WIPO

 

WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

Phytopharm plc v. Aston Borushek

Case No. DBIZ2001-00012

 

1. The Parties

The Complainant in this administrative proceeding is Phytopharm Plc, a public limited company registered in the UK, whoís principle place of business is Corpus Cristi House, 9 West Street, Godmanchester, Cambridgeshire, PE 29 2HY, UK. The Respondent in this administrative proceeding is Aston Borushek of P.O.Box 3100, Nedlands, W A 6009, Australia.

 

2. The Domain Name and Registrar

The disputed domain name is <phytopharm.biz>. The Registrar of the domain name is Register.com, of New York, NY, USA.

The Registry operator has confirmed the ticket number.

By registering the subject domain name with the Registrar, the Respondent agrees to the resolution of disputes pursuant to the Start-up Trademark Opposition Policy for <.biz> and the Rules for Start-up Trademark Opposition Policy for <.biz>.

 

3. Procedural History

This is a mandatory administrative proceeding submitted for decision in accordance with the Start-up Trademark Opposition Policy for <.biz>, adopted by NeuLevel, Inc. and approved by ICANN on May 11, 2001, (the "STOP"), the Rules for Start-up Trademark Opposition Policy for <.biz>, adopted by NeuLevel, Inc. and approved by ICANN on May 11, 2001, (the STOP Rules) and the WIPO Supplemental Rules for Start-up Trademark Opposition Policy for <.biz> (the WIPO Supplemental STOP Rules).

The Administrative Panel consisting of one member was appointed on February 11, 2002 by WIPO.

Complainant filed its STOP Complaint with the World Intellectual Property Organization Arbitration and Mediation Center (the "Center") on December 8, 2001, by email, on December 10, 2001, by facsimile and on January 10, 2002, by hardcopy. An Amendment to the Complaint was filed with WIPO on December 21, 2001, by email and on January 10, 2002, by hardcopy. On January 11, 2002, having verified that the STOP Complaint satisfied the formal requirements of the STOP and the STOP Rules, the Center formally commenced this proceeding. A Response was filed with WIPO on January 30, 2002, by email and on February 6, 2002, by hardcopy. On February 8, 2002, the Complainant replied to the Response. An e-mail inquiry to the Complainantís reply to the Response was received from the Respondent on February 22, 2002, to which there was no reply.

An examination of this material confirms that all technical requirements for the prosecution of this proceeding were met and the Administrative Panel is content to proceed on the basis of the existing record.

 

4. Factual Background

The following information is derived from the Complaint.

The Complainant is the beneficial owner of United Kingdom trade mark Registration number 1,418,557 for the mark PHYTOPHARM and Registration number 2,048,148 for the mark PHYTOPHARM (+Logo). The predominant element of the mark is the word PHYTOPHARM, rather than the logo.

Registration number 1,418,557 covers "Pharmaceutical preparations and substances; all included in Class 5" of the International Classification. Registration no 2,048,148 covers "Pharmaceutical preparations and substances; herbal remedies for use in the treatment of eczema" in Class 05 of the International Classification.

Both of these marks stand in the name of Phytotech Ltd, which was previously known as Phytopharm Ltd. Phytotech Ltd is a wholly owned subsidiary of the Complainant.

The Complainant is a substantial company, which was floated on the London Stock Exchange in 1996 and operates through various subsidiaries, including Phytotech Limited.

The Complainant develops and markets a range of naturally derived pharmaceutical products for clinical use under its marks. For several years, the Complainant and its subsidiaries have operated a website from www.phytopharm.co.uk in relation to these products and associated services.

Trade mark searches have been conducted in order to try and locate pending trade mark applications or registrations for the word "phytopharm", standing directly or indirectly in the name of the Respondent and no such marks belonging to him have been found.

The Complainant filed its application for <phytopharm.biz> on the basis of a prior trade mark right.

The Complainant knows of no legitimate reason why the Respondent should wish to own <phytopharm.biz>, but in an attempt to find a legitimate reason searches were made on the Internet and elsewhere. From these it transpires that the Respondent operates a variety of health related websites through a company called Family Health Network. This company appears primarily to operate out of Australia and the United States of America from websites such as www.familyhealth.com.au, www.calorieking.com and others. No reference can be found in any of the websites which were checked by the Complainant to the word "phytopharm". At present the Respondent does not appear to offer any product or service using the word "phytopharm".

