WIPO

 

WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

Tennessee Education Lottery Corporation v. Mark Dalton

Case No. D2003-0726

 

1. The Parties

The Complainant is Tennessee Education Lottery Corporation, Nashville, Tennessee, United States of America, represented by Waller Lansden Dortch and Davis, PLLC, United States of America.

The Respondent is Mark Dalton, Franklin, Tennessee, United States of America.

 

2. The Domain Name and Registrar

The disputed domain name <tennesseelottery.com> is registered with Network Solutions, Inc.

The disputed domain name was initially registered on April 15, 1998.

 

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the "Center") on September 15, 2003. On September 16, 2003, the Center transmitted by email to Network Solutions, Inc. a request for registrar verification in connection with the domain name at issue. On September 24, 2003, Network Solutions, Inc. 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 September 25, 2003. In accordance with the Rules, paragraph 5(a), the due date for Response was October 15, 2003. The Response was filed with the Center on September 26, 2003.

The Center appointed R. Eric Gaum as the sole panelist in this matter on October 7, 2003. The Panel finds that it was properly constituted. 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

On November 5, 2002, the citizens of the State of Tennessee voted to amend the Tennessee Constitution remove an absolute prohibition on all lotteries within the state. The Tennessee Education Lottery Implementation Law was signed into law by the Governor of Tennessee on June 11, 2003, and Complainant Tennessee Education Lottery Corporation was formed as a legal entity on July 28, 2003, to operate the lottery. On August 29, 2003, Complainant filed an Intent-To-Use trademark application with the United States Patent and Trademark Office.

On April 15, 1998, Respondent registered <tennesseelottery.com> with Network Solutions, Inc.

 

5. Partiesí Contentions

A. Complainant

Complainant states:

"For approximately the past 15 years, the State of Tennessee has debated whether to enact legislation to have a state lottery. On November 5, 2002, the citizens of the State of Tennessee voted to amend the Tennessee Constitution to remove an absolute prohibition on all lotteries within the state. This constitutional amendment granted the General Assembly the authority to create a single and exclusive state-sponsored lottery, the proceeds of which would be earmarked for education. The Tennessee Education Lottery Implementation Law was signed into law by the Governor of Tennessee on June 11, 2003, and the Complainant was formed as a legal entity on July 28, 2003. All other public gaming and gambling are still prohibited under the laws of the State of Tennessee."

"In the years prior to the passage of the constitutional amendment, the formation of a lottery received a great deal of publicity and became an important campaign issue in state politics."

"On April 15, 1998, the day of a vote by the Tennessee Legislature to allow a voter referendum on whether to have a lottery. Respondent registered the Disputed Domain Name to profit wrongfully from the potential establishment of a lottery in the State of Tennessee and/or to attract and confuse consumers into visiting his website."

"The Disputed Domain Name registered by Respondent is nearly identical, or confusingly similar, to the statutory-granted name of the Complainant and the official website of Complainant, "www.tennesseelottery.gov". Respondentís use of the Disputed Domain Name also infringes upon the Complainantís trademark rights. Article XI, Section 5 of the Tennessee Constitution provides Complainant the exclusive right to operate a lottery within the State of Tennessee."

"Substantial consumer confusion will result if the Disputed Domain Name is not transferred to Complainant; it is reasonable for consumers to infer that, because Complainant is a quasi-corporation, its domain name will be registered as a ".com" instead of a ".gov. " Because Complainant is the only legal lottery in Tennessee, it is also reasonable for consumers to infer that Complainant would be registered at the Disputed Domain Name address, as such address specifically describes Complainantís exclusive services."

"In furtherance of its exclusive legislative grant to promote lottery services within the State of Tennessee, Complainant also operates and maintains the website "www.tennesseelottery.gov", the official website of the Tennessee Lottery. Because the Disputed Domain Name only differs from Complainantís website in that the Disputed Domain Name is registered with a ".com" extension, it is confusingly similar to Complainantís official website."

"Arbitrators have held routinely that government domain names registered as a Ď.comí should be transferred to the proper government entity under the Policy."

"In other State lottery ".com," ".net" or ".org" domain name disputes, such as Washington State Lottery v. Kendell Lang, FA0208000123893 (National Arbitration Forum October 21, 2002), administrative panels have uniformly transferred lottery domain names to validly authorized state lotteries to avoid consumer confusion and deception."

"Although Respondent registered the Disputed Domain Name on April 15, 1998, in anticipation of the authorization of a state lottery in Tennessee, Paragraph 4(a)(i) of the Policy does not require that Complainantís trademark be registered or used prior to Respondentís registration of the Disputed Domain Name. Complainant has filed with the United States Patent and Trademark Office (the USPTO) an intent to use trademark application for the mark Tennessee LotteryÖ"

"Complainant has asserted its trademark and common law trademark rights to satisfy the requirements of Paragraph 4(a)(i) of the Policy; it is using its marks and has filed to register such marks with the USPTO."

