WIPO

 

WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

Sun Peaks Resort Corporation v. 505398 B.C. Ltd.

Case No. D2003-0873

 

1. The Parties

The Complainant is Sun Peaks Resort Corporation of Vancouver, British Columbia, Canada, represented by Davis & Company of Vancouver, British Columbia, Canada.

The Respondent is 505398 B.C. Ltd. of North Vancouver, British Columbia, Canada, for whom a response was submitted by Mary Davies of Vancouver, British Columbia, Canada.

 

2. The Domain Name and Registrar

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

 

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the "Center") on November 3, 2003. On November 6, 2003, the Center transmitted by email to Network Solutions, Inc. a request for registrar verification in connection with the domain name at issue. On November 11, 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 November 27, 2003. In accordance with the Rules, paragraph 5(a), the due date for Response was December 17, 2003. The Response was filed with the Center on December 17, 2003.

The Center appointed Daniel J. Gervais as the sole panelist in this matter on December 29, 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

The trademark SUN PEAKS has been registered to the Complainant in Canada since 2001, under No. TMA540,448. The Complainant also obtained registrations for SUN PEAKS & Design and SUN PEAKS SPORTS since 2001 and 2002, respectively. Trademark applications were first filed in 1993, when the Complainant started using the name SUN PEAKS. The marks are used in association with resorts, ski equipment and related wares; ski and golf instruction and various related services. The Complainant operates a resort near the city of Kamloops, British Columbia, Canada. The resort is well-known and regularly featured in skiing guides and magazines.

Also, Sun Peaks has been the name of a resort improvement district and municipality (under the British Columbia Municipal Act), as well as being a trademark since March 1995.

The Respondent was incorporated in 1995. Two of its initial shareholders were, at one time, employed by the Complainant. When the domain name was registered by the Respondent in 1995, these two initial principals were employed by the Complainant.

The Respondent started operating a website using the domain name in 1996 or 1997. After receiving a cease-and-desist letter from the Complainant in late 1997, the Respondent stopped using the domain name.

The Complainant commenced legal action in the Supreme Court of British Columbia against the Respondent for passing off and trademark infringement and sought, inter alia, transfer of the domain name. The matter has not proceeded since 1998, and there was no contact between the parties between 1998 and 2003.

 

5. Partiesí Contentions

A. Complainant

The Complainant contends that the disputed domain name is identical to its SUN PEAKS trade-marks.

Complainant contends that the Respondent has no possible basis to argue that it has made any (bona fide) use of the domain name. Complainant further contends that the Respondent has no rights in the SUN PEAKS marks. Use made by the Respondent was commercial and not legitimate under the Policy.

The domain name was registered and used in bad faith. At the time of registration, the Respondent had no legitimate interest in the domain name and was well aware of the Complainantís marks. It used the domain name to its financial advantage.

Use made of the domain name was also in bad faith because it appeared to be a website operated by or on behalf of the Complainant, thus misleading Internet users and potential customers. The Respondent disrupted the business of the Complainant and attempted to attract Internet users to its site for commercial gain.

B. Respondent

The Respondentís purpose in creating a website using the domain name in 1996, was to promote a number of business activities at Sun Peaks, not just the Complainantís, who registered and used a different domain name, namely <sunpeaksresort.com>. The Respondent provides examples of similar sites, including <whistler.com>.

The creation of a website/portal using the domain name was discussed in November 1996, with a representative of the Complainant, at which time Mary Davies, a principal of the Respondent and, at that time an employee of the Complainant, offered to the Complainant the "opportunity to become anchor tenant of the Sun Peaks portal website" for a fee of $1,000 per month, plus various traffic and linking charges. The Complainant apparently indicated an intention to participate, but approximately a year later, Respondent received a cease-and-desist letter from the Complainantís attorneys. The Respondent contends that this letter was the first warning that the Complainant objected to the use of the domain name.

The domain name was registered in good faith in the early days of the Internet to be used as an email address. The Respondent then decided to create an information gateway concerning Sun Peaks district. Use was in good faith and never conveyed any hint that the website to which the domain name resolved was the Complainantís or authorized by the Complainant.

One of the Respondentís principals (and former employee of the Complainant), Paul Storey, is a resident of Sun Peaks, British Columbia, who registered the domain name "for the purpose of establishing an email address for himself. Later on, it was decided to use it for a commercial purpose.

The Complainant has no rights in the words ĎSun Peak.í Alternatively, the Complainant gave up such rights in "allowing the Province of British Columbia to name the new improvement district located near Kamloops, British Columbia, the Sun Peaks Resort Improvement District."

The Respondent used the domain name to provide information, not the goods or services in respect of which the Complainantís marks are registered.

The Respondent has legitimate interests in the domain name because (a) one of its principals resides in Sun Peaks, British Columbia, and (b) several administrative decisions under the Policy have recognized such legitimate interests in respect of geographical identifiers.

The Respondent, on the basis of the intention indicated in late 1996 by the Complainant, made demonstrable preparations for use in good faith of the domain name. The lack of use since 1997, is due to the high cost of defending legal action against the Complainant.