The Respondent obtained and appears to have held the domain name <phytopharm.com> (the ".com domain name") for several years. When the Complainant became interested in the use of the this domain it took steps to investigate. The Complainant and its IT consultants checked the ownership of the .com domain name and regularly checked for use. These investigations conducted prior to March 2000, indicated that no use appeared to have been made of the domain name and that the only information displayed on the website indicated that the it was available for purchase.

The Complainant was interested in using this website in conjunction with its extant ".co.uk" website. Because no use by the Respondent was detected and because the .com domain name was offered for sale, an approach was made to the Respondent. The initial attempts to approach the Respondent were made by Fay Margetts (an employee of the Complainant) but these failed. She asked Ms. Le Maux to try on the Complainantís behalf. Ms. Le Maux is not directly employed by the Complainant, but is an external consultant who acts as an agent on its behalf.

In April 2000, Ms. Le Maux reached the Respondent and obtained a reply.

The Complainant offered US$500 for the domain name. This was rejected by the Respondent who indicated that the mark would only be sold for a "substantial" sum or instead he might use it. Negotiations stopped at this point because the Complainant did not wish to enter into discussion of what it considered to be unrealistic figures.

Nothing more happened with regard to the .com domain, but the Complainant continued to monitor the website and noticed that no use thereof was made despite what had been suggested by the Respondent in his email.

Eighteen months later, Ms. Le Maux received an unsolicited email dated October 15, 2001, from the Respondent offering to sell the .com domain name for US$25,000. After negotiation the Respondent agreed to sell the ".com" domain for US$20,000.

The ".com" domain has been transferred to the Complainant via Ms. Le Maux.

The following information is derived from the Response.

The Respondent says that he is not obliged "to submit to a mandatory administrative proceeding because the three criteria set out [identical, no legitimate use and bad faith] are NOT met". (emphasis in original)

The Respondent acts for Phytopharm Company (USA) ("Phytopharm USA") of which his father Allan Borushek is the President.

Allan Borushek is a dietitian and biochemist with over 25 years of experience in clinical dietetics, community health education and lecturing. He has formal university degrees in biochemistry, clinical nutrition and dietetics. Allan Borushek is the founder and president of Family Health Publications.

His best-selling books have sold over 7 million copies worldwide.

Phytopharm USA sells a range of nutriceuticals in the United States and has done so for a period of three years.

Phytopharm USAís phytomedicines began stringent testing at various prestigious institutions such as the University of California and the Montreal Heart Institute in early 2000, to establish their health giving benefits. Testing is ongoing.

The Respondent acquired <phytopharm.com> from a re-seller in April 2000, for the sum of US$600.00 with the intention of using this domain name to assist in the sale of Phytopharm USA products in the United States. Prior to this acquisition, the domain <phytopharmcom.com> was used.

After the <phytopharm.com> domain was acquired by Phytopharm USA, it launched a new web-site on April 29, 2000.

The Respondent has never solicited a sale of the .com domain name. His emails dated April 13, 2000, and October 15, 2001, were in response to unsolicited emails from Ms. Le Maux. The email received on behalf of the Complainant from Ms. Le Maux was one of many received from numerous parties, particularly in the United States regarding the potential sale of the domain name. The Respondent believes the Complainant pretended to be other parties on occasions.

On April 13, 2000, Allan Borushek received an unsolicited email from Ms. Le Maux to his email address on the <phytopharm.com> web-site, regarding the possible sale of the .com domain name. This email was forwarded to the Respondent who sent an email to Ms. Le Maux stating "Sorry we plan on using itÖ" Ms. Le Maux sent further emails to the Respondent seeking a sale and on May 5, 2000, clearly stated "This is my final offerÖyou may rest assured I will not be bothering you again." Despite this, Ms. Le Maux again contacted Allan Borushek on September 25, 2001, asking "Is this site now available for sale?". This email again was forwarded by Allan Borushek to the Respondent to be dealt with. In response the Respondent suggested a high figure with the hope of making Ms. Le Maux go away.