"Where a party has a right to use a trademark it also has an exclusive right to Ďlotteryí domain names encompassing the mark."

"In accordance with Rules, Para. 3(b)(ix)(2), Respondent has no rights or legitimate interests in the Disputed Domain Name. Before notice of this dispute, the Respondent has not used, or made demonstrable preparations to use, the Disputed Domain Name in connection with a bona fide offering of goods or services. Respondent is not engaged in the operation of any lottery within Tennessee and, absent a Constitutional amendment, it is illegal for him to do so."

"Furthermore, Respondent is not generally known as "Tennesseelottery" and has not acquired any related trademarks or service marks."

"Respondent is not making a legitimate non-commercial or fair use of the Disputed Domain Name, without intent for commercial gain and intent to mislead consumers. Respondent is using the website for his commercial gain Ė to promote his business and to provide advertising space to third-parties. Such activities are not non-commercial uses and are not protected by the Policy."

"The timing of Respondentís registration of the Disputed Domain Name indicates bad faith in the registration of the Disputed Domain Name. As indicated above, Respondent registered the Disputed Domain Name on April 15, 1998. In the days immediately prior to Respondentís domain name registration, Tennessee media outlets reported that a state lottery bill Ďwas scheduled for a floor vote on Wednesday [April 15, 1998] and the sponsor is predicting that thereís a Ďreal goodí chance for its approval.í

"On the day of this anticipated vote, Respondent registered the Disputed Domain Name, presumably, fully aware that there was a real possibility that Tennessee would soon have a state lottery. The timing of Respondentís registration is actual evidence of Respondentís bad faith in registering the Disputed Domain Name."

"In addition to the suspicious timing of Respondentís domain name registration, Respondent acted in bad faith because he registered the Disputed Domain Name primarily for the purpose of selling, renting, or otherwise transferring the Disputed Domain Name to the Complainant or to a third party, for valuable consideration in excess of the Respondentís out-of-pocket costs."

"Respondent also acted in bad faith by using the Disputed Domain Name to attract, intentionally for commercial gain, Internet users to his website by creating a likelihood of confusion with the Complainant as to the source, sponsorship, affiliation, or endorsement of the Respondentís website."

B. Respondent

Respondent states:

"On April 15,1998 I was not aware of any discussions about an Education Lottery being considered for the State of Tennessee."

"Iíve been accused of being a cyber squatter of something that didnít exist when purchasing the Domain and hasnít existed until recently. If I were trying to be a cyber squatter of Domain Names, I would have purchased more than one name. Tennessee is the state in which I live and Lottery is any game of chance. It doesnít have to be Gaming, or Gambling related to be a game of chance. There are Video Games, Board Games and Tournaments that are all Games of Chance.í

"Iíve operated the TennesseeLottery.com website over the past five years and have never used it for anything offensive or in Bad Faith. There was never a State Lottery back then and it was my understanding my website could be used freely."

"Just recently did the Education Lottery apply for a Trademark, which Iím not sure if itís been approved. Just recently the voters approved the Education Lottery, itís not even in operation."

"Hundreds of Tennessee businesses use Tennessee in connection with products and services and this statement within the complaint is without merit."

"The Complainant offered to purchase the domain for past registration fees and plus a 10% finders fee. I have refused this offer and Iím proceeding with a new website to launch on January 1st. 2004."

"Only after they made an offer to purchase this Domain Name did I present them with a counter offer. My counter offer was for the sum of $5,000 USD, as per an appraisal on July 2002 by GreatDomains.com."

 

6. Discussion and Findings

The Uniform Domain Name Dispute Resolution Policy (the "Policy"), adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) on August 26, 1999, (with implementing documents approved on October 24, 1999), is addressed to resolving disputes concerning allegations of abusive domain name registration. The Panel will confine itself to making determinations necessary to resolve this administrative proceeding.

Paragraph 4(a) of the Policy sets forth three elements that must be established by a Complainant to merit a finding that a Respondent has engaged in abusive domain name registration, and to obtain relief. These elements are that:

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

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

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

In the administrative proceeding, the complainant must prove that each of these three elements are present.

A. Identical Or Confusingly Similar To A Trademark Or Service Mark In Which The Complainant Has Rights

The Policy requires that a Complainant have "rights" in a mark that is the subject of a domain name dispute. Therefore, a threshold question in this dispute is whether Complainant has established a protectable right in the service mark TENNESSEE LOTTERY or another mark that is identical or confusingly similar to <tennesseelottery.com>.

