WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Netfirms Inc. v. eshoppers.com.inc
Case No. D2001-0223
1. The Parties
The Complainant is Netfirms Inc., a Canadian corporation with its principal place of business in Toronto, Ontario, Canada. The Complainant is represented by Mr Tapas Pain of Ridout & Maybee LL.P., Solicitors, of Mississauga, Ontario, Canada.
The Respondent is eshoppers.com.inc, a United States corporation having its principal place of business in Manitowee, Wisconsin, U.S.A. The Respondent is represented by Mr Ari Goldberger, of Cherry Hill, New Jersey, U.S.A.
2. The Domain Name and Registrar
The domain name at issue is <net-firms.com>. The domain name is now registered with TierraNet, Inc. of San Diego, California, U.S.A. ("the Registrar"). The name was registered on October 8, 2000 with a previous Registrar.
3. Procedural History
The Complaint, submitted by Netfirms Inc. was received on February 12, 2001, (electronic version) and February 12, 2001, (hard copy) by the World Intellectual Property Organization and Mediation Center ("WIPO Center"). After correspondence with the Center, the Complainant filed an Amended Complaint on February 20, 2001.
On February 16, 2001, a request for Registrar verification was transmitted by the WIPO Center to the Registrar, requesting it to:
- Confirm that a copy of the Complaint had been sent to it by the Complainant as requested by WIPO Supplemental Rules for Uniform Dispute Resolution Policy ("Supplemental Rules"), paragraph 4(b).
- Confirm that the domain name at issue is registered with the Registrar.
- Confirm that the person identified as the Respondent is the current registrant of the domain name.
- Provide full contact details, i.e., postal address(es), telephone number(s), facsimile number(s), email address(es), available in the Registrarís WHOIS database for the registrant of the disputed domain name, the technical contact, the administrative contact and the building contact for the domain name.
- Confirm that the Uniform Domain Dispute Resolution Policy ("UDRP") was in effect.
- Indicate the current status of the domain name.
By email dated February 16, 2001, the Registrar advised WIPO Center as follows:
- The Registrar had received a copy of the Complaint from the Complainant.
- It is the Registrar of the domain name registration <net-firms.com>.
- The above Respondent is shown as the "current registrant" of the domain name at the above address. The administrative, technical, zone and billing contact is Cheap Domain Reg, Box 1282, Manitowoc, WI, U.S.A.
- The domain name registration <net-firms.com> is currently "Active".
The Registrar has currently incorporated in its agreements the policy for Uniform Domain Name Dispute Resolution adopted by the Internet Corporation for Assigned Names and Numbers ("ICANN").
The advice from the Registrar that the domain name in question is "active" indicates the Respondent has not requested that the domain name at issue be deleted from the domain name database. The Respondent has not sought to terminate the agreement with the Registrar. Accordingly, the Respondent is bound by the provisions of the Registrarís Domain Name Dispute Resolution Policy, i.e., the ICANN policy. The Respondent has not challenged the jurisdiction of the Panel.
Having verified that the Amended Complaint satisfied the formal requirements of the Uniform Policy and the Uniform Rules, the WIPO Center on February 22, 2001, transmitted by post-courier and by email a Notification of Amended Complaint and Commencement of Administrative Proceedings to the Respondent. A copy of the Amended Complaint was also emailed to the Registrar and ICANN.
The Complainant elected to have its Complaint resolved by a single panel member: it has duly paid the amount required of it to the WIPO Center.
The Respondent was advised that a Respondent to the Complaint was required within 20 calendar days. The Respondent was also advised that any Response should be communicated, in accordance with the Rules, by four sets of hard copy and by email. A Response was filed by the Respondent on March 13, 2001 (electronic) and March 16, 2001 (hard copy).
On March 20, 2001, the WIPO Center invited the Honorable Sir Ian Barker QC of Auckland, New Zealand to serve as Sole Panelist in the case. It transmitted to him a statement of acceptance and requested a declaration of impartiality and independence.
On March 20, 2001, the Honorable Sir Ian Barker QC advised his acceptance and forwarded to the WIPO Center his statement of impartiality and independence. The Panelist finds that the Administrative Panel was properly constituted in accordance with the Rules and the Supplemental Rules. Barring exceptional circumstances, a decision from the Panel was due on April 8, 2001.