Prior to Ms. Le Maux contacting Allan Borushek, the Respondent was unaware of the Complainant. Phytopharm USA conducts business in the United States and does not and never has conducted business in the United Kingdom, although it is interested in expanding to the United Kingdom in the future. The Complainant does not conduct business in the United States and does not have an office there. At all relevant times the Complainant was without a noticeable presence in the United States or Australia.

The Respondent agreed to sell the .com domain to Ms. Le Maux given her willingness to pay the sum of US$20,000.00, which the Respondent considered too good an offer to refuse. Given the belief of the Respondent in the quality of Phytopharm USA products, he believed they would be successfully marketed without this domain.

The Respondent denies any suggestion that he purchased the .com domain name with the intention of warehousing it to make a profit from its future sale. The Respondent purchased it with the intention of using it to benefit Phytopharm USA.

The Respondent is deeply concerned by the inaccuracies contained in the Complainantís documents and the assertions that he has engaged in conduct of an underhand nature. The Respondent and his father Allan Borushek at all times have conducted themselves in a professional manner.

The Respondent denies that he ever intended to gain from creating a perception that he was in any way associated with the Complainant.

The Respondent denies that the application for the subject domain name, on behalf of Phytopharm USA took place on the basis of a prior trade mark right.

The Respondent denies that the subject domain name was registered in order to prevent the Complainant from reflecting the mark in a corresponding domain name.

The Respondent denies that the Complainant is a competitor of Phytopharm USA or the Respondent. They market differing products and operate in different, unconnected countries.

The Respondent further denies that the subject domain name was registered by him primarily to disrupt the Complainantís business.

The Respondent denies that the subject domain name was registered by him in an attempt to attract for commercial gain, Internet users to the Respondentís web-site or other on-line location, by creating a likelihood of confusion with the Complainantís mark as the source, sponsorship, affiliation, or endorsement of the Respondentís web-site or location or of a product or service on the Respondentís web-site or location.

Phytopharm USA has been known commonly by its name, which is the same as the subject domain name, for the last two years.

The following information is derived from the Reply.

The Complainant says that the Respondentís suggestion that he had no intention of selling the domain and was instead forced to sell by accidentally agreeing to a price with Ms. Le Maux is incorrect.

The Respondent sent an email to Ms. Le Maux dated October 15, 2001, saying "This domain is now for sale for the sum of US$25,000. A transfer can take place within 48 hours of monies being received". This was met with a reply from Ms. Le Maux in which she made a counter offer of US$15,000. The Respondent replied on October 22, 2001, stating, "Iím prepared to meet you half way and sell for US$20,000. I cannot sell below this figure". It was on the basis of this amount that the transfer of the .com domain name was concluded.

The Complainant also challenges the Respondentís assertion that this communication was in response to an unsolicited approach made by Ms. Le Maux. The September 25, 2001, email from Ms. Le Maux was addressed to allen@mediobotanica.com, not to the Respondent as he suggested. The fact that there was a link between allen@mediobotanica.com and the Respondent was not apparent to outsiders (including Ms. Le Maux). The fact that the message found its way to the Respondent does not indicate the Ms. Le Maux knew she was again contacting him. The email link was the only information on the website at the time and consequently it was not unreasonably for Ms. Le Maux to suppose that a change of situation had occurred.

Ms. Le Maux did not explicitly identify that she operated on behalf of the Complainant, but she did not attempt to obscure the fact as alleged by the Respondent.

The Respondentís email address (aston@familyhealth.com.au) does not suggest a connection with Phytopharm USA.

The Complainant denies that it made covert attempts to buy the .com domain name.

The Complainant is a high profile drug discovery company with a market capitalisation in excess of £215,000,000. Its primary aim is to discover, research, patent and license pharmaceuticals derived from plants for treatment of serious human and animal disease. These drugs are subject to full clinical trials and cannot be marketed without first obtaining permission from the appropriate national regulatory authorities. Conversely the products, which Phytopharm USA produces and distributes through a range of differently named companies, are un-regulated and unproven "Nutraceuticals" (or herbal remedies) which suggest that they are useful for preventing or alleviating certain ailments. The products are not FDA approved, and in small print on the labels of the products it states specifically that "this product is not intended to diagnose, treat, cure or prevent any disease".

The Complainant questions the Respondentís assertion that he had not heard of the Complainant.

