Cultivations & Production Facilities, LLC v.
Rebecca Nickerson / Rock City Harvest
Claim Number: FA2004001892080
Complainant is Harvest Dispensaries, Cultivations & Production Facilities, LLC (“Complainant”), represented by Jeremy Kapteyn of KW Law, LLP, Arizona, USA. Respondent is Rebecca Nickerson / Rock City Harvest (“Respondent”), represented by Kutak Rock LLP, Georgia, USA.
REGISTRAR AND DISPUTED DOMAIN NAMES
The domain names at issue are <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com>, all of which are registered with GoDaddy.com, LLC.
Each of the undersigned certify that he has acted independently and impartially and to the best of his knowledge has no known conflict in serving as Panelist in this proceeding.
Michael A. Albert, David H. Bernstein, and Gerald M. Levine as Panelists.
Complainant submitted a Complaint to the Forum electronically on April 14, 2020; the Forum received payment on April 14, 2020.
On April 16, 2020, GoDaddy.com, LLC confirmed by e-mail to the Forum that the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names are registered with GoDaddy.com, LLC and that Respondent is the current registrant of the names. GoDaddy.com, LLC has verified that Respondent is bound by the GoDaddy.com, LLC registration agreement and has thereby agreed to resolve domain disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”).
On April 17, 2020, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of May 11, 2020 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 firstname.lastname@example.org, email@example.com, firstname.lastname@example.org. Also on April 17, 2020, the Written Notice of the Complaint, notifying Respondent of the e-mail 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.
Having reviewed the communications records, the Administrative Panel (the "Panel") finds that the Forum has 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" through submission of Electronic and Written Notices, as defined in Rule 1 and Rule 2.
A timely Response was received and determined to be complete on May 11, 2020. Among other things, the Respondent argued that the Panel should terminate the proceeding under Rule 18(a) in light of the litigation that the Respondent filed on January 14, 2020 against affiliates of the Complainant (but not against the Complainant itself) in the Circuit Court of Faulkner County, Arkansas (the “Court”), captioned Rock City Harvest, LLC dba “Harvest Cannabis Dispensary” v Natural State Wellness Dispensary, LLC and Natural State Wellness Enterprises, LLC, Case No. 23CV-2-56 (the “Litigation”).
On May 19, 2020, pursuant to Complainant's request to have the dispute decided by a three-member Panel, the Forum appointed Michael A. Albert, David H. Bernstein, and Gerald M. Levine as Panelists.
On May 26, 2020, the Forum received Respondent’s Additional Submission, which was filed according to Supplemental Rule 7. That submission consisted in its entirety of a copy of a preliminary injunction decision (the “PI Decision”) issued by the Court in the Litigation on May 25, 2020.
On May 27, 2020, the Panel issued a procedural order soliciting optional Supplemental Submissions from both parties to address the impact of the PI Decision.
On June 4, 2020, the Forum received Complainant’s Supplemental Submission, which was filed in response to the Panel’s procedural order.
On June 12, 2020, the Forum received Complainant’s Supplemental Submission, which was filed in response to the Panel’s procedural order.
Complainant requests that the domain names be transferred from Respondent to Complainant.
Because of the factual complexities of this case, the Panel has found it helpful to summarize the salient undisputed facts as taken from the parties’ submissions, including the Court’s PI Decision.
Complainant operates or licenses the operation of cannabis dispensaries under the HARVEST mark in a number of states. Complainant states that it first used the HARVEST mark in commerce on April 2, 2013. Complainant states that internet users from Arkansas have visited its website since October 31, 2013. Complainant states that it has received nationwide media attention for its business, and trademark, since January 2016.
Complainant applied to register the trademark HARVEST with the United States Patent and Trademark Office (“USPTO”) on January 22, 2016 for use in connection with “retail pharmacy services in the field of botanical medicines.” That mark was registered as Reg. No. 5,154,042 on March 7, 2017. See Compl. Annex 1. Ex. 1.
Respondent was formed on August 23, 2017, more than five months after Complainant’s mark was registered. On September 14, 2017, Respondent filed an application for an Arkansas Dispensary License and indicated that it would operate under the name HARVEST.
