WIPO

 

WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

SAir Group v. Pat Reinhardt

Case No. D2000-0482

 

1. The Parties

The Complainant is:

SAirGroup, Hirschengraben 84, CH-8001 Zurich, Switzerland.

The Complainant is represented by: Vincenzo Pedrazzini, Isler & Pedrazzini AG, Patent and Trademark Attorneys, Gotthardstr. 53, CH-8002 Zurich, Switzerland.

The Respondent is:

Pat Reinhardt, Walther-Merzweg 7, CH-5000 Aarau, Switzerland.

The Respondentís Administrative Contact and Billing Contact is: Pat Reinhardt, Walther-Merzweg 7, CH-5000 Aarau, Switzerland, e-mail: qualiflyer@hotmail.com.

The Respondent has not designated counsel.

 

2. The Domain Name(s) and Registrars

The Domain Name at issue is "qualiflyer.com". It is registered with Network Solutions, Inc., 505 Huntmar Park Drive, Herndon, VA. 20170 USA.

 

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the Center) by e-mail on May 23, 2000. A hard copy was received by the Center on May 24, 2000. The Center acknowledged receipt of the Complaint on May 29, 2000.

On May 30, 2000 the Registrar, Network Solutions, confirmed that: 1) Pat Reinhardt is the current registrant of the qualiflyer.com domain name registration, 2) that the address of the Registrant is Walther-Merzweg 7, CH-5000 Aarau, Switzerland 3) that the Administrative Contact and Billing Contact is Pat Reinhardt, 4) that the Technical Contact and Zone Contact is eBiz.net, Inc., 400 Continental Boulevard, 6th Floor, El-Segundo, CA. 90266 USA, 5) that Network Solutionsí 4.0 Service Agreement is in effect, and 6) that the domain name "qualiflyer.com" is in "active" status.

On June 2, 2000 the Center notified the Respondent that the Complaint satisfied the formal requirements of the Policy, Rules and Supplemental Rules; that payment of the required sum had been made by the Complainant; and that an administrative proceeding had been commenced against the Respondent. A deadline of June 21, 2000 was fixed for the Response.

A Response was filed timely on June 19, 2000, and the Center acknowledged receipt of the Response on June 20, 2000.

On June 27, 2000 the Center notified the Parties that an Administrative Panel composed of a single member, Dr. Kamen Troller, had been appointed. The Center further notified the Parties that the Panelist had duly submitted a Statement of Acceptance and Declaration of Impartiality and Independence to the Center. Absent exceptional circumstances, the Panelist was required to forward its decision to the Center in accordance with Paragraph 15 of the Rules by July 10, 2000.

The Panelist examined all notifications of the Center, and the Complaint, and finds that they comply with the formal requirements of the Rules and Supplemental Rules. The Panelist further finds that the Center has adhered to the Policy, Rules and Supplemental Rules throughout this proceeding, and that the Administrative Panel was properly constituted.

 

4. Factual Background

 

The Complainant, SAirGroup, is a corporation organized under the laws of Switzerland. Its principal place of business is in Zurich, Switzerland. Swissair is a wholly owned subsidiary of SAirGroup.

The Complainant is a member of "The QualiflyerGroup", a strategic alliance of airline companies that has operated a frequent flyer programme, known as QUALIFLYER, since 1992. The Complainantís wholly owned subsidiary, Swissair, is a member of The Qualiflyer Group. The Qualiflyer programme now has 2.5 million members.

The Complainant is the owner of:

Swiss Trademark: No. 436227 QUALIFLYER (word mark). The priority date is March 15, 1996. Although the priority date of the registration of the QUALIFLYER mark is March 26, 1996, the Complainant points out that in 1992 trademark rights in Switzerland were "constituted by use", and that this explains why the trademark was registered at a later stage only.

International trademarks: 700142 and 700309 THE QUALIFLYERGROUP (word and device marks), which are based on corresponding Swiss trade marks 453442 and 454099 which have priority dates of February 2, 1998 and March 26, 1998 respectively. International registration of these marks is valid from July 28, 1998 and August 25, 1998 respectively.

