Shoe Mart Factory Outlet, Inc. v.
DomainHouse.com, Inc. c/o Domain Administrator
Claim Number: FA0504000462916
Complainant
is Shoe Mart Factory Outlet, Inc. (“Complainant”),
represented by Gene S. Winter, of St. Onge Steward Johnston and Reens LLC, 986 Bedford Street, Stamford, CT 06905. Respondent is DomainHouse.com, Inc. c/o Domain Administrator (“Respondent”),
represented by Wilson Martinez, 2501 Colorado Blvd., Suite H, Los
Angeles, CA 90041
REGISTRAR AND DISPUTED DOMAIN NAME
The
domain name at issue is <shoemart.com>,
registered with Enom, Inc.
PANEL
The
undersigned certify that they have acted independently and impartially and to
the best of their knowledge have no known conflict in serving as Panelist in
this proceeding.
G.
Gervaise Davis III, Houston Putnam Lowry, Chartered Arbitrator, and David S.
Safran as Panelists.
PROCEDURAL HISTORY
Complainant
submitted a Complaint to the National Arbitration Forum electronically on April
13, 2005; the National Arbitration Forum received a hard copy of the Complaint
on April 15, 2005.
On
April 13, 2005, Enom, Inc. confirmed by e-mail to the National Arbitration
Forum that the domain name <shoemart.com>
is registered with Enom, Inc. and that the Respondent is the current registrant
of the name. Enom, Inc. has verified
that Respondent is bound by the Enom, 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
April 25, 2005, a Notification of Complaint and Commencement of Administrative
Proceeding (the “Commencement Notification”), setting a deadline of May 16,
2005 by which Respondent could file a Response to the Complaint, was
transmitted to Respondent via e-mail, post and fax, to all entities and persons
listed on Respondent’s registration as technical, administrative and billing
contacts, and to postmaster@shoemart.com by e-mail.
A
timely Response was received and determined to be complete on May 16, 2005.
A
timely Reply from Complainant was received on May 20, 2005.
A
Sur-reply was received from Respondent on May 25, 2005. While this was not submitted in a timely
manner, it was accepted as a late submission by the Panel and considered by the
Panel.
On May 24, 2005, pursuant to Respondent’s request to
have the dispute decided by a three-member
Panel, the National Arbitration Forum
appointed Houston Putnam Lowry, Chartered Arbitrator, as Chair, G. Gervaise Davis
III and David S. Safran as Panelists.
RELIEF SOUGHT
Complainant
requests that the domain name be transferred from Respondent to Complainant.
PARTIES’ CONTENTIONS
A.
Complainant’s Allegations
A. THE FACTUAL BACKGROUND
Complainant
is in the business of providing retail store services and online retail store
services featuring footwear; footwear care products, namely, shoe polish, shoe
brushes, shoehorns and shoe trees; clothing, namely, jackets, gloves and belts;
and leather goods, namely, leather cases for pens, keys, business cards, credit
cards and knives (“Shoemart Goods and Services”) under its SHOEMART trade name
and trademark.
Complaint
has used the SHOEMART trademark for nearly fifty years. Shoemart has continuously advertised its
business and services since at least 1956.
As a result of exclusive, continuous and extensive use by Complainant,
the SHOEMART trademark is alleged to have acquired significant goodwill, and
over the years has came to represent quality and excellence in the full range
of Shoemart Goods and Services.
Complainant
is the owner of a domain name registration for the <theshoemart.com>
domain name. Complainant uses
its SHOEMART website at the <theshoemart.com> domain to provide on-line
retail store services featuring footwear; footwear care products, namely, shoe
polish, shoe brushes, shoehorns and shoe trees; clothing, namely, jackets,
gloves and belts; and leather goods, namely, leather cases for pens, keys,
business cards, credit cards and knives.
Respondent,
DomainHouse.com, Inc. (“DomainHouse”), is the registrant of the <shoemart.com>
domain name.
On
or about November 30, 2004, Complainant, through its attorneys, wrote to the
domain name registrant, DomainHouse, to inquire about the possible purchase of
the <shoemart.com> domain name, and was told the price was
$250,000.
DomainHouse
has a website at its <shoemart.com> domain name. The DomainHouse website has the following
banner at the top of its website:
Complainant
claims that because of this logo, the website is intended to convey that
DomainHouse is providing a footwear-related website. There is also, however, a
temporary posting of information on the web page relating to relief efforts
connected with the December 26, 2004, tsunami disaster in the Indian
Ocean. This is clearly unrelated to the
intended actual use of the website, that is, to hold the domain name for sale
to the rightful owner of the mark.
1. The <shoemart.com> Domain Name Is Identical to Complainant’s
SHOEMART Mark
It
is alleged that Complainant’s common-law rights in the mark SHOEMART require
that the <shoemart.com> domain name be transferred to Shoemart.
The Policy protects misuse of unregistered as well as registered trademarks. See
Archer-Daniels-Midland Co. v. Bodine, D2002-0482 (WIPO July 16, 2002); see
also Sydney Mkts. Ltd. v. Rakis, D2001-0932 (WIPO Oct. 8,
2001) ("A Complainant may rely on an unregistered word, phrase or string
of characters, provided that the unregistered mark is and performs the function
of a 'trademark.'"). A trademark distinguishes the goods and services of
one party in trade from those of another. Id. Furthermore, under United
States law trademark rights accrue from usage, not registration. See Ga.
Gulf Corp. v. Ross Group, D2000-0218 (WIPO June 14, 2000) ("There is
no requirement, at least under U.S. law, for a mark to be registered before
rights attach. Rather, under U.S. trademark law, rights attach upon use of the
mark in commerce."). Complainant has been using the SHOEMART mark since
1956; thus, Complainant claims the mark possesses acquired distinctiveness
based on its long-term use.
The
<shoemart.com> domain name is identical to the SHOEMART mark
pursuant to the Policy paragraph 4(a)(i).
Numerous courts and prior panels have recognized that the incorporation
of a trademark in its entirety is sufficient to establish that a domain name is
identical or confusingly similar to the complainant’s mark. See Paccar Inc.
v. Telescan Techs., L.L.C., 115 F. Supp. 772 (E.D. Mich. 2000) (finding
that <peterbuilttrucks.com>, <kenworthtrucks.com> and similar
domain names are not appreciably different from the PETERBUILT and KENWORTH
trademarks); Quixtar Invs. Inc. v. Hoffman, D2000-0253 (WIPO May 29,
2000) (finding that QUIXTAR and <quixtarmortgage.com> are legally
identical).
Here,
DomainHouse has adopted, in its entirety, the SHOEMART mark in the <shoemart.com>
domain name. Generally, a user
of a mark "may not avoid likely confusion by appropriating another's
entire mark and adding descriptive or non-distinctive matter to it." McCarthy on Trademarks & Unfair
Competition § 23:50 (4th ed. 1998). The addition of the phrase
".com" is non-distinctive because it is required for registration of
such a domain name. Therefore, the <shoemart.com>
domain name is confusingly similar to the SHOEMART mark, pursuant to
Policy paragraph 4(a)(i).
2. Respondent Has No Rights or Legitimate
Interests in Respect of the Domain Name that Is the Subject of the Complaint
Respondent
has no rights or legitimate interests in the <shoemart.com> domain
name pursuant to Policy paragraph 4(a)(ii). Respondent has no relationship with or
permission from Complainants to use the SHOEMART mark. There are three elements under Policy
paragraph 4(c) that, if satisfied, lead to the conclusion that Respondent has
rights or a legitimate interest in the domain name: (1) Prior to notice of the
dispute, Respondent had used or prepared to use the domain name or a name
corresponding to the domain name in connection with a bona fide offering
of goods or services; or (2) Respondent has been commonly known by the domain
name, even if it had not acquired
trademark or service mark rights; or (3) Respondent is making a legitimate
noncommercial or fair use of the domain name, without intent for commercial
gain to misleadingly divert consumers or to tarnish the trademark or repair
mark at issue. See Document Techs.,
Inc. v. Int’l Elec. Communications, Inc., D2000-0270 (WIPO June 6,
2000).
Here,
none of the three elements is satisfied.
Respondent has not incorporated under the name SHOEMART. Respondent has no fictitious business name
registration for SHOEMART or <shoemart.com>. Having searched appropriate databases, Complainants
have found no evidence that Respondent has ever used the trade name
SHOEMART.COM or been known as <shoemart.com>. Respondent is not commonly known by the
Domain Name and is using the domain name solely to force Complainant to buy the
name at an exorbitant price. This is not a bona fide or fair use of the domain
name. Policy para. 4(c)(i), (iii).
It was
only after the offer from Complainant that Respondent placed solicitations for
donations to relief efforts, bearing no relationship to the domain name, on the
website.