The following year, in or around July 2018, Natural State Wellness Dispensary, LLC (“NSWD”) and Natural State Wellness Enterprises, LLC (“NSWE”) also applied for licenses to sell medical marijuana in Arkansas. NSWD and NSWE appear to be licensees of the Complainant; it is not clear whether there is an ownership relationship or other affiliation between them and Complainant as well. See Kimbro Deposition Testimony at 26 (NSWD and NSWE “are authorized, permitted, licensed to use the HARVEST trademark”). In their applications, NSWD and NSWE did not indicate that they intended to sell medical marijuana under the HARVEST mark.
In January 2019, Respondent learned that it would receive a license to operate its marijuana dispensary. Accordingly, Respondent states, it began work towards operating its dispensary in Conway, Arkansas. Respondent made preparations to operate its dispensary by registering the domain names <harvestrockcity.com> and <harvestcannabisarkansas.com> on January 25, 2019.
On February 13, 2019, the Arkansas Alcoholic Beverage Control Division granted Respondent a Medical Marijuana Permit allowing it to open a dispensary under the name HARVEST.
On February 19, 2019, Complainant’s counsel had a telephone call with Respondent. During that call, Complainant informed Respondent that its planned use of the HARVEST name would infringe Complainant’s federally registered HARVEST mark.
On March 29, 2019, Respondent registered the domain name <harvestcannabisdispensary.com>.
On October 11, 2019, Respondent opened its dispensary and began the sale of medical marijuana to patients in Arkansas under the HARVEST name.
In November 2019, Respondent applied for four Arkansas state trademark registrations containing the HARVEST mark. Those registrations were issued to Respondent on February 27, 2020.
In December 2019, NSWD changed the signage at its forthcoming dispensary in Little Rock, Arkansas to HARVEST HOUSE OF CANNABIS. On January 14, 2020, the Arkansas Medical Marijuana Commission accepted NSWD’s name change to Harvest House of Cannabis.
On January 14, 2020, Respondent sued NSWD and NSWE for trademark infringement in the Court.
NSWD began the sale of medical marijuana in Arkansas on February 14, 2020. Meanwhile, on February 12, 2020, Respondent filed a motion for a preliminary injunction in the Litigation.
The hearing on Respondent’s motion for a preliminary injunction began on April 14, 2020, the same day that Complainant filed the Complaint in this UDRP proceeding.
On May 25, 2020, the Court granted Respondent’s motion and entered a preliminary injunction enjoining NSWD and NSWE from using the HARVEST mark in Arkansas. Among other things, the Court found that Respondent “was the first to perfect its right to use the name ‘Harvest’ for the sale of cannabis, by being the first to use the name in the Arkansas market for cannabis.” The Court also found that, as of Respondent’s first use of the HARVEST mark in October 2019, Complainant and its affiliates had no use of the HARVEST mark in Arkansas, and that the closest use was in Tallahassee, Florida, which was more than 700 miles away.
Complainant was established in the market (since 2013), was receiving media attention (since 2016), and registered its trademark (in March 2017) all before Respondent was formed (in August 2017) and all before Respondent registered the domain names at issue (in 2019). Respondent’s domain names are confusingly similar to Complainant’s mark as Respondent merely adds descriptive terms to Complainant’s fully incorporated mark.
Respondent has no rights or legitimate interests in the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names as Respondent is not commonly known by the disputed domain names nor has Respondent been licensed, authorized, or otherwise permitted by Complainant to use Complainant’s mark. Furthermore, Respondent’s use is not a bona fide offering of goods or services, nor a legitimate noncommercial or fair use, as Respondent did not make preparations to use the <harvestcannabisarkansas.com> domain name prior to the dispute and now uses this disputed domain name to compete with Complainant. Furthermore, the <harvestcannabisdispensary.com> and <harvestrockcity.com> domain names are being held as parked webpages.
Respondent registered and used the disputed domain names in bad faith. Specifically, Respondent is attempting to attract Internet users for commercial gain. Finally, Respondent had actual knowledge of Complainant’s rights in the HARVEST mark at the time of the registration of the domain names.
Respondent operates as a medical cannabis provider doing business solely within the state of Arkansas. Although Complainant may have rights in the HARVEST mark, the federal trademarks on which Complainant relies do not cover the cannabis Complainant sells, and they could not cover cannabis because federal registration is not available for cannabis. Complainant’s federal registration should therefore be disregarded as having been fraudulently obtained.