The Complainant provides a number of examples of actual confusion by customers of its products and those of Phytopharm USA.

The Complainant validly applied in the "Start-up period" on the basis of its prior trade mark registrations. The Respondent must have subsequently applied, but not on the basis of any trade mark right, and by arbitrary allocation was awarded the subject domain name. The Complainant acted promptly and correctly at all times, and was forced to file this STOP Complaint because the Respondent randomly was awarded the domain name.

The Respondent offered the .com domain name for sale after the time by which he must have filed his subject domain name application. His implication that he needed to obtain the .biz registration to replace the .com domain name is untrue.

The Complainant suggests that Phytopharm USA has been implicated in a trade mark dispute with a company in the United States and Canada, but is not able to provide details of the situation.

 

5. Partiesí Contentions

A. Complainant

The Complainant asserts that the subject domain name is identical to its United Kingdom trade mark registrations on the basis that the ".biz" part of the subject domain name "Öis generic and the only distinctive element is the word "phytopharm" which is both grammatically and phonetically identical to the trade mark registrations belonging to the Complainant.

Noting that the Respondent was prepared to sell the higher level .com domain name and the lack of any actual significant use of the that domain name or the subject domain name, the Complainant asserts that the Respondent does not have a legitimate interest in the subject domain name.

Bad faith is said to flow from the lack of use and the fact that the Respondent was prepared to sell the .com domain name for a significant amount of money. In addition, the Complainant questions the Respondentís assertion that he did not know of the Complainant when he registered the .com domain name. It also states that the Respondentís explanation for registering the subject domain Ė to replace the .com domain name Ė is not credible because he had to do so before he sold the .com domain name.

B. Respondent

The Respondent says little if anything concerning the relationship between the Complainantís marks and the subject domain name. He contends that there would not be confusion.

Referring to the business of Phytopharm USA, which he represents and for whom apparently he holds the subject domain name, the Respondent contends that he has a legitimate interest in the subject domain name just as he did in the .com domain name.

He denies bad faith and states that no adverse inference should be drawn from his sale of the .com domain name because the Complainant offered him a great deal of money for it.

 

6. Discussion and Findings

Paragraph 4(a) of the STOP requires the Complainant to prove that:

(i) the domain name is identical to a trademark or service mark in which the Complainant has rights;

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

(iii) the domain name has been registered or is being used in bad faith.

Paragraph 4(b) provides for the implication of evidence of bad faith in a number of circumstances:

(i) circumstances that indicate that the Respondent has registered or has 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 the Complainant, for valuable consideration in excess of the Respondentís documented out-of-pocket costs directly related to the domain name;

(ii) registration of the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name;

(iii) registration of the domain name primarily for the purpose of disrupting the business of a competitor;

(iv) by using the domain name, intentionally attempting to attract, for commercial gain, Internet users to the Respondentís web site or other on-line location, by creating a likelihood of confusion with the Complainant's mark as to the source, sponsorship, affiliation, or endorsement of the web site or location or of a product or service on it or a location.

These are illustrative and do not represent the only circumstances from which may arise evidence of bad faith.

The resolution of this dispute takes place in the context of a consideration of the requirements of paragraph 4(a) of the STOP.

The Respondent states that it is not required to submit to the mandatory STOP dispute resolution process because the Complainant has not established its case. The position goes to the merits of the dispute, not to the commitment to the process for determining those merits.

A. Identical or Confusingly Similar

It is clear that the Complainant has rights to the word "phytopharm". The subject domain name differs from it only by the addition of .biz. That has no substantive significance.

The Administrative Panel is satisfied that the Complainant has met the requirements of paragraph 4(a)(i).

B. Respondents Legitimate Interest

Much of the debate between the parties concerns the acquisition and sale of the .com domain name. The Complainant contends that the fact that the Respondent was willing to depart with it shows that he did not have a legitimate interest in the .com domain name and thus no legitimate interest in the subject domain name.

In addition, the Complainant states that it monitored the .com site for some time and no commercial use was made of it.

