25th Jun 2010

 

National Arbitration Forum

 

DECISION

 

Visual Systems, Inc. v. Development Services Telepathy, Inc.

Claim Number: FA1004001318632

 

PARTIES

Complainant is Visual Systems, Inc., represented by Hoang-chi Truong, of Fenwick & West LLP, (“Complainant”), California, USA. Respondent is Development Services Telepathy, Inc., represented by Ari Goldberger, of ESQwire.com Law Firm, (“Respondent”), New Jersey, USA.

 

REGISTRAR AND DISPUTED DOMAIN NAME 

The domain name at issue is <cygnet.com>, registered with Moniker.

 

PANEL

The undersigned certifies that he or she has acted independently and impartially and to the best of his or her knowledge has no known conflict in serving as Panelist in this proceeding.

 

James Bridgeman as Chair.

Judge Ralph Yachnin as Panelist.

The Hon. Neil Brown QC as Panelist.

 

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum electronically on April 12, 2010.

 

On April 13, 2010, Moniker confirmed by e-mail to the National Arbitration Forum that the <cygnet.com> domain name is registered with Moniker and that the Respondent is the current registrant of the name. Moniker has verified that Respondent is bound by the Moniker 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 19, 2010, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of May 10, 2010 by which Respondent could file a Response to the Complaint, via e-mail to all entities and persons listed on Respondent’s registration as technical, administrative, and billing contacts, and to postmaster@cygnet.com by e-mail. Also on April 19, 2010, the Written Notice of the Complaint, notifying Respondent of the email addresses served and the deadline for a Response, was transmitted to Respondent via post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts.

 

A timely Response was received and determined to be complete on May 20, 2010.

 

Complainant’s Additional Submission was received on May 26, 2010 in compliance with Supplemental Rule 7. 

 

On May 28, 2010, pursuant to Complainant’s request to have the dispute decided by a three-member Panel, the National Arbitration Forum appointed James Bridgeman as Chair, Judge Ralph Yachnin as Panelist and The Hon. Neil Brown QC as Panelist.

 

 

RELIEF SOUGHT

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

 

PARTIES’ CONTENTIONS

 

A. Complainant

 

Complainant is a California corporation located in San Luis Obispo, California.

 

Complainant submits that it has rights in the CYGNET trademark through its ownership of the U.S.P.T.O service mark registration described below and its use of the mark in relation to its software services.

 

Complainant submits that the disputed domain name is identical to Complainant’s CYGNET mark because the .com gTLD extension is not taken into consideration when analyzing the identity between a trademark and domain. 

 

Complainant submits that it has therefore satisfied the first requirement under Policy ¶ 4(a)(i).

 

Complainant submits that Respondent has no rights or legitimate interest in the disputed domain name. Respondent has no legitimate relationship to Complainant giving rise to any license, permission, or authorization to register or use the disputed domain name, nor has Complainant ever licensed or authorized Respondent’s use of the CYGNET Mark in any manner.

 

Respondent is known as Development Services and Telepathy, Inc. and is not commonly known by the CYGNET or <cygnet.com> names. Respondent owns no relevant trademark applications or registrations for CYGNET or <cygnet.com>.  Respondent cites  Google Inc. v. Miller, FA 1067791 (Nat’l Arb. Forum Oct. 24, 2007) (holding that a domain Respondent had no rights or legitimate interests in, and was not commonly know by, the domain name <youtubex.com> where its “WHOIS information indicates that the Respondent is ‘David Miller’”); Braun Corp. v. Loney, FA 699652 (Nat. Ar. Forum July 7, 2006) (concluding that Respondent was not commonly known by the disputed domain names where the WHOIS information, as well as other information in the record, gave no indication that Respondent was commonly known by the disputed domains, and complainant had not authorized the Respondent to register domains containing its registered mark); Popular Enterprises, LLC v. Jang, FA 811921 (Nat’l Arb. Forum Nov. 16, 2006) (Respondent’s “WHOIS information does not suggest that [it] is commonly known by the <ntester.com> domain name”); Tercent Inc. v. Lee Yi, FA 139720 (Nat. Arb. Forum Feb. 10, 2003) (finding that the WHOIS information and its failure to imply that Respondent is commonly known by the disputed domain name is a factor in determining whether Respondent has any rights or legitimate interests in the dispute domain name).

 

Complainant argues that the term “cygnet” is not descriptive or generic of Complainant’s software solutions or services, nor is it a common surname, giving rise to Respondent’s rights or legitimate interests in the disputed domain name. The dictionary definition of the word “cygnet” is “a young swan” and there is also a small town in Ohio with the name, however, Respondent’s use of the disputed domain name is not connected in any way to either meaning. In fact, Respondent’s only use of the disputed domain name since registration of it has been for a parked website on which links appear for a variety of products and services. It was only very recently, and after being contacted by Complainant, that Respondent, changed the site, making it appear to be a search engine from which Respondent still receives revenue from the searches and pop-ups generated from the site.

 

Complainant anticipates that Respondent may argue that Complainant does not own exclusive rights in the CYGNET mark. Complainant submits that any such argument is irrelevant to this proceeding because whether or not there are other third party uses of CYGNET does not give Respondent any rights or legitimate interests in the disputed domain name. The Policy does not require that Complainant have exclusive rights in the trademark. Here, Complainant has clearly shown that it has rights in the CYGNET mark as a result of, not only its federal registration, but also its extensive use of the mark since December 1, 1995. The fact that there may be other third party uses of CYGNET does not show that Respondent itself has rights or legitimate interests in the disputed domain name; any such arguments made by Respondent to this effect are irrelevant.

 

Respondent’s use of Complainant’s trademark as a domain name to divert traffic to Respondent’s parked site is not a bona fide offering of goods or services, nor is it a legitimate non-commercial or fair use of the Domain Name. See, e.g., Adobe Systems Inc. v. Domain OZ, D2000-0057 (WIPO March 22, 2000) (using a disputed domain to attract consumers to a Respondent’s website alone would not be sufficient to establish rights or legitimate interests in the domain name). Respondent’s only plausible reason to register and use the disputed domain name is to take unfair advantage of the recognition associated with Complainant’s CYGNET mark by diverting consumers from Complainant’s website to its parked site, where Respondent is benefiting from the confusion and diversion by receiving pay-per-click commissions. 

 

Complainant submits that given the above, it is clear that Respondent has no rights or legitimate interests in the disputed domain name, nor is the disputed domain name being used in a legitimate fair use manner.

 

Complainant submits that it has therefore succeeded in establishing that a Respondent has no rights or legitimate interests in the disputed domain name as required by Policy ¶ 4 (a)(ii).

 

Complainant submits that Respondent registered and is using the disputed domain in bad faith. In particular Complainant submits that Respondent’s activities fall squarely into Paragraph 4(b)(iv) because Respondent has parked the disputed domain name to take unfair advantage of the recognition associated with Complainant’s CYGNET mark by diverting consumers looking for Complainant’s CYGNET software solutions and services from Complainant’s website to Respondent’s parked site, where it benefits from the confusion and diversion by receiving pay-per-click commissions. Complainant argues that Respondent’s bad faith is underscored by the fact that, despite its statement that it would remove advertising links from the site, Respondent did not immediately do so and continued to offer advertising links on the site well after receiving Complaint’s demand to transfer the Domain Name to Complainant so that it could continue to benefit from the resulting pay-per-click commissions. See, e.g., REO Speedwagon, Inc. v. Domain Administrator, FA 910799 (Nat. Arb. Forum March 23, 2007) (bad faith use and registration found; domain name used to attract Internet users to generate per click revenue); National Association for Stock Car Auto Racing, Inc. (NASCAR) v. RMG – Buy or Lease by E-mail, D2001-1387 (WIPO Jan. 23, 2002) (panel found bad faith use because of Respondent’s use of click-through advertising on the disputed site). 

 

Complainant further argues that Respondent’s registration and use of the disputed domain name is also in bad faith because, despite having actual or constructive notice of Complainant’s rights to the CYGNET mark, Respondent still registered and is using the disputed domain name. Prior panels have found that such behavior is indeed evidence of a Respondent’s bad faith in registering and using a domain name. See, e.g., Samsonite Corp. v. Cologny Holding, FA 94313 (Nat’l Arb. Forum April 17, 2000) (holding that evidence of bad faith includes actual or constructive knowledge of a commonly known mark at the time of registration); DaimlerChrysler AG v. NOLDC, Inc. FA 677360 (Nat’l Arb. Forum May 29, 2006) (registration of a mark with the U.S. Patent and Trademark Office serves as constructive notice of a complainant’s rights in a mark, therefore, Respondent acted in bad faith by registering the <mecedes-benz.com> and <mercede-benz.com> domain names despite its constructive notice of complainant’s rights in the mark MERCEDES BENZ). Here, Complainant’s CYGNET Mark registered July 15, 1997, years prior to Respondent’s registration and use of the Domain Name. Respondent, therefore, had constructive notice, if not actual notice, of Complainant’s rights in CYGNET. Thus, Respondent’s registration of the Domain Name, despite its notice of Complainant’s rights to the CYGNET mark, evidences bad faith.