The fact that the Respondentís initial shareholders were employees of the Complainant has no bearing on the Complaint.

Finally, the Respondent is asking this Panel to make a finding of reverse domain name hijacking. It mentions 25 other websites and 14 businesses using the words Ďsun peakí in their name.

 

6. Discussion and Findings

In accordance with paragraph 4(a) of the Policy, in order to succeed in this proceeding and obtain the transfer of the domain name, the Complainant must prove that each of the three following elements is satisfied:

a) The domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights (see below, section 6(A));

b) The Respondent has no rights or legitimate interests in respect of the domain name (see below, section 6(B)); and

c) The domain name has been registered and is being used in bad faith (see below, section 6(C)).

Paragraph 4(a) of the Policy clearly states that the burden of proving that all these elements are present lies with the Complainant.

Pursuant to paragraph 15(a) of the Rules, the Panel shall decide the complaint on the basis of the statements and documents submitted and in accordance with the Policy, the Rules and any rules and principles of law that it deems applicable. Moreover, in accordance with paragraph 14(b) of the Rules, if a party, in the absence of exceptional circumstances, does not comply with any provision of, or requirement under, the Rules or any request from the Panel, the Panel shall draw such inferences therefrom, as it considers appropriate.

A. Is the Domain Name Identical or Confusingly Similar to a Trademark in which Complainant has Rights?

This question raises two issues: (1) does the Complainant have rights in a trademark or service mark; and, (2) is the domain name identical or confusingly similar to such a mark.

As to the first question, the answer is clearly yes. The Complainant does hold valid trademark registrations in Canada for the words SUN PEAKS in association with certain wares and services. The Complainant also has rights at common law deriving from use of those words since 1993, or thereabouts.

The Respondent referred the Panel to the decisions under the Policy concerning <barcelona.com>, Excelentisimo Ayuntamiento de Barcelona v. Barcelona.com Inc. (WIPO Case No. D2000-0505) and <puertorico.com>, Puerto Rico Tourism Company v. Virtual Countries, Inc. (WIPO Case No. D2002-1129) and the fact that the Policy does not apply to geographical identifiers. That is not the question in this case. Where the identifier is duly registered as a trademark the panel notes that neither party is a public authority seeking to obtain or oppose transfer of a geographical identifier used as a domain name.

The Respondentís point concerning the overlap between the Complainantís mark(s) and the name of the improvement district/municipality is also different from other cases concerning geographical identifiers, because the words were first used as a trademark, which became a geographical identifier by decision of the provincial government. In other cases referred to by the Respondent, including the two just mentioned, the geographical identifier preceded its use by anyone as a trademark. That had an impact on the scope of protection of the Complainantís mark, but for the purposes of this first part of the test, there is a valid trademark.

It is also clear that the domain name is identical to the Complainantís mark(s), except for the ".com" which, as was decided in numerous decisions under the Policy, is irrelevant for the purpose of determining similarity.

B. Does the Respondent Have Rights or Legitimate Interests in the Domain Name?

According to paragraph 4(c) of the Policy, a Respondent may establish its rights or legitimate interests in the domain name, among other circumstances, by showing any of the following elements:

(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 [Respondent] (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 [Respondent] 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.

The Respondentís only valid claim (i.e., supported by evidence) is based on subparagraph (i). As the result of discussions held in November 1996 with a representative of the Complainant, the Respondent made "demonstrable preparations to use the domain name." The question is whether these were a bona fide offering of goods or services. On this point, the evidence is contradictory. The Complainant asserts that the Respondent registered the domain name in order to free ride on its goodwill and use it for its own financial benefit and with a view to misleading Internet users. While this is a credible assertion, there is little, if any, evidence to support the claim. The Respondent asserts, on the other hand, that use of the domain name to create a portal to promote goods and services available at Sun Peaks, British Columbia, was discussed with the Complainant who initially intended to participate. While it does not fall into the purview of this panelís mandate to determine whether a contract was formed at that time, the Panel notes that a year went by between those discussions and the cease-and-desist letter sent by the Complainantís attorneys. There is no evidence of prior complaints or warnings by Complainant.

While there is no doubt that the Respondent knew of the Complainantís use of "Sun Peaks," the Panel notes that the domain name was used only after "Sun Peaks" had been declared the name of a public authority (improvement district) by the Province of British Columbia under its Municipal Act. Absent any evidence of mala fide intent by the Respondent or its principals, it is legitimate, bona fide use for a resident of a municipality to want to offer a portal to inform potential customers of services available there.

To be sure, if "Sun Peaks" had been solely used by the Complainant, and was not the name of a municipality, use by the Respondent would not have qualified as bona fide. In addition, the Panel notes that Sun Peaks has since been adopted and used by several businesses and websites. It appears that if the Complainant had at one time (possibly from 1993-1995) broad (i.e., beyond the scope of the trademark registration) exclusive rights in the use of the words "Sun Peaks" based on secondary meaning, that may no longer be the case.

