eGalaxy Multimedia Inc. v. ON HOLD By Owner Ready To Expire

Claim Number:  FA0305000157287



Complainant is eGalaxy Multimedia Inc., Toronto, ON, CA (“Complainant”) represented by David Warga of Warga Professional Corporation. Respondent is ON HOLD By Owner Ready to Expire, Neuchatel, CH (“Respondent”).



The domain name at issue is <>, registered with Tucows, Inc.



The undersigned certifies that she has acted independently and impartially and that to the best of her knowledge she has no known conflict in serving as Panelist in this proceeding. Hon. Carolyn Marks Johnson sits as Panelist.



Complainant submitted a Complaint to the National Arbitration Forum (the "Forum") electronically May 9, 2003; the Forum received a hard copy of the Complaint May 12, 2003.


On May 12, 2003, Tucows, Inc. confirmed by e-mail to the Forum that the domain name <> is registered with Tucows, Inc. and that Respondent is the current registrant of the name. Tucows, Inc. verified that Respondent is bound by the Tucows, 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 May 15, 2003, a Notification of Complaint and Commencement of Administrative Proceeding (the "Commencement Notification"), setting a deadline of June 4, 2003, 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 by e-mail.


Having received no Response from Respondent, using the same contact details and methods used for the Commencement Notification, the Forum transmitted to the parties a Notification of Respondent Default.


On June 12, 2003, pursuant to Complainant's request to have the dispute decided by a single-member Panel, the Forum appointed Hon. Carolyn Marks Johnson as Panelist.


Having reviewed the communications records, the Administrative Panel (the "Panel") finds that the Forum discharged its responsibility under Paragraph 2(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") "to employ reasonably available means calculated to achieve actual notice to Respondent."  Therefore, the Panel may issue its decision based on the documents submitted and in accordance with the ICANN Policy, ICANN Rules, the Forum's Supplemental Rules and any rules and principles of law that the Panel deems applicable, without the benefit of any Response from Respondent.



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



A.  Complainant makes the following assertions:


1.      The domain name registered by Respondent, <>, is confusingly similar to Complainant’s NAKED NEWS mark.


2.      Respondent has no rights or legitimate interests in the <> domain name.


3.      Respondent registered and used the <> domain name in bad faith.


B. Respondent did not submit a Response in this proceeding.


C. Complainant submitted an Additional Submission.


Complainant carbon copied the Provider in an email exchange with the Registrar in this dispute and that email exchange was included in the submission to the Panel. The Panel chose to view this exchange as an Additional Submission pursuant to Forum Supplemental Rule 7.




Complainant established in this proceeding that it has rights in the NAKED NEWS mark through registration in as many as five nations or territories and by pending registration applications in fifteen other states or territories.


Complainant consistently and successfully has defended its exclusive rights in NAKED NEWS against others claiming a right to use the two terms. See eGalaxy Multimedia, Inc. v. T1 (Nat. Arb. Forum Case FA0111000101823, Dec.23, 2001); eGalaxy Multimedia, Inc. v. Complete Digital Marketing (Nat. Arb. Forum Case FA0203000105975, Apr. 30, 2002).


Further, Complainant, through its agent, sent Respondent a cease and desist letter March 24, 2003, giving notice of Complainant’s continued intent to vigorously defend its rights in the mark.


Respondent registered the disputed domain name April 4, 2001.  After receiving notice of Complainant’s challenge to Respondent’s right to register the disputed domain name, Tucows, Inc., the domain name Registrar placed the domain name on Registrar Lock on April 7, 2003.


The Record permits the Panel to find that Complainant has expended considerable sums

in developing the mark and that the mark has international recognition.


The Record also permits the Panel to take notice that litigation is pending that arises from this same dispute and involving these same parties. That lawsuit was filed by this Complainant April 3, 2003, against this Respondent and several other entities and was filed more than a month before this Complaint was filed on May 15, 2003.


When a court action is pending at the time a Complaint is filed, or when it is filed contemporaneously with a Complaint, a Panel may choose not to decide the case on the merits, pursuant to UDRP Rule 18(a).  The remedy in that event would be to suspend or terminate the administrative proceeding.  In light of the fact that the Panel’s decision may be superseded by a subsequent Order or Decision by another Court, the Panel also may choose not render a decision on the merits. See Lutton Invs., Inc. v. Darkhorse Distrib., Inc., FA 154142 (Nat. Arb. Forum June 6, 2003) (stating that “[t]he pending arbitration between the parties to this dispute, touching on matters directly relevant to the resolution of a claim under the UDRP, justifies terminating the present administrative proceeding” and deciding to dismiss the Complaint without prejudice).


Should a Panel determine that it will not decide this case on the merits, it may choose, at its discretion, to issue a stay pending determination of the concurrent Court proceeding in Canada, or to dismiss the Complaint without prejudice. 


