12th Mar 2003
WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Vernons Pools Limited v. Vertical Axis, Inc
Case No. D2003-0041
1. The Parties
The Complainant is Vernons Pools Limited, Maple Court, Central Park, Reeds Crescent, Watford, Herfordshire, WD24 4QQ, United Kingdom of Great Britain and Northern Ireland. The Complainant is represented by Laytons, Solicitors of Guildford, Surrey, United Kingdom of Great Britain and Northern Ireland.
The Respondent is Vertical Axis, Inc, GPO Box 287, Hong Kong, SAR of China. The Respondent is represented by Mr. Ari Goldberger of ESQwire.com Law Firm, of Cherry Hill, N.J., United States of America.
2. The Domain Name and Registrar
The disputed domain name <vernons.com> is registered with the Registry at Info Avenue (dba IA Registry) ("the Registrar").
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the "Center") on January 21, 2003. On January 21, 2003, the Center transmitted by email to the Registrar a request for registrar verification in connection with the domain name at issue. On January 21, 2003, the Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details for the administrative, billing, and technical contact. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the "Policy"), the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules"), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the "Supplemental Rules").
In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on January 23, 2002. In accordance with the Rules, paragraph 5(a), the due date for a Response was February 12, 2003. The Response was filed with the Center on February 12, 2003.
The Center appointed on February 27, 2003, the Honourable Sir Ian Barker QC of Auckland, New Zealand, Mr. Clive D Thorne of London, UK and Mr. Milton L. Mueller of Syracuse, NY, USA as Panelists. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.
4. Factual Background
The Complainant is the proprietor of registered trademarks which comprise the word VERNONS or of which the word VERNONS is the dominant feature. Its registered trademarks include the following:
CTM 001506930 VERNONS Classes 16, 41
2066569 VERNONS Classes 35, 36, 41
Republic of Ireland Trademark
217892 VERNONS Classes 16, 41
The marks are used in connection with betting, gaming, gambling, lottery and football pools services as well as information services relating to these services including their provision over the Internet.
The Complainant has been a leading operator of football pools in the United Kingdom since 1925. It is a wholly-owned subsidiary of Hilton Group Plc and has diversified into other aspects of betting, gaming, gambling and lottery services including the provision of these over the Internet. The Complainant’s annual turnover is in excess of 30 million. It has spent a substantial sum developing, advertising and promoting its services throughout the world and has over 3 million customers in 150 countries.
The Complainant has not licensed nor otherwise permitted the Respondent to use the domain name nor any of its trademarks.
The domain name <vernons.com> was originally registered within the Hilton Group of companies. The registration was not renewed and accordingly lapsed. The disputed domain name was registered by the Respondent on October 14, 2001.
The Complainant’s representative wrote a ‘cease and desist’ letter to the Respondent on December 2, 2002. No response was received to this letter.
The website of the disputed domain name sells advertising space. It provides links to numerous webhosting services including links to gambling websites. The website states that the domain name is for sale at <onbid.com>. It states: "This site is Planned for Development. In the Meantime, Try Searching the Internet for these Topics."
5. Parties’ Contentions
Identical or confusingly similar
The disputed domain name is identical to the registered trademarks in which the Complainant has rights.
Rights or Legitimate Interests in the Domain Name
The Respondent has no rights or legitimate interests in the disputed domain name through any licence or other permission from the Complainant. The Respondent’s business has no connection with the name "Vernons" in that it does not trade under this name nor offer goods and services under this name and has not been and is not commonly known under this name.
The Domain Name Registered And Used in Bad Faith
The domain name should be considered as having been registered and used in bad faith by the Respondent because the domain name is used solely to attract, for commercial gain, Internet users to a website which offers access to gambling services. The Respondent is thus creating a likelihood of confusion with Complainant’s registered trademark as to the source, sponsorship, affiliation or endorsement of the Respondent’s website.
The Respondent has made illegitimate use of the disputed domain name, which it purchased purely to create an association with Complainant or its services or with intent misleadingly to divert Internet users. The Respondent must have known of the existence of the Complainant prior to registering its domain name.
The Respondent is engaged in a pattern of bad faith registrations. The Respondent has been the subject of domain name dispute resolution proceedings before. The Complainant refers to the decision of the National Arbitration Forum (NAF) on 10 October 2002, in Dispute Number FA0207000117320 to transfer the domain <harveys-tahoe.com>, registered by the Respondent to Harveys Casino Resorts.