In
a previous panel decision involving the same Respondent, the panels have found
DomainHouse to have no rights or legitimate interests in other domains involved
in the proceedings in which DomainHouse was named as a respondent. For example, in Apple Computer, Inc. v. DomainHouse.com, Inc., D2000-0341 (WIPO
July 5, 2000), Respondent represented that regarding the <quicktime.com>
domain name, it had “prepared to use the domain name to
establish a website devoted to presenting information about parenting for
non-commercial purposes.” DomainHouse
attempted to show that the domain name at issue, <quicktime.com>,
referred to the idea of “quality time” between parents and children. DomainHouse further argued that it failed to
develop its non-commercial web site because of the cease-and-desist letter it
had received from the Complainant, the trademark owner. The panel rejected
DomainHouse’s argument:
[T]he Panel
does not find Respondent’s evidence or explanation persuasive. Respondent, on
his own behalf, has made clear that it is in the business of developing,
warehousing and selling domain names. It has gone to some lengths to justify
this practice. The development of a noncommercial website devoted to parenting
and childcare is sufficiently remote from the ordinary object and purpose of
Respondent’s activities to demand more concrete evidence of its intention.
Apple Computer, Inc. v. DomainHouse.com,
Inc., D2000-0341 (WIPO
July 5, 2000). Although in the instant
case, Respondent has made a half-hearted attempt to create a noncommercial
website devoted to the Tsunami relief efforts, these postings are clearly only
an attempt to thwart the process of this panel in the transfer of the domain
name to its rightful owner.
In
yet another case involving DomainHouse as Respondent, the panel found
DomainHouse had no rights or legitimate interests in the domain names
<cgfns.com> and <cgfns.net>. See
Comm’n on Graduates of Foreign Nursing Sch. v. Free Speech Alliance, FA
109364 (Nat. Arb. Forum June 12, 2002). The panel found:
Respondent
registered the disputed domain names with knowledge of Complainant’s mark and
rights therein, and with the intent to sell the domain names for profit. Such intentions demonstrate Respondent’s
lack of rights and interests in the domain names. See Hewlett-Packard
Co. v. High Performance Networks, Inc., FA 95083 (Nat. Arb. Forum July 31,
2000) (finding no rights or legitimate interests where the Respondent
registered the domain name with the intention of selling it); see also 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).
Complainant
argues that since the disputed domain names were registered nearly three years
ago, with no actual use having been made, Respondent’s passive holding of the
names demonstrates its lack of rights or interests therein. See Bloomberg L.P. v. Sandhu, FA 96261 (Nat. Arb. Forum Feb. 12, 2001)
(finding that no rights or legitimate interest can be found when Respondent
fails to use disputed domain names in any way); see also J. Paul Getty Trust v. Domain 4 Sale &
Co., FA 95262 (Nat. Arb. Forum Sept. 7, 2000) (finding rights or legitimate
interests do not exist when one has made no use of the websites that are
located at the domain names at issue, other than to sell the domain names for
profit); see also Comm’n on
Graduates of Foreign Nursing Sch. v. Free Speech Alliance, FA 109364 (Nat.
Arb. Forum June 12, 2002).
In
the instant case, Respondent conducts business under the name “DomainHouse.com,
Inc.” indicating that Respondent is not commonly known by the <shoemart.com>
domain name under Policy ¶ 4(c)(ii). See Tercent Inc. V. Lee Yi, FA 139720
(Nat. Arb. Forum Feb. 10, 2003) (stating “nothing in Respondent’s WHOIS
information implies that Respondent is ‘commonly known by’ the disputed domain
name” as one factor in determining that Policy ¶ 4(c)(ii) does not apply); see
also Gallup Inc. v. Amish Country Store, FA 96209 (Nat. Arb. Forum Jan. 23,
2001) (finding that Respondent does not have rights in a domain name when
Respondent is not known by the mark).
When
Complainant inquired about purchasing the <shoemart.com> domain
name, Respondent stated that Complainant’s offer was “way below the asking
price of $250,000.” Respondent’s offer to sell the domain name registration
indicates that Respondent lacks rights or legitimate interests in the domain name
under Policy ¶¶ 4(c)(i) and (iii). See
J. Paul Getty Trust v. Domain 4 Sale & Co., FA 95262 (Nat. Arb. Forum
Sept. 7, 2000) (finding rights or legitimate interests do not exist when one
has made no use of the websites that are located at the domain names at issue,
other than to sell the domain name registrations for profit); see also
Wal-Mart Stores, Inc. v. Stork, D2000-0628 (WIPO Aug. 11, 2000) (finding
Respondent’s conduct purporting to sell the domain name registration suggests
it has no legitimate use).
Complainant
argues that other panels have ruled similarly in other cases, holding that
Respondent’s lack of purpose or development of the domain name suggests that
Respondent lacks rights or legitimate interests in the domain name under Policy
¶ 4(a)(ii). See Do The Hustle, LLC
v. Tropic Web D2000-0624 (WIPO Aug. 21, 2000) (finding that when Respondent
declares its intent to develop a website, “[Policy ¶] 4(c)(i) requires
Respondent to show 1) ‘demonstrable’ evidence of such preparations to use the
domain name, and 2) that such preparations were undertaken ‘before any notice
to [Respondent] of the dispute’”); see also 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 Computer Doctor Franchise Sys., Inc. v. Computer Doctor, FA 95396
(Nat. Arb. Forum Sept. 8, 2000) (finding that Respondent’s website, which is
blank but for links to other websites, is not a legitimate use of the domain
names); see also Ritz-Carlton Hotel v. Club Car Executive, D2000-0611
(WIPO Sept. 18, 2000) (finding that prior to any notice of the dispute, the
Respondent had not used the domain names in connection with any type of bona
fide offering of goods and services).
It
is argued that in the instant case, DomainHouse has acted in exactly the same
way, registering the domain name with the intent to sell it for profit. In
addition, the domain name was registered more than five years ago and was
transferred to DomainHouse more than a year ago. DomainHouse failed to use the
domain name in any way until approached by Complainant. Respondent’s current
use of the site does not represent a legitimate noncommercial use of the domain
name. Thus DomainHouse has no rights or legitimate interests in the <shoemart.com>
domain name.
Complainant
claims Respondent registered and is using the domain name in bad faith in
violation of Policy paragraph 4(a)(iii).
In Apple Computer, Inc. v.
DomainHouse.com, Inc., D2000-0341 (WIPO July 5, 2000), the panel found
DomainHouse had acted in bad faith:
The Policy
indicates that certain circumstances may, "in particular but without
limitation", be evidence of bad faith (Policy, para. 4(b)). Among these
circumstances are that the domain name has been registered or acquired by a
respondent "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 [Respondent’s] documented out-of-pocket
costs directly related to the domain name" (id., para. 4(b)(i)).
Respondent
observes that offering for sale and selling domain names is an inherently
legitimate commercial activity. The leading domain name registrars offer or
plan to offer their services to assist domain name registrants to advertise and
sell names they have previously registered. Respondent is in the business of
developing and selling domain names. Respondent claims to have developed
combinations of generic or common descriptive terms, or misspellings of such
terms, that will appeal to purchasers of domain names.
There is
nothing inherently wrongful in the offer or sale of domain names, without more,
such as to justify a finding of bad faith under the Policy. However, the fact
that domain name registrants may legitimately and in good faith sell domain
names does not imply a right in such registrants to sell domain names that are
identical or confusingly similar to trademarks or service marks of others
without their consent.
[O]ffers to
sell to the public at large domain names that are identical or confusingly
similar to marks of others may constitute bad faith within the meaning of
paragraph 4(a)(iii) of the Policy (citation omitted). This is based on the
nonexhaustive character of the express list of bad faith factors in paragraph
4(b) of the Policy, and the lack of a justification for awarding financial gain
to persons for the mere act of registration of the marks of others.
In the
present case, Respondent’s business is the development and sale of domain
names. Its acknowledged purpose for registering names is to sell them. In light
of this evident purpose, the Panel determines that Respondent registered the
disputed domain name with the intention to offer it for sale to the public for
valuable consideration in excess of its out-of-pocket costs. The Panel
determines that Respondent has acted in bad faith within the meaning of
paragraph 4(a)(iii) of the Policy.
Apple Computer, Inc. v. DomainHouse.com,
Inc., D2000-0341 (WIPO July 5, 2000)
Likewise,
in Comm’n on Graduates of Foreign Nursing
Sch. v. Free Speech Alliance, FA 109364 (Nat. Arb. Forum June 12,
2002), the panel found DomainHouse had acted in bad faith:
Respondent’s
posted offer to sell the disputed domain names evidences bad faith registration
and use pursuant to Policy ¶ 4(b)(i). See
Am. Anti-Vivisection Soc’y v. “Infa
dot Net” Web Serv., FA 95685 (Nat. Arb. Forum Nov. 6, 2000) (finding that
“general offers to sell the domain name, even if no certain price is demanded,
are evidence of bad faith”); see also Booz-Allen & Hamilton Inc. v. Servability Ltd, D2001-0243 (WIPO Apr. 5, 2001) (finding bad faith where
Respondent, a domain name dealer, rejected Complainant’s nominal offer of the
domain in lieu of greater consideration).[1]
In
this case, DomainHouse still acquires domain names for the express purpose of
holding them for sale. Respondent has acquired the <shoemart.com>
domain name primarily for the purpose of selling, renting, or otherwise
transferring the domain name registration to Complainant, who is the owner of
the trademark, for valuable consideration in excess of Respondent’s documented
out-of-pocket costs directly related to the domain name.