The Complainant sought leave to file a Reply to the Response, because it wished to reply to the Respondentís counterclaim for a declaration that the Complainant was guilty of reverse domain name hijacking. The Panel granted this request and a Reply was filed by the Complainant on March 30, 2001. It was received with its hard copy attachments by the Panel on April 10, 2001. Because of the need for the Panel to consider the Reply, the decision will now be given on or before April 18, 2001.
The Panel has independently determined and agrees with the assessment of WIPO Center that the Complaint meets the formal requirements of the Rules for Uniform Domain Name Dispute Resolution Policy as approved by ICANN on October 24, 1999, ("the Rules") and the Supplemental Rules.
The language of the administrative proceeding is English, being the language of the registration agreement.
4. Factual Background
The Complainant has applied for the following trade or service marks:
(a) Canadian Trade-Mark Application No. 1081057 Ė NETFIRMS Ė filed October 31, 2000 with the Canadian Trade-Marks Office, for use in association with Web hosting services; electronic commerce services namely development of web sites that enable buying and selling of wares and services through the internet; consulting services regarding development and operation of web sites; computer services, namely providing on-line publications in the nature of magazines and annotations, all in the field of start-up, emerging and growth businesses and the management of start-up, emerging and growth businesses; commercial information services, namely, advertisement management by providing reports, advertisement targeting, and management of electronically stored advertising, for use on the global computer network; promoting the goods and services of others by preparing and placing on-line advertisements on a network of web pages on the global computer, as well as via e-mail; consulting in the field of on-line advertising; since at least as early as July 1999;
(b) United States Trade-Mark Application No. 76179572 Ė NETFIRMS Ė filed December 13, 2000 with the United States Trade Marks Office, for use in association with services as described above; since at least as early as July 1999;
(c) Australian Trade-Mark Application No. 860563 Ė NETFIRMS Ė filed December 14, 2000 with the Australian Trade Marks Office, for use in association with services as described above.
The Complainant also alleges:
(a) Common law trade-mark rights in NETFIRMS Ė for use in association with services as described above, in 237 countries around the world, since at least as early as July 1999;
(b) Common law trade-mark rights in NETFIRMS, in all those countries, for use in association with computer software, namely, web design software, and instruction manuals therefor; since at least April 2000.
The Complainant was incorporated on June 17, 1999, pursuant to the laws of Ontario, Canada. It registered the following domain names for use with the NETFIRMS trade-mark:
Date of Registration
Date of First Use
September 30, 1998
September 30, 1998
January 7, 2001
July 26, 1999
December 26, 2000
November 9, 2000
January 11, 2001
The Complainant provides through its websites, free and paid domain name hosting with the related registration and maintenance services, storage space for user websites, search engine submission utilities, unlimited e-mail forwarding services, common gateway interface (CGI) support, Perl support, web design support, support for file transfer protocols (FTP), and twenty-four hour monitoring of services. All of these services and domain names make use of the NETFIRMS mark.
In addition to the aforementioned services, the NETFIRMS mark is also used on computer software, namely, software for website design, and instruction for said software. To date, an estimated 2000 copies of said software and manuals have been distributed throughout the countries serviced by the Complainant.
On free websites hosted by the Complainant, a non-removable banner displaying the NETFIRMS trade-mark appears on every web page.
The Complainant services more than 140,000 clients by providing the aforementioned wares and services for domain names, as well as sub-domain names for NETFIRMS.COM, all over the world, averaging yearly sales of $540,000 USD.
From at least November 1, 2000, the disputed domain name offered no services. It displayed the home page of USID.COM, which offers identical and similar services to that of home page of NETFIRMS,INC.. The domain name USID.COM is owned by the Respondent.
By letter of November 21, 2000, the Complainant requested that the Respondent transfer ownership of NET-FIRMS.COM to the Complainant because of the likelihood of confusion in the internet marketplace.
In a letter dated December 4, 2000, but not received until December 14, 2000, the Respondent stated that NET-FIRMS.COM was not in use in conjunction with any services, but that it was "parked".
After the letter of the Respondent dated December 4, 2000, was received by the Complainant, the NET-FIRMS.COM website was altered on or about December 15, 2000, into its present format. The Respondentís agent, in a letter of January 28, 2001, acknowledged that the Respondent initially directed visitors to the NET-FIRMS.COM domain to USID.COM and that the services offered by USID.COM are similar to those of NETFIRMS,INC..
