Syncopated Software Development Corporation v. Do Life Right
Claim Number: FA0608000780309
Complainant is Syncopated Software Development Corporation (“Complainant”), P.O. Box 160634, Austin, TX 78716-0634. Respondent is Do Life Right (“Respondent”), 3040 W. Curly Horn Rd., Sahuarita, AZ 85629.
REGISTRAR AND DISPUTED DOMAIN NAMES
The domain names at issue are <syncopatedsoftware.biz>, <syncopatedsoftware.com>, <syncopatedsoftware.info> and <syncopatedsoftware.net> (collectively, the “Domain Names”), registered with Go Daddy Software, Inc.
The undersigned certifies 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.
David H. Bernstein as Panelist.
Complainant submitted a Complaint to the National Arbitration Forum electronically on August 17, 2006; the National Arbitration Forum received a hard copy of the Complaint on August 21, 2006.
On August 18, 2006, Go Daddy Software, Inc. confirmed by email to the National Arbitration Forum that the Domain Names are registered with Go Daddy Software, Inc. and that Respondent is the current registrant of the Domain Names. Go Daddy Software, Inc. has verified that Respondent is bound by the Go Daddy Software, 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 August 29, 2006, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of September 18, 2006 by which Respondent could file a Response to the Complaint, was transmitted to Respondent via email, post and fax, 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 and email@example.com by email.
A timely Response was received and determined to be complete on September 1, 2006.
On September 12, 2006, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the National Arbitration Forum appointed David H. Bernstein as Panelist.
Complainant requests that the Domain Names be transferred from Respondent to Complainant.
Complainant asserts that the Domain Names are identical or confusingly similar to its registered SYNCOPATED SOFTWARE service mark. Complainant filed an application to register the mark SYNCOPATED SOFTWARE with the United States Patent and Trademark Office (“USPTO”) on October 27, 2004 claiming first use of the mark as of October 12, 2004. On May 9, 2006, the USPTO registered the mark as U.S. Trademark Registration Number 3,091,462. Complainant alleges that the Domain Names each include the exact words of the SYNCOPATED SOFTWARE mark followed by a gTLD.
Complainant alleges that Respondent does not own any rights to or have a legitimate interest in the Domain Names. In support of this allegation, Complainant notes that Respondent has not registered the names “Syncopated Software, Inc.” or “Sync O’Pated Software, Inc.” – both phrases which have appeared on Respondent’s website – with the Corporate Commission of Arizona, the state in which Respondent resides.
Complainant also alleges that Respondent registered and used the Domain Names in bad faith. The totality of Complainant’s allegations of Respondent’s bad faith are set out below:
(A) Respondent apparently registered the domain names only after Complainant filed for trademark registration and began regular use of its trademark on Complainant’s website;
(B) Respondent demanded compensation when advised of Respondent’s infringement;
(C) Respondent responded to Complainant’s advise of infringement via Complainant’s Web site though no reference to it was made, suggesting that Respondent was either already aware of Complainant’s use of the trademark or had the ability to find Complainant’s use of the trademark via such a search prior to registering the domain names;
“(D) Respondent responded to Complainant’s advise of infringement by mocking Complainant, changing the text on Respondent’s Web site from ‘Syncopated Software, Inc.’ to ‘Sync O’Pated Software, Inc.’”
Respondent does not dispute that the Domain Names are confusingly similar to Complainant’s registered service mark.
Respondent claims that it has a legitimate interest in the Domain Names because Respondent undertook preparations to form an operating system software company called “Syncopated Software” in December 2005, prior to learning of this dispute. Respondent alleges that it searched for the phrase “Syncopated Software” on various search engines and on the USPTO website, www.uspto.gov, and found no results (though Respondent now realizes that it erroneously searched the USPTO website itself rather than the USPTO’s TESS database of trademark applications and registrations). Respondent alleges that, prior to being contacted by Complainant regarding the Domain Names in April 2006, it took steps to create its company by registering the Domain Names and by contacting accountants, lawyers, venture capitalists, and a graphic designer in order to form a business entity called “Syncopated Software.” Additionally, Respondent claims that, because it contacted potential investors using the name “Syncopated Software,” it was commonly known by that name.