In this case, Complainant initiated both a court action and an ICANN Complaint.  While the Respondent did not bother to file a Response in this ICANN proceeding, and while the Panel has reviewed the Complaint to determine if Complainant established Complainant’s right to recover under ICANN rules and decisions, at least one Panel has held that it is contrary to the purposes of ICANN to permit a party to pursue both avenues at the same time. One of the important purposes of the ICANN rules is to provide parties a simplified mechanism in lieu of litigation to adjudicate ICANN disputes. It does not reduce costs and effort for the parties for a Complainant to seek relief with both ICANN and the Courts. See AmeriPlan Corp. v. Gilbert FA105737 (Nat. Arb. Forum April 22, 2002) (the function of the UDRP is to reduce the cost and effort required to resolve domain name disputes by offering a simplified mechanism in lieu of litigation, to render a decision on a domain name dispute when there is already a court action pending does violence to this function of the UDRP) (dismissing the Complaint).


In the absence of a Response to this claim by Respondent, the Panel reviewed the allegations of Complainant to determine if Complainant established by clear evidence a right under ICANN to recover without regard to the contemporaneously pending Court litigation.




Paragraph 15(a) of 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."


When a Respondent fails to submit a Response, the Panel decides these administrative proceedings on the basis of Complainant's undisputed representations pursuant to paragraphs 5(e), 14(a) and 15(a) of the Rules and draws such inferences as the Panel considers appropriate pursuant to paragraph 14(b) of the Rules.


Paragraph 4(a) of the Policy requires that a 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 Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and

(2)    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 to and/or Confusingly Similar


Complainant contends that it has rights in the NAKED NEWS mark through registration of the mark with appropriate governmental authorities worldwide. 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 Respondent operates.  It is sufficient that Complainant can demonstrate a mark in some jurisdiction). Complainant also maintains that it has established common law rights in the NAKED NEWS and NAKED NEWS RADIO marks. See Tuxedos By Rose v. Nunez, FA 95248 (Nat. Arb. Forum Aug. 17, 2000) (finding common law rights in a mark where its use was continuous and ongoing, and secondary meaning was established); see also Keppel TatLee Bank v. Taylor, D2001-0168 (WIPO Mar. 28, 2001) (“[O]n account of long and substantial use of the said name [<>] in connection with its banking business, it has acquired rights under the common law).


Complainant also argues that the <> domain name is confusingly similar to its NAKED NEWS mark. See Arthur Guinness Son & Co. (Dublin) Ltd.  v. Healy/BOSTH, D2001-0026 (WIPO Mar. 23, 2001) (finding confusing similarity where the domain name in dispute contains the identical mark of Complainant combined with a generic word or term); see also AXA China Region Ltd. v. KANNET Ltd., D2000-1377 (WIPO Nov. 29, 2000) (finding that common geographic qualifiers or generic nouns can rarely be relied upon to differentiate the mark if the other elements of the domain name comprise a mark or marks in which another party has rights).


For Respondent to prevail on this issue, the Panel would be required to find that Complainant’s NAKED NEWS mark is generic or descriptive and that Complainant has failed to establish secondary meaning associated with the mark, thus finding that Complainant has no enforceable rights under the UDRP. See Successful Money Mgmt. Seminars, Inc. v. Direct Mail Express, FA 96457 (Nat. Arb. Forum Mar. 7, 2001) (finding that seminar and success are generic terms to which Complainant cannot maintain exclusive rights); see also FilmNet Inc. v. Onetz, FA 96196 (Nat. Arb. Forum Feb. 12, 2001) (finding that Complainant failed to establish that Respondent did not have rights or legitimate interests in the <> domain name, where the disputed domain name is wholly comprised of generic words, even though Complainant is the owner of the FILMNET mark). 


As to this Complainant, such a finding would be contrary to two prior holdings of Forum panels, who have looked at this express issue with regard to this Complainant’s rights in its mark.  No need exists to defer a decision based on this issue. See eGalaxy Multimedia, Inc. v. T1 FA 101823 (Nat. Arb. Forum Dec.23, 2001); see also eGalaxy Multimedia, Inc. v. Complete Digital Marketing FA 105975 (Nat. Arb. Forum Apr. 30, 2002).


The Panel finds that Complainant satisfied the requirements of ICANN Policy ¶ 4(a)(i) to show “confusing similarity.”


Rights to or Legitimate Interests


The Panel may decide to view the Complaint in a light most favorable to Complainant due to the fact that Respondent did not respond to the Complaint. See Ziegenfelder Co. v. VMH Enter., Inc., D2000-0039 (WIPO Mar. 14, 2000) (drawing two inferences based on the Respondent’s failure to respond: (1) Respondent does not deny the facts asserted by Complainant, and (2) Respondent does not deny conclusions which Complainant asserts can be drawn from the facts); see also Vertical Solutions Mgmt., Inc. v. webnet-marketing, inc., FA 95095 (Nat. Arb. Forum July 31, 2000) (holding that Respondent’s failure to respond allows all reasonable inferences of fact in the allegations of Complainant to be deemed true).


The Panel also may find that Respondent’s failure to respond to the Complaint is evidence that Respondent lacks rights or legitimate interests in the domain name. See Pavillion Agency, Inc. v. Greenhouse Agency Ltd., D2000-1221 (WIPO Dec. 4, 2000) (finding that Respondents’ failure to respond can be construed as an admission that they have no legitimate interest in the domain names); see also Geocities v., D2000-0326 (WIPO June 19, 2000) (finding that Respondent has no rights or legitimate interests in the domain name because Respondent never submitted a response or provided the Panel with evidence to suggest otherwise).