 

Complainant submits that on information and belief, Respondent is a speculator that simply hopes to license or sell the domains in the future for profit, but had no specific use in mind at the time of registration or acquisition.

 

Since its registration Respondent has continually parked the disputed domain name to receive pay-per-click fees based on the number of visitors who click on the links displayed on the site or on the paid search advertisements and pop-ups generated from searches on the site.

 

Complainant states that upon discovering Respondent’s registration and use of the disputed domain name, Complainant, through counsel, called Respondent on January 25, 2010, notifying it of Complainant’s trademark rights in the CYGNET Mark and demanding transfer of the disputed domain name. Complainant has furnished this Panel with copies of the correspondence that followed during the month of February 2010. The President of the Respondent refused to agree to transfer the disputed domain name on the grounds that the registration and use of the disputed domain name in connection with a parked website did not infringe Complainant’s rights in the CYGNET mark. 

 

Complainant further states that at that time the President of the Respondent company promised that Respondent would remove all advertising links from cygnet.com website. Complainant states that notwithstanding that undertaking, Respondent nonetheless continued to advertise on the site so that it can continue to receive pay-per-click revenues. 

 

Anticipating that Respondent may claim that Complaint is barred by laches because Complainant was aware of Respondent’s registration and use of the disputed domain name long before contacting Respondent and demanding the transfer of the domain, Complainant submits that any such argument is also irrelevant because laches is not an available defense in these proceedings. See, e.g., Tax Analyst v. eCorp, D2007-0040 (WIPO April 10, 2007) (although the parties are both located in the U.S., where courts recognize the doctrine of laches, the panel nonetheless concluded that laches does not properly apply to UDRP proceedings because the remedies under the ICANN Policy are injunctive rather than compensatory in nature); The E.W. Scripps Company v. Sinologic Industries, D2003-0447 (WIPO July 1, 2003) (the ICANN Policy does not contemplate a defense of laches, which is contrary to its purposes); The Hebrew University of Jerusalem v. Alberta Hot Rods, D2002-0616 (WIPO Oct. 7, 2002) (because there is no limitation period in the ICANN Policy and the remedy available under the Policy is not equitable, laches has no application). Therefore, the defense of laches is not applicable here and should not be considered.

 

Complainant submits that it has satisfied the third element of the test in Policy ¶ 4(a)(iii) and is entitled to succeed in its application.

 

 

B. Respondent

 

Respondent submits that there is no basis for transferring the disputed domain name cygnet.com to Complainant and alleges that this is a case of reverse domain name hijacking.

 

Respondent does not deny that the disputed domain name is identical or confusingly similar to the CYGNET trademark but takes no position as to the enforceability of the Complainant’s claimed trademark rights. Respondent does however submit that Complainant does not have exclusive rights to use the common English language word meaning “a young swan”. Respondent submits that the word “cygnet” is the subject of tremendous third party use as a trademark and on the Internet. Respondent submits that there are 14 other pending and registered U.S trademarks incorporating this term, and five Canadian registered trademarks for a wide variety of goods and services such as: aquatic herbicides; children’s books; computer consultations; scientific instruments; wine; jewelry; financial services; surgical clamps; nutrition consulting; pool water pumps; computer programs; and jukeboxes.

 

Respondent asserts that it has rights and legitimate interest in the <cygnet.com> domain name. Respondent submits that anyone is entitled to register a common word in a domain name on a first-come first served basis, provided there is no intent to target a trademark. Respondent states that it acquired the disputed domain name because it incorporates a common word, not with any intention of targeting a trademark, thereby establishing Respondent’s legitimate interest in the disputed domain name. Respondent’s use of the disputed domain name in connection with a search page or to display pay per click links further establishes Respondent’s legitimate interest. Respondent has been investing in quality common word domain names since 1997 believing they are easy-to-remember with multitudes of potential online commercial applications. The disputed <cygnet.com>  domain name is one such domain name acquired by Respondent.

 

Respondent registered the disputed domain name because it incorporated a common word to which it believed no party could claim exclusive rights. Respondent did not register the disputed domain name with Complainant’s trademark in mind.

 

Respondent is the owner of numerous generic domain names such as: geometric.com, cordial.com, workouts.com, flotsam.com, deduction.com, sultry.com, and between.com.

 

As noted, the disputed domain name incorporates the name of a small swan. Respondent is the registrant of numerous other bird and animal-related domain names, such as Tanager.com (a brightly colored songbird); Popinjay.com (a woodpecker); Goldfinch.com (a yellow bird); Porcupine.com; Ermines.com (a weasel); Whelk.com (a snail); Dromedary.com (a camel); Abalone.com (a mollusk); Woodchuck.net; Yellowfox.com; Yellowturtle.com; Orangebird.com; Orangemouse.com.

 

Respondent submits that common word domain names therefore serve well as online identities and, as a result, are commercially valuable. Respondent states that its ultimate goal is to develop its domain names or resell them to other entities looking for easy-to-remember domain names for Internet addresses for their web sites. Respondent hosts its underdeveloped domain names with domain name parking services which pay Respondent a share of the advertising revenue they generate, and industry-wide accepted practice.

 

The common word “cygnet,” meaning a “young swan.” is subject to substantial third party use on the Internet. A Google search for “cygnet,” excluding the terms “cygnetscada.com;” “scada;” “visual;” “software;” “oil;” and “gas, to avoid references to Complainant, yielded 959,000 third party results1. Examples include: CygnetTheatre.com; CygnetRestaurant.com; CygnetEnterprises.com; CygnetStudios.com; and many more. Google results annexed as Exhibit 2. There are also 15 active pending and registered U.S. trademarks incorporating the word “cygnet,” for a wide variety of goods and services such as: aquatic herbicides; children’s books; computer consultations; scientific instruments; wine; jewelry; financial services; surgical clamps; nutrition consulting; pool water pumps; computer programs; and jukeboxes.

 

Respondent purchased the disputed domain name in October 2001, more than eight years ago because it incorporated a common word to which it believed no party could claim exclusive rights.

 

Respondent denies that it registered the disputed domain name with Complainant’s trademark in mind and submits that it had no knowledge of Complainant, its web site, its business name or trademark when it registered the domain name. Respondent further denies that it registered the disputed domain name with the intent to sell to Complainant, to disrupt Complainant’s business, or to confuse consumers seeking to find Complainant’s web site. Respondent also denies that it registered the disputed domain name to prevent Complainant from owning a domain name incorporating its trademark.

 

Respondent has been registering common word domain names for investment and development, since 1997, long before the advent of pay-per-click advertising, and long before there were domain name parking services. Respondent registered common word domain names in the belief that they best fulfill the purpose of a domain name which is to be easy to remember. While Respondent has hosted the disputed domain name at a number of domain name parking services, such as Domain Sponsor and HitFarm, Respondent’s purpose in registering domain names was not to park them.

 

Respondent submits that “cygnet” is a common English word in the dictionary meaning “a young swan.” The registration of domain names that contain common words are permissible on a first-come, first served basis, and such registration establishes the Respondent’s legitimate interest, provided the domain was not registered with a trademark in mind. National Gardening Association, Inc. v. CK Ventures, No. 1294457 (NAF Feb. 16, 2010) (“common words and descriptive terms are legitimately subject to registration as domain names on a first come, first-served basis”), quoting Zero International Holding v. Beyonet Servs., D2000-0161 (WIPO May 12, 2000). CNRV, Inc. v. Vertical Axis, Inc., No. 1300901 (NAF May 3, 2010)(legitimate interest “[if] the domain names have been registered because of their attraction as dictionary words, and not because of their value as trademarks”) quoting Landmark Group v. DigiMedia.com, L.P., FA 285459 (NAF Aug. 6, 2004);i Canadadrugs.com et al. v. ASM Bioventure, No. 568743 (NAF Nov. 29, 2005)(“disputed domain name name is comprised of common terms and geographic identifiers, “Canada,” and “drug(s)” which are descriptive.”) ii Baccus Gate Corp. et al v. CKV et al, No. D2008-0321 (WIPO May 20, 2008)(Legitimate interest established where domain is registered based on “generic value of the word.”).iii C Brewer and Sons Ltd. v. Vertical Axis, Inc., No. D2009-1759 (WIPO April 11, 2010)(“in general it is inherently more likely that a respondent may have a legitimate interest in using a more descriptive domain name.”) quoting Exotiq Properties Ltd., v. David Smart, No. D2009-1672 (WIPO Jan. 25, 2010).