The Respondent tendered a signed statement from a Mr. Colin Yu, a director of the Respondent, in support of its factual allegations. It also cited numerous cases decided under the Policy by WIPO and NAF Panelists in support of its submissions. The statement does not purport to be either an affidavit, affirmation or statutory declaration.
Identical or Confusingly Similar
The Respondent does not dispute that the disputed domain name is identical to the Complainant’s trademarks.
Rights or Legitimate Interests in the Domain Name
The Respondent registered the disputed domain name because it incorporates the common forename of Vernon. Its intention was – and continues to be – to use the name to offer users (principally people with the first name Vernon) a personalized email address as part of an email service, as well as personalized homepages. Other domain names which the Respondent has registered for personalized email and homepage service include <pauls.com>, <joanne.com>, <trevors.com> and <vickie.com>. Due to the downturn in the economy, and in the tech sector in particular, the Respondent has held off on developing this service until the financial outlook improves.
Although Respondent has not yet developed the email and homepage service due to the downturn in the economy, a legitimate interest under paragraph 4(c)(i) of the Policy is still established where economic circumstances preclude the implementation of a Respondent’s business plan.
Vernon is a very common name, and the Complainant does not have exclusive use of or rights to the words Vernon or Vernons. An Internet search for "Vernon" (excluding the words pool; pools; lottery; betting; bet, and game) yielded over 1.7 million third party web pages containing this common name. The same search for "Vernons" yielded over 4,000 third-party web pages.
A Respondent may use a domain name consisting of a person’s first name for goods and services unrelated to those offered by a trademark owner, and such use establishes the Respondent’s legitimate interest. Mere registration of a domain name incorporating a person’s first name establishes the Respondent’s legitimate interest. In Rusconi Editore S.p.A. v. FreeView Publishing, Inc., D2001-0875 (WIPO October 10, 2001). There, the Panel held in connection with the domain name <donna.com>:
"Donna is commonly used as a woman’s name in English. Despite having registered trademarks for that word in particular classes, the Complainant does not have exclusive rights to this common word."
The Respondent has used, and continues to use, the disputed domain name in connection with link advertising programs. The use of a common-word domain name in connection with a general advertising links programme establishes the Respondent’s legitimate interest. In Williams, Babbitt & Weisman, Inc. v. Ultimate Search, No. 98813 (NAF October 8, 2001), the Respondent had registered numerous generic and descriptive terms to generate advertising revenue. In finding a legitimate interest, the panel noted that "[n]either the current UDRP nor current ICANN registrar contracts preclude this type of domain name use."
The Domain Name Registered and Used in Bad Faith
There can be no bad faith finding in connection with a domain name incorporating a common word, like a person’s name, unless there is evidence that Respondent registered the domain name:
"specifically to sell to the Complainant"
or that the
"value of [the] domain derived exclusively from the fame of [the] trademark."
Ultrafem, Inc. v. Warren R. Royal, 97682 (NAF August 2, 2001).
According to Mr. Yu’s statement, the Respondent had no knowledge of the Complainant or its trademark when it registered the disputed domain name. The Respondent did not register the disputed domain name with the intent to sell it to the Complainant, to prevent it from incorporating its trademark in a domain name, to disrupt its business, or to confuse users.
The most the Complainant can allege is that the Respondent "must have known" of its existence prior to registering its domain name. But the Complainant has provided no evidence of such knowledge.
The Complainant cannot establish bad faith registration on a theory of constructive knowledge of its trademark. Complainant is a UK-based operation with registered trademarks only in European Community, the UK and Ireland. Respondent is located in Hong Kong.
As to the allegation that the Respondent chose the disputed domain name "purely to create an association with Vernon’s Pools" there is no evidence that the Respondent had even heard of the Complainant when the Domain Name was registered. Paragraph 4(b)(iv) of this Policy requires evidence that Respondent intended to create a likelihood of confusion.
The fact that the Complainant was a prior registrant of the disputed domain name does not mean that the Respondent’s subsequent registration was in bad faith. The opposite is true. As the Panel noted in Corbis Corporation v. Zest, No. 98441 (NAF September 12, 2001);
A domain registrant who knows a domain name has been abandoned should be more confident, not less so, that there is no competing trademark claim relating to the domain name ….