Respondent has rights and legitimate interests in the disputed domain names as they are used in connection with Respondent’s medical cannabis dispensary in Arkansas. Additionally, Respondent has gone by the name HARVEST since September 2017 and chose the disputed domain names as they reflected Respondent’s properly licensed business.
Respondent did not register the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names in bad faith. Respondent registered the disputed domain names to reflect the name of the dispensary business that it was granted the right to open in Arkansas. Respondent did not know of Complainant’s mark when it selected the HARVEST name, and is not attempting to trade off of the goodwill associated with Complainant’s mark.
Reverse Domain Name Hijacking
Respondent alleges that Complainant is attempting to reverse domain hijack the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names with its complaint.
C. Additional Submissions
Respondent’s First Additional Submission
As noted above, on May 26, 2020, Respondent filed a supplemental submission, which consisted of the PI Decision entered by the Court in the Litigation. Neither the complaint in the Litigation nor the PI Decision addresses the domain names at issue in this proceeding. The Panel thereafter authorized supplemental submissions from each party to address the impact (if any) of the Order.
Complainant’s Supplemental Submission
In its Supplemental Submission, Complainant alleges that it has rights in the HARVEST mark in connection with its legal business operations relating to retail pharmacy services in the field of botanical medicine. Complainant asserts that the USPTO recognizes federal trademark rights incidental to cannabis businesses even if it does not permit registration for cannabis per se. Complainant alleges that Respondent lacks rights in the disputed domain names and cannot rely on the PI Decision to resolve the merits of this dispute relating to domain names that are not at issue in the Litigation.
Respondent’s Supplemental Submission
In its Supplemental Submission, Respondent withdraws its initial request to suspend the UDRP proceeding. It argues that, in light of the Court’s PI Decision in which the Court grant a preliminary injunction against NSWD’s and NSWE’s use of the term HARVEST in Arkansas, Respondents have established that they own exclusive rights to use the name HARVEST for the sale of cannabis in Arkansas. This amounts to legitimate rights under ¶4(a)(ii), which moots the need to respond to any averments made by Complainant on the issue of Respondent’s legitimate rights in the domain names and the bad faith registration and use of the same domain names.
As a threshold matter, the Panel notes that the instant proceeding presents a complicated series of questions relating to the interconnected disputes between the parties and their affiliates. This proceeding owes much of its difficulty to the parallel Court Litigation and the relative uncertainty present within the limited record available to this Panel. Although some areas of the analysis in this decision may be rendered moot by the parties’ submissions or ancillary findings on the merits of this case, the Panel still endeavors to provide a fulsome discussion of all factors considered in a typical UDRP proceeding.
Under Rule 18(a), where concurrent litigation was filed prior to the initiation of a UDRP proceeding, this Panel retains the authority and discretion to either terminate the complaint or proceed to a determination on the merits. See eProperty Direct LLC v. Miller, FA 836419 (Forum Jan. 3, 2007) (holding that the panel could decide the dispute under Rule 18(a) of the Policy “since the legal proceedings referred to by the parties appear to be concluded and Orders made. Moreover,… those Orders do not touch directly on the disposition of the disputed domain name or on the parties’ intellectual property rights.”); see also W. Fla. Lighting v. Ramirez, D2008-1122 (WIPO Oct. 2, 2008) (deciding to proceed under the UDRP despite concurrent court proceedings because “the Panel does not find that it is necessary or advantageous to await a judicial determination of the issues raised in the federal litigation in order to reach a decision strictly under the Policy. This administrative proceeding under the Policy concerns only control of the Domain Name, not any of the other remedies at issue in the federal litigation. It is not binding on the court, and it does not preclude the prosecution of any claims, defenses, or counterclaims in the federal litigation”); see also Mary’s Futons, Inc. v. Tex. Int’l Prop. Assocs., FA 1012059 (Forum Aug. 13, 2007) (choosing to proceed under the UDRP despite concurrent court proceedings for multiple reasons, including that the proceedings appeared to be filed in a court that did not commonly adjudicate intellectual property issues and that the court proceedings were filed by the respondent on the same day the response in these proceedings was filed).