Thus
Respondent has clearly acted in bad faith in registering and now using the <shoemart.com>
domain name and purporting to construct a noncommercial web site upon
receiving notice of Complainant’s legitimate interest in the web site domain
name. Respondent’s use of Complainants’ entire mark, SHOEMART, in the domain
name makes it impossible to infer a legitimate use of the domain name by
Respondent.
Here,
Respondent never even made a pretext of using the domain name to carry on its
own independent business under the mark until after it received notice of
Complainant’s legitimate interest in the domain name. Immediately after the offer to purchase the domain name,
Respondent attempted to “repackage” its web site as a source of information
about donations to tsunami relief efforts.
Respondent's current use of the <shoemart.com> domain name
only underscores its bad faith.
B.
Respondent’s Assertions
A. The Factual Background.
Respondent
is in the business of providing a domain name exchange for the registration of
domain names, the identification of users on a global computer network, website
development, namely, designing and implementing websites for others, and
hosting the web sites of others on a computer server for a global computer
network.
It
also identifies domain names comprised of generic or descriptive terms,
registers those domain names, develops these domains as businesses and from
time to time sells a few of these generic domains to interested parties.
Respondent
is operating a website at <domainhouse.com> and is offering a wide
variety of Internet services related to domain names, such as email packs,
website creator, traffic vista, web monitoring, ssl certificates, url
forwarding and many more all related to the function of domain names on the
Internet. DomainHouse.Com, Inc. holds a
federally registered trademark for this type of service.
On
March 7, 1999, <shoemart.com> was registered, and the fees were
paid through March 7, 2012. The domain
was used in commerce to promote registration of domain names with the two
domain Registrars, namely, Register.Com and Bulkregister.com. Mr. Martinez
earns a commission for every domain registered at these Registrars during this
period. At the time the domain name was registered by Wilson Martinez, CEO of
DomainHouse.Com, Inc., he had no knowledge of the existence of Complainant nor
any of its trademark rights.
On
February 25, 2000, DomainHouse.Com was incorporated, and acquired <shoemart.com>.
Respondent began using <shoemart.com> to promote its domain name
registration and hosting services, which it has continued to do up until the
present.
On
March 31, 2000, Respondent filed a fictitious business name statement with the
County Clerk of Los Angeles, for Shoemart.com and DomainHouse.Com, Incorporated
along with two other business names that Respondent uses. This filing has been renewed and published
this year. The allegation of Complainant that Respondent has no fictitious
business name registration for <shoemart.com> is false.
In
April 2000, Respondent hired a graphic designer from Gotlogos.com to design a
logo and a slogan for the domain name that is currently in use.
On
March 29, 2001, Respondent then entered into a collocation contract with Epoch
Internet which is currently Vital Stream.Com, Inc., one of the world’s best
streaming media service, to co-locate its dedicated server for <shoemart.com>.
The contract has been renewed through June 11, 2005.
<shoemart.com> has been assigned its own static IP
address. A static IP is an Internet protocol address that does not change. This
is required when secure socket layer technology is applied to the website and
digital certificates installed for e-commerce capabilities. Respondent provides
its clients with a password to login at <https://www.shoemart.com:8443>;
once logged in they will be able to see the features of the hosting server. These help Respondent’s clients experience
in reality how the server works from the backend with features like backup
capability, file transfer protocols, file system management, creation of
unlimited email addresses and how to set up emails as auto-responders, pop or
re-directing emails, domain name server management and many more.
Shoemart.com’s
front end website simply directs potential clients to <domainhouse.com>
via a contact email. Respondent’s clients upon request are given a password to
log in at https<shoemart.com:8443> to demo the hosting server features
before they purchase the service.
On
November 18, 2004, a person by the name of Anne Marie Provino sent us an email
inquiring and offering a transfer amount for the domain name. She concealed her true identity and her
intentions in inquiring and offering a price for the domain. The email address
she used was provino@optonline.net with the name Peter Provino. The email has a letterhead logo of Pro International,
Inc. with an address in Beaver Landing, Harrison, NY. It also shows her
position as the Vice President of this company. There is no way for Respondent to know, based on the information
provided that this person is one of the attorneys for Complainant. Respondent only learned of her real identity
as an attorney for Complainant when Respondent received the Complaint.
The
legal argument of Complainant stated below is false and deceptive.
“Immediately
after the offer to purchase the domain name, Respondent attempted to
“repackage” its website as a source of information about donations to Tsunami
relief efforts.”
This
information was posted simply because the tragedy happened on December 26,
2004. It was the worst human disaster
in recent history; it was a sincere gesture by Respondent to help the victims
and is not in any way connected to Complainant’s anonymous email. These
charitable links were posted not only on <shoemart.com> but also
on two other domains that Respondent is using.
On
April 21, 2005, Respondent filed a trademark application for <shoemart.com>
under class 042 with Serial Number 78,613,711 based on its continuous use in
commerce for six years.
1. The <shoemart.com> domain name is not
identical or confusingly similar to a trademark or service mark in which
Complainant has rights.
Respondent
argues that a common law mark is established only when a complainant’s mark
becomes distinctive and acquires secondary meaning. Complainant alleges that it
has used the SHOEMART mark since 1956 and therefore the mark possesses acquired
distinctiveness based on its long-term use.
Descriptive
marks (or more properly, "merely descriptive marks") are devices,
which merely describe the services or goods on which the mark is used. If a
device is merely descriptive, it is not a mark at all, since it does not serve
to identify the source of the goods or services. No trademark rights are
granted to protect merely descriptive marks.
As
in this case Complainant has been using the words “shoe mart” in its
descriptive meaning; a shoe store. Respondent claims the USPTO has recently
denied Complainant’s application for a trademark.
However,
it is possible for descriptive marks to "become distinctive" by
achieving secondary meaning. Secondary meaning indicates that although the mark
is on its face descriptive of the goods or services, consumers recognize the
mark as having a source indicating function. Once it can be shown that a
descriptive term or phrase has achieved this "second meaning" (the
first meaning being the generally understood meaning of the term or phrase), a
protectable trademark is developed.
Secondary
meaning can be achieved through long-term use, or large amounts of advertising
and publicity. The acquisition of secondary meaning is often proven through the
use of consumer surveys that show that consumers recognize the mark as a brand.
Examples
of marks, which might be considered descriptive but have clearly developed
secondary meaning include:
SHARP for televisions;
DIGITAL
for computers;
WINDOWS
for windowing software;
Because
the mark claimed by the Complainant is based in common law, it does not enjoy
the presumption of validity, inherent distinctiveness, or constructive notice
presumption. It is the burden of Complainant to prove with a preponderance of
evidence that the mark has acquired distinctiveness or secondary meaning before
rights under common law may become enforceable.
Complainant
has submitted no evidence to establish either fame or strong secondary meaning
in its mark such that consumers are likely to associate SHOE MART only with
Complainant.
There
is no proffered evidence that the words have acquired secondary meaning nor
evidence of Complainant’s exclusive rights to the words “shoe mart.”
Complainant’s long term use of the words “shoe mart” did not produce a
protectable common law right because the words did not acquire a secondary
meaning associated only with Complainant. Complainant advertised and used the
words in its descriptive or generic meaning; a shoe store. See Cyberimprints.com,
Inc. v. Alberga, FA 100608 (Nat. Arb. Forum Dec. 11, 2001) (finding that
Complainant failed to prove trademark rights at common law because it did not
prove the CYBERIMPRINTS.COM mark was used to identify the source or sponsorship
of goods or services or that there was strong customer identification of the
mark as indicating the source of such goods or services).
Trademark
rights under common law also have a geographical limitation. Complainant submitted evidence of
advertisements on local newspapers and receipts for plastic bags and flyers,
within the years 1996, 1998 and 1999.
Assuming that this may give rise to a protectable right, it can only be
enforced within the geographical location where Complainant operate but not
against a shoe store in California or in any other state outside of its County
or State.
Furthermore,
the phrase “shoe mart” is comprised entirely of generic terms to which
Complainant cannot maintain exclusive rights. See SOCCERPLEX, INC. v. NBA
Inc., FA 94361 (Nat. Arb. Forum May 25, 2000) (finding that Complainant
failed to show that it should be granted exclusive use of the domain name
<soccerzone.com>, as it contains two generic terms and is not exclusively
associated with its business); see also 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 Lucky Money, Inc. v.
ilovesschool.com, FA 96383 (Nat. Arb. Forum Mar. 9, 2001) (finding
Complainant cannot claim exclusive common law rights to an expression – Lucky
Money – comprised of generic terms).