The Respondent is (Thomas) Patrick Reinhardt. He is a Swiss citizen. He registered the domain name "qualiflyer.com" on April 1, 1998.

The Respondent has not provided proof of a trademark registration for "qualiflyer" in any jurisdiction.

 

5. Partiesí Contentions

The Complainant asserts that: (1) The domain name qualiflyer.com is identical or confusingly similar to the trademark "Qualiflyer" in which the Complainant has rights; (2) the Respondent has no rights or legitimate interests in respect of the domain name; (3) the domain name was registered and is being used in bad faith. The Complainant also disputes the registration information provided by the Respondent.

In accordance with paragraph 4(i) of the Policy, the Complainant requests the Administrative Panel to issue a decision that the domain name qualiflyer.com be transferred to the Complainant.

The Respondent asserts that: (1) the Respondent has a right to and a legitimate interest in the domain name; (2) the domain was not registered and used in bad faith.

The Respondent does not deny that "QUALIFLYER" and qualiflyer.com are identical or confusingly similar. The Respondent disputes the Complainantís suggestion that the Respondent provided false registration information to the Registrar.

The Respondent suggests that the Complainant has acted in bad faith but does not make a claim for reverse domain name hijacking.

 

6. Discussion and Findings

A) Preliminary Matters

Certain preliminary matters were raised in this proceeding:

The Complainant disputes the information that the Respondent provided to the WHOIS database. The Respondent has satisfied the Panel concerning his provision of accurate information.

The Panel notes that the Response is not in compliance with the Rules. The certification required by Rule 5(b)(viii) is lacking. Despite this procedural shortcoming, the Panel has decided to admit the Response on the grounds that the Respondent was not represented by counsel and should, pursuant to Rule 10(b) be "given a fair opportunity to present its case."

The Panel also observes that the Registrar maintains in its May 30, 2000 communication that Network Solutionsí 4.0 Service Agreement is in effect. The Complainant has provided the Network Solutionsí 5.0 Service Agreement as its Exhibit B. (The index provided by the Complainant is incorrect in this regard.) Both of these Agreement are in English and the parties have made their submissions in English. Based on these facts, the Panel concludes pursuant to Rule 11(a) that the language of the proceeding is English.

Lastly, Complainantís Exhibit J was not provided, and Complainantís Exhibit K was incomplete making it difficult to assess the country in which protection is asserted in this document. These irregularities in no way affected the Panelís decision.

B) The Merits

Pursuant to paragraph 4(a), SAirGroup as Complainant must prove that each of the following three elements are present if it is to prevail:

(i) The Respondentís "domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights;" and

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

(iii) The "domain name has been registered and is being used in bad faith."

a. Identical or confusingly similar

The Complainant asserts that the domain name qualiflyer.com is identical or confusingly similar to the trademarks "QUALIFLYER" and "THE QUALIFLYERGROUP" which it has registered in several jurisdictions. The Respondent has not denied this allegation.

The Panel finds that but for the ".com" designation, and the capitalization of the terms "QUALIFLYER" and "qualiflyer.com" are identical. The Panel furthermore finds that in the designation " The QUALIFLYER GROUP", the term "Qualiflyer is the distinctive element and that therefore, the term qualiflyer.com is confusingly similar to the term "The QUALIFLYER GROUP".

The Panel therefore concludes that the domain name is identical or confusingly similar to a trademark or service mark in which the Claimant has rights.

b. Rights or legitimate interests

Paragraph 4(c) of the Policy defines the circumstances required for the Respondent to demonstrate "rights to and a legitimate interest in the domain name". The Respondent is only required to demonstrate any one of the following circumstances (in particular and without limitation) to prove its rights to or legitimate interest in the domain name:

(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

The Complainant argues that the being a Swiss citizen and a member of the QUALIFLYER programme, Pat Reinhardt was aware of SAirGroupís prior trademarks, and that by placing the domain name on a "parking site" he was not interested in activating the domain name, but in selling it to the Complainant.