In this case, Respondent initially requested that this Panel terminate the administrative proceeding on the grounds that it had previously initiated an action in the Court for “trademark infringement and unfair competition under Arkansas law.” Resp. Ex. B. Respondent filed the Litigation against companies that appear to be licensees of Complainant, and further alleges that Complainant filed this UDRP proceeding as a retaliatory measure.
The Panel finds that Respondent’s argument for termination based on the co-pending Litigation is flawed. The domain names in this dispute do not appear to be included as part of the subject matter of the Litigation, which therefore does not implicate Rule 18(a) (which applies to “legal proceedings . . . in respect of a domain-name dispute that is the subject of the complaint”). Resolution of the Litigation will not address the domain name issues since those rights are not before the Court; indeed, the PI Decision says nothing at all about the domain names. See Rejuve Clinics LLC v. Merlin Kauffman, Rejuve Inc., D2019-2607 (WIPO Feb. 6, 2020) (“[W]hile the TTAB may eventually rule on issues of trademark ownership and priority, the TTAB will not address cybersquatting issues.”)
Moreover, the Complainant was not a party to the Litigation at the time it filed its UDRP complaint, during the hearing on Complainant’s motion for a preliminary injunction, or at the time that the Court entered the PI Decision. Rather, Respondent filed the Litigation against separate parties that appear to be licensees of Complainant. It would violate basic principles of fairness and due process to terminate this proceeding brought by Complainant based on an action brought against different parties and in which Complainant had no opportunity to be heard. See BluMarble, LLC v. Steve Cherry / GENERAL DELIVERY, FA1406001562590 (Forum July 8, 2014) (“Complainant makes no mention of the pending proceedings in its Complaint, but its Additional Submission contends it is not a party to that litigation. Respondent does not dispute that fact and no court document provided indicates that Complainant is a party to any such litigation.”).
Complainant’s Supplemental Submission notes that the Litigation still does not appear to address the domain names at issue in this dispute. For that reason, the Panel exercises its discretion to proceed to the merits of this case. In any event, Respondent has now withdrawn its request to suspend this proceeding, which makes the request for suspension moot.
In arriving at this determination, the Panel notes that Respondent’s request to terminate the proceedings is an alternative argument to its defense, and not the main thrust of its merits argument, which the Panel will now proceed to examine.
The Panel finds that Complainant has rights in the HARVEST mark. The disputed domain names are confusingly similar to Complainant’s mark as they contain the entirety of Complainant’s mark.
Although it is a close question, on the evidence presented, Complainant has not satisfied its burden of proving Respondent has no rights or legitimate interests with respect to the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names.
Complainant also has not satisfied its burden of proving Respondent registered and used the <harvestrockcity.com> and <harvestcannabisarkansas.com> domain names in bad faith. However, Complainant has established that Respondent registered and is using the <harvestcannabisdispensary.com> domain name in bad faith.
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."
Paragraph 4(a) of the Policy requires that 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.
The Panel finds that Complainant has rights in the HARVEST mark through its registration of that mark with the USPTO. Registration of a trademark with the USPTO is prima facie evidence of the validity of the trademark under Policy ¶ 4(a)(i). See DIRECTV, LLC v. The Pearline Group, FA 1818749 (Forum Dec. 30, 2018) (“Complainant’s ownership of a USPTO registration for DIRECTV demonstrate its rights in such mark for the purposes of Policy ¶ 4(a)(i).”).
The Panel further agrees with Complainant that Respondent’s <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names are confusingly similar to Complainant’s mark. The Panel notes that the domain names wholly incorporate the Complainant’s federally registered trademark and merely add descriptive terms like “cannabis,” “arkansas” and “rockcity” (a nickname for Little Rock, Arkansas), along with the .com generic top-level domain (“gTLD”), which does not distinguish a domain name for the purposes of Policy ¶ 4(a)(i). See MTD Products Inc. v. J Randall Shank, FA 1783050 (Forum June 27, 2018) (“The disputed domain name is confusingly similar to Complainant’s mark as it wholly incorporates the CUB CADET mark before appending the generic terms ‘genuine’ and ‘parts’ as well as the ‘.com’ gTLD.”). As the WIPO Jurisprudential Overview 3.0 notes at section 1.8, “[w]here the relevant trademark is recognizable within the disputed domain name, the addition of other terms (whether descriptive, geographical, pejorative, meaningless, or otherwise) would not prevent a finding of confusing similarity under the first element.” The Panel accordingly finds that the disputed domain names are confusingly similar to the HARVEST mark under Policy ¶4(a)(i).