There is no doubt that there is a very strained relationship between the parties and there have been many years of conflict. The Panel also noted Complainantís assertion that the Respondentís principals had been, at one time, employees of the Complainant. If there is a cause of action (e.g., for breach of a fiduciary duty or duty of loyalty recognized by the Supreme Court of Canada in well-known cases, or on trademark grounds outside the scope of the UDRP), that is not for this Panel to decide. The Panel noted that the matter was raised in legal action taken against the Respondent in the Supreme Court of British Columbia (a matter not disclosed in the Complaint). The Policy is not the proper instrument to solve such disputes.

One reason that could have led this Panel to find an absence of legitimate interest is the fact that the domain name was not used between 1997 and 2003. However, the Respondent offered a credible explanation: they received a cease-and-desist letter and, as a small company, did not want to incur the cost of a court battle. Establishment of rights or legitimate interests in a domain name is not precluded by the absence of active use, when such absence is justified by the circumstances. A similar finding may be found in Excmo. Cabildo Insular de Tenerife and Promocion Exterior de Tenerife, S.A. v. Jupiter Web Services Limited, (WIPO Case No. D2003-0525). In a similar vein, this Panel is not prepared to apply the doctrine of laches against the Complainant. In sum, if time can be said to have played a part in this matter, it did so equally for or against both Parties. See this panelistís analysis on this point in Paule Ka v. Paula Korenek, (WIPO Case No. D2003-0453).

For these reasons, the Panel finds that the Complainant has not established that the Respondent lacks legitimate interests in the domain name.

C. Was the Domain Name Registered and Used in Bad Faith?

Paragraph 4(b) of the Policy sets out four circumstances which, without limitation, shall be evidence of the registration and use of a domain name in bad faith, namely:

(i) circumstances indicating that Respondent has registered or 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 the Respondent's documented out-of-pocket costs directly related to the domain name; or

(ii) Respondent has 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 Respondent has engaged in a pattern of such conduct; or

(iii) Respondent has registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, Respondent has intentionally attempted to attract, for commercial gain, Internet users to Respondent's website 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 Respondent's website or location or of a product.

It is not essential to continue this analysis in light of the finding on the second leg of the test, because the Complainant must succeed on all three parts of the test to obtain a transfer of the domain name. Yet, the panel thinks it important to comment briefly on the issue of bad faith and to note, first, that both Mary Davies (a former principal of the Respondent and acting on its behalf in this administrative proceeding) and the Respondent have consistently maintained (in court proceedings before the Supreme Court of British Columbia and in this proceeding) that the domain name was registered as a "gift" in order to establish an email address for Paul Storey, a principal of the Respondent. That may not have been sufficient to conclude registration in good faith had the Complainant demonstrated exclusive rights to the use of the words Ďsun peaks.í But the declaration of the name "Sun Peaks" as a "resort improvement district" under the British Columbia Municipal Act and the fact that the words ĎSun Peaksí are now used by several other entities located or offering services in Sun Peaks, BritishColumbia, support the Respondentís assertions. For the same reasons, the Complainantís case under subparagraph (iv) is considerably weakened. As to subparagraph (iii), the record shows that the Complainant has been using a different domain name, <sunpeaksresort.com>, and that the intention of the Respondent seemed to be to create a portal to describe and offer links to services available at Sun Peaks, British Columbia, which is a credible use. There is no evidence to support a claim under subparagraph (i) or (ii).

Because of the contradictory nature of the evidence and the fact that the Complainant has the burden of proof, the case also fails on the issue of bad faith, but the Panel cannot, for the same reasons, make a finding of reverse domain name hijacking. The test contained in Rule 15(e) is not met. See Aspen Grove, Inc. v. Aspen Grove, (WIPO Case No. D2001-0798).

The Complainant did show that it has rights in a trademark, and that the domain name is identical thereto. Action by the provincial government that turned the Complainantís mark into a geographical identifier (though based on the evidence submitted, it is still a protected trademark, and a mark which does not seem prohibited by s. 9 of the Canadian Trade-marks Act) followed by the adoption of such identifier by a series of other businesses means that the Complainant lost any claim it may have had to the exclusive use of its trademarks outside of its protected realm (i.e., in respect of wares and services in relation with which it is used). But the Complainantís case is not frivolous and the Complainant might indeed still have a cause of action based on the fact that the Respondentís principals were its employees when the domain name was registered. This Panel is not able to determine questions of employment and contract law, nor questions of trademark law outside the Policy, nor the extent to which a fiduciary obligation existed at the time, which might, in turn, impact ownership of the domain name. For the purposes of the Policy, legitimate use was made of the domain name, but the domain name corresponds to a trademark in which the Complainant has rights. The Complainant proved part of its case, but failed on the last two counts and thus cannot obtain the remedy it seeks in this forum. But, neither can the Respondent legitimately claim reverse domain name hijacking.

 

7. Decision

For all the foregoing reasons, the Complaint is denied and the Respondentís claim for a declaration of reverse domain name hijacking is similarly denied.

 


 

Daniel J. Gervais
Sole Panelist

Dated: January 8, 2004