Respondent
claims it registered <shoemart.com> because it is a common
combination of generic words that has widespread use and is used extensively by
third parties. It is a combination of two generic words “shoe,” which means a
durable covering for the human foot, made of leather or similar material with a
rigid sole and heel, usually extending no higher than the anklet, and the word
“mart,” which simply means a store or market.
A
search in Goggle for the words “shoe mart” shows over 755,000 third party web
pages mostly unrelated to Complainant, demonstrating that Complainant does not
have exclusive rights to the words. A
search in the business section of Smart Pages, an online directory of
businesses showed over 41 businesses with addresses and telephone numbers that
incorporate the words “shoe mart” as part of their business or corporate name.
A
search in Big Book super pages by Verizon showed ninety-two companies using the
words “shoe mart” in their company name. These are evidence that Complainant
does not have exclusive use of the phrase “shoe mart.”
Complainant
applied for a Federal trademark for the phrase THESHOEMART.COM on June 4, 2004
under Serial No. 78,430,117 and SHOEMART SINCE 1956 filed on February 26, 2004
under Serial No. 78,374,534; both were refused registration by the USPTO on
March 6, 2005 and March 7, 2005. This
shows that the mark as used by Complainant is not registrable as a trademark.
Furthermore, Complainant filed this Complaint against
Respondent, but will do nothing in a timely manner to protect its alleged
exclusive interest in its company name.
Complainant should know that other parties with bad faith intentions can
register their company name or their variations as a domain name, but as of May
12, 2005, a name availability search at <networksolutions.com> shows that
the <shoemartsince1956.com>, <shoemartfactoryoutletinc.com>,
<shoemartfactory.com> and <shoemartoutlet.com> domain names are all
available for registration by third parties.
Respondent argues that Complainant simply wants to plunder a
valuable dot com domain owned by Respondent, while all the domains that more
accurately reflect Complainant’s company name are left available for
registration by third parties.
2. Respondent has rights or
legitimate interests in respect of the <shoemart.com> domain name.
(i.) Before any notice to Respondent of the
dispute, Respondent has used the domain for the promotion of its domain name
registration and hosting services.
(ii.) Respondent has also been commonly known
by the domain name as a business in the county of Los Angeles, California.
Respondent has acquired trademark rights through its continuous use in commerce
for six years. A federal trademark application by the Respondent is pending
under Serial No. 78,613,711.
(iii.)
Respondent
has also made a legitimate noncommercial posting on its domain name for
charitable purposes.
(iv.)
Where, as
here, a disputed domain incorporates a mere combination of common words,
Respondent, ipso facto, has a legitimate interest in the <shoemart.com>
domain name. See Target Brands, Inc.
v. Eastwind Group, FA 267475 (Nat. Arb. Forum July 9, 2004) (involving the
domain name <target.org>). In
this case, the complainant there had a trademark for the TARGET mark, which is
arguably far more well-known than Complainant’s alleged mark here. Finding for the respondent, the panel held
that the “[r]espondent has rights to and legitimate interests in a domain name
that consists of a generic or common term.”
The panel explained that “where a domain name is generic, the first
person to register it in good faith is entitled to the domain name and this is
considered a legitimate interest.” Id., citing Target Software
Solution GmbH v. NetVirtue, Inc., D2002-0277 (WIPO Aug. 19, 2002); see
also CRS Tech. Corp. v. CondeNet, FA 93547 (Nat. Arb. Forum Mar. 28, 2000);
see also Coming Attractions v. ComingAttractions.com, FA 94341 (Nat.
Arb. Forum May 11, 2000); see also Energy Source Inc. v. Your Energy Source,
FA. 96364 (Nat. Arb. Forum Feb. 19, 2001) (finding that the respondent has
rights and legitimate interests in the <yourenergysource.com> domain name
where “[r]espondent has persuasively shown that the domain name is comprised of
generic and/or common words, and, in any event, is not exclusively associated
with Complainant’s business”); see also Ultrafem, Inc. v. Royal, FA
97682 (Nat. Arb. Forum Aug. 2, 2001)(Respondent “has a legitimate interest in
the domain name. The <instead.com> domain name is generic, and is a
commonly used word.”). As noted, the
common word “hood” appears on over 3.8 million third party web pages wholly
unrelated to Complainant, so it is clear that Complainant does not have
exclusive rights to the word.
3. The
<shoemart.com> domain name has been registered and used in good faith.
(i) Respondent did not register or acquire
the domain name primarily for the purpose of selling, renting, or otherwise
transferring the domain name registration to Complainant who claims to be the
owner of the trademark or service mark.
Respondent
registered the domain name because it is a common descriptive combination of
words. Respondent, in the declaration
of its President, states it had no knowledge of any trademark rights of
Complainant or its existence as a business at the time the domain name was
registered.
Respondent
did not seek to sell the domain name to Complainant; rather, Complainant
solicited the offer to sell using an anonymous agent. These facts do not
indicate any bad faith on the part of Respondent.
The
Panel in Container Research Corp. v. Markovic, FA 328163 (National
Arbitration Forum Nov. 2, 2004) found that the complainant could not prod the
respondent into offering a transfer price and then invoke Policy ¶ 4(b)(i) to
show the respondent’s bad faith registration and use. The Panel denied the
complaint.
(ii.) Respondent did not register the domain
name in order to prevent the owner of the trademark or service mark from
reflecting the mark in a corresponding domain name. Complainant has been using <theshoemart.com> as its
website. As of May 12, 2005, the date of Respondent’s latest search conducted
by Respondent with Networksolutions.com, Complainant’s corporate name, slogan
and their variations in domain names are still available for registration by
third parties. See Exhibit M.
(iii.) Respondent did not register the domain
name primarily for the purpose of disrupting the business of a competitor; or
(v.)
Respondent
did not attempt to attract, for commercial gain, Internet users to Respondent’s
web site or other on-line location, by creating a likelihood of confusion with
Complainant’s mark as to the source, sponsorship, affiliation, or endorsement
of Respondent’s web site or location or of a product or service on Respondent’s
web site or location.
C.
Additional Submission by Complainant
I. INTRODUCTION
Complainant’s Additional Submission
reiterates that it disputes the factual and legal assertions in the Response
filed by Respondent in this matter, on the basis that:
·
Complainant’s
SHOEMART trademark has acquired distinctiveness and secondary meaning, and
contrary to Respondent’s assertions, the U.S. Trademark Office has acknowledged
and accepted the claim of Acquired Distinctiveness.
·
Respondent
has registered a domain name that is identical to Complainant’s protected
trademark.
·
Respondent
offers no bona fide services or any meaningful content whatsoever on the
disputed domain. Respondent’s alleged
use consists of nothing more than making the control panel settings available
for viewing. Such use renders
meaningless the requirement for bona fide use because all websites by
definition have administrative settings regardless of whether they have
content.
·
Despite the
fact that it makes no discernable use of the domain, Respondent demanded a
payment of $250,000 for transfer of the domain name.
·
Respondent
has engaged in a pattern of bad faith domain registration as evidenced by two
prior findings of bad faith in similar cases.
Thus, Complainant is entitled to transfer of the disputed
domain name.
II. THE DISPUTED DOMAIN NAME IS IDENTICAL OR CONFUSINGLY SIMILAR
TO COMPLAINANT’S PROTECTED TRADEMARK
Long
use of a mark is relevant in determining whether a mark has acquired
distinctiveness. See In re Uncle Sam
Chem. Co., Inc., 229 USPQ 233 (TTAB 1986) (accepting a §2(f) claim of
acquired distinctiveness of SPRAYZON for "cleaning preparations and
degreasers for industrial and institutional use").
Complainant has more than met the burden
for establishing that the SHOEMART trademark has acquired distinctiveness under
the Trademark Act. Complainant has
provided retail store services under the SHOEMART trademark for nearly fifty
(50) years. Complainant has provided
evidence of use consisting of receipts, invoices, business documents, and
advertisements dating back to 1960.
Complainant’s use of the mark in connection with the retail store
services is uncontested by Respondent.
Moreover, the U.S. Trademark Office has
accepted Complainant’s claim of Acquired Distinctiveness in two separate
trademark applications for the THESHOEMART.COM and SHOEMART SINCE 1956
trademarks. In each case, the Trademark
Office initially refused registration on the grounds that the proposed mark was
descriptive of the identified services.
Contrary to Respondent’s assertions, the Trademark Office withdrew the
refusal to register in each case in light of Complainant’s demonstration of acquired
distinctiveness.
The disputed domain name, <shoemart.com>,
is identical to Complainant’s SHOEMART trademark. Complainant has protected
trademark rights in the SHOEMART name, and the U.S. Trademark Office has
acknowledged that right. Respondent
does not contest the similarity of the terms.
III. RESPONDENT
HAS NO LEGITIMATE INTEREST IN THE DISPUTED DOMAIN NAME BECAUSE IT DOES NOT USE
THE DOMAIN NAME IN CONNECTION WITH A BONA FIDE OFFERING OF GOODS OR SERVICES
AND IS NOT COMMONLY KNOWN BY THE DOMAIN NAME
Respondent’s
bad faith in registering the disputed domain name is evident because it fails
to use the domain name with a bona fide offering of goods or services
and is not commonly known by the disputed domain name.