Respondent’s argument on this prong of the analysis is unconvincing. Indeed, Respondent largely sidesteps the issue of confusing similarity and instead focuses its argument on an attack on Complainant’s trademark rights. It claims Complainant fraudulently acquired the mark “through deception” and charges Complainant with fraud in connection with the trademark applications in failing to disclose the true nature of the services it offers. Respondent asserts that “the manufacture, importation, possession, use, and distribution of marijuana is illegal in the United States under the Controlled Substances Act (“CSA”).”
Respondent’s argument is without merit. Complainant’s trademark registrations are not for cannabis; rather, they are for “retail pharmacy services in the field of botanical medicines.” Those registrations are entitled to a presumption of validity. Respondent has submitted no evidence – let alone compelling evidence – to support a claim that Complainant does not offer such retail services. Electronic Commerce Media, Inc. v. Taos Mountain, Claim No. FA0008000095344 (NAF Oct. 11, 2000) (“[F]ederal trademark registrations . . . are prima facie evidence of the mark’s validity. Given the nature of these UDRP proceedings, a Panel should not overturn that presumption of validity . . . absent compelling evidence.”) Moreover, Respondent has not submitted any evidence that it has challenged those registrations or sought their cancellation, either in the Litigation or before the USPTO.
Respondent’s argument, and the accompanying battery of U.S. cases cited by Respondent, contribute nothing to the resolution of this dispute. Respondent offers no relevant substantive response regarding the confusing similarity factor.
Accordingly, the Panel finds that Complainant has satisfied ¶4(a)(i) of the Policy for standing to maintain this UDRP proceeding.
Although it is an exceedingly close and difficult case, the Panel holds that Complainant has not established, by a preponderance of the evidence, that Respondent lacks rights and legitimate interests under Policy ¶ 4(a)(ii).
If Complainant had established that Respondent was aware of Complainant’s HARVEST trademark when it adopted the HARVEST name for its business in September 2017, the Panel would have no difficulty concluding that Respondent’s adoption of the HARVEST name was not legitimate. That is because adoption of an infringing trademark cannot create a legitimate interest. Schouten Industries B.V. v. Canadian Soylife Health Co., Claim No. FA0303000149188 (NAF July 19, 2003). Given the close proximity of “retail pharmacy services in the field of botanical medicines” and the retail sale of medical marijuana (which is, itself, a type of botanical medicine), it is obvious to the Panel that use of the same trademark (HARVEST) for those highly similar services would be infringing.
The Complainant, however, has not established – whether through direct evidence, circumstantial evidence, or fair inferences to be drawn from such evidence -- that the Respondent had such actual knowledge. For its part,
Respondent plausibly contends that it was not aware of Complainant’s trademark usage as of the date of registration. Rather, Respondent asserts it selected the HARVEST mark because it is “simple, memorable evocative of the natural growing process” and “the word ‘Harvest’ also evokes Arkansas’ deep agricultural heritage while avoiding any connection or reference to recreational cannabis’s traditional reputation.” Resp. Annex 7, Exhibit J. Complainant makes no contrary showing. There is no evidence, for example, that Respondent visited Complainant’s website, corresponded with Complainant, or was on Complainant’s mailing list. There is no evidence that Respondent conducted a trademark search when it adopted the HARVEST name, or searched the internet for possible conflicting uses of HARVEST. There is no evidence that Respondent subscribes to the publications in which Complainant has obtained media coverage. And there is no evidence that Complainant or its mark is so famous or well-known as to suggest that Respondent’s denials of knowledge are implausible.
Complainant contends that “Respondent had actual knowledge of Complainant’s Marks no later than about 11:00 AM CT on February 19, 2019, when Respondent initiated a telephone conversation with Complainant’s then General Counsel regarding “Complainant’s intent to enter the Arkansas market under Complainant’s HARVEST Mark.” But that call was more than 17 months after Respondent adopted the HARVEST mark for its dispensary business in Arkansas.