 

Respondent further submits that it is significant that Complainant’s mark is a common dictionary word subject to substantial third party use. There are close to one million third party uses of the word “cygnet,” in connection with swans, for a theatre company, an aerospace company, a restaurant, studios, etc. There are also 15 third party U.S. registered trademarks incorporating “cygnet,” for a wide variety of goods and services such as: aquatic herbicides; children’s books; computer consultations; scientific instruments; wine; jewelry; financial services; surgical clamps; nutrition consulting; pool water pumps; computer programs; and jukeboxes. There are also 5 Canadian trademarks incorporating “cygnet.” The numerous third party uses of the term “cygnet,” further demonstrates that “cygnet” is a word and not subject to exclusive use by Complainant. The Panel should, therefore, conclude that Respondent has a legitimate interest in the Disputed domain name. See e.g.Energy Source Inc. v. Your Energy Source, Case No. 96364 (NAF Feb. 19, 2001)(“[r]espondent has persuasively shown that the domain name is comprised of generic and/or common descriptive terms, and, in any event, is not exclusively associated with [c]omplainant’s business”).

 

Respondent denies that the disputed domain name was registered with Complainant’s trademark in mind. Respondent submits that to the contrary, the evidence demonstrates that Respondent registered the disputed domain name because it incorporates a common word for a young swan. The evidence is that Respondent has been acquiring common word and descriptive term domain names since 1996. Respondent’s pattern of registration bolsters Respondent’s position that it registers domain names based on the words they incorporate, not because the word happens to be similar to the trademark of another entity. Cf. C Brewer and Sons Ltd. v. Vertical Axis, Inc., No. D2009-1759, supra. (Legitimate interest finding in connection with the domain name wallpaperdirect.com supported in part by “the fact the Respondent has registered so many domain names which include the words ‘wallpaper’ or ‘direct’”).

 

Respondent submits that its claim to have a legitimate interest in the domain name is bolstered by the fact that Respondent uses the disputed domain name to post pay-per-click advertising links related to the descriptive meaning of the dsputed domain name, as well as generic links.

 

Respondent argues that Complainant is simply wrong that Respondent’s use of the disputed domain name in this manner is illegitimate, citing C. Brewer and Sons Ltd. v. Vertical Axis, Inc., D2009-1759 supra. (“there is nothing under the Policy which prohibits such conduct, and there have been several decisions in which it has been held that operation of pay-per-click websites can amount to a bone fide offering of goods and services.”); See also Roderick W. Accetta v. Domain Admin et al., No. 826565 (Jan. 2, 2007).v (use of “domain name to operate a pay-per-click search engine is a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i)”); Dial-a-Mattress Operating Corp. v. Ultimate Search, No.D2001-0764 (WIPO Sept. 26, 2001);vi Etam, plc v. Alberta Hot Rods, D2000-1654 (WIPO Jan. 31, 2001);vii GLB Servicos Interativos S.A. v. Ultimate Search, No. D2002-0189 (WIPO May 29, 2002).viii The Landmark Group v. Digimedia L.P., No. 285459 (NAF Aug. 6, 2004);ix Target Brands, Inc. v. Eastwind Group, supra.; Sweeps Vacuum & Repair Center, Inc. v. Nett Corp., No. D2001-0031 (WIPO Apr. 13, 2001).

 

Respondent submits that one sole pay-per-click link on its website does not represent an intent to confuse and misdirect consumers. In any event, the links do represent a manifestation of Respondent’s intent since Respondent did not select them. They were entirely automated. As held in Mariah Media Inc. v. First Place Internet Inc. No. D2006-1275 (WIPO Dec. 6, 2006) (appearance of links created by a third party domain monetization service does not constitute bad faith on the part of the domain owner where they are unintended by the domain name owner). See also Aquascape Designs, Inc., supra. Aquascape Designs, Inc. v. Vertical Axis, Inc.et al., No. 629222 (NAF Mar. 7, 2006)(finding of legitimate interest notwithstanding that pay per click links related to complainant’s services appeared on disputed domain name name web site.).

 

Respondent argues that to the contrary, its use of the disputed domain name to display pay-per-click links constitutes use of the disputed domain name in connection with a bona fide offering of goods and services, which establishes Respondent’s legitimate interest.

 

Respondent states that Complainant, through its CEO sent an email to Respondent inquiring to purchase the disputed domain name and argues that the approach amounts to an acknowledgement of Respondent’s legitimate interest in the disputed domain name, citing Prom Software, Inc. v. Reflex Publishing, Inc., No. D2001-1154 (WIPO Mar. 4, 2002) where the complainant offered to purchase the respondent’s domain name. In finding a legitimate interest and denying the complaint, the Panel stated that the complainant had failed to meet its burden of demonstrating that the respondent has no right or legitimate interest in the domain name and the complainant had actually established the apparent legitimacy of the respondent’s interest. Respondent further argues that the email exchange between the principals of the two companies, initiated by Complainant, unequivocally shows both that Complainant was well aware that it had no entitlement to the domain name.

 

Respondent submits that Complainant’s inquiry about purchasing the disputed domain name therefore constitutes a tacit acknowledgement of Respondent’s legitimate interest in the disputed domain name.

 

Accordingly, Respondent submits that it has demonstrated that it has rights and a legitimate interest in the disputed domain name and the Complaint must, therefore, be dismissed.

 

Respondent submits that it registered and is using the disputed domain name in good faith. Respondent argues that there is absolutely no evidence that Respondent targeted the mark, nor is there a basis for inferring such intent. As one would expect of a common word, there is tremendous third party use of the word “cygnet.”

 

An advanced Google search for “cygnet,” excluding the terms “cygnetscada.com;” “scada;” “visual;” “software;” “oil;” and “gas”, to avoid references to Complainant yielded 959,000 third party results.

 

Examples range from an aerospace company to a San Diego theatre company. Complainant does not have a monopoly on use of the word “cygnet,” nor does its trademark provide it with such rights. Indeed, there are 15 other active and pending registered U.S. trademarks that incorporate “cygnet,” as well as 5 such trademarks in Complainant’s native country of Canada.

 

The registration of the disputed domain name was entirely in good faith based on the fact that it incorporated a common word meaning a young swan, and was thus desirable. Respondent has registered numerous domain names incorporating common words, including the names of birds and animals, as is the case with the disputed domain name and numerous other common words as domain names as listed above.

 

Respondent refutes Complainant’s allegations that Respondent’s use of the disputed domain name to post pay-per-click advertisements establishes bad faith use by Respondent. There is no evidence that any links have ever appeared on Respondent’s web site for third parties selling goods and services similar to the goods and services covered by Complainant’s trademark, i.e., software for the gas and oil industry. Links that have appeared most commonly have been generic in nature (travel, financial, health and beauty, insurance, shopping, etc.) or related to swans. Some links have appeared which are related to the general category of software. However, none were related to Complainant’s software for the oil and gas industry. Moreover, the displayed links were auto-generated by a third-party domain name parking service over which Respondent had no control and, thus, the links do not represent Respondent’s intentions. Not only does the use of a domain name to post pay-per-click links fail to establish bad faith registration and use, such use has been found to establish a Respondent’s legitimate interest under the Policy on numerous occasions.

 

Respondent accepts that in 2005, almost 5 years ago, an isolated link appeared which was a pay-per-click advertisement for Complainant however Respondent denies that the event constitutes bad faith use under the Policy because the advertisement was directing consumers directly to Complainant. Respondent argues that it is hard to understand how a link to Complainant’s business (likely resulting from Complainant purchasing the Google Adwords keyword “cygnet,”) is illegitimate.

 

Respondent submits that other software links that appeared on its web page are not related to Complainant’s business in any way as they are not directed to or related to the oil and gas industry to which Complainant markets its software. In addition, there are third party software companies also known as Cygnet.