The agent of the Respondent suggested that mutual links be placed on the websites of both NETFIRMS,INC. and NET-FIRMS.COM. This suggestion was allegedly made by the Respondentís agent to cure the problem of visitors arriving at the Respondentís domain name in error. This letter was not identified as being without prejudice, or for the purposes of settlement.
Respondent was incorporated as Eshoppers.com, Inc. in December 1999. Respondent began operating a domain name registration service at ESHOPPERS.COM in December 1999. It has served customers in 28 countries including the U.S., Canada, U.K., Ireland, France, Hong Kong, Malaysia, Australia, Israel and Spain. In May 2000, the Respondent expanded its services to include web hosting, design, internet programming and promotion services, and began to operate under the name USID (United States Internet Developers), located on the web at USID.COM. The domain registration services were shifted from "ESHOPPERS.COM" to "USID.COM" allegedly because Respondent felt that the name eShoppers potentially created the impression among users that site was of a retail ecommerce nature. In order to prevent losing customers, Respondent continued to maintain "ESHOPPERS.COM" as an entry-point to "USID.com" for those who were accustomed to reaching Respondentís website by typing this URL.
Eshoppers.com continued to be Respondentís corporate name until February 9, 2001, when it was changed to Marsgerm Technologies, Inc.
5. Partiesí Contentions
The Complainant submits in summary:
(a) The disputed domain name is identical or confusingly similar to its marks which are pending registration or to its common law marks.
(b) The Respondent has no legitimate rights or interest in the disputed domain name.
(c) The Respondentís services offered by <USID.COM> reached via the disputed domain name, are similar to those offered by the Complainant.
(d) The domain name was registered in bad faith in order to disrupt the business of a competitor. The domain name is used as a "deceptive portal".
(e) The modification to the "net-firms.com" website was made only after Respondent had admitted no legitimate interest in the name.
(f) The Complainantís position is supported by Canadian and U.S. law.
The Respondent submits in summary:
(a) The Complainantís mark gives it no rights because it is highly descriptive and arguably generic.
(b) The Respondent has rights or legitimate interest in the domain name because it is a generic name describing a business which Respondent intended to operate - i.e. internet programming services.
(c) The Respondent had no knowledge or basis for knowledge of the Complainantís mark and registered the name two months before the trademark application was lodged. Consequently, it is impossible to prove registration of the name by the Complainant with malicious interest.
(d) The Panel should declare the Complainant guilty of reverse domain hijacking and abusive behavior. The grounds for this claim are that the Complainant registered the name <Netfirms.com> in September 1998 but waited two more years to apply for a trademark. It must therefore be inferred that the Complainant truly believed it would not receive trademark protection for a generic, descriptive mark and filed its trademark application solely to harass the Respondent and to hijack its domain name.
(e) Respondent registered the disputed domain name with the bona fide intent to offer the internet programming services it had been offering at <USID.COM>. Registration of a non-famous domain name composed of common words constitutes "demonstrable preparations to use the domain name in connection with a bona fide offering of goods or services". (See WIPO D2000-0967, Asphalt Technology, Inc v Anthing.com).
(f) It is a legitimate interest to use a domain name of common words to promote a business logically related to the term.
(g) Netfirms is a generic term referring to companies doing business on the internet. A search returned 24,300 web pages containing the expression "Net Firms".
(h) It is common and legitimate for companies owning several domain names to direct all of them to a single web presence. The use of the expression "parked" by Respondentís Mr Lu had no sinister significance.
(i) There is no evidence of any of the instances of bad faith by the Respondent as listed in paragraph 4(b) of the Policy.
The Complainant in reply submits in summary:
(a) The affidavit of Mr Lu for the Respondent is incorrect when it claims that he registered <Net.firms.com> with intent to use it for a separate website for interest programming circumstances which had been offered at the USID.COM since May 2000. Mr Butcher for the Complainant deposed in an affidavit that Mr Lu, in reply to an enquiry to identify Respondentís services, did not mention the USID.COM site.
(b) A print-out of the USID.COM website on March 16, 2001 failed to mention that Net-firms.comís services were ever offered. No corroborating evidence has been offered of Respondentís intentions.
(c) Respondent filed a trademark application for NET-FIRMS, two days after Complainant had filed its trademark application. Yet Respondent made no mention in its Response that it had applied for a trademark and submitted that Complainantís application for NETFIRMS mark was not registrable. It is difficult to reconcile the Respondentís submission that the expression Net-Firms is generic with its application for trademark registration of the same.