This is a close case because the circumstances surrounding the lead up to that call and Respondent’s subsequent actions are not free from suspicion. For example, the record shows that Complainant was featured in Marijuana Business Magazine in January 2016, over three years before Respondent claims to have first learned (in February 2019) that Complainant used the HARVEST mark in its similar business. Complainant also applied to register the HARVEST mark over a year before Respondent was formed to apply for a medical marijuana dispensary license in Arkansas, and that mark was registered several months before Respondent’s license application. In the exercise of due diligence, Respondent likely would have become aware of Complainant prior to entering the cannabis dispensary business. Certainly, had Respondent conducted a trademark search, it would have learned of Complainant’s trademark. There is, however, no evidence in the record of whether Respondent conducted such a search at the time. Although discovery may shed more light on these issues, this Panel can only rule on the evidence before it.
Although the Panel harbors doubts that Respondent would be oblivious to Complainant’s position within the cannabis market, mere doubt does not satisfy the burden of proof that rests with Complainant. Given Respondent’s credible denial of knowledge, and Complainant’s failure to establish, either directly or circumstantially, that Respondent likely had such knowledge, the Panel finds that Complainant has not established that Respondent knew of Complainant and its rights at the time it adopted the HARVEST name for its business.
Accepting for these purposes that Respondent was not aware of Complainant when it adopted the HARVEST mark in September 2017, Respondent’s subsequent actions are consistent with the actions of a party that has made preparations to use that name in its business. Respondent offers documentary proof that it was formed on August 23, 2017 under the fictitious trade name of HARVEST to apply for a medical marijuana dispensary license in Arkansas. Resp. Annex 7, Exhibit H (Articles of Organization). Application for the license was made on September 14, 2017 disclosing that Respondent intended to operate under the fictitious trade name HARVEST. Resp. Annex 8, Exhibit K. Respondent further established that it received news in January 2019 that it would receive a license to operate a marijuana dispensary under the name HARVEST. Annex 7, Exhibit I at p. 60, ln. 14 - p. 61, ln. 11. That news was realized when Respondent received a Medical Marijuana Permit in the name of HARVEST from the Arkansas Alcoholic Beverage Control Division on February 13, 2019. Resp. Annex 9, Exhibit N. Consistent with this timeline, Respondent registered the domain names <harvestrockcity.com> and <harvestarkansas.com> on January 25, 2019.
All of those activities occurred prior to the February 19, 2019 call between the parties, which is the latest date by which Respondent definitely was aware of Complainant and its trademark. The plausible inference to be drawn from Respondent’s proof is that its adoption of the HARVEST name for its entry into the cannabis market in Arkansas occurred “before notice” of Complainant and its trademark rights. Thus, the overlap between Complainant’s federal registration (albeit a registration with priority of rights) and Respondent’s subsequent rights in Arkansas, appears, based on the limited record before the Panel, more likely to have been coincidental rather than the product of purposeful infringement.
Respondent’s selection of the HARVEST name in September 2017, and its application that month for an Arkansas Dispensary License, are thus sufficient to show that Respondent made “demonstrable preparations” to use the HARVEST name in connection with a bona fide offering of goods and services. JJ206, LLC v. Erin Hackney, FA 1629288 (Forum Aug. 25, 2015) (finding that a Respondent may defeat a Complainant’s established case by showing it has made demonstrable preparations to use the domain name in connection with a bona fide offering of goods or services). Although such preparations may not be sufficient to immunize Respondent from a claim for trademark infringement (since trademark priority, rather than the date of knowledge, is the key in an infringement lawsuit), this Panel is not tasked with adjudicating Complainant’s claim that Respondent is infringing Complainant’s trademark. Rather, this Panel is tasked solely with adjudicating Complainant’s assertion of abusive cybersquatting, under the UDRP, which provides in ¶ 4(c)(i) that demonstrable preparations prior to knowledge are sufficient to establish rights for purposes of the UDRP, which was designed to address clear cases of abusive domain name registration.
Moreover, Respondent has followed through on those preparations. Respondent presents documents that show Respondent is licensed to operate a medical cannabis dispensary in Arkansas under the name “Rock City Harvest” and that such permits were obtained legitimately. See Resp. Ex. H-V. Accordingly, the Panel finds reasonable evidence within the record that Respondent is commonly known by the HARVEST name under Policy ¶ 4(c)(ii) prior to learning of Complainant and its trademark rights. See Navigant Consulting, Inc. v Bradley Shive / Navigant Technologies, FA 1587953 (Forum Dec. 17, 2014) (finding that respondent had rights and legitimate interests in the <naviganttechnologies.com> and <naviganttech.com> domain names because respondent had provided evidence of doing business as “Navigant Technologies” “before Complainant’s registration of its NAVIGANT marks and before receiving a notice of [the domain] dispute”).