The Respondent, who lives in Australia, acts for Phytopharm USA which is a company carrying on a business involving the supply of medically related products. It was incorporated in December 1999. In April 2000, the Respondent acquired the .com domain name to replace <phytopharmcom.com>. It is at least curious that the company's name is identical to that of the Complainant and that the original domain name included the additional letter "com". Both facts could give rise to inferences contrary to the Respondent's position, but it is inappropriate for the Administrative Panel to speculate.

The Respondent states that the original domain name was used as was the .com domain name.

Asserting that the Respondent must have applied for the subject domain name after he offered the .com domain name for sale, the Complainant says that the Respondent's "Ö implication that he needed to obtain the ".biz" registration to replace the ".com" which he 'accidentally' sold is clearly untrue."

The Respondent did not invite the Administrative Panel to so conclude. He says that he was willing to sell the .com domain name because of the amount of money offered by the Complainant to acquire it and the fact that having offered to sell, he was obliged legally to do so once the offer was accepted. The latter is a valid legal proposition in the common-law. In addition, he states that he believed that the Phytopharm USA products would sell without the .com domain name.

The evidence does not disclose why the Respondent registered the subject domain name, but the fact is that today Phytopharm USA does not have the .com domain name and it apparently continues in business.

Although there are some unanswered questions concerning the Respondent's interest in and use of the subject domain name and some disagreement by the parties on the facts, the information available to the Administrative Panel does not lead to a conclusion that the Respondent does not have a legitimate interest in the subject domain name.

The fact that a complainant has a legitimate interest in a domain name, does not negate another entity also having a legitimate interest. Both parties stress the differences in the products with which they are concerned: the Complainant is in the business of developing and marketing pharmaceutical products for clinical use; the Respondent's focus appears to be involved with phytomedicine or natural medical products. The wish to use the company name in a domain name is not surprising for either company.

It may be that the use by Phytopharm USA of the word "phytopharm" would engage the Complainant's trade mark rights, but that is not an issue for resolution by this Administrative Panel.

It also may be that the Respondent's future use or non-use of the subject domain name would support a different conclusion, but on the information presented to the Administrative Panel, it cannot conclude that the Respondent does not have a legitimate interest in the subject domain name.

The Administrative Panel is not satisfied that the Complainant has met the requirements of paragraph 4(a)(ii).

C. Bad Faith

The fact that a respondent uses a domain name that is identical to a complainant's trade mark rights does not establish bad faith. This is so even if the respondent were to have no legitimate interest in the domain name. The facts that support such conclusions could be relevant to the bad faith issue.

In this case, the subject domain name is identical to the Complainant's marks. It is clear that as of April 2000, the Respondent knew that the Complainant existed and that it was interested in acquiring a domain name that incorporated its name and marks. Eventually, that domain name was sold for a significant sum. During these events, the subject domain name was registered by the Respondent.

These facts raise suspicion.

Had the Respondent been pro-active is seeking to sell the .com domain name, the suspicion would have considerable weight, but on the information presented to the Administrative Panel, the Respondent was not. It was contacted indirectly by the Complainant and replied that he was not interested in selling the .com domain name. Only after further action by the Complainant did the Respondent react positively to the notion of selling.

The Respondent provides information why he acquired the .com domain name and denies that it attempted to sell it.

The Complainant quite properly expresses concern that having once sold a related domain name to the Complainant for a considerable sum of money, the Respondent may seek to repeat its success. There is no direct information before the Administrative Panel that the Respondent has or intends to do so. If this were to be the case, it could be addressed appropriately.

These facts do not support a conclusion that the .com domain name has been registered in bad faith. The Complainants case concerning the subject domain name rests largely on such a conclusion.

As to use, there is little information one way or the other, which in the early days of the .biz registrations is not surprising.

On the information provided to the Administrative Panel it cannot be said that the subject domain name has been registered or is being used in bad faith.

The Administrative Panel is not satisfied that the Complainant has met the requirements of paragraph 4(a)(iii).

 

7. Decision

Based on its findings of fact and conclusions, the Administrative Panel decides that the Complainant has not established its case. It is dismissed.

If new facts were to emerge, to the extent that these new facts may lead to a different conclusion, it may be a matter for a future Administrative Panel to decide under the UDRP. The extent to which any future Administrative Panel would entertain such information is a matter for its consideration.

 


 

Edward C. Chiasson, Q.C.
Sole Panelist

Dated: February 25, 2002