 

Respondent argues that bad faith use under the Policy arises where there is an intention to confuse and misdirect consumers. There were many other links on that page, including “Knox Swans;” “How to Keep Swans;” “Animal wallpaper;” and “Russ Stuffed Animals.” Complainant’s argument that one link for their software product among a hodgepodge of other links, including those related to “swans,” constitutes a bad faith intent on Respondent’s part is patently absurd and disingenuous. The likely reason a sponsored advertisement for Complainant’s business appeared is that Complainant placed a Google Adwords bid for the keyword “cygnet”, and authorized Google to syndicate this ad across Google’s partner network, which at the time included the disputed domain name. Complainant’s ad presumably would also have appeared in connection with a search on Google.com for the term “cygnet.”

 

A single, isolated, unintended non-misleading link certainly does not support a finding of bad faith registration and use under the Policy. Even if it were bad faith, this single act would not retroactively convert an otherwise good registration into a bad faith registration.

 

Respondent accepts that it is true, as Complainant alleges, that Respondent, strictly as a courtesy and without admitting any wrongdoing, agreed to remove the pay-per-click links from the web site following receipt of a cease and desist letter from Complainant. Respondent also accepts that certain links subsequently reappeared on its website but explains that this is the result of a misunderstanding. Respondent hosted the disputed domain name with a company known as Above.com. Above.com is a company that rotates its client’s domain names through several domain parking services. At the time Respondent offered to remove the advertising links the disputed domain name was hosted with Domain Sponsor. Respondent had forgotten that the disputed domain name was on the Above.com service and believed erroneously that he only needed to instruct Domain Sponsor to remove the links. For this reason, when Above.com cycled the disputed domain name through two other parking sites, BigJumbo.com and Skenzo.com, links appeared. As Respondent’s intention was to remove all advertising links, the inadvertent appearance of some advertising links was not a manifestation of Respondent’s intent and, thus, not a bad faith act on its part. Respondent adds that as noted above, the use of a domain name to display pay-per-click ads is entirely permissible and legitimate under the Policy.

 

Respondent states that its offer to remove the links was made with an express statement that Respondent was not admitting any wrongdoing, and there was no wrongdoing to admit and adds that the links that have appeared at Cygnet.com have overwhelmingly not been related to the goods and services marketed under Complainant’s Cygnet mark.

 

Respondent states that in order to prove bad faith registration of a common word domain name, the Complainant must prove that Respondent registered the disputed domain name with the intent to specifically target its mark.

 

 

Respondent argues that because of the substantial third party use of the term, it cannot be assumed that Respondent targeted Complainant’s trademark. Complainant needs to present evidence of such intent, none of which has been produced — because there is none. The fact is that the only target of Respondent’s registration was the common word, “cygnet.” Not only does that fail to support a finding of bad faith registration, such registration in and of itself, establishes Respondent’s legitimate interest.

 

Respondent submits that the fact that Complainant waited more than 8 years after Respondent registered the disputed domain name – and two years after its CEO tried to buy it — to bring this action raises an inference that Complainant did not truly believe Respondent engaged in bad faith registration and use of the domain. Complainant attempted to purchase the disputed domain name long before the initiation of this dispute. In March 2008, Complainant’s President and CEO sent an inquiry attempting to purchase the disputed domain name. Respondent argues that an offer to purchase a domain name made outside of the context of a settlement is a tacit acknowledgement of a respondent’s legitimate interest in the domain name and therefore Complainant’s purchase inquiry is a recognition of Respondent’s legitimate interest in the disputed domain name. Respondent points out that Complainant’s President and CEO did not raise any trademark claim when initiating the purchase inquiry.

 

Respondent objects to the fact that Complainant is first raising a legal claim two years after its failed purchase attempt. Respondent has not engaged in bad faith registration or use. There is absolutely no evidence Respondent acquired the disputed domain name with Complainant’s trademark in mind. As alleged in the Complaint, and indicated in Complainant’s Exhibit 11, in 2005, almost 5 years ago, an isolated link appeared on Respondent’s web site which was a pay-per-click advertisement for Complainant that appears to have led directly to Complainant’s web site. Accordingly Respondent submits that the Panel should issue a decision denying the Complaint.

 

There is absolutely no evidence of bad faith registration or use. Respondent did not register the disputed domain name with Complainant’s trademark in mind and had no knowledge of Complainant, its web site, its business name or trademark when it registered the domain name. Respondent did not register the disputed domain name with the intent to sell to Complainant, to disrupt Complainant’s business, or to confuse consumers seeking to find Complainant’s web site. Respondent did not register the disputed domain name to prevent Complainant from owning a domain name incorporating its trademark.

 

While Respondent has hosted the disputed domain name at a number of domain name parking services, such as Domain Sponsor and HitFarm, Respondent’s purpose in registering domain names was not to park them. Respondent has been registering common word domain names for investment and development, since 1997, long before the advent of pay-per-click advertising, and long before there were domain name parking services. Respondent registered common word domain names because it believes they best fulfill the purpose of a domain name which is to be easy to remember.

 

“Cygnet” is a common dictionary word. Where a complainant’s mark is a common word with substantial third party use, as it is here, the complainant must proffer evidence that demonstrates that respondent has specifically intended to confuse consumers seeking out Complainant. There is no such proof here. In Drew Bernstein v. Action Advertising, Inc., No. D2000-0706 (WIPO Sept. 28, 2000) the panel explained: the term “lip service” used in the respondent’s domain name is not an arbitrary or coined term nor a distinctive trademark, but a common English phrase susceptible of more than one meaning or connotation, which can be and is used in many commercial contexts and for this reason, the Panel found that the evidence was insufficient to establish bad faith registration and use. See also, Canned Foods, Inc. v Ult. Search Inc., No. FA 96320 (NAF Feb. 13, 2001) (“There are dozens of other enterprises that use the term “Grocery Outlet,” therefore one cannot conclude that Complainant must necessarily be the special target);xii Lumena s-ka zo.o. v. Express Ventures LTD, Case No. 94375 (NAF May 11, 2000)(“no direct evidence that Respondent registered the [generic] domain name with the intent of capitalizing on Complainant’s trademark interest”).Ultrafem, Inc. v. Warren Royal, No. 97682 (NAF Aug. 2, 2001)(“ Complainant cannot assert an exclusive right over a domain name that is a common, generic term.”).There is no such evidence here. See also Canadadrugs.com Partnership et al v. ASM Bioventure, No. 568743 (NAF Nov. 29, 2005)(“Respondent did not register the <canadadrugsonline.com> domain name in bad faith because Complainant’s mark is comprised of common terms.”). As one 3-member panel recently noted, the mere fact that a complainant has a trademark for a descriptive term does not prohibit the registration of domain names incorporating that term. National Gardening Association, Inc. v. CK Ventures, Inc., No. 1294457 (NAF Feb. 16, 2010)(“Complainant may have two trademark registrations containing the words GARDENING WITH KIDS but that does not mean that these are not common words.”)

 

The fact that there are numerous entities using the disputed domain name and others who value this domain further demonstrates that Respondent did not have Complainant’s trademark in mind, and that the value of the disputed domain name does not derive from Complainant’s trademark. Respondent has received several purchase inquiries from entities, including other trademark holders, who have made opening offers in amounts ranging from $1,000 to $10,000.

 

The link on Respondent’s site in 2005 that related to Complainant’s business was auto-generated and, thus, does not constitute evidence that Respondent acted in bad faith, i.e. they do not reflect Respondent’s intent. Mariah Media Inc. v. First Place Internet Inc., supra. Publicly available archived screenshots of Respondent’s web site demonstrate overwhelmingly that the links on Respondent’s web site have had nothing to do whatsoever with Complainant’s trademark over the course of eight years. In any event, the link to Complainant’s web site, as well as other software links unrelated to Complainant’s business, appeared years after the Disputed domain name was registered. Accordingly these links are irrelevant in determining Respondent’s mindset in when it acquired the Disputed domain name. See Intuit Inc. v. Nett Corp., No. D2005-1206 (WIPO Feb. 20, 2006).(“The earliest evidence that could possibly amount to bad faith use is so long after registration that it cannot outweigh the evidence tending to show good faith registration”). See also Passion Group Inc. v. Usearch, Inc., eResolution case AF-0250; followed in Viz Communications, Inc., v. Redsun et al, No. D2000-0905 (WIPO Dec. 22, 2000); Yoomedia Dating Limited v. Cynthia Newcomer / Dateline BBS, No. D2004-1085 (WIPO Feb. 22, 2005).