Complainant contends that Respondent’s passive holding of the disputed domain name is evidence that Respondent lacks rights or legitimate interests. See Vestel Elektronik Sanayi ve Ticaret AS v. Kahveci, D2000-1244 (WIPO Nov. 11, 2000) (finding that “merely registering the domain name is not sufficient to establish rights or legitimate interests for purposes of paragraph 4(a)(ii) of the Policy”); see also Flor-Jon Films, Inc. v. Larson, FA 94974 (Nat. Arb. Forum July 25, 2000) (finding that Respondent’s failure to develop the site demonstrates a lack of legitimate interest in the domain name). Complainant alleges that it has not licensed or authorized Respondent to use its NAKED NEWS mark, evidence that it lacks rights or legitimate interests. See Compagnie de Saint Gobain v. Com-Union Corp., D2000-0020 (WIPO Mar. 14, 2000) (finding no rights or legitimate interest where Respondent was not commonly known by the mark and never applied for a license or permission from Complainant to use the trademarked name); see also RMO, Inc. v. Burbridge, FA 96949 (Nat. Arb. Forum May 16, 2001) (Interpreting Policy ¶ 4(c)(ii) "to require a showing that one has been commonly known by the domain name prior to registration of the domain name to prevail").


Further, the Panel may find that Respondent’s unsolicited attempt to sell its domain name registration to Complainant for $500 is evidence that Respondent lacks rights or legitimate interests in the domain name. See Cruzeiro Licenciamentos Ltda v. Sallen, D2000-0715 (WIPO Sept. 6, 2000) (finding that rights or legitimate interests do not exist when one holds a domain name primarily for the purpose of marketing it to the owner of a corresponding trademark); see also Kinko’s Inc. v. eToll, Inc., FA 94447 (Nat. Arb. Forum May 27, 2000) (finding that Respondent has no rights or legitimate interests in the domain name where it appeared that the domain name was registered for ultimate use by Complainant).


Mere passive holding of a domain name does not automatically constitute evidence that a Respondent has no rights to or legitimate interests in a domain name. See VeriSign Inc. v. VeneSign C.A., D2000-0303 (WIPO June 28, 2000) (finding that the Respondent’s default does not automatically lead to a ruling for the Complainant); see also Casual Corner Group, Inc. v. Young, FA 95112 (Nat. Arb. Forum Aug. 7, 2000) (finding that Respondent has rights and legitimate interests in the domain name even though he has made no use of the website at the time of the Complaint).  But here, Complainant supported its allegations with documentation in support.  Respondent filed nothing to show a plan or intent to use the domain name in a bona fide legitimate manner and the Panel has no basis to make inferences in favor of Respondent.


Further, a mere attempt to sell a domain name registration is not necessarily evidence of a lack of rights or legitimate interests in the disputed domain name. See Fifty Plus Media Corp. v. Digital Income, Inc., FA 94924 (Nat. Arb. Forum July 17, 2000) (finding that Complainant failed to prove that Respondent had no rights in the domain name and had registered and used the domain name in bad faith where the Respondent is an Internet business which deals in selling or leasing descriptive/generic domain names). But here, Complainant supported its allegations with documentation in support and Respondent offered no evidence to overcome Complainant’s allegations and the Panel has no basis to make inferences that favor Respondent.


The Panel finds that Complainant satisfied the requirements of Policy ¶ 4(a)(ii) to show that Respondent has “no rights or legitimate interests.”


Registration and Use in Bad Faith


Taking into consideration that Respondent’s business of acquiring and holding expired domain names has not been shown by any extrinsic evidence to be an abuse of the ICANN rules, the Panel looked to Complainant’s extrinsic evidence that Respondent’s passive holding and offer to sell the name for $500 supported findings of bad faith. Whether Respondent’s demand of $500 for a domain name is excessive may be shown by extrinsic proof of reasonable registration costs. No extrinsic evidence was offered to show costs of registration or that Respondent is passively holding the domain name to prevent Complainant from using its mark in a domain name.  In addition, no evidence was offered showing any relationship between Respondent and Complainant that would permit an inference that Respondent acted to harm Complainant’s business or to compete with Complainant using the domain name. 


Because Complainant did not produce clear evidence to support its subjective allegations of bad faith under ICANN Policy ¶ 4(a)(iii), the Panel finds it appropriate to dismiss the Complaint without prejudice, subject to its being re-filed after the Court case that Complainant also brought has been determined. See AmeriPlan Corp. v. Gilbert supra.




Having determined that Complainant did not show a right to recover in this default ICANN action, the Panel concludes that the appropriate remedy is to dismiss the Complaint without prejudice to its being re-filed after the Court case has been determined.


Accordingly, it is Ordered that the Complaint be dismissed without prejudice.




Hon. Carolyn Marks Johnson, Panelist

Dated: June 26, 2003.


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