World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

SPECS Surface Nano Analysis GmbH v. Rickmer Kose / Domain Name Administrator, PrivacyProtect.org

Case No. D2010-1173

1. The Parties

The Complainant is SPECS Surface Nano Analysis GmbH, Berlin, Germany, represented by Pattishall, McAuliffe, Newbury, Hilliard & Geraldson, United States of America.

The Respondent is Rickmer Kose, San Francisco, California, United States of America; Domain Name Administrator, PrivacyProtect.org, Netherlands.

2. The Domain Name and Registrar

The disputed domain name <specsus.com> is registered with GoDaddy.com, Inc.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on July 15, 2010. On July 16, 2010, the Center transmitted by email to GoDaddy.com, Inc. a request for registrar verification in connection with the disputed domain name. On July 19, 2010, GoDaddy.com, Inc. transmitted by email to the Center its verification response disclosing registrant and contact information for the disputed domain name which differed from the named Respondent and contact information in the Complaint. The Center sent an email communication to the Complainant on July 22, 2010 providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. The Complainant filed an amended Complaint on July 22, 2010. The Center verified that the Complaint amended Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), 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 July 26, 2010. Following a request from the Respondent and some related correspondence between the parties and the Center, the Center extended the due date for Response until August 19, 2010 respectively. The Response (and amended Response) was filed with the Center on August 15, 2010 and August 19, 2010, respectively (both of which the Panel has treated as a single “Response” for the purpose of these proceedings).

On August 24, 2010, the Complainant made a supplemental filing. As noted in the Center’s acknowledgement of that filing, the neither the Policy nor the Rules make express provision for supplemental filing by either party. For this reason, and because that filing largely sought to reargue matters raised in the Response that were already raised in the Complaint, the Panel has not considered that supplemental filing.

On August 25, 2010, the Respondent sent an email to the Center that a lawsuit had been filed against the Complainant. The Respondent attached a copy of a filing dated August 19, 2010, in the Superior Court of the State of California for the County of San Francisco for, among other things, breach of contract against the Complainant.

The Center appointed James A. Barker as the sole panelist in this matter on September 2, 2010. 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. On September 17, 2010, the Panel extended the due date for decision under paragraph 10 of the Rules.

4. Factual Background

The Complainant was founded in Germany and is a manufacturer of components and systems for surface analysis, based on ion and spectroscopic methods. The Complainant conducts its business on various websites, including “www.specs.de”, “www.specs.com”, and “www.specsusa.com”. The Complainant also owns a subsidiary company, named SPECS Surface Nano Analysis Inc., incorporated in Florida. The Complainant is the owner of a registered trademark in Germany for SPECS, as well as registrations for that mark in other jurisdictions.

The disputed domain name was registered in August 17, 2006. At the date of this dispute, it reverts to a website stating “Welcome to SPECS USA” and “Your trusted partner in surface science and analysis”.

5. Parties’ Contentions

A. Complainant

The Complainant says that in 2006, the Respondent incorporated SPECS USA Corporation in California, on behalf of the Complainant and the Respondent. The Complainant says that that entity was intended to be jointly owned by the Complainant and the Respondent. The Complainant says however that it permitted the Respondent to own 100% of that company “during his tenure as a SPECS sales agent. The Respondent worked as a sales agent of the Complainant until April 30, 2010. After that date, there ceased to be any relationship between the parties that would give the Respondent rights or a permission to use the SPECS mark. Since being terminated as a sales agent, the Respondent has continued to use the Complainant’s SPECS name and mark, and has refused to transfer the disputed domain name.

The Complainant says that the disputed domain name is confusingly similar to its mark, because that mark is entirely incorporated in the disputed domain name. Internet users are also likely to be confused because the disputed domain name adds only the geographic term “US”.

The Complainant says that the Respondent has no rights or legitimate interests in the disputed domain name. The Complainant refers to SPECS GmbH v. SPECS Scientific Instruments, Inc. d/b/a SPECS Technologies Corporation, WIPO Case No. D2009-0308 where it says the then panel found that the respondent’s continued commercial use of the domain name <specsusa.com> to compete with the Complainant after the Complainant terminated the respondent’s authorization to use the domain name was not bona fide. The Complainant says that other panels have reached similar conclusions.

The Complainant also says that the Respondent has registered and used the disputed domain name in bad faith. The Complainant says that it never permitted the Respondent to obtain any rights to marks or domain names incorporating the Complainant’s mark. The Complainant says that the Respondent has used the disputed domain name for commercial gain to prevent the Complainant’s rightful use for the domain name and to attract Internet users to the Respondent’s website.

B. Respondent

The Respondent states that the Complainant has no trademark rights in the United States, and that the term “specs” has been registered in the USA by other parties that have no affiliation with the Complainant. The Respondent says that the term “specs” is a dictionary word (the plural of “spectacles”) and is also frequently used as the short form for “specifications”. The Respondent says that because its registration of the disputed domain name preceded the registration of the Complainant’s marks outside Germany, and because of the Complainant’s failure to register a mark in the United States, the Respondent cannot be in breach of paragraph 4(a)(i) of the Policy.