 

Respondent submits that it registered the domain name in good faith and had no malicious intent with respect to the use of the domain name either. Respondent further submits that even if the links are deemed a bad faith use, the Complaint should nevertheless be denied because there is no evidence of bad faith registration. The Motley Fool, Inc. v. Domain Works, Inc., No. D2006-1625 (WIPO Mar. 20, 2007)(to prove bad faith the original domain registration must be in bad faith).

 

Complainant’s action and its inaction demonstrate it did not truly believe Respondent has engaged in bad faith registration. First, Complainant did not initiate these proceedings until more than eight years following Respondent’s acquisition of the Disputed domain name. Complainant was obviously aware the domain was registered to Respondent as early as 2001 but failed to do anything for eight years.

 

While laches is not generally recognized under the Policy, such a long delay in taking action, can raise an inference that the Disputed domain name was not registered and used in bad faith. C. Brewer and Sons Ltd. v.Vertical Axis, Inc., D2009-1759 supra. There, the Complainant had delayed bringing a complaint for 8 years. The Panel stated that: the Complainant has not been assisted by its delay in filing the Complaint. The delay, together with the lack of evidence of goodwill and reputation in the Trade Mark when the disputed domain name name was registered, and the Respondent’s assertion that it had never heard of the Complainant when it registered and commenced use of the disputed domain name name, gives rise to the inference that the disputed domain name name has not been registered and used in bad faith.

 

As the Panel stated in the recent decision in Vanguard Trademark Holdings USA LLC v. Nett Corp., No. 1262162 (NAF July 26, 2009) In reaching this decision this Panel accepts that the doctrine of laches does not apply in the UDRP, but in the present case there appears to be some merit in Respondent’s argument that if Complainant were confident in its allegation of bad faith registration of the domain name it would not have delayed so long in bringing this Complaint. See also Rolling Stone LLC v. Robbins Carnegie Inc., No. 318048 (NAF Oct. 14, 2004)(delay could indicate that Complainant“ did not seriously believe” that Respondent had violated the Policy.”) see also Bosco Prod., Inc. v. Bosco email Servs., No. 94828 (NAF June 29, 2000) (“Without determining if the passage of considerable time would alone bar Complainant from relief in this proceeding, the Panel notes that Complainant does not explain why it has waited nearly four years to try and resolve [the domain name dispute].”); New Piper Aircraft, Inc. v. Piper.com, supra. (Complainant’s failure to initiate a suit in over two years indicated that Complainant did not believe that Respondent intended to attract customers through confusion). Like these cases, the panel should find that Complainant’s silence for over 8 years, followed by negotiations to purchase the domain name, raises the inference that Complainant did not believe Respondent’s registration and use of the Disputed domain name was in bad faith.

 

Finally, in citing the early UDRP case of J. Crew International, Inc. v. crew.com, D2000-0054 (WIPO April 20, 2000) from the early days of the UDRP Complainant has neglected to mention that there was a very strong dissenting opinion in this decision that argued emphatically that the two panelists finding for the Complainant were not applying the policy correctly. Gervaise Davis, the dissenting panelist, stated: “In my judgment, the majority’s decision prohibits conduct which was not intended to be regulated by the ICANN Policy. This creates a dangerous and unauthorized situation whereby the registration and use of common generic words as domains can be prevented by trademark owners wishing to own their generic trademarks in gross. I cannot and will not agree to any such decision, which is fundamentally wrong.” Respondent submits that Mr. Davis’ dissenting view has since become the prevailing view among UDRP panels. Respondent’s activities have been reviewed by numerous other UDRP panels. The vast majority have found that Respondent’s activities of registering common word and descriptive domains comply with the UDRP policies even if other entities have registered trademarks for a similar term. Shoe Land Group LLC v. Telepathy, Inc. et al, No. 1255365 (NAF June 9, 2009); HM Publishers Holdings Ltd v. Telepathy, Inc., No. D2002-0658 (WIPO Sept. 27, 2002); Geometric Sofware Solutions Co. Ltd. V. Telepathy, Inc., No. D2007-1167 (WIPO Nov. 8, 2007); General Machine Products Co., Inc. v. Prime Domains (a/k/a Telepathy.com), No. 92531 (NAF Mar. 16, 2000); U.S. Nutraceuticals, LLC v. Telepathy, Inc., No. 365884 (NAF Jan. 17, 2005); Koninklijke KPN N.V. v.Telepathy Inc., Case No. D2001-0217 (WIPO May 7, 2001).

Accordingly, because Complainant has failed to establish that Respondent registered or used the disputed domain name in bad faith, the Complaint must be denied.

 

Respondent finally submits that Complainant has abused the Policy by bringing a Complaint wholly without merit. The disputed domain incorporates a common word subject to substantial third party use, and third party trademarks. There is absolutely no evidence that Respondent registered the disputed domain name with Complainant or its trademark in mind. Respondent argues that Complainant “knew or should have known at the time it filed the Complaint that it could not prove one of the essential elements required by the Policy.” Carsales.com.au Ltd. v. Flanders, No. D2004-0047 (WIPO Apr. 8, 2004); Futureworld Consultancy, Pty Ltd v. On-line Advice, No D2003-0297 (WIPO July 18, 2003). As noted above, Complainant’s delay in initiating this action for eight years suggests it did not really believe Respondent’s activities amounted to bad faith under the Policy, underscored by Complainant’s attempt to purchase the domain name 2 years earlier.

 

Accordingly, Respondent submits that the Panel should find that Complainant has engaged in reverse domain name hijacking.

 

C. Complainant’s Additional Submissions

In detailed Additional Submissions Complainant accepts that Respondent is correct that registering a domain name for its descriptive or generic value may constitute a legitimate interest for the purposes of ¶ 4(c) of the Policy, but submits that this proposition is true only if the disputed domain name (1) has not been registered because of its value as a trademark and (2) is being used solely in connection with its descriptive or generic meaning. See Landmark Group v. DigiMedia.com, L.P., FA 285459 (NAF Aug. 6, 2004) (pay-per-click landing pages are legitimate if “the domain names have been registered because of their attraction as dictionary words, and not because of their value as trademarks”). See also mVisible Technologies, Inc. v. Navigation Catalyst Systems, Inc., D2007-1141 (WIPO Nov. 30, 2007) (if the pay-per-click links are based on the trademark value of the domain names, “the trend in UDRP decisions is to recognize that such practices generally do constitute abusive cybersquatting”); Asian World of Martial Arts Inc. v. Texas International Property Associates, D2007-1415 (WIPO Dec. 10, 2007) (disputed domains ordered transferred because the links on registrant’s site were clearly based on the trademark value of the disputed domains as they were not about generic products that offered professional force strength which registrant argued was the commonly understood meaning of “proforce” as a generic word for “professional force,” meaning “strength”; rather, registrant’s site was focused on targeted advertising and promotion of “karate”- and “martial arts”-related products that were exactly the kinds of products sold by complainant under the trademarks); Ustream.TV, Inc. v. Vertical Axis, Inc., D2008-0598 (WIPO July 29, 2008) (disputed domain ordered transferred; even if “you stream” was descriptive of some services, the content of registrant’s site belies its argument that it is using the disputed domain solely in connection with its descriptive meaning because there is no descriptive relationship between the disputed domain <ustream.com> and conference call services, computer science training, and business continuity services, all of which were advertised on registrant’s site).

 

Similarly, in casu, the fact that the term “cygnet” may mean “a young swan” does not per se give Respondent rights or legitimate interests in the disputed domain name. Respondent  must be using the disputed domain name solely in connection with its descriptive or generic meaning, which is clearly not the case. In fact, Respondent has admitted that the site to which the disputed domain name resolves features pay­-per-click links for non-swan related categories such as travel, finances, health and beauty, insurance, and shopping. Therefore, it is clear that Registrant has not and is not using the disputed domain name solely in connection with the descriptive or generic meaning of the term “cygnet.” Accordingly, it is reasonable to infer that Registrant did not acquire the domain name based on a good faith belief that its value derived from the term’s descriptive or generic qualities.

 

As noted by previous administrative panels, “Paragraph 2 of the Policy implicitly requires some effort to avoid registering and using a domain name corresponding to the trademark of another…[if a registrant] has not indicated that it [has] explored the possibility of third-party rights in any way before registering the disputed domain name, [the registrant cannot form] the requisite good faith belief by closing its eyes to whether the domain name was identical or confusingly similar to the trademark of another.” HSBC Finance Corporation v. Clear Blue Sky Inc., D2007-0062 (WIPO June 4, 2007). Here, Respondent has not demonstrated that it registered the disputed domain name because of its attraction as a dictionary word or as a descriptive or generic term, therefore, Respondent has no rights or legitimate interests in the disputed domain name.