(d) The Respondent is wrong to argue that that trademark "Netfirms" is generic and descriptive and yet say that "Net-Firms" is registrable.
(e) It is a clear inference that Respondent must have known of the Complainantís common law mark and registered domain name. Respondent specializes in registering domain names and, on its "eshoppers.com" site, suggests that persons choosing as domain names choose simple or compound words with no punctuation.
(f) Respondent counsels its clients: "If you find the name you want has been trademarked [sic] donít be afraid. If that name is not a famous trademark, then register it anyway. You can use your domain to do other business".
(g) As shown in Annexure 4 to the Reply, the Respondent discusses the Complainantís challenge to the name "net-firms.com" and solicits support from internet users.
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 ICANN 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;
- That the Respondent has no legitimate interests in respect of the domain name; and
- The domain name has been registered and used in bad faith.
The domain name <net-firms.com> is, in the judgment of the Panel, confusingly similar to the Complainantís common law mark. Were it not for the hyphen, it would have been identical. The Panel notes that the trademark applications were filed after registration of the name. However, the Respondent does not contend that the Complainant does not have a common law mark which it has enjoyed since it was incorporated in July 1999. Whether or not the trademark should ultimately be denied registration is a matter for the authorities in the several countries where trademark applications have been filed. It is sufficient for the purposes of the Policy that the Panel is able to find a domain name identical to or confusingly similar to a mark Ė common law or registered. Moreover the common law mark was used in the Complainantís <netfirms.com> domain name.
The Complainant gave the Respondent no rights or legitimate interests in the disputed domain name. That finding can sometimes be sufficient for the Complainant to discharge the initial evidential burden. Paragraph 4(a)(ii) of the Policy indicates that a Respondent can demonstrate rights or legitimate interests in the domain name. Thus:
(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 and 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 direct customers or to tarnish the trademark or service mark at issue.
The Respondent cannot point to any evidence that might bring it into the above categories. It appears to carry on business using the USID.COM name and/or "Eshoppers.com", as it is entitled to do. But that entitlement is no justification for using the Complainantís common law mark in a manner which could direct persons who might have knowledge of that mark on to the Respondentís website. The use of the two components of the Complainantís mark, separated by a hyphen, indicates a degree of calculation on the part of the Respondent.
Paragraph 4(b) of the ICANN Policy states:
"For the purposes of paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name 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 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."
It should be noted that the circumstances of bad faith are not limited to the above.
The Panel considers that the Respondent has registered and used the domain name in "bad faith" for the reasons set out in the summary of the Complainantís submissions. There has clearly been an attempt by the Respondent to use the Complainantís mark which is identical, save for the hyphen.
Other factors pointing to bad faith include the Respondentís "parking" of the name, followed by activity once the name had been challenged: the fact that the name will direct users to the Respondentís internet programming business: the near identical nature of the domain name with the Complainantís mark. The Respondentís soliciting of support in its campaign to retain the name against the Complainantís protests. In these circumstances bad faith registration and use is not hard to infer.
Accordingly, for all the various reasons discussed above, the Panel finds that the domain name has been registered and is being used by the Respondent in bad faith.
Reverse Domain Name Hijacking
This allegation is often used as a form of counter-attack by respondents unhappy with a complainantís invocation of the Policy. The allegation cannot succeed in this case. The basis for the allegation is that Complainant did not apply for trademark registration until two years after registering its domain name <Netfirms.com>. It did not think it would succeed in obtaining registration and is using the UDRP to harass the Respondent.
The Panel cannot find that the Complainant was required to file for trademark registration within any fixed time after its domain name registration. Indeed, as WIPO cases show, a common law mark will suffice to bring the Policy into play. Moreover, the Respondent was not frank with the Panel in omitting to mention that it had applied for registration of the Net-Firms mark. No doubt there will be trademark litigation, but the Respondentís trademark application does not lie easily with a claim of harassment against the Complainant.
For the foregoing reasons, the Panel decides:
(a) That the domain name registered by the Respondent is confusingly similar to the trademark to which the Complainant has rights;
(b) That the Respondent has no rights or legitimate interests in respect of the domain name;
(c) That the Respondentís domain name has been registered and is being used in bad faith; and
(d) That the Respondentís claim of reverse domain name hijacking is dismissed.
Accordingly, pursuant to paragraph 4(i) of the Policy, the Panel requires that the registration of the domain name <net-firms.com> be transferred to the Complainant.
Hon. Sir Ian Barker QC
Dated: April 12, 2001