Respondent alleges that it did not register the Domain Names in bad faith. Respondent asserts that it did not register the Domain Names for the purpose of selling, renting, or otherwise transferring the Domain Names. Respondent does not deny that, after receiving notice that Complainant wished to contact Respondent regarding the Domain Names, Respondent contacted Complainant through Complainant’s website. However, Respondent alleges that it found Complainant’s website by searching for “John Carlsen” in Austin, Texas – information regarding Complainant provided by Domains By Proxy – on the Internet and not, as Complainant alleges, by searching for the phrase “Syncopated Software.” Respondent claims that, after conducting this search, it first learned of Complainant; until that time, Respondent was unaware of Complainant or its use of the SYNCOPATED SOFTWARE mark.
Respondent claims that, once it was notified by Complainant that Complainant owned the SYNCOPATED SOFTWARE service mark, Respondent offered to sell the Domain Names to Complainant for $67.60, an amount equal to Respondent’s out-of-pocket expenses in registering the Domain Names. Respondent states that it did not offer to sell the Domain Names to any other party.
Respondent also alleges that after Complainant’s refusal to purchase the Domain Names, Respondent changed the name displayed on its website from “Syncopated Software” to “Sync O’Pated Software” and displayed a disclaimer stating: “This site is in no way affiliated with Syncopated Software® Development Corporation of Austin, TX.” Respondent claims that these measures were taken to comply with Complainant’s request to cease using the SYNCOPATED SOFTWARE mark.
Respondent’s principal, Gregory D. Bentley, certifies that, at the time he registered the Domain Names, he was not aware of Complainant’s registered service mark or its use of that mark and, therefore, did not intend to register the Domain Names to prevent Complainant from reflecting the mark in a corresponding domain name. Respondent further alleges that it has never engaged in registering domain names in order to prevent a service mark or trademark holder from reflecting its mark in a domain name.
Respondent claims that it did not register the Domain Names to disrupt Complainant’s business because Respondent was unaware of the existence of Complainant’s business. Furthermore, Respondent asserts that its operating software business would not be in competition with Complainant’s gaming software business because both Respondent and Complainant focus on different types of software.
Respondent asserts that it did not attempt to attract, for commercial gain, Internet users to Respondent’s website or other on-line location by creating a likelihood of confusion. Respondent claims that it could not have had such an intention because it was unaware of the existence of Complainant’s business or service mark.
The Panel finds that Complainant has demonstrated rights in the SYNCOPATED SOFTWARE mark and that the Domain Names are confusingly similar to the SYNCOPATED SOFTWARE mark. Complainant also has shown (albeit on a thin record) that Respondent lacks a legitimate interest in the Domain Names. However, Complainant has failed to show that Respondent registered the Domain Names in bad faith. For that reason, the Complaint must be denied.
The Panel also finds the Complaint was brought in bad faith and therefore constitutes Reverse Domain Name Hijacking.
Paragraph 15(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”) instructs this Panel to “decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”
Paragraph 4(a) of the Policy requires that the complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:
(1) the domain name registered by the respondent is identical or confusingly similar to a trademark or service mark in which the complainant has rights;
(2) the respondent has no rights or legitimate interests in respect of the domain name; and
(3) the domain name has been registered and is being used in bad faith.
Respondent does not dispute that Complainant owns a federally-registered trademark and that the Domain Names, incorporating the trademark in its entirety, are confusingly similar to Complainant’s mark. The Panel agrees, and therefore Complainant has carried its burden on the first factor.