 

Furthermore, the content of Registrant’s site does not reflect a bona fide offering of goods or services or a legitimate noncommercial or fair use of the disputed domain name. Rather, the disputed domain name is being used for pay-per-click pages at which advertisements are displayed keyed to the term “cygnet,” with revenue from those advertisements paid to Registrant. As prior administrative panels have held, it is well established that pay-per-click pages built around a trademark, as contrasted with pay-per-click pages built around a dictionary word and used solely in connection with the merely descriptive or generic meaning of the word, do not constitute a bona fide offering of goods or services pursuant to ¶ 4(c)(i) of the Policy, nor do they constitute a legitimate non-commercial or fair use pursuant to paragraph 4(c)(iii). See mVisible Technologies, Inc v. Navigation Catalyst Systems, Inc., supra; Asian World of Martial Arts Inc. v. Texas International Property Associates, supra.

 

Complainant states that the fact that Complainant’s president made an inquiry to purchase the disputed domain name is not per se an acknowledgment of Respondent’s right or legitimate interest in the disputed domain name. In fact, it is common for trademark owners to inquire about purchasing a disputed domain name as a means to quickly resolve a domain dispute. If the registrant agrees to sell the disputed domain name for less than the cost of filing a UDRP or other action, it is more economically feasible for the trademark owner to purchase the domain name compared to going through with a UDRP or other action. The facts of this case are distinguishable from that of Prom Software, Inc. v. Reflect Publishing, Inc., D2001-1154 (WIPO Mar. 4, 2002), cited by Registrant. In Prom Software, the complainant sought to acquire the domain name <prom.com> from the registrant who was using it to resolve to a site in connection with the descriptive meaning of the word, i.e., school prom-related links as well as other content of general interest to teens. Therefore, the complainant was trying to acquire a disputed domain name in which it likely had no better rights than the registrant. These are not the same circumstances here as Registrant does not have any right or legitimate interest in the Domain Name because Registrant is not using the Domain Name in connection with the descriptive or generic meaning of the term “cygnet.” Consequently, contrary to Registrant’s assertions, Complainant’s president’s inquiry does not constitute a tacit acknowledgment of Registrant’s legitimate interest in the Domain Name but, rather, was an informal way for Complainant to have possibly resolved the dispute without resorting to a UDRP or other action.

 

D. Respondent’s Additional Submissions

In detailed Additional Submissions Respondent inter alia re-asserts that it did not question the enforceability of Complainant’s trademark, stating that it “did not take a position regarding the enforceability of Complainant’s trademark.” Respondent simply indicated “the existence of third party trademarks” to demonstrate the weakness of Complainant’s trademark and the fact there is no basis to infer Respondent targeted its trademark, since Complainant’s trademark was one of several that incorporate the common word “cygnet.”

 

Respondent re-iterates that its legitimate interest is, per se, established upon registration of a domain name incorporating a common word, where there is no evidence Respondent targeted Complainant’s trademark. The evidence demonstrates that the disputed domain name was one of many common word domain names registered by Respondent incorporating the names of birds and other animals. There simply is no evidence demonstrating Respondent registered the disputed domain name with Complainant’s trademark in mind, or any trademark in mind. In any event, it is not Respondent who must prove it registered the disputed domain name based on its dictionary meaning, it is Complainant who has the burden of proof of demonstrating the disputed domain name was registered to target its trademark. Complainant has failed to meet this burden.

 

Complainant argues that the offer by its President to buy the disputed domain was simply an offer to settle a dispute and not a recognition of Respondent’s right to the domain name. Complainant argues that the offer was made as an informal way to resolve the case in an attempt to avoid filing a UDRP or other action. The problem with Complainant’s argument is that the President made the purchase inquiry in 2008 – two years ago. If Complainant truly believed it had a claim at the time it made the purchase inquiry, it would have filed the UDRP after getting no reply to its offer. Instead, Complainant waited two years. Such a wait raises an inference that Complainant did not believe it had a valid claim. Vanguard Trademark Holdings USA LLC v. Nett Corp., No. 1262162, supra.)(“delay” helps “give[] rise to the inference that the disputed domain name has not been registered and used in bad faith.”).

 

 

 

FINDINGS

The domain name <cygnet.com> (the “Domain Name”) is the subject of this Complaint (ICANN Rule 3(b)(vi)).

 

The registrar of the Domain Name is Moniker Online Services, LLC (“Registrar”).

 

Complainant owns U.S. Trademark Registration No. 2,079,850 for CYGNET for “personal computer software for local and wide area local networks used to construct business applications for manufacturing, utilities, financial, transportation, and communications industries,” with rights dating back to the June 22, 1995, application filing date. In addition, Complainant has been using the CYGNET Mark in connection with its software solutions and services since December 1, 1995. Attached as Ex. 7 is a copy of the U.S. registration for CYGNET.

 

Complainant also owns the following CYGNET-based domain names: cygnet.us; cygnetcentral.net; cygnetcomplete.com; cygneteop.com; cygnetetm.com; cygnetrealtime.com; cygnetrt.com; cygnetr-t.com; cygnetscada.com; cygnetscada.net; cygnetsoftware.ca; cygnetsoftware.net; cygnetsw.com; cygnetsystems.com; cygnetsystems.info; cygnetsystems.mobi; cygnetsystems.net; cygnetsystems.org; cygnetsystems.us; cygnetuserforum.com; cygnetusergroup.com; cygnetusergroupforum.com; cygnetusersgroup.com; cygnetusersgroup.net; cygnetusersgroup.org.

 

The disputed domain name was registered on June 28, 2001, five and a half years after Complainant began using the CYGNET Mark. 

 

Respondent is a company based in Washington, D.C. Respondent states that its ultimate goal is to develop its domain names or resell them to other entities looking for easy-to-remember domain names for Internet addresses for their web sites. Respondent hosts its underdeveloped domain names with domain name parking services which pay Respondent a share of the advertising revenue they generate, and industry-wide accepted practice.

 

At all material times Respondent has arranged for the disputed domain name to resolve to a search engine and Respondent receives pay-per-click fees based on the number of visitors who click on the paid advertisements and pop-ups generated from these searches.

 

 

 

DISCUSSION

Paragraph 15(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”) instructs this Panel to “decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”

 

Paragraph 4(a) of the Policy requires that the Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:

 

(1)   the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

(2)   the Respondent has no rights or legitimate interests in respect of the domain name; and

(3)   the domain name has been registered and is being used in bad faith.

 

Identical and/or Confusingly Similar

 

This Panel finds that Complainant has established rights in the trademark CYGNET through its registration and use of the mark in trade in relation to its software business.

 

This Panel further finds and that the disputed domain name <cygnet.com> is identical to Complainant’s trademark because it is well accepted that when comparing a domain name and a trademark under the Policy, the .com domain extension may be ignored.

 

In the circumstances Complainant has satisfied the first element of the test as set out in Policy ¶ 4 (a)(i).

 

Rights or Legitimate Interests

 

This Panel accepts Complainant’s submissions that the fact that Complainant’s president made an inquiry to purchase the disputed domain name is not per se an acknowledgment of Respondent’s right or legitimate interest in the disputed domain name. This Panel accepts that a party may for commercial reasons engage in negotiations to purchase a disputed domain name without conceding that a registrant has a legitimate interest in the registration.[1]

 

In Overview of WIPO Panel Views on Selected UDRP Questions ¶ 2.2 the question is posed: “Does a respondent automatically have a legitimate interest in a domain name comprised of a generic (dictionary) word(s)?”

 

Both parties accept that the word “cygnet” is a generic (dictionary) word. Complainant has adapted the word as a service mark. Respondent states that it has chosen to register the word, along with many other generic (dictionary) words because of its inherent value as an Internet domain name without any reference to the goodwill of Complainant’s trademark.

 

 The analysis of the consensus of panelist’s views is as follows:

“Consensus view: If the complainant makes a prima facie case that the respondent has no rights or legitimate interests, and the respondent fails to show one of the three circumstances under Paragraph 4(c) of the Policy, then the respondent may lack a legitimate interest in the domain name, even if it is a domain name comprised of a generic word(s). Factors a panel should look for when determining legitimate use would include the status and fame of the mark, whether the respondent has registered other generic names, and what the domain name is used for (a respondent is likely to have a right to a domain name “apple” if it uses it for a site for apples but not if the site is aimed at selling computers or pornography).