Respondent
alleges in its Response that it uses the domain name for the promotion of its
domain name registration services and further that it is commonly known by the
domain name. However, Respondent offers
no credible support for these assertions.
As of the date
of the filing of this Complaint, Respondent offered no services through the
domain <shoemart.com>.
Respondent states that it offers a log-in page for clients to
“experience in reality how the server works from the back end.” However, nothing in the records establishes
that the services are offered in connection with the <shoemart.com> website.
Moreover, even
if the evidence put forward by Respondent is accurate, it does not demonstrate
use of the domain name in connection with bona fide services. Nothing on the website, <shoemart.com>, references
any services whatsoever.
Furthermore,
Respondent is not commonly known by the domain name in question. Respondent has provided no evidence to
indicate that it is commonly known by either “shoemart.com” or “shoemart” in
commerce. Evidence of use such as
advertisements, business forms, or any other documentation normally used in the
course of business is absent from the record.
Respondent
cites as evidence that it is commonly known by the domain name, its fictitious
business name and federal trademark application shoe for SHOEMART.COM. A fictitious business name does not require
proof of use and therefore does not establish that Respondent is commonly known
by the domain name. Moreover, the
“Fictitious Business Name Statement” states on its face “the filing of this
statement does not itself authorize the use in this state of a fictitious
business name in violation of the rights of another under federal, state, or
common law.”
Respondent is
commonly known by the name “DomainHouse.com” – one of the names on its Fictitious
Business Name Statement. See
Tercent Inc. v. Lee Yi, FA 139720 (Nat. Arb. Forum Feb. 10,
2003) (stating “nothing in Respondent’s WHOIS information implies that
Respondent is ‘commonly known by’ the disputed domain name” as one factor in
determining that Policy ¶ 4(c)(ii) does not apply). The other names in the
statement are <officestuff.com> and <medicalshoppe.com>. Both these domains are used in the same
manner as <shoemart.com>.
Finally, Respondent’s federal trademark application
was filed on April 21, 2005, after this Complaint was initiated, and is a
thinly veiled attempt to create a trademark right in the domain name where none
exists. A review of Respondent’s
trademark application demonstrates that their specimen of use consists of a
logo on a blank page and provides no reference to any actual services
provided. To show service mark usage, the specimens
must show use of the mark in a manner that would be perceived by potential
purchasers as identifying the applicant's services and indicating their
source. In re Universal Oil Prods.
Co., 476 F.2d 653, 177 USPQ 456 (C.C.P.A. 1973).
Complainant
says Respondent’s pattern in these matters is clear. It registers domain names and maintains them without use in
connection with any goods or services and without any meaningful content
presumably in seeking to sell the domain name at a later time. However, without some evidence of bona
fide use or evidence that it is commonly known by the domain name,
Respondent cannot demonstrate that it has a legitimate interest in the domain
name when challenged by a trademark holder.
Respondent has
failed to use the domain in connection with any bona fide offering of
goods and services and is not commonly known by the <shoemart.com> domain name–
therefore it has no legitimate right to the disputed domain name.
IV. RESPONDENT HAS REGISTERED THE DISPUTED DOMAIN FOR THE PURPOSE
OF SELLING IT AND HAS OTHERWISE ENGAGED IN A PATTERN OF BAD FAITH CONDUCT IN
REGISTERING DOMAIN NAMES.
Complainant
reiterates that Respondent is in the business of speculating in domain
names. Respondent states that it
registers domain names and “from time to time” sells the names of interested
parties.
Offers
to sell domain names that are identical or confusingly similar to the marks of
others to the public at large constitute bad faith under section 4(a)(iii) of
the UDRP. See Apple Computer, Inc.
v. DomainHouse.com, Inc., D2000-0341 (WIPO July 5, 2000). Moreover, an offer for sale of an otherwise
unused domain name can constitute use for the purposes of paragraph 4(a)(iii)
of the Policy. See Espirito Santo
Fin. Group, S.A. v. Colman, D2001-1214 (WIPO Jan. 22, 2002); see also
J. Paul Getty Trust v. Domain 4 Sale
& Co., FA 95262 (Nat. Arb. Forum Sept. 7, 2000) (finding rights
or legitimate interests do not exist when one has made no use of the websites
that are located at the domain names at issue, other than to sell the domain
name registrations for profit); see also Wal-Mart Stores, Inc. v. Stork, D2000-0628
(WIPO Aug. 11, 2000) (finding Respondent’s conduct purporting to sell the
domain name registration suggests it has no legitimate use). This is particularly so in the case where
the price sought is exorbitant in proportion to out of pocket expenses. See Gortsew Ltd. v. Cavanaugh, D2004-1214
(WIPO Aug. 25, 2004) (A fee of $10,000 raised an inference of bad faith); see
also Booz-Allen & Hamilton Inc. v. Servability Ltd, D2001-0243
(WIPO Apr. 5, 2001) (finding bad faith where Respondent, a domain name dealer,
rejected Complainant’s nominal offer of the domain in lieu of greater
consideration).
When
Complainant inquired about purchasing the <shoemart.com> domain
name, Respondent stated that Complainant’s offer was “way below the asking
price of $250,000.” An asking price of
$250,000 for a domain name that is not being used clearly raises an inference
of bad faith, especially given Respondent’s pattern of bad faith registrations.
In
summary, Complainant argues it has established that it is the owner of the
protected SHOEMART trademark, whose acquired distinctiveness has been
recognized by the U.S. Trademark Office.
Respondent has not used the disputed domain name, <shoemart.com>,
for any legitimate purpose and has offered to sell it for a price far in excess
of its out-of pocket expenses. Given
Respondent’s history of bad faith registrations, it is clear that Complainant
is entitled to transfer of the disputed domain name.
D.
Additional Submission by Respondent
Respondent’s
Sur-Reply disputes the factual and legal assertions in the Additional
Submission filed by Complainant in this matter, by a series of assertions that
are largely repetitions of its initial Response, to wit:
I. THE DOMAIN NAME IS NOT IDENTICAL OR CONFUSINGLY
SIMILAR TO COMPLAINANT'S PROTECTED TRADEMARK.
Complainant's
bare assertion that
SHOEMART
has acquired distinctiveness and secondary meaning is false and illusory. There
is no explanation whatsoever by Complainant as to the secondary meaning of SHOEMART based on its usage and there is
also no proof of exclusive use by Complainant. To the contrary, the Respondent
has offered evidence that the term “shoe mart” is being used by multiple third parties
in their websites or as part of their company names.
Complainant's
application for trademark "in their own words" has been refused
registration for being descriptive, so the assumption by Complainant that the
USPTO has "acknowledged or accepted the claim of acquired distinctiveness”
and
that therefore
they have presumptive enforceable federal trademark rights is false. Such reconsideration
by the USPTO
is
simply a
part
of the
trademark
application process and subject to review and opposition by parties that may
be adversely affected by the registration of this descriptive term. Respondent will
vigorously oppose Complainant's application if it ever reaches the publication
stage. Complainant is trying to assert a claim of a registered trademark holder in
this Reply versus their claim of common law rights in the Complaint.
Complainant simply does not have a federally registered trademark at this point in
time, and does not enjoy a legal presumption of inherent distinctiveness.
There
is
a
complete absence of proof of exclusive use or secondary meaning in the record
of this case. Furthermore, the alleged evidence of long use submitted is mostly
scribbled, handwritten third party invoices from suppliers, which are not
authenticated, by those third parties who "presumably" have issued
these handwritten Shoe Mart invoices. This type of hearsay evidence is highly
susceptible of being fabricated; its probative value is suspect as to proof of
long use of the name “shoe mart.” Complainant has not offered evidence of
incorporation papers since 1956 nor a business name statement supporting
their 1956 use claim. Complainant makes bare, self-serving statements through a declaration
of its counsel that SHOEMART has acquired distinctiveness and secondary
meaning, where there is no independent corroborating evidence to support it.
Complainant
has also not been forthcoming with its statements in the Complaint, when it
decided not to disclose that its application has been refused for being
descriptive. It is only when brought to light in our Response that this Complainant
admitted that its federal trademark application was refused for being descriptive.
Based
on the facts and legal arguments above mentioned, Complainant has no
protectable rights under the Policy. No further analysis of the other elements
of the Policy is necessary where Complainant has failed to prove that it has
protectable trademark rights under the Policy.
II. RESPONDENT HAS LEGITIMATE INTEREST IN THE DOMAIN NAME,
BECAUSE IT IS USING THE DOMAIN NAME IN CONNECTION WITH
A
BONA
FIDE OFFERING OF SERVICES AND IS COMMONLY KNOWN BY THE DOMAIN NAME.