There is an element of "finders keepers, Losers weepers" in this decision. We believe that is as it should be.
In sum, where a party registers a lapsed domain name, and it is not attempting to use the name to compete with the mark holder or disrupt its business, we believe that ordinarily the trademark holder should be denied relief, whether the mark is a common law or registered mark, whether the mark is "strong" or "weak."
The Respondent’s failure to reply to the Complainant’s ‘cease and desist’ letter does not support a finding of bad faith.
In the other UDRP case involving the Respondent, Harveys Casino Resorts v. Vertical Axis, Inc., (No. 117320 NAF, October 10, 2002), the Respondent did not file a response in that proceeding, so it was unable to defend itself. The Respondent had transferred the disputed domain name to the Complainant prior to the rendering of the decision. Despite this, the proceeding still continued, which is peculiar, since this Respondent was not the registrant of the disputed domain name when the matter was decided. In any event, that case cannot be used to make up for the Complainant’s failure to demonstrate bad faith on the part of the Respondent in connection with the domain name at issue here.
6. Discussion and Findings
Paragraph 15(a) of the Rules instructs the 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."
The burden for the Complainant, under paragraph 4(a) of the Policy, is to show:
- that the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and
- that the Respondent has no legitimate rights or interests in respect of the domain name; and
- that the domain name has been registered and is being used in bad faith.
Identical or Confusingly Similar
The disputed domain name is identical to the Complainant’s registered trademarks. The Panel considers the first criterion proved.
Rights or Legitimate Interests
As to the second criterion, the Complainant gave the Respondent no legitimate rights or interests in respect of the domain name. The fact, on its own, in the absence of evidence to the contrary, can be sufficient to prove the second criterion. Paragraph 4(c) of the Policy sets out matters which a Respondent is entitled to raise which, if found by a Panel to be proved based on an evaluation of all evidence presented, demonstrate a Respondent’s rights or legitimate interests to a domain name.
The Respondent claims that it comes within paragraph 4(c)(i) in that before any notice of the dispute it used or it made demonstrable preparations to use the disputed domain name in connection with a bona fide offering of goods or services. It offers two bases for this submission:
First, the Respondent claims an intention of offering a personalised email service to persons bearing the name Vernon. It has not developed this service because of a downturn in economic circumstances. The Panel finds this part of the Respondent’s claim unproven. The Respondent has not proved any demonstrable preparations to run a vanity email service for persons called Vernon. It appears rather to be involved in an advertising business using many domain names.
Secondly, the Respondent claims that it acquired the disputed domain name when it happened to become available to add to its collection of common names and letter combinations for use in advertising.
The Respondent claims that its use of the disputed domain name in connection with advertising link programmes establishes a legitimate interest. The practice of registering different names to attract advertising hits is not necessarily deceptive or inimical to the rights of the trademark owners. See the Williams, Babbitt & Weisman case (supra). However, one of the links in the Respondent’s website is to "gambling" which when activated could take the user to possible competitors of the Complainant.
As against this, the Respondent is correct that the Complainant does not have exclusive rights to a common name. There is also, in the Respondent’s favour, the inference to be drawn from the Complainant’s failure to renew registration. This common name became available to whomsoever became lucky enough to buy it. Weighing all the considerations, the Panel is of the opinion that the Respondent’s use of the disputed domain name is legitimate and that the second criterion has not been proved.
The Complainant must establish evidence from which the Panel can infer bad faith both at the time of registration and continuing thereafter. The Respondent’s witness has declared that the Respondent in Hong Kong had no knowledge of the Complainant which operates from the United Kingdom and has trademarks registered thee in the European Union. There is no evidence to justify the Complainant’s bold assertion that the Respondent must have known about it at the time of registration. Nor is there evidence to support the Complainant’s contention that the Respondent chose the domain name purely to create an association with the Complainant.
There are cases where a Panel has been unable to infer bad faith at the time of registration because the Complainant operated and owned marks in one country but the Respondent operated in another country with which the Complainant enjoyed no apparent contact and where the Complainant owned no mark. The VZ Vermogens case cited by the Respondent (WIPO D2000-0527) is a case in point. There, the Complainant operated a financial business in Germany and Switzerland: the Respondent was domiciled in the Cayman Islands where the Complainant did no business. The Panel considers this case to be basically one of those cases.