Relevant decisions:
402 Shoes, Inc. dba Trashy Lingerie v. Jack Weinstock and Whispers Lingerie D2000-1223, Transfer
Classmates Online, Inc. v. John Zuccarini, individually and dba RaveClub Berlin D2002-0635, Transfer
Emmanuel Vincent Seal trading as Complete Sports Betting v. Ron Basset D2002-1058, Transfer
Owens Corning Fiberglas Technology, Inc v. Hammerstone D2003-0903, Transfer

However: If a respondent is using a generic word to describe his product/business or to profit from the generic value of the word without intending to take advantage of complainant’s rights in that word, then it has a legitimate interest.

Relevant decisions:
Allocation Network GmbH v. Steve Gregory D2000-0016, Denied
Porto Chico Stores, Inc. v. Otavio Zambon D2000-0270, Denied
Asphalt Research Technology, Inc. v. National Press & Publishing, Inc. D2000-1005, Denied
Gorstew Limited v Worldwidewebsales.com D2002-0744 among others, Denied.”

In determining the issue of legitimate use in the present case, this Panel is conscious that Complainant has not claimed or provided evidence that CYGNET is a famous mark, Respondent has for many years registered other generic names, and there is no evidence that Respondent has ever had any intention of taking advantage of Complainant’s rights in the CYGNET mark.

 

This panel is satisfied that on the balance of probabilities, Respondent registered and is using the disputed domain name to profit from the generic value of the word “cygnet” without any reference to Complainant’s rights or goodwill.

 

It follows that on the balance of probabilities, applying the consensus view, Respondent has rights and legitimate interest in the domain name as it claims.

 

In the circumstances Complainant has failed to establish the second element of the test in Policy ¶ 4 (a)(ii) and the Complaint must fail.

 

 

Registration and Use in Bad Faith

 

For completeness, this Panel further finds that Complainant has failed to establish that Respondent registered and used the domain name in bad faith.

 

Respondent has provided by way of a statement from the President of the Respondent and in submissions, an entirely credible explanation as to how it came to decide upon and register the disputed domain name. Respondent is engaged in an entirely legitimate business of trading in domain names and in itself such activities do not constitute bad faith.

 

Respondent has provided evidence that the word “cygnet” is widely used as a trademark and on the Internet by third parties.

 

On the balance of the evidence, this Panel rejects Complainant’s submission that the only plausible reason that Respondent had to register and use the disputed domain name was to take unfair advantage of the recognition associated with Complainant’s CYGNET mark by diverting consumers from Complainant’s website to its parked site, and thereby benefit from the confusion and diversion by receiving pay-per-click commissions. Respondent chose and registered the domain name without any reference to Complainant or its goodwill. There are no circumstances indicating that Respondent registered the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to Complainant or to a competitor of Complainant. When Complainant approached Respondent with an offer to purchase the disputed domain name Respondent did not engage in negotiations.

 

It is accepted by both Parties that a link to Complainant’s website appeared on Respondent’s web page in the year 2005. In the circumstances outlined above, this Panel accepts Respondent’s submission that the single, isolated, unintended non-misleading link does not support a finding of bad faith registration and use under the Policy.

 

Neither is there any evidence that Respondent registered the domain name in order to prevent Complainant from reflecting the mark in a corresponding domain name or to disrupt Complainant’s business in any way.

 

While there may be similar cases where a domain name consisting of a dictionary word is registered to take predatory advantage of the goodwill of the owner of a trademark as demonstrated by the examples given in ¶ 2.2 of the Overview of WIPO Panel Views on Selected UDRP Questions, this Panel is satisfied that this was not the case in casu

 

There is no evidence that Respondent has intentionally attempted to attract, for commercial gain, Internet users to its 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 your web site or location. Complainant’s trademark and the disputed domain name consist of a commonplace English language word meaning “a young swan” and Respondent has accumulated a store of domain names consisting of descriptive words including a number of bird and animal names. The disputed domain name was chosen for this purpose and not to target Complainant’s goodwill.

 

This Panel accepts Respondent’s submission that it is not Respondent who must prove it registered the disputed domain name based on its dictionary meaning; it is Complainant that bears the burden of proof of demonstrating the disputed domain name was registered to target its trademark. On the evidence in the present proceeding, Complainant has failed to meet this burden.

 

This Panel finds it unnecessary to decide this case on the basis of the claimed defense of laches on the part of Claimant. That being said this Panel takes an inference from Complainant’s delay prior to and subsequent to Complainant’s approach to Respondent with an offer to purchase the domain name.

 

Reverse Domain Name Hi-Jacking

While there is a number of factors indicating that Complainant brought this application in the knowledge that it was unlikely to succeed, in particular the delay in bringing this Complaint, this Panel is reluctant to make a finding of reverse domain name hi-jacking given that Complainant has long standing established trademark rights in the word CYGNET and Respondent has no trademark rights in the word.

 

 

DECISION

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

 

 

James Bridgeman, Panel Chair

Honorable Ralph Yachnin, (Ret.), Neil Anthony Brown, Panelists
Dated: June 25, 2010

 

 

SEPARATE DECISION BY THE HONOURABLE NEIL ANTHONY BROWN QC ON THE ISSUES OF LACHES AND REVERSE DOMAIN NAME HIJACKING

 

 

Laches

Although it has not specifically raised the defence of laches by name, Respondent has in fact raised the defence that the Complainant’s inaction over several years demonstrates that it did not truly believe Respondent had engaged in bad faith registration, a defence that is akin to laches. In advancing its argument, the Respondent has said that while laches is not generally recognized under the Policy, such a long delay in taking action, over 8 years in the present case from when the domain name was registered, can raise an inference that the domain name was not registered and used in bad faith ; the Respondent cites the decisions in C.Brewer and Sons Ltd v.Vertical Axis , Inc D2009-1759 , Vanguard Trademark Holdings USA LLC v. Nett Corp., No.126162 ( NAF July 26,2009) and several others.

 

The Complainant, in its supplementary submission, argues that laches is not a defence in UDRP proceedings and that even if it were, in the present case there have “only been two years” between the time when the Complainant first inquired about buying the domain name and the time when the Complainant was filed, which is not long enough to give rise to laches. Moreover, the Complainant argues, there is no evidence that the Respondent has suffered prejudice from the delay.

 

As the parties have thus joined issue on the question of delay and its consequences, whether it is called laches or something else, it seems somewhat artificial not to give a ruling on the issue, a ruling to which the parties are entitled.

 

It could then be noted that this panelist was part of a majority in one case that felt that there is scope for looking again at the assumption that laches has no part to play in UDRP proceedings , a decision that has been the subject of at least one commentary at www.cyberlawonline.com. In Board of Trustees of the University of Arkansas v. FanMail.com, LLC, WIPO Case No. D2009-1139, the majority said:

 

“Complainant’s delay in filing the Complaint and Respondent’s Defense of Laches

At the outset, the Panel believes it necessary to discuss Complainant’s considerable delay in filing this case under the Policy. This is because Respondent raised the issue of laches in both its 2008 correspondence to Complainant and in its Response to the Complaint. The Panel also observes that the applicability of laches under the Policy has garnered some, but not much, commentary in prior cases.

 

As a general matter in litigation, laches is a defense to some claims where the plaintiff has unreasonably delayed pursuing his claim, and as a result of such delay the defendant has suffered prejudice. Unlike a statute of limitations, which attempts to draw a bright temporal line between a time-barred claim and a timely claim, laches is a more malleable doctrine, and often entails a deeper factual inquiry.

A majority of the Panel (Messrs. Badgley and Brown) is prepared to acknowledge the possible applicability, in appropriate and limited circumstances, of laches in a case under the Policy.

 

Rule 15(a) provides that “a panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.” 

 

In the United States, where both parties in this case reside, the doctrine of laches is a longstanding and universally recognized principle. It has been said that laches does not fall within the “catchall” language of Rule 15(a) because, strictly speaking, it is a principle of equity and not law. See, e.g., The Hebrew University of Jerusalem v. Alberta Hot Rods, WIPO Case No. D2002‑0616 (October 7, 2002). Messrs. Badgley and Brown take the view, however, that it is not unreasonable to consider laches as falling within Rule 15(a) given that, in many if not most jurisdictions in the United States and in countries such as the United Kingdom and Australia, the formerly sharp line between law and equity has been blurred if not effaced by the amalgamation of law and equity. Indeed, it would appear unlikely that when they used the expression ‘principles of law that it deems applicable,’ those who drafted the Rules meant ‘principles of law but not equity.’