The Respondent accuses the Complainant of confusing the "bad faith" criteria set forth in paragraph 4(a)(iii) with the criteria set forth in paragraph 4(a)(ii) of the Policy. The Respondent further asserts that as a "QUALIFLYER" member he has a right in the domain name, and that he is offering a legitimate service to those with a fear of flying.

Paragraph 4(c)(i) of the Policy requires the Respondent to demonstrate that the domain name in question is being used in connection "with a bona fide offering of goods or services". The Panel visited Respondentís website on several occasions and found that the Respondent is not making a bona fide offering of goods or services on this site. The Respondent has chosen to "park" this site with a firm, "Affinity Internet", which offers domain name parking services. The "parking" of a domain name associated with such a widely known trademark is highly indicative that the name is being reserved for sale, and that the site is not being used for a bona fide offering of goods or services.

The very meager content of the Respondentís website further demonstrates that there has not been a bona fide offering of goods or services. The website has no original content, instead offering only links to a very small number of other sites: 1) Affinity Internet (the domain name parking company), 2) CNNft, 3) "SOAR, INC." (an apparently unrelated company offering services to those with fear of flying Ė a link which could arguably tarnish the QUALIFLYER trademark), and 4) the Respondentís e-mail address "qualiflyer@hotmail.com". The Panel is unwilling to conclude under these circumstances that the mere inclusion of links to unrelated companies, including the link to SOAR, INC., constitutes a legitimate offering of services by the Respondent. Not only is the Respondent offering no original content on his site, he is not selling any products or services himself. Even the Respondentís e-mail account is being hosted by another company.

In light of the above findings, the Panel has concluded that the domain name is not being used in conjunction with a bona fide offering of goods or services.

Paragraph 4(c)(ii) requires that the Respondent prove that the has been commonly known by the domain name, in this case "qualiflyer.com". The Respondent has offered no such proof, and has even failed to raise this issue. The Panel notes that Respondent is using part of the domain name, the term "qualiflyer," in his e-mail address: "qualiflyer@hotmail.com". This address appears on his webpage, and in some of the contact information provide by Network Solutions. It is noteworthy, however, that e-mail service is being offered through another site (hotmail.com) and that only a part of the domain name is being utilized in the e-mail address. The Respondent has introduced no evidence that he is "commonly" known by this name "qualiflyer.com", or even "qualiflyer". Furthermore, he has not stated whether he has other e-mail addresses. The Panel concludes that Pat Reinhardt has offered no proof that he is commonly known by the domain name "qualiflyer.com", and as a result this element of paragraph 4(c)(ii) has not been satisfied.

Paragraph 4(c)(iii) requires the Respondent to prove that he is making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue. The Respondent is correct to point out that some of the criteria related to the "bad faith" prong of the Policy (paragraph 4(a)(iii)) were introduced by the Complainant in its analysis of paragraph 4(c)(iii) of the Policy. This is, however, understandable, and perhaps even inevitable, given that paragraph 4(c)(iii) of the Policy is defined in terms of legitimacy and fairness, meaning that some of the evidence involved in its analysis is also relevant to a determination of bad faith.

Turning to the Complainantís allegation, the Panel finds that the Respondent has offered no evidence demonstrating a legitimate non-commercial or fair use of the domain name. The site is "parked", so for all practical purposes it is not in real use. The links that are provided appear to be purely cosmetic Ė to a small number of unrelated sites. As already noted, the Respondentís site offers no original content, nor does it organize the content of others in an original or useful fashion. The Panel concludes that the Respondentís offering falls short of a legitimate non-commercial or fair use of the domain name.

The Panelís conclusion is supported by some of the same elements that are present in its analysis of bad faith. The use of the name "qualiflyer", in particular by a person who admits to being a QUALIFLYER member, falls far short of a "fair use" of the name. Indeed, to the extent that the Respondentís use of this name appears designed to confuse those searching for the QUALIFLYER site, it is an unfair use. This conclusion is strengthened by the Respondentís evident decision to register the name "qualiflyer.com" after the Complainant registered the trademark. Had the Respondent demonstrated fair use prior to the registration of the trademark, an argument for legitimate use would have been more tenable.