While not free of doubt regarding Respondent’s claims that it lacked awareness of a competing participant in the cannabis dispensary market, the Panel finds, in view of the burden of proof and based on the limited record before the Panel, that Complainant has failed to meet its burden to show that Respondent lacks rights or legitimate interest in the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names under Policy ¶ 4(a)(ii).
In light of the Panel’s finding that Respondent has rights or legitimate interests in the HARVEST portion of the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names pursuant to Policy ¶ 4(a)(ii), the Panel need not reach the question of whether Respondent registered and used the disputed domain names in bad faith pursuant to Policy ¶ 4(a)(iii). See Record Connect, Inc. v. Chung Kit Lam / La-Fame Corporation, FA 1693876 (Forum Nov. 3, 2016) (finding that the issue of bad faith registration and use was moot once the panel found the respondent had rights or legitimate interests in the disputed domain name). However, because the parties are engaged in other disputes, the Panel will provide its views on this issue as well, with the hopes of aiding the parties’ assessment of their respective claims.
As discussed above, Complainant has not sufficiently established that Respondent was aware of Complainant or its trademark at the time it registered two of the domain names at issue -- <harvestrockcity.com> and <harvestcannabisarkansas.com> -- and so has likewise not established bad faith registration. See Sheet Labels, Inc. v. Harnett, Andy, FA 1701423 (Forum Jan. 4, 2017) (finding that, because the respondent had rights and legitimate interests in the disputed domain name, its registration of the name was not in bad faith). The Panel rejects Complainant’s argument that the registration of these two domain names was nevertheless in bad faith because Respondent had constructive knowledge of Complainant’s trademark registration. Although constructive knowledge may be relevant to certain issues under U.S. trademark law, see 15 U.S.C. § 1072, constructive knowledge is insufficient to support a finding of actual knowledge and bad faith under Policy ¶ 4(a)(iii). See Meredith Corp. v. CityHome, Inc., D2000-0223 (WIPO May 18, 2000) (respondent’s constructive notice of complainant’s registered mark was insufficient to support a finding of bad faith registration). Here, Respondent asserts that it did not know of Complainant before the registration of the disputed domain names, and Complainant has failed to rebut that assertion with persuasive direct or circumstantial evidence. Therefore, the Panel finds Respondent did not register these two disputed domain names in bad faith under Policy ¶ 4(a)(iii).
Moreover, because Respondent is using those domain names – which expressly include a geographic designation of the place where Respondent sells its cannabis – in connection with its state-sanctioned sale of cannabis in Arkansas, the Panel finds that Respondent’s use of those domain names is not in bad faith.
The Panel also observes that Complainant’s assertion that the HARVEST mark “is an arbitrary or suggestive term which has no meaning outside its use as a means to identify Complainant as a source of certain products and services” amounts to an exaggeration of its rights. The term HARVEST appears to be used relatively commonly in the marketplace for various herbal or vegetal products. It is not implausible that Respondent could have independently chosen the term HARVEST to market cannabis services in Arkansas commencing at a time prior to learning about Complainant’s commercial intentions.
Complainant also contends that Respondent had notice of its intentions from information contained in its numerous domain names. Yet, as with the constructive notice theory based on trademark registration, a theory of constructive notice based on domain name registrations is insufficient to substitute for proof that Respondent had actual knowledge.