Complainant has made a prima facie showing that Respondent lacks rights to or legitimate interests in the Domain Names. Because it is difficult to produce evidence to support a negative statement, the threshold to prove a lack of legitimate interest is low. Starwood Hotels & Resorts Worldwide, Inc. v. Samjo CellTech.Ltd, FA 406512 (Nat. Arb. Forum Mar. 9, 2005) (“unsupported assertions … are sufficient to make a prima facie showing in regard to the legitimacy element”). Here, Complainant alleges that Respondent has no rights or legitimate interests in the Domain Names. Furthermore, Complainant notes that Respondent has not formally incorporated an entity under the names “Syncopated Software, Inc.” or “Sync O’Pated Software, Inc.” with the Arizona Corporation Commission. These allegations, though thin, are sufficient enough to establish a prima facie showing with respect to the legitimacy element, and to shift the burden of production to Respondent to come forward with evidence of its rights to or legitimate interests in the Domain Names. Document Techs., Inc. v. Int’l Elec. Commc’ns, Inc., D2000-0270 (WIPO June 8, 2000).
According to Paragraph 4(c) of the Policy, Respondent may demonstrate right to or legitimate interests in the Domain Names by showing any of the following circumstances:
(i) before any notice to [the Respondent] of the dispute, its use of, or demonstrable preparations to use, the Domain Name[s] or a name corresponding to the Domain Name[s] in connection with a bona fide offering of goods or services; or
(ii) [the Respondent] (as an individual, business, or other organization) has been commonly known by the Domain Name[s], even if [the Respondent has] acquired no trademark or service mark rights; or
(iii) [the Respondent] is making a legitimate noncommercial or fair use of the Domain Name[s], without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.
Respondent alleges that it has taken steps to use the Domain Names in connection with a bona fide offering of goods or services. The submitted evidence includes emails seeking venture capital and legal assistance to create a business under the SYNCOPATED SOFTWARE name. For purposes of this proceeding, though, these emails alone are not sufficient to satisfy the level of proof required by the Policy because they do not constitute evidence of demonstrable preparations. At best, the emails prove that Respondent had an interest in creating a company using this name, but they do not show that Respondent took concrete steps such as incorporation, the drafting of a business plan, the design of a website, or the creation of promotional materials. See World Wide Wrestling Fed’n Entm’t, Inc. v. Ringside Collectibles, D2000-1306 (WIPO Jan. 24, 2001); cf. AutoNation Holding Corp. v. Alaweh, D2002-0058 (WIPO May 1, 2002) (finding that the respondent submitted “substantial, overwhelming and undisputed evidence” of its preparations); Titan Indus. Ltd. v. Tanishq Corp. D2000-1793 (WIPO Mar. 14, 2001) (finding that the respondent made demonstrable preparations where it received governmental certification and entered into business contracts).
Similarly insufficient is Respondent’s claim that it was “commonly known” by the Domain Names. Although the emails show that a few potential business partners were aware of Respondent’s intentions and its use of SYNCOPATED SOFTWARE as part of its email address, that evidence falls far short of the sharing necessary to show that this knowledge was “common.”
Accordingly, based on the very limited record submitted, the Panel finds that Complainant has made a prima facie showing that Respondent lacks any rights or interests in the Domain Names, and Respondent has failed to rebut that showing.
Paragraph 4(b) of the Policy states that any of the following circumstances, in particular but without limitation, shall be considered evidence of the registration and use of a domain name in bad faith:
(i) circumstances indicating that [the Respondent has] 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 documented out-of-pocket costs directly related to the domain name; or
(ii) [the Respondent has] 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 it has engaged in a pattern of such conduct; or
(iii) [the Respondent has] registered the domain name primarily for the purpose of disrupting the business of a competitor; or
(iv) by using the domain name, [the Respondent] intentionally attempted to attract, for commercial gain, Internet users to its website 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 [the Respondent’s] website or location or of a product or service on [the Respondent’s] website or location.