 

It has also been said that laches should not apply to cases under the Policy because UDRP cases are supposed to be streamlined and quick, and application of a laches defense entails too intensive a factual inquiry to lend itself to the celerity of the UDRP process. See, e.g., The E.W. Scripps Company v. Sinologic Industries, WIPO Case No. D2003‑0447 (July 1, 2003) (laches defense runs counter to the Policy’s objectives). That may be true in some instances, but in others, Messrs. Badgley and Brown believe, it is possible that disposition of the laches question might be no more difficult than disposition of other questions that routinely come before UDRP panelists. Again, a majority of the present Panel (Messrs Badgley and Brown) believes that, in appropriate and limited circumstances, a laches defense might be sufficiently clear based on the limited record, so that its application would not unduly complicate or prolong the UDRP process.

 

However, the considerable delay in bringing this case does color the merits of the dispute. As has been observed in prior cases, even if laches does not apply, delay may reflect the strength, or lack thereof, of a complainant’s case. See, e.g., AIB-Vincotte Belgium ASBL, AIB-Vincotte USA Inc./Corporation Texas v. Guillermo Lozada, Jr., WIPO Case No. D2005‑0485 (August 29, 2005) (although laches does not provide a separate defense under the Policy, it “may sometimes be relevant in considering whether the requirements of the Policy have been satisfied”). For instance, the record in this case does not include much if any hard evidence surrounding Respondent’s decision to register the Domain Name 14 years ago. Instead, as is discussed below, Complainant relies heavily on the fame of its university sports teams and asks the Panel to draw inferences therefrom.

 

Ultimately, the majority of the Panel (Messrs Badgley and Isenberg) does not decide this case on the basis of a laches defense. This is because, among other reasons, Respondent did not present any hard evidence of prejudice it suffered as a result of Complainant’s considerable delay.

 

Panelist Brown takes the view that whether the delay is properly characterized as laches or not, the considerable delay on the part of Complainant in bringing the Complaint militates against its success in this proceeding. It should be remembered that Respondent registered the Domain Name as long ago as August 7, 1995, which is 14 years before the Complaint was filed. Such an extreme delay calls for some explanation. Although Respondent’s attorneys squarely raised the issue in correspondence and in the Response and relied on it as a defense, and although Complainant filed a Supplementary Reply to the Response and had an opportunity to explain its delay, it did not do so and did not put forward any facts to explain either the delay or the consequences that Respondent sought to draw from it.

 

In particular, Panelist Brown notes that there was no explanation given as to why, after Complainant sent its first letter of demand to Respondent and was rebuffed, it then waited a further five years before renewing its siege, and then a further year before actually filing the proceeding. These extended delays could not help but have lulled Respondent into the sense that either Complainant had decided it had no claim, had abandoned or waived it, or had no confidence in it. Respondent could not help but have been encouraged by the delay to continue running its e-mail service and subsequently its website. 

 

Accordingly, although there may be no evidence of actual financial prejudice suffered by Respondent and although the whole matrix may not be properly characterized as laches, in Panelist Brown’s view, the delay and lack of explanation for it strengthen Respondent’s case for a right or legitimate interest in the Domain Name and negate Complainant’s case that the Domain Name has been used in bad faith. That is so because the unchallenged evidence is that Complainant by inactivity encouraged Respondent to continue to use the Domain Name in the way in which Complainant knew it was being used.”

 

Those remarks seem to be appropriate to the present case and in some respects they mirror the present proceedings. The domain name was registered 8 years before the Complaint was filed, a considerable period of time, calling for an explanation both of the effluxion of time itself and how and when the Complainant first came to be aware of the domain name. More importantly, the Respondent’s legal representatives raised in the Response the delay in its consequences so far as the Respondent was concerned. This certainly called for an explanation from the Complainant for the overall delay and, as the Complainant’s case is that it did not know of the domain name until “in 2008”, an explanation as to why it waited from 2008 until 2010 to file the Complaint. The Complainant filed a supplementary submission, so it had ample opportunity to give its explanation, but the only one that was forthcoming was that it has “only been two years”, which is not long enough to give rise to concern, but two years is a long time in a domain name case. As to prejudice, the prejudice is that the Respondent has been allowed to build up a business by using the domain name and without any actual challenge from the Complainant.

 

      Finally, it should be recalled that the Complainant’s case is that the Respondent registered

the domain  name in bad faith by intentionally engaging in an act of deception by creating confusion in the public mind. Accordingly, the observations I made in Shoe Land Group LLC v. Development, Services c/o Telepathy Inc. No: FA0904001255365 (NAF June 9, 2009) seem to be appropriate in the present case, for the facts were similar. I said in that decision:

 

“Alternatively, the delay of almost two years since Complainant evinced a desire to buy the domain name leads to the same result. More particularly, it can hardly be said that Complainant stood by during those periods of time believing that Respondent was actively siphoning off its potential customers and yet doing nothing of substance about it. As the panelist said in The New Piper Aircraft, Inc. v. Piper.com, FA 94367 (NAF May 2, 2000), one of the 3 cases cited by Respondent on this issue,

 

“Complainant’s waiting two years to complain after being advised of the existence of the site indicates that Complainant did not believe that Respondent intended to attract internet users to its site through confusion.”

 

 All of that being so, it is reasonable to conclude that there should be more debate on

 recognizing laches, or at least unexplained delay, as a defence to a UDRP claim. In any event, on the facts of the present case, enough is known to justify the conclusion that the Complainant did not demonstrate or believe that the Respondent registered or used the domain name in bad faith.

 

Reverse Domain Name Hijacking

 

It is true that the reason relied on by the majority for finding against reverse domain name hijacking, that “Complainant has long standing established trademark rights in the word CYGNET and Respondent has no trademark rights in the word” may be factors weighed in the balance to decide the issue. But they cannot decide the issue by themselves. It is important that a panel apply the words of the Rules, which require it to examine the submissions and decide, by taking everything into account, whether the Complaint was brought in bad faith or as a form of harassment. A complaint that is brought with an excess of optimism will not necessarily have been brought in bad faith or as a form of harassment.

 

But a claim which the Complainant must be taken to have known was destined to fail, especially when part of its case is that it was the Respondent who acted in bad faith, when there was never any evidence at all to support that proposition, must be at risk of a finding of reverse domain name hijacking.

 

In the present case, before the Complaint was filed, the Complainant had apparently looked at the record of how the Respondent had used the domain name. That was sensible, for the Complainant’s trademark was an ordinary English word descriptive of a young swan and the domain name adopted the same word . But any fair and reasonable observer should have concluded from the results of that examination (or at least from the parts of it that found their way into the evidence) that the Respondent had not used the word in the narrow use for which it had been registered as a trademark, but in the generic sense in which it was usually used as an word in the English language.

 

Moreover, it had not targeted the Complainant, its line of products or its area of activity, but had been running, in substance, a cygnet, bird and general commercial website with links to swans and even schwans, as well as the usual offerings of goods and services found on so many websites. This must have been apparent before the Complaint was filed.

 

Even if it were not so apparent at that time, it was certainly made apparent in the Response, supported as it was by 9 pages of evidence of archived screenshots from the Respondent’s website. Despite that, the Complainant persisted with its allegations and bolstered its case by the additional argument that if it could find one “non-swan” link on the Respondent’s website, this showed that the Respondent had no right to the domain name. That was an argument that was not supported by any authority, was contrary to the long list of decisions cited by the Respondent and was doomed to failure, as it is clear that the Policy and the Rules look, not to minutiae like occasional “non swan” links, but to the substance of what the Respondent was doing with the domain name and whether it was acting in a bona fide manner. The overwhelming substance of the use made of the domain name was for “swan” and bird links, links to Australia and Tasmania, no doubt because of the historic town of Cygnet in Tasmania, together with “ non-swan” links which are just as legitimate. However, the point is that the domain name was clearly not being used to target the Complainant or its business.

 

It was therefore apparent, before and after filing the Complaint, that it would fail.

 

For those reasons it is appropriate to make a finding of Reverse Domain Name Hijacking.

 

 

Neil Anthony Brown, Panelist

Dated: June 25, 2010

 

National Arbitration Forum





[1] Panelist Brown’s view is that the fact that the inquiry to buy the domain name was made is a factor that may be taken into account to show that the Complainant in this case believed the Respondent had some right or interest in the domain name, although the conclusion to be reached about such inquiries will depend on the facts of an individual case.