Contrary
to the false allegations of Complainant, Respondent has had a fictitious
business name statement since March 31, 2000. It was filed and published for three
consecutive weeks in a newspaper of general circulation in the County of Los
Angeles; it enjoys a legal presumption of validity. It provides legal notice to
the public that <shoemart.com> is also known as DomainHouse.Com.
Respondent
repeats that it has used the <shoemart.com> domain name to
advertise and promote DornainHouse.Com, Inc. which is a provider of new domain
name registrations, hosting, ssl certificates, dedicated server hosting,
website creator, traffic vista, web monitoring, etc. These are bona fide
offering of services. The claim of Complainant that these are not bona fide offering
of services is absurd.
Respondent
again argues that it has continuously used the domain as a gateway to its dedicated
hosting services. Complainant characterized this as mere "settings."
Complainant is again misleading and wrong on this issue. While all websites have settings,
not all websites are hosted on a dedicated server, not all websites have
control panels that can modify traffic usage and data and control disk space
usage, not all websites have traffic monitoring management and not all websites
have assigned static IP addressees and many more. All of these services are being
utilized by
<shoemart.com> and is not
just mere generic administrative settings for domain names.
Respondent
filed a trademark application on April 21, 2005, before Respondent received notice of the
Complaint on April 25, 2005. It is not a "veiled attempt to create a
trademark right." This Complainant is trying to explain that
our logo has no reference to actual services provided. Again this Complainant
is
looking
for "shoes" as the only goods or services you can offer
for this domain. Complainant has deliberately ignored the fact that <shoemart.com>
can be used and is being used to promote the offering of domain name
registration and hosting services at Domainhouse.Com.
Respondent,
as a federal trademark applicant, has used the domain name <shoemart.com>
continuously for five years in the domain name registration and hosting
business. It has acquired distinctiveness in its exclusive use in the domain
name registration and hosting industry. It is for this reason that Respondent
believes it has a protectable right and a legitimate interest in <shoemart.com>
and is entitled to keep the domain name.
III. RESPONDENT HAS NOT REGISTERED
OR USED THE
DOMAIN
NAME
IN BAD
FAITH.
Respondent
was neither aware nor had knowledge of the existence of Complainant or its alleged
trademark rights when the domain name was registered on March 7, 1999. Respondent chose to register this domain
name because it was descriptive of a service that could be offered under the
domain name.
There
was no demand made by Respondent to Complainant for the sale of the domain to
Complainant. Complainant, without a good faith intention to purchase, solicited
Respondent to sell the domain name. Complainant went to the extent of prodding
for a reply when Respondent did not return its solicitous email. Respondent,
after being prodded for a reply, expressed what it believed to be its valuation
of the domain name.
Immediately
thereafter, Anne Marie Provino, a lawyer pretending to be a businessperson,
sent an email to Mr. Gene Winter, counsel for Complainant. This
clearly shows that the only purpose for this solicitation was to use it as evidence of bad
faith under the Policy.
The
Panel in Container Research Corp. v. Markovic, FA 328163 (Nat.
Arb. Forum Nov. 2, 2004), that this kind of practice mitigates the Policy. It found
that the complainant could not prod the respondent into offering a transfer price
and then invoke Policy ¶ 4(b)(i) to show the respondent's bad faith
registration and
use.
It
is also well established that the sale of generic domain names constitutes a bona
fide offering of goods and services where the respondent is unaware of a party's rights in a mark. See BND Ent. v. RN WebReg, FA 280502
(Nat. Arb. Forum
July
28, 2004); see also Micron Tech., Inc. v. Null Int'l Research Ctr., D2001-0608
(WIPO June 20, 200l).
In
CRS
Tech.
Corp. vs. CondeNet Inc., FA 93547 (Nat. Arb. Forum Mar. 28, 2000), the
Panel found that a person or entity may legitimately register and use many
domain names that are different from its corporate or trade names.
Thus, while the registration of a domain name that mimics one's corporate or
trade name may provide proof of legitimacy under Policy ¶ 4(c)(ii), the inverse
is not also true: the absence of a corporate or trade name from which a domain
name was
derived
does not render the registration and use illegitimate.
This
is not a
case
where Respondent selected a domain name of a famous or
distinctive mark that it should have known it is not entitled to use, nor is
this a case where the words “shoe mart,” although based on a word from everyday discourse, has
developed such a strong fame or distinctiveness that consumers would inevitably
believe that a website located at the <shoemart.com> domain name
is affiliated only with Complainant, To the contrary, Respondent has provided
evidence of widespread use of “shoe mart” by third parties in their websites
or part of their company name or trade name, while Complainant offered no
evidence of exclusive use.
Complainant's
allegation that Respondent "registers domain names and maintains them
without use" is false. It is asserted by Respondent that under
Respondent's business plan, it waits for the right time when its market had
been properly evaluated and financing has been prepared before it launches an
online business.
For
example, Registrant asserts <medicalshoppe.com> is one of these domains
that is being organized as an independent online business. Respondent
registered this
domain
name on June 14, 1999. This domain name however was referenced by Complainant in its reply as a domain
without use, which is again an allegation that is completely false.
On
March
2,
2004, MedicalShoppe.Com,
Inc. was incorporated in California, it applied for federal trademark
registration for its mark on Feb. 12, 2005, was issued a license by the
Bureau of Home Furnishings and Thermal Insulation, State Board of Equalization
and the City of Los Angeles. It also has pending application for License with
Bureau of Food and
Drug
with
the
State of California for Medical Device Retailers license. With all of these
licenses, Complainant has referenced this domain name in their Reply as a "domain
name without use."
The
claim of this Complainant in this case is totally without merit. It relies
solely on its devious presumption that it should be awarded the domain, simply
because Respondent lost two prior cases. Complainant's legal arguments and
factual characterization is false, misleading and deceptive.
IV. COMPLAINANT
SHOULD BE
FOUND
TO
HAVE ENGAGED IN DOMAIN NAME HIJACKING.
Respondent
has enjoyed quiet possession of the domain name from March 7, 1999 up until
April 25,
2005,
when Respondent received notice of the Complaint. This Complainant knew for six
years that Respondent owns the domain name and is legitimately using the
domain.
Respondent
argues that what is really happening here is that Complainant is feeling
discontented with
its
<theshoemart.com> domain name as its website, so Complainant decided that
it wants a better domain name which it knows is descriptive and very valuable.
Complainant then
chose
to apply for a federal trademark registration with a motive to hijack
Respondent’s domain name. The application was refused registration by the USPTO because it is
descriptive. Complainant then proceeded to create a deceptive scheme of
inquiring and offering a paltry sum of money that they clearly knew would be
rejected, so it can offer proof of bad faith, simply because the domain has been offered
for sale. In addition it
found Respondent had lost two prior cases, which provided Complainant
an incentive to file this Complaint.
So
even though Complainant clearly knew or should have known that it cannot
prove any of the elements of the Policy, it then proceeded with this spurious
Complaint at the expense of Respondent. Complainant is convinced that even
though it has no evidence of its rights in the mark and was in fact refused by the
USPTO, it could use the Forum to plunder a valuable descriptive domain
name from its
rightful
owner.
This
action of Complainant is a grave abuse of the Policy and of the Forum and
should be sanctioned. Respondent requests a finding of domain name hijacking
against Complainant.
The Panel makes the following findings:
(1)
the mark in
which Complainant claims exclusive rights has not been registered nor has
Complainant established that it has acquired a secondary meaning sufficient to
constitute a common law trademark under existing law, even though the domain
name in suit is identical and confusingly similar to the trade name used by
Complainant;
(2)
the Panel
finds it unnecessary, under these circumstances, to determine if Respondent has
any rights or legitimate interests in respect of the domain name; and
(3)
similarly,
the Panel makes no findings as to whether the domain name was properly
registered and is being used in good or bad faith.
DISCUSSION
Paragraph 15(a) of the Rules for Uniform Domain Name
Dispute Resolution Policy (the “Rules” or the “UDRP”) 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.
General Comments on
Underlying Basis of this Decision
With
respect to our dissenting brother, the Panel Majority has a different
understanding of the purpose of the UDRP and the rules under which we are to
decide domain name cases. It is on that
basis that we decide this case in favor of Respondent, in spite of the fact
that we agree that many of the arguments of Respondent appear contrived. We are constrained by these rules to
conclude that Complainant has not established that it owns a mark protectible
under the UDRP, for the reasons expressed below.
As
the Panel Majority understands the history of the UDRP, it was developed and
adopted to provide a summary proceeding for the prompt recovery of domain names
that had been registered “abusively” or “in bad faith” in the sense that they
were obviously registered to extort money from holders of registered trademarks
or owners of well established common law trademarks. See ICANN Staff Report on Implementation Documents for the
Uniform Dispute Resolution Policy, available at
http://www.icann.org/udrp/staff-report-29sept99.htm (discussing the approach
used in developing the UDRP).