The Respondent says that it has rights in the disputed domain name because it was the nearest available match to the Respondent’s company name, SPECS USA Corp. While SPECS USA Corp does sell the products of the Complainant, it has also achieved significant recognition and business for products of other manufacturers. The Respondent says that the Complainant has never explicitly granted nor denied SPEC USA Corp’s use of the disputed domain name.

For somewhat similar reasons, the Respondent denies bad faith use. According to the Complainant’s own statements, the Respondent has rights to distribute the Complainant’s products until at least December 31, 2010.

The Respondent seeks a finding of reverse domain name hijacking.

6. Discussion and Findings

To succeed under paragraph 4(a) of the Policy, the Complainant must prove that:

(i) the disputed 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 disputed domain name; and

(iii) the disputed domain name was registered and is being used in bad faith.

These issues are discussed below, immediately after a discussion of the effect of the Respondent’s filing of court proceedings against the Complainant.

A. Court proceedings

“Paragraph 18(a) of the Rules relevantly provides that, in the event of any legal proceedings initiated prior to or during an administrative proceeding… the Panel shall have the discretion to decide whether to suspend or terminate the administrative proceeding, or to proceed to a decision.”

Although the Panel notes that the filed court proceedings involve the same parties, the remedies sought by the Respondent in the County Court are not the same as those sought by the Complainant here. In particular, in the County Court, the Respondent seeks, inter alia, remedies for breach of contract including declarations and injunctive relief.

Accordingly, on the facts of this case, the Panel exercises its discretion under Rule 18(a) and proceeds to a decision on the merits. See, e.g. Cognigen Networks, Inc. v. Pharmaceutical Outcomes Research a/k/a Cognigen Corporation, WIPO Case No. D2001-1094 (panel proceeded to decision on the merits because concurrent federal district court proceeding did not “specifically include the relief sought through this proceeding; namely, cancellation of the contested domain name”); Sonatel Multimédia SA v. Universal Computer Associates SUARL/Mamadou Kébé, WIPO Case No. D2005-0009 (“The Panel observes that, while both proceedings deal with the disputed domain names, the nature of the demands presented to the Senegalese Court by each party does not prevent the Panel from proceeding to a decision under the UDRP on the issue of whether such domain names shall be transferred or not to the Complainant.”)

B. Identical or Confusingly Similar

The Complainant has provided evidence of its registered trademark rights in various jurisdictions, including Germany where it was registered in 1990. It is plain that the Complainant’s evidence of its registered rights demonstrate that it ‘has rights’ for the purpose of paragraph 4(a)(i) of the Policy.

The Panel finds that the disputed domain name is confusingly similar to the Complainant’s mark. The Complainant’s mark is entirely incorporated in the disputed domain name with the addition only of the letters “us”, which were intended to denote the United States. The whole incorporation of a mark in a domain name has been previously recognized as a sufficient basis for a finding of confusing similarity under the Policy. (See e.g., Oki Data Americas, Inc v. ASD, Inc., WIPO Case No. D2001-0903; EAuto, L.L.C. v. EAuto Parts, WIPO Case No. D2000-0096.)

The Respondent’s arguments, that the Complaint cannot succeed on this ground because it has no mark registered in the United States or because there are similar marks registered by third parties, are misplaced. The Policy does not require a Complainant to have a mark registered in the same jurisdiction as the Respondent. The rights or third parties also do not directly affect the question of whether the disputed domain name is identical or confusingly similar to the Complainant’s mark.

For these reasons, the Panel finds that the Respondent has established its case under paragraph 4(a)(i) of the Policy.

C. Rights or Legitimate Interests

The Respondent claims to have rights or legitimate interests in the disputed domain name because its correspondence with the Respondent’s company name, SPECS USA Corp. The Complainant claims that the Respondent does not have rights or legitimate interests because, in effect, the Complainant terminated its distribution arrangement with the Respondent, with effect from April 30, 2010.

The Panel finds it persuasive that relevantly similar circumstances have been the subject of a recent panel decision involving the Complainant’s mark: SPECS GmbH v. SPECS Scientific Instruments, Inc. d/b/a SPECS Technologies Corporation, WIPO Case No. D2009-0308, referenced in the Complaint. In relation to paragraph 4(a)(ii) of the Policy, the then panel, referring to other cases, stated that “In these cases, when the licence of distribution arrangement has terminated, the respondent is generally found to have no rights or legitimate interests in a domain name which was only used in the respondent’s capacity as licensee or authorised distributor.” As noted in that case, this includes a circumstance where the respondent’s company name corresponds to the disputed domain name. Accordingly, the panel in that case found in favour of the Complainant on this ground.

Other previous WIPO panel decisions have reached similar conclusions, to the effect that the termination of an agency or distributorship agreement under which the disputed domain names were registered, left the agents/distributors without any “rights or legitimate interests” within the meaning of paragraph 4(a)(ii) of the Policy. See e.g. Lonely Planet Publications Pty Ltd v. Mike Tyler, WIPO Case No. D2004-0670; Omnigraphics Capital (Pty) Ltd v. Fleximount, Guy Langevin, WIPO Case No. D2004-0471; UVA