The Respondent contends that his membership in the QUALIFLYER programme gives him "a right in the domain name" (para. 7). The Panel does not agree. If the Respondentís position were to be accepted, his membership in the programme, coupled with his prior registration of the domain name, would give him a right superior to the company that created the programme, trademarked the name, and assiduously promoted the programme, both before and after the Respondentís registration of the domain name.

Respondent contends (Claimantís Annex R) that he has a right to "Qualiflyer.com" under the principle of "First Come, First Serve" (FCFS). That principle calls for the following general observations:

 

The principle of "First come, first serve" cannot be adhered to in an absolute way. The principle dates from the beginning of the Web, when it started to become occupied by its first users - most of them computer enthusiasts. The situation is comparable to the occupation of the California gold fields during the gold rush - the first who staked a claim owned the site.

The Internet is now a means of global communication, shared by millions of individuals, organizations, businesses and other entities. In cases where there is a dispute between individual registrants of domain names and economic actors using the same designation in their business, then the principle of FCFT has to be refined.

The situation cannot be compared to the one prevailing in Industrial Property, where as a general rule, the first registrant obtains the exclusive rights. Those rights are based on intellectual creations (except for trademarks), they are limited territorially and time wise, and they grant only a legal exclusivity which can easily be violated by any party, whereas a gTLD name confers upon its registrant a world wide de facto exclusivity on a designation, which can no more be used by any one else.

The FCFS principle may still prevail in the event that newly invented designations are registered, which are not widely protected as trademarks or not widely used by economic actors for their professional activities.

If however such designations are chosen as domain names, then a weighing of the various interests has to take place: on the one hand the interest of the individual which has accidentally chosen such a widely protected or widely used designation to be registered as domain name for his private (or professional) activities, and, on the other hand, the interest of the (individual or corporate) economic actor to be able to use his name or trade mark or other proprietary distinctive sign not only in his traditional business, but also in his Web based business. In the Panelís opinion, in the weighing of such interests, the weight of the economic actorís interests outweighs the interests of the individual who has just started to use that newly invented name, and the former should be allowed to obtain the transfer of the domain name against reimbursement of reasonable expenses (for registration and creation of the domain name), or, if such costs cannot be established, the costs which may reasonably be incurred for the creation of another domain name of the same kind, however without creating a risk of confusion.

In the event that the individual has registered as domain name a designation which he knew or had to know was the name or the trade name or protected trade mark of an economic actor, or was a designation used in the economic or other activities by a third party (business entities or International Organizations or NGOs), then he shall have to transfer the domain name to such entity without any compensation.

When the balance of circumstances are weighed in the present case, the Panel concludes that this is not an instance where the principle of "first come first serve" can be blindly applied. The chronology of events makes this conclusion evident, and also raises certain doubts concerning the utility of this principle when prior existing intellectual property rights are at stake. The Complainant created the QUALIFLYER programme in 1992. Respondent subsequently learned of the programme and became a member. From the programmes inception, the Complainant protected the trademark rights to QUALIFLYER in Switzerland, and promoted the programme internationally. Subsequent to the protection of the trademark in Switzerland, the Respondent registered the domain name, and now seeks to justify his use of the domain name by his membership in the QUALIFLYER programme.

SAirGroup may have been slow to register the domain name qualiflyer.com, but it was not slow to protect its "QUALIFLYER" trademark. The QUALIFLYER trademark was registered before the Respondent registered "qualiflyer.com".

It is in light of the above chronology that the Panel must weigh the interests of the Respondent in the domain name "qualiflyer.com" against the prior existing intellectual property rights, and associated commercial interests of the Complainant. In this particular case, the analysis is not difficult. This is not an instance of an individual choosing an original phrase as a domain name, and using the name to provide original content, or to sell goods or services without knowledge of the trademark and goods and services offered by the Complainant. The opposite is true. This is instead a classic case of "cybersquatting". The domain name registered by the Respondent is a trademark with which he was familiar by virtue of his membership in the Swiss Complainantís frequent flyer programme. The Respondent then devised a means to tie up the domain name, while providing little or no benefit to "internet society", until an opportunity presented itself to reap a profit from the Complainant.