Complainant does not have either a federal or state registration for the service mark TENNESSEE LOTTERY or any other similar mark. However, a trademark registration is not required under the Policy. Complainant may have established common law rights in an identical or confusingly similar mark sufficient to give it "rights" in such a mark.

In the years prior to implementation of the Tennessee Lottery and during the legislative process enacting the Tennessee Lottery, the evidence shows that the possibility of implementing a Tennessee Lottery was widely disseminated in media outlets in Tennessee.

The Tennessee Education Lottery Implementation Law was signed into law by the Governor of Tennessee on June 11, 2003, and the Complainant was formed as a legal entity on July 28, 2003.

On August 29, 2003, the Complainant filed U.S. Intent-To-Use trademark applications for, inter alia, the mark TENNESSEE LOTTERY.

In addition, Complainant has a statutorily granted name and is operating the official website of the Tennessee Lottery, "www.tennesseelottery.gov".

Finally, Complainant is the only organization authorized to conduct a lottery in the state of Tennessee.

It is well settled that actual sale of a product or offer of a service is not necessary for the purpose of determining priority of use in an unfair competition action. New West Corp. v. NYM Co. of Calif., Inc., 595 F.2d 1194 (9th Cir. 1979). In New West Corp., the defendant first announced that it intended to publish a new magazine entitled "New West." Before the defendant could publish its first issue, the plaintiff, with knowledge of the defendantís promotional campaign and upcoming inaugural issue, hastily published a "preview issue," in an attempt to beat the defendant to the newsstands. The 9th Circuit found that "evidence showing, first, adoption, and second, use in a way sufficiently public to identify or distinguish the marked [services] in an appropriate segment of the public mind as those of the adopter of the mark is competent to establish ownership, even without evidence of actual sales." Id.

Based upon the totality of the evidence, it is the Panelís opinion that Complainant has sufficiently shown its "rights" in TENNESSEE LOTTERY. The evidence shows vast media efforts publicizing the possibility of implementing a Tennessee Lottery. The public undoubtedly associated the mark TENNESSEE LOTTERY with the state government of Tennessee and the services to be offered only by the state of Tennessee, because state lotteries are typically known by [the name of the State] Lottery.

The domain name <tennesseelottery.com> is confusingly similar to TENNESSEE LOTTERY.

B. Rights or Legitimate Interests

Paragraph 4(c) of the Policy lists several circumstances, without limitation, that if found by the Panel shall demonstrate the Respondentís rights or legitimate interests to the domain name for purposes of paragraph 4(a)(ii). In particular, paragraph 4(c) states:

(i) before any notice to you [Respondent] 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 noncommercial 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.

There is no evidence that Respondent used or had preparations to use the domain name in connection with a bona fide offering of goods or services before having notice of this dispute. Respondent only makes vague references of plans for a future website. In the current version of Respondentís website, and a prior version of the website, Respondent indicated that the domain name was for sale.

There is no evidence that Respondent is or has been commonly known as Tennessee Lottery. Respondent is an individual.

There is no evidence that Respondent is making a legitimate noncommercial or fair use of <tennesseelottery.com>, without intent for commercial gain or to divert consumers. On the contrary, the evidence shows that, on a prior version of the website, Respondent noted that "Tennesseelottery.com equals guaranteed visitors!"

Based on the evidence, the Panel finds that Respondent has no legitimate rights or interest in <tennesseelottery.com>.

C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy lists several factors, without limitation, that if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith. In particular, paragraph 4(b)(iv) states:

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website 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 website or location or of a product or service on your website or location.

The evidence in this case suggests that Respondent registered and is using the domain name in bad faith. The Respondent registered <tennesseelottery.com> on the very day that the Tennessee Legislature voted on whether to implement a Tennessee Lottery. From the evidence, it is reasonable to assume that Respondent knew of the possibility that the state of Tennessee would enact a lottery and attempted to preemptively register a domain name that may be of considerable monetary value at a future time.

Furthermore, the Respondent not only listed the domain name for sale, but also boasted on the website that "Tennesseelottery.com equals guaranteed visitors!" Therefore, the evidence shows that Respondent intentionally attempted to attract, for commercial gain, Internet users to his website, by creating a likelihood of confusion as to source.

Although Respondent has listed a disclaimer on his website that <tennesseelottery.com> is not affiliated the "State Education Lottery," it is well-settled that such disclaimers do not negate likelihood of confusion and initial interest confusion. See, e.g., Estée Lauder Inc. v. Hanna, WIPO Case No. D2000-0869 (September 25, 2000).

 

7. Decision

For all the foregoing reasons, in accordance with Paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name, <tennesseelottery.com> be transferred to the Complainant.

 


 

R. Eric Gaum
Sole Panelist

Date: November 3, 2003