There is no evidence here that the Complainant does business in Hong Kong although it claims to do business over the Internet, there is no evidence of the extent of its Internet business. It has no trademark registrations in Hong Kong or China.
The fact that Vernon is a common name is a relevant consideration under this criterion also. See the <donna.com> case, referred to by the Respondent, WIPO Case D2002-0056, <gloria.com> and WIPO case DBIZ2002-00005 <sam.biz>.
The Panel has considered Edmunds.com v. Ult. Search Inc. (WIPO D2001-1319) <edmund.com> which has some points of similarity to the present case. These are:
a) The Complainant had allowed registration of the disputed domain name to lapse and the name had been acquired by the Respondent;
b) The name was a common male forename and surname in English-speaking countries;
c) The Complainant had published printed guides for automobile buyers since 1966, and Internet versions of these free-of-charge since 1994;
d) The Complainant gave details in its Complaint of the extensive information provided on its websites which attracted 2.8 million visitors a year;
e) The Respondent had "parked" the disputed domain name on a website;
f) The Respondent’s website for the disputed domain name included links to numerous categories of businesses, including links to competitors of the Complainant under the heading "autos";
g) The Respondent demonstrated perfunctory preparations to use the name commercially;
h) The Respondent was a sophisticated user of the internet and maintained a portfolio of domain names based on common names or initials and useful phrases in order to provide free email service;
i) The Respondent was based in Hong Kong where the Complainant’s US trademarks had not been registered. It claimed to have been unaware of the Complainant when it acquired registration of the name. The Panel considered that the Respondent should have undertaken a US trademark search, in the particular circumstances.
The significant issue for the Panel in that case was that the Respondent’s parking of the name in a site gave entry to another site advertising competitors of the Complainant. Following Net Wizards Inc. v. Spectrum Enters (WIPO D2000-1768), the Panel found that registration and use of a domain name to redirect internet users to websites of the Complainant’s competitors can constitute bad faith registration and use under the Policy.
The Panel in <edmund.com> found that the Complainant’s failure to renew its registration might have compelled a different result had the Respondent not used the domain name in the way it did. The Panel inferred that the Respondent was using the Complainant’s mark to attract Internet business for commercial gain and was thus acting in bad faith under para 4(b)(iv) of the Policy. It also found that there was no legitimate right or interest which justified the Respondent using the name.
One difference between the <edmund.com> case and the present case is that Respondent’s website is basically a commercial site dealing in advertising space and it does not obviously conflict with the Complainant’s activities. ‘Gambling’ is just one of the many options offered to viewers. The Complainant does not specify how a link on the website to "gambling" would necessarily give information about the Complainant’s competitors. Gambling is featured no more prominently than ‘hotels’ and ‘stocks’ and about 40 other categories. It is less prominent than ‘mortgages’. The site contains no sense that its owner is targeting the Complainant’s audience specifically or that it is trading on the value of the Complainant’s mark.
There was no evidence from the Respondent in the <edmund.com> case of the sort provided by Mr. Yu’s statement. The panel has no means of assessing credibility but accepts his statement in the absence of any evidence of a contrary indication.
The Panel considers that the failure by the Respondent to reply to a reasonably-expressed ‘cease and desist’ letter, whilst not of itself determinative of bad faith can be one of the strands in the rope of circumstantial evidence which could justify a bad faith finding. Any reasonable business person, if owning a name in complete innocence, would have replied with surprise, even approaching outrage, to a suggestion of the wrongful use of the name as part of running a legitimate business. However, the Panel does not find the Respondent’s failure to reply sufficient to justify a finding of bad faith registration in this case. There is no requirement that such a letter receives a reply and failure to reply is not stated in the Policy as an example of ‘bad faith’ conduct.
The Panel does not consider proved the allegation of ‘course of conduct’ made by the Complainant against the Respondent. Each case must be considered in its merits and one previous case does not comprise a ‘course of conduct’. The Panel declines to draw any inference against the Respondent from the NAF decision in which it had been a Respondent. The Panel notes the Respondent’s claim that it had transferred the domain name to the Complainant before a decision was given.
Accordingly, on balance, the Panel considers that the Complainant has not proved registration in bad faith. The third criterion is therefore not proved.
The Panel decides that the registration of the domain name <vernons.com> should not be transferred to the Complainant. The Complaint is dismissed.
Hon. Sir Ian Barker QC
Clive D. Thorne
Milton L. Mueller
Dated: March 12, 2003