and Use in Bad Faith

The circumstances of Paragraph 4(b) of the Policy are illustrative but not exhaustive of the circumstances under which bad faith registration and use under Policy ¶ 4(a)(iii) can be established.

 

Paragraph 4(b) reads:

 

[T] he following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith:

i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or

(ii) you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or

(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site or other on-line location, by creating a likelihood of confusion with the complainant's mark as to the source, sponsorship, affiliation, or endorsement of your web site or location or of a product or service on your web site or location.

 

In each of the circumstances listed in Policy ¶ 4(b), or otherwise, the Complainant must establish that Respondent intentionally and actively registered and used the domain names at issue for the purpose of causing injury to the Complainant.

 

Lack of rights or legitimate interests under Policy ¶ 4(a)(ii) does not automatically translate into a finding of bad faith under Policy ¶ 4(a)(iii).

 

Proof of Policy ¶ 4(a)(iii) generally requires more than assertions of bad faith.  See Starwood Hotels & Resorts Worldwide, Inc. v. Samjo CellTech.Ltd, FA 406512 (Nat. Arb. Forum Mar. 9, 2005) (finding that the complainant failed to establish that respondent registered and used the disputed domain name in bad faith because mere assertions of bad faith are insufficient for a complainant to establish Policy ¶ 4(a)(iii)); see also Graman USA Inc. v. Shenzhen Graman Indus. Co., FA 133676 (Nat. Arb. Forum Jan. 16, 2003) (finding that general allegations of bad faith without supporting facts or specific examples do not supply a sufficient basis upon which the panel may conclude that the respondent acted in bad faith).

 

Complainant has not shown any intent or actions of Respondent to injure Complainant.

 

First, the Panel finds that the CLUB PENGUIN trademark is not a famous mark.  As the Panel has stated previously, Complainant has not established that it has common law rights in that trademark.  Without proof of such notoriety, it is incumbent upon Complainant to show that Respondent had actual knowledge of the trademark prior to registration and use of the domain name.

 

Second, the Panel finds that Respondent's nonuse of the domain name at issue may be evidence of bad faith use of the domain name.  Prior panels have found passive holding may qualify as bad faith use when the respondent registered a domain name that was identical to a very famous or distinctive trademark and the overall circumstances justified such a finding.  For example, in Disney Enterprises Inc. v. Meyers, FA 697818 (Nat. Arb. Forum June 26, 2006), the panel found that the respondent should have known of the DISNEY mark because it is domestically and internationally famous.  The panel concluded that the respondent’s failure to use the <disneyparks.com> domain name seven years after its creation date supported a finding of use in bad faith.  Additionally, in eBay Inc. v. xu kefei (kefei xu), D2008-0481 (WIPO July 7, 2008), the panelists concluded the respondent should have known about the complainant’s EBAY mark given that the mark “is famous around the world.”  But, as the Panel has found here, the CLUB PENGUIN trademark is not a famous mark.

 

Third, the Panel finds that the domain name at issue was registered before Complainant acquired its trademark rights (by reason of the issue of its Australian registrations in 2009). See Ode v. Intership Ltd., D2001-0074 (WIPO May 1, 2001) (“[W]e are of the unanimous view that the trademark must predate the domain name.”); see also SPB Software House v. SPB Online Servs., Ltd., FA 1067638 (Nat. Arb. Forum Oct. 17, 2007) (“When a domain name is registered before a trademark right is established, the registration of the domain name is not in bad faith under Policy ¶ 4(a)(iii) because the registrant could not have contemplated the complainant’s non-existent right.”).

 

Third, the Panel finds that Respondent's request for "a better offer" does not establish that Respondent registered the domain name at issue primarily for the purpose of transferring the domain name registration to the Complainant for more that its documented out-of-pocket costs directly related to the domain name. See Mark Warner 2001 v. Larson, FA 95746 (Nat. Arb. Forum Nov. 15, 2000) (finding that considering or offering to sell a domain name is insufficient to amount to bad faith under the Policy; the domain name must be registered primarily for the purpose of selling it to the owner of a trademark for an amount in excess of out-of-pocket expenses); see also JCM Germany GmbH v. McClatchey Jr., D2004-0538 (WIPO Sept. 17, 2004) (holding that the respondent did not violate Policy ¶ 4(b)(i) by attempting to sell the disputed domain name for profit because the respondent did not register the domain name with the intent to sell it to the complainant or one of its competitors).

 

Fourth, the Panel finds that Respondent was under no obligation to conduct a trademark search prior to its registration of the domain name at issue.  Even if Respondent had conducted such a search, it would have found only pending applications for registration of the CLUB PENGUIN trademark in Australia and the U.S. See FormLinc Information v. Credit Suisse Grp., FA 96750 (Nat. Arb. Forum Apr. 18, 2001)(“[I]t is clear from the travaux preparatoires of the Policy that mere failure to conduct a trademark search does not constitute bad faith.”); see also Essex Grp., Inc. v. Song, FA 114664 (Nat. Arb. Forum Jan. 20, 2002) (finding due to the geographical nature of the domain name that no registrant should have had to conduct a trademark search before registering.); see also Am. Med. Response, Inc. v. Advanced Mktg. Res., FA 117380 (Nat. Arb. Forum Sept. 24, 2002) (finding “Respondent cannot be found to have registered the domain name in bad faith on the sole ground that it did not execute a trade name search for the application for a service mark filed by Complainant.”).

 

Fifth, the Panel finds that Respondent's awareness of the trademark rights of third parties in "Penguin" trademarks is irrelevant absent a showing that Respondent knew or should have known of Complainant's trademark prior to registration and use of the domain name at issue.

 

Sixth, the Panel finds that Respondent's technical violation of the Supplemental Rules is no basis at all for a finding of bad faith.  Complainant has provided no authority for this novel and unfounded proposition.

 

The Panel finds that Complainant has failed to carry its burden of proof under ¶ 4(a)(iii) of the Policy.

 

DECISION

Complainant not having established all three elements required under the Policy, the Panel concludes that relief shall be DENIED.

 

 

 

 

Bruce E. O'Connor, Panelist
Dated: September 6, 2010

 

 

 

 

 

 

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