Complainant’s allegations fail to establish Respondent’s bad faith in registering and using the Domain Names. At best, they merely establish that Respondent registered the Domain Names after Complainant filed for trademark registration. Complainant did not, however, make any showing that Respondent knew of Complainant and its mark, let alone that it registered the Domain Names with a bad faith intent to wrongfully profit from Complainant or its trademark rights. Equally without merit is Complainant’s allegation that Respondent must have registered the Domain Names in bad faith merely because it demanded compensation for the Domain Names. Although an effort to sell a domain name may, in appropriate circumstances, constitute evidence of bad faith, the uncontroverted evidence here is that the price requested was equal to Respondent’s cost of registration. The Policy ¶ 4(b) makes it clear that the offer to sell a domain name is evidence of bad faith only if the consideration is “in excess of the documented out-of-pocket costs directly related to the domain name.” See Broadcom Corp. v. Corporategamer.com, FA0101000096355 (Nat. Arb. Forum Feb. 12, 2001) (noting that a respondent’s demand for compensation, without more, is not in bad faith when it is equal to its out-of-pocket costs). Thus, Respondent’s willingness to sell the Domain Names to Complainant in return for recovery of its registration costs is, if anything, evidence of Respondent’s good faith, not of bad faith registration.
Similarly, Respondent’s ability to respond to Complainant’s notice of infringement via Complainant’s website does not establish Respondent’s bad faith because Respondent credibly explains that it was able to find Respondent’s website after searching for Respondent on the Internet by searching for “John Carlsen” in Austin Texas.
Further evidence of Respondent’s lack of bad faith was provided by Respondent. Respondent’s representative certified that he had no knowledge of Complainant’s service mark prior to registering the Domain Names. That assertion is credible in this case because Complainant has submitted no evidence that Respondent actually was aware of Complainant (e.g., that they had conducted business together) or that Complainant was so well known at the time Respondent registered the Domain Names that Respondent must have been aware of Complainant’s trademark rights. If Respondent had no knowledge of Complainant’s service mark at the time of registration, Respondent could not have registered the Domain Names in bad faith with respect to that mark. See Primal Quest, LLC v. Gabrial Salas, D2005-1083 (WIPO Dec. 15, 2005) (respondent could not have registered domain name in bad faith towards the complainant’s marks if it had not heard of the complainant or its service marks prior to registration).
Respondent’s certification is particularly credible here given Respondent’s response to Complainant’s concerns regarding the Domain Names. Once informed of the existence of Complainant’s mark, Respondent notified Complainant that Respondent was still early in the formation of its company, and that it was willing to change its planned corporate name and Domain Names. In return for transferring the Domain Names to Complainant, Respondent asked only for a payment of $67.60 to compensate Respondent for its expenses in registering the Domain Names. Complainant does not deny Respondent’s assertion, but rather relies on the indefensible argument that Respondent’s demand for any compensation is evidence of bad faith.
For all these reasons, the Panel finds that Respondent did not register or use the Domain Names in bad faith, and that the Complaint must thus be denied.
Reverse Domain Name Hijacking
Although Respondent has not requested a finding of Reverse Domain Name Hijacking, under the Rules, the Panel must also consider whether a finding of Reverse Domain Name Hijacking is nevertheless appropriate. Goway Travel Limited v. Tourism Australia, D2006-0344 (WIPO June 6, 2006). That is because Paragraph 15(e) of the Rules provides:
If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.
Complainant’s decision to file the instant Complaint notwithstanding Respondent’s demonstrably good faith offer to sell all four Domain Names in return only for reimbursement of Respondent’s registration cost ($67.70) is not only incomprehensible (given that the $1,450 filing fee paid by Complainant to commence this proceeding was more than twenty times that amount), but also is indicative of Complainant’s bad faith. In the face of Respondent’s reasonable offer, Complainant had no basis to refuse to reimburse Respondent for its registration costs and instead invoke the Policy. The Panel thus finds that Complainant’ filed this proceeding not to recover Domain Names that had been the subject of abusive cybersquatting, but rather for the purpose of harassing the Respondent. Such behavior is Reverse Domain Name Hijacking under the Policy.
Because Complainant failed to establish all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED. Further, the Panel declares that the Complaint was brought in bad faith and thus constitutes Reverse Domain Name Hijacking.
David H. Bernstein, Panelist
Dated: October 2, 2006
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