The Panel notes with interest that the Respondent accuses the Complainant of fostering the idea that big business owns the internet, and implies that the Complainant is using the internet for "maximizing profit coffers" (Complainantís Annex R). The Panel has chosen to draw the opposite conclusion from the facts as presented. After weighing the sundry interests in this case, in particular the prior existing rights of the Complainant to the designation "Qualiflyer", the Panel is convinced that it is the Respondent who is playing the role of a modern day pirate, and is seeking to fill his coffers by holding the domain name "qualiflyer.com" hostage.

The particularly ingenious ransom sought by the Respondent, a payment of three cents for every QUALIFLYER member (USD 185,000), meant that had the Complainant accepted the Respondentís offer, each step taken by the Complainant to develop the value of its trademark would have benefited the Respondent monetarily. The Respondent would have been the ultimate free rider Ė plundering the intellectual property rights of Complainant, and as a result capitalizing on the Complainantís investment and business success.

c. Bad faith

Paragraph 4(b) of the Policy sets forth a non-exclusive list of circumstances which shall be evidence that the registration and use of a domain name is in bad faith:

 

(i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or
(ii) you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or
(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site or other on-line location, by creating a likelihood of confusion with the complainantís mark as to the source, sponsorship, affiliation, or endorsement of your web site or location or of a product or service on your web site or location.

The debate in the Partiesí submissions revolves around 4(b)(i), acquisition of the domain name primarily for the purpose of selling it to the owner of the trademark for consideration in excess of the out-of-pocket expenses related to the domain name.

The Complainant, SAirGroup, has demonstrated that QUALIFLYER was registered as a trademark in Switzerland before the Respondent registered qualiflyer.com. The Complainant has therefore proven prior trademark rights in Switzerland for the trademark QUALIFLYER.

The Complainant has also demonstrated that the Respondent offered to sell the domain name "qualiflyer.com" to the Complainant for USD 185,000 (Complainantís Annex R). This is an important sum of money, well in excess of out-of-pocket expenses, and as such is evidence of bad faith. While it may be true that the Respondentís offer was triggered by the Complainantís actions, the Panel is convinced that the Respondent acquired the domain name primarily for the purpose of selling it to the Complainant, and that an offer or solicitation was inevitable. This conclusion is supported by the Respondentís decision to "park" the domain name, and his decision not to use the domain name for a legitimate non-commercial use, or the provision of goods or services.

The criteria for finding bad faith set forth in paragraph 4(b) of the Policy are not exclusive. The Panel also finds support for its finding of bad faith by the fact that the Respondent is a member of the QUALIFLYER programme, and as such particularly aware of the value of the QUALIFLYER designation. QUALIFLYER is a widely recognized and valuable designation, both inside Switzerland and in almost every country where those airlines in THE QUALIFLYERGROUP fly. Recognition is however particularly high in Switzerland. The commercial advantage to be had from registering qualiflyer.com would be particularly evident to almost every adult Swiss citizen, including Respondent.

Bad faith is also inferred from the apparent decision of the Complainant to disable the "counter" on the "parked" Internet site. This had made it impossible for the Panel to discern how many people, perhaps mistakenly, have visited the site.

In conclusion, the Respondentís evident knowledge of the value of the domain name "qualiflyer.com", the trademarked status of the QUALIFLYER name, the Respondentís failure to make significant use of the domain name, and his attempt to sell "qualiflyer.com" at a price significantly above his out-of pocket expenses, have led the Panel to conclude that the domain name "qualiflyer.com" was registered and used in bad faith within the meaning of paragraph 4(a)(iii) of the Policy.

 

7. Decision

The Panel decides that:

1) the domain name qualiflyer.com is confusingly similar to the trademark "Qualiflyer";

2) that the Respondent has no rights or legitimate interest in respect of the domain name;

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

Pursuant to paragraph 4(i) of the Policy and pursuant to paragraph 15 of the Rules, the Panel requires that the Registrar, Network Solutions, Inc., transfer the name "qualiflyer.com" to the Complainant.

 


 

Dr. Kamen Troller
Sole Panelist

July 6, 2000