Early
in the outset of the Internet, there were a series of egregious cases where an
unscrupulous party registered a domain name and then attempted to force the
owner of a famous trademark to pay extortionate sums of money to use it. See, e.g., Thomas R. Lee, In Rem
Jurisdiction In Cyberspace, 75 Wash. L. Rev. 97, (2000) (discussing the
activities of Dennis Toeppen and others engaging in this activity).
In
these cases, the owner of the mark had to engage in expensive trademark
infringement litigation in order to recover the domain. This was time consuming
and deemed unfair and undesirable, so the UDRP rules and regulations were
developed and adopted to provide a summary proceeding for cases that were clear
instances of abusive registration. “One
of the main purposes of the UDRP is to provide a quick, cheap, and easy means
to adjudicate domain name disputes between trademark holders and bad faith
registrants of domain names.” See discussion available at
http://cyber.law.harvard.edu/udrp/process.html.
Under
these rules, if three elements can be proven in simple pleadings and
declarations, the domain name can be cancelled or transferred to the trademark
owner without the necessity of a formal trial.
It is also clear that if the Complainant does not prove the three
elements, it cannot prevail and the domain name cannot be taken away from the
registrant. These are the rules set forth at the outset of this Discussion, and
we are required to apply these three standards to the facts of this case.
Because
of this history, the sine qua non of
a complainant prevailing in a UDRP case is that the complainant establish
conclusively that the complaint is based upon ownership of either a registered
trademark or a mark which would be recognized by a court as a common law
trademark. As the parties correctly
argue the law here, although they view the facts differently, a mark which is
either generic or descriptive cannot be registered and cannot become a
protected common law trademark unless it is conclusively shown to have become
distinctive in the sense that it has achieved a secondary meaning such that
consumers identify those common terms exclusively with the goods or services of
the owner of the mark. An excellent
example of this situation is cited by Respondent. The WINDOWS mark was sought to be registered by Microsoft early
in its use, and Microsoft had to place this mark on the Supplemental Registry
until five years had passed so it could establish conclusively that it had
acquired a secondary meaning beyond its common, generic meaning. At that point,
and only at that point, was it granted protection as a registered mark.
One
of the difficulties that this system presents to UDRP panels is that, since we
are not a trial court with parties and witnesses physically before us, all we can
do is read the briefs and declarations and other evidence presented, and make a
determination on that basis. Here, on
reviewing the evidence, it appears to the Panel Majority that Complainant,
while using the trade name ShoeMart in its business for more than 50 years, has
not established, and we believe could not, that its name has become so
distinctive as to have acquired a secondary meaning in the minds of the public,
and thereby to become a protectible common law trademark because there is ample
evidence that use of the term “shoe mart” is currently not exclusive to
Complainant and has not been exclusive to Complainant in the past. That being the case, Complainant has no
protectible interest in the term “shoe mart” under the UDRP, regardless of
whether it proved the second and third elements here.
For
the sake of completeness, it should be noted that the Panel Majority also
disagrees philosophically with our dissenting brother on what he deems to be
the key issue here -- whether it is illegal to register domain names for the
purpose of selling them later, as he seems to suggest is the case. We think it is well established by UDRP
decisions that the registration of common descriptive or generic terms and
holding them for the purpose of sale is perfectly legal. What is prohibited is only the registration
of protectible common law marks or registered marks for sale to the
owners. In fact, even the cases cited
by Complainant acknowledge that there is nothing inherently wrong with
registering domain names for the purpose of selling them so long as the names
registered are not trademarks. See, e.g., Apple Computer, Inc. v. DomainHouse.com, Inc., D2000-0341 (WIPO July 5, 2000)
(“There is nothing inherently wrongful in the offer or sale of domain names,
without more, such as to justify a finding of bad faith under the Policy.
However, the fact that domain name registrants may legitimately and in good
faith sell domain names does not imply a right in such registrants to sell
domain names that are identical or confusingly similar to trademarks or service
marks of others without their consent.”).
Further support for the proposition that there in nothing wrong with the
registering of domain names for the purpose of resale can be found in numerous
panel decisions. In Allocation Network GmbH v. Gregory, D2000-0016
(WIPO Mar. 24, 2000), the respondent had registered
over 400 domain names, all of which contained or were composed of common words
or short phrases from the English language or misspellings of such words. The
panel found the respondent's explanation that he selected many of the domain
names offered for sale at random was prima facie acceptable and it found that
the respondent had a legitimate interest in the domain, which could have been
refuted if the complainant had established that the domain was chosen with the
intent to profit from or otherwise abuse the complainant's trademark rights.
Thus,
the majority have chosen not to depart from the general proposition that “even though the trademark and the name are
all but identical… the first person or entity to register the domain name
should prevail in circumstances such as these where the domain name is a
generic word.” CRS Tech. Corp. v.
CondeNet, Inc., FA 93547 (Nat. Arb. Forum Mar. 28, 2000).
The
simple fact is that Complainant’s claimed protectible mark is generic and
descriptive and Complainant has not established that these two descriptive
words in combination have obtained any secondary meaning in the marketplace.
The Panel has taken considerable care to set out the facts and the arguments of
the parties to demonstrate this fact. See
Rollerblade, Inc. v. CBNO, D2000-0427 (WIPO Aug. 24, 2000) (finding that
"genericness, if established, will defeat a claim of trademark rights,
even in a mark which is the subject of an incontestable registration"); SportSoft
Golf, Inc. v. Sites to Behold Ltd., FA 94976 (Nat. Arb. Forum July 27,
2000) (finding that the disputed domain name, golfsociety.com, is neither
identical to nor confusingly similar to complainant’s trademark because the
trademark links together two generic words – golf and society).
Thus,
Complainant has failed to establish rights in the SHOEMART mark pursuant to
Policy ¶ 4(a)(i), and cannot prevail here, even if it shows evidence of lack of
interest in the domain name and/or bad faith, since it has no protectible
interest under the UDRP. See Successful Money Mgmt. Seminars, Inc. v.
Direct Mail Express, FA 96457 (Nat. Arb. Forum Mar. 7, 2001) (“seminar” and
“success” are generic terms to which the complainant cannot maintain exclusive
rights); see also SOCCERPLEX, INC. v. NBA Inc., FA 94361 (Nat. Arb. Forum May 25, 2000)
(finding that the complainant failed to show that it should be granted
exclusive use of the domain name <soccerzone.com>, as it contains two
generic terms and is not exclusively associated with its business).
It is particularly significant that, because it holds no
registered mark on these words,
Complainant has failed adequately to show that its descriptive mark has
acquired secondary meaning, and therefore has not established that it has any
common law trademark rights. Thus, the
Panel is required to find that Complainant lacks standing to file this current
Complaint pursuant to Policy ¶ 4(a)(i).
See Weatherford
Int’l, Inc. v. Wells, FA
153626 (Nat. Arb. Forum May 19, 2003) (“Although Complainant asserts common law
rights in the WELLSERV mark, it failed to submit any evidence indicating
extensive use or that its claimed mark has achieved secondary source
identity.”); see also, Lowestfare.com
LLA v. US Tours & Travel, Inc., AF-0284 (eResolution Sept. 9, 2000)
(finding that marks classified as descriptive cannot be protected unless
secondary meaning is proven and to establish secondary meaning the complainant
must show that the public identifies the source of the product rather than the
product itself); see also, Cyberimprints.com, Inc. v. Alberga, FA 100608
(Nat. Arb. Forum Dec. 11, 2001) (finding that the complainant failed to prove
trademark rights at common law because it did not prove the CYBERIMPRINTS.COM
mark was used to identify the source or sponsorship of goods or services or
that there was strong customer identification of the mark as indicating the
source of such goods or services).
As noted at the outset of this
Discussion, the Panel feels that no discussion of this point is appropriate or
necessary because Complainant has failed to establish a protectible mark under
the UDRP. The Panel Majority notes however, that it agrees with our dissenting
brother that there are some disturbing facts here which might have tipped the
case in favor of Complainant on this point, if it had been able to establish
ownership of a protectible mark.
The same is the case with respect to this
point, although the Panel notes that Complainant did not provide evidence to
rebut Respondent’s assertion that, at the time it registered the subject domain
name, it was unaware of Complainant’s use of the mark. This would normally defeat the case of
Complainant even if it had a protectible interest in the mark. Policy ¶ 4(b).
Complainant,
having failed to establish or prove the critical first element of ownership of
a protectible mark, as required under the ICANN Policy, the Panel concludes by
a majority vote that relief shall be DENIED.
G. Gervaise Davis III, Panelist
Dated: June 10, 2005
David S. Safran, Panelist
Dated: June 10, 2005
DISSENT:
With all due
respect to my brother Panelists, I must dissent. As an overall matter, I believe the UDRP was designed to regulate
a scarce resource (domain names) rather than to provide a mechanism to protect
registered trademarks.
There is no
doubt Respondent is in the business of being a reseller of domain names that
consist of common English words. The
fundamental question before the Panel is whether or not such a business should
be allowed under the UDRP. The
secondary question is whether the trademark in question has acquired a
secondary meaning (no pun intended).
As with any
claim under the UDRP, three elements must be proven:
1.