Complainant also has failed to establish bad faith under ¶ 4(b)(iii), which requires Complainant to prove that the registrations of the domain names were “primarily for the purpose of disrupting” Complainant’s business. Here, it appears that the <harvestrockcity.com> and <harvestcannabisarkansas.com> domain names were primarily registered for a business for which Respondent began preparing, and for which it sought licenses, prior to actual knowledge of Complainant’s rights. Nor has Complainant shown an intent to cause confusion at the time of the registration of these two domain names. The fact that cannabis-related media had already recognized Complainant as early as January 2016 lends some color to Complainant’s theory, but ultimately Complainant has offered no concrete evidence that Respondent had actual knowledge of Complainant or its mark when it registered the first two domain names in January 2019. Complainant has had ample opportunity to provide such evidence, first in its Complaint and more recently in the Supplemental Submission requested by the Panel. Where such evidence has not been offered, the Panel ultimately resolves this issue in favor of Respondent, the party not bearing the burden of proof. Cf. Uhrenholt A/S v. FILLIP NIELSEN, FA 1646444 (Forum Dec. 21, 2015) (finding that mere assertions of bad faith, without evidence, are insufficient for a complainant to establish bad faith under Policy ¶ 4(a)(iii)).
However, the Panel finds that Respondent did register and is using the domain name <harvestcannabisdispensary.com> in bad faith. At the time Respondent registered that third domain name in March 2019, it was, by its own admission, already well aware of Complainant and its federal trademark. Notwithstanding that knowledge, it not only elected to register a third domain name that contains Complainant’s trademark in its entirety, but also one that contains no geographic reference (even though Respondent has made clear that it is only authorized to sell cannabis in Arkansas and its other two domain names both include Arkansas-related geographic terms). The registration of a domain name that consists of the words Harvest Cannabis Dispensary, when Respondent knows full well that the Complainant operates Harvest Cannabis Dispensaries in other states, coupled with Respondent’s change of its own name from Rock City Harvest to Harvest Cannabis Dispensary in June 2019 (after it learned of Complainant and its trademark rights), see PI Decision at 3, seems designed solely for the purposes of diverting Complainant’s customers and causing confusion. That is paradigmatic bad faith under the Policy.
In sum, Complainant has not proven that Respondent registered and used the domain names <harvestrockcity.com> and <harvestcannabisarkansas.com> in bad faith under Policy ¶ 4(a)(iii). The Panel does find that Respondent registered and used the domain name <harvestcannabisdispensary.com> in bad faith, but, because the Panel also has found that Complainant failed to establish that Respondent lacks rights or legitimate interests in the HARVEST domain names, the Panel will not order transfer of the <harvestcannabisdispensary.com> domain name.
Respondent alleges that Complainant has engaged in reverse domain-name hijacking (“RDNH”) by initiating this dispute, attempting to deprive Respondent, the rightful, registered holder of the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names, of its rights to use the disputed domain names.
The Panel finds that Complainant has satisfied Policy ¶ 4(a)(i), and that it has prior trademark rights to the term HARVEST for “retail pharmacy services in the field of botanical medicines,” which is sufficiently similar to the sale of cannabis as to make the sale of cannabis under the HARVEST mark a likely infringement. The Panel also has found that Complainant satisfied Policy ¶ 4(a)(iii) with respect to the <harvestcannabisdispensary.com> domain name. Moreover, Complainant appears to have been doing business under the disputed mark for about four years prior to the registration of the domain names. Although the Panel is ultimately unpersuaded by Complainant’s arguments, the case is close enough, and Complainant has enough of a basis for its filings, that the Panel cannot find RDNH. There is insufficient evidence to conclude that the Complaint was filed without any good faith basis or reasonable prospect of success. Complainant cannot be faulted for its efforts to invoke the Policy to protect its trademark from abusive cybersquatting, even if, ultimately, its proof (based on a limited record without the opportunity for discovery) does not suffice to support its contentions. The Panel therefore declines Respondent’s request to declare that Complainant filed the Complaint in an attempt at Reverse Domain Name Hijacking. See Gallup, Inc. v. PC+s.p.r.l., FA 190461 (Forum Dec. 2, 2003) (finding no reverse domain name hijacking where complainant prevailed on the “identical/confusingly similar” prong of the Policy).
Complainant having failed to establish all the three elements required under the ICANN Policy for all three of the domain names at issue, the Panel concludes that relief shall be DENIED.
Accordingly, it is Ordered that the <harvestcannabisdispensary.com>, <harvestrockcity.com>, and <harvestcannabisarkansas.com> domain names REMAIN WITH Respondent.
Michael A. Albert, David H. Bernstein, and Gerald M. Levine, Panelists
Dated: June 26, 2020
Click Here to return to the main Domain Decisions Page.
Click Here to return to our Home Page