The
domain name is identical or confusingly similar to a trademark or service mark
in which the complainant has rights.
Please note this
does not require Complainant to have registered rights. This does not require the Complainant to
have exclusive rights. It merely
requires Complainant to have some rights. There are three general categories of trademarks:
1. Fanciful
(a word that is new and unique, such as Kleenex®).
2. Misapplied
(a word that has a meaning is applied in a new way, such as scotch tape®-which
has no relation to the alcoholic beverage).
3. Descriptive
(but not to the level of generic, which gets no protection).
The trademarks
are given protection in a descending manner.
A descriptive trademark is generally less protected than a misapplied
trademark (and a misapplied trademark is given less protection than a fanciful
trademark). SHOEMART is in the third
category, although reasonable minds differ.
There is no
doubt that Complainant did not register SHOEMART with the United States Patent
and Trademark Office.
I would find
Complainant established common law rights in the SHOEMART mark through
aggressive promotion and continuous use of the mark in commerce for nearly
fifty years. See SeekAm. Networks Inc. v. Masood,
D2000-0131 (WIPO Apr. 13, 2000) (finding that the Rules do not require that the
complainant’s trademark or service mark be registered by a government authority
or agency for such rights to exist); see
also 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 Nat’l Ass’n of Prof’l Baseball Leagues v. Zuccarini,
D2002-1011 (WIPO Jan. 21, 2003) (finding that the complainant had provided
evidence that it had valuable goodwill in the <minorleaguebaseball.com>
domain name, establishing common law rights in the MINOR LEAGUE BASEBALL mark).
I would also
find Respondent’s <shoemart.com> domain name is identical to
Complainant’s SHOEMART mark because the addition of the generic top-level
domain is not enough to distinguish Respondent’s domain name from Complainant’s
mark pursuant to Policy ¶ 4(a)(i). See
Kioti
Tractor Div. v. O’Bryan Implement Sales, FA 210302 (Nat.
Arb. Forum Dec. 29, 2003) (“Respondent's domain name,
<kioti.com>, is identical to Complainant's KIOTI mark because adding a
top-level domain name is irrelevant for purposes of Policy ¶ 4(a)(i).”); see
also Busy Body, Inc. v. Fitness Outlet Inc., D2000-0127 (WIPO Apr. 22, 2000) (“[T]he
addition of the generic top-level domain (gTLD) name ‘.com’ is . . . without
legal significance since use of a gTLD is required of domain name registrants.”).
2.
Respondent
has no rights or legitimate interests in respect of the domain name.
This can be
proven a number of ways, such as:
(i) before
any notice to Respondent of the dispute, 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 or services.
Respondent
failed to meet this test. No goods or
services were offered on the web site.
Simply claiming to have put a “dummy” back end web hosting panel behind
a password does not constitute an offering of goods and services (especially
since the content of the web site had nothing to do with web hosting). Simply entering into a web hosting contract
(even if it has a static IP address) does not constitute demonstrable
preparations to make bona fide offering of goods or services. Reselling domain names does not constitute a
bona fide offering of goods or services. To allow such an absurd construction would eviscerate the UDRP
because every respondent could demonstrate rights.
While Respondent
had 2,241 days from the date this domain name was registered until the
Complaint was filed to establish some rights, it simply failed to do so.
(ii)
Respondent
(as an individual, business, or other organization) have been commonly known by
the domain name, even if Respondent has acquired no trademark or service mark
rights.
While Respondent
filed a trade name certificate in Los Angles Country, that does not mean
Respondent is commonly known by that name.
Filing an application with the United States Patent and Trademark Office
(which I would find was done before Respondent knew of this UDRP
complaint) does not give Respondent any rights. It is only after a registration is allowed that an applicant
acquires rights from the filing.
(iii) Respondent
is making a legitimate noncommercial 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 did
not make this claim.
I would find Respondent is using the <shoemart.com>
domain name, which is identical to Complainant’s SHOEMART mark, in conjunction
with its domain name resale operation, and that the domain name registration is
offered for sale. While Respondent
claims it is in the business of a
domain name exchange, for the registration of domain names, for identification
of users on a global computer network; website development, namely, designing
and implementing websites for others and hosting the web sites of others on a
computer server for a global computer network, none of that is obvious from its
web site. In fact, you cannot tell what
business Respondent is in from its web site.
I would find such use is not a
use in connection with 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). I would conclude Respondent
has not established rights or legitimate interests in the disputed domain name
pursuant to Policy ¶ 4(a)(ii). See J. Paul Getty Trust v. Domain 4 Sale
& Co., FA 95262 (Nat. Arb. Forum Sept. 7, 2000) (finding rights or
legitimate interests do not exist when one has made no use of the websites that
are located at the domain names at issue, other than to sell the domain names
for profit); see also Hewlett-Packard
Co. v. High Performance Networks, Inc., FA 95083 (Nat. Arb. Forum July 31,
2000) (finding no rights or legitimate interests where the respondent
registered the domain name with the intention of selling its rights).
Despite
the neat trick of filing a fictitious trade name certificate in Los Angles
County, I would find Respondent is neither commonly known by the disputed
domain name nor authorized to register domain names featuring Complainant’s
SHOEMART mark. I would conclude that
Respondent has not established rights or legitimate interests in the <shoemart.com>
domain name pursuant to Policy ¶ 4(c)(ii).
See Compagnie de Saint
Gobain v. Com-Union Corp., D2000-0020 (WIPO Mar. 14, 2000) (finding no rights
or legitimate interests where the respondent was not commonly known by the mark
and never applied for a license or permission from the 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”).
3. Respondent’s domain name has been
registered and is being used in bad faith.
Bad faith must
be determined from the totality of circumstances. There are a number of ways to prove bad faith, as described in
the rules:
(i) circumstances
indicating that Respondent registered or 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 Respondent’s documented out-of-pocket costs directly related to the
domain name; or
Being
in the business of reselling domain names seems to fit pretty clearly into this
category.
(ii) Respondent
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 Respondent engaged in a pattern of such conduct; or
Being
in the business of reselling domain names seems to fit pretty clearly into this
category. While this Panel would not
claim Respondent did this to specifically block Complainant, Respondent did
this to block someone in Complainant’s position. In fact, Respondent’s entire business model assumes the existence
of someone in Complainant’s position.
(iii) Respondent
registered the domain name primarily for the purpose of disrupting the business
of a competitor; or
Not applicable
in this case.
(iv) by
using the domain name, Respondent 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.
Respondent is
entitled to sell its domain name.
Making an offer to sell the domain name is not evidence of bad
faith. The evidence of the bad faith
was offering to sell it for $250,000. I
would find Respondent registered the <shoemart.com> domain name
primarily for the purpose of selling it for an amount in excess of its
out-of-pocket expenses to Complainant or a competitor, which constitutes bad
faith registration and use pursuant to Policy ¶ 4(b)(i). See World Wrestling Fed’n Entmt., Inc. v.
Bosman, D99-0001 (WIPO Jan. 14, 2000) (finding that the respondent used the
domain name in bad faith because he offered to sell the domain name for
valuable consideration in excess of any out-of-pocket costs); see also Dynojet Research, Inc. v. Norman,
AF-0316 (eResolution Sept. 26, 2000) (finding that the respondent demonstrated
bad faith when he requested monetary compensation beyond out-of-pocket costs in
exchange for the registered domain name).
I would also
find Respondent has engaged in a pattern of preventative domain name
registration through its prior conduct of registering domain names that are
identical to third party marks. See
Apple Computer v. DomainHouse.com, Inc., D2000-0341 (WIPO July 5, 2000)
(involving the complainant’s QUICKTIME mark and Respondent’s <quicktime.net
domain name); see also Comm’n on Graduates of Foreign Nursing Sch. v. Free
Speech Alliance, FA 109364 (Nat. Arb. Forum June 12, 2002) (involving the
complainant’s CGFNS mark and Respondent’s (under the name of Wilson Martinez,
Respondent’s president) <cgfns.com> and <cgfns.net> domain
names). Respondent registered and used
the disputed domain name in bad faith pursuant to Policy ¶ 4(b)(ii). See Gamesville.com, Inc. v. Zuccarini, FA 95294 (Nat. Arb. Forum Aug.
30, 2000) (finding that the respondent engaged in a pattern of conduct of
registering domain names to prevent the owner of the trademark from reflecting
the mark in a corresponding domain name, which is evidence of registration and
use in bad faith); see also Encyclopaedia
Britannica Inc. v. Shedon.com, D2000-0753 (Sept. 6, 2000) (finding bad
faith where the respondent engaged in the practice of registering domain names
containing the trademarks of others).
Houston Putnam Lowry, Chartered
Arbitrator and Chair, Panelist
Dated: June 10, 2005
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[1] Also in the Comm’n on Graduates of Foreign Nursing Sch. case, the panel found bad faith in the fact that DomainHouse had provided false information to the domain name registrar when it switched the registration from Advent Home Health to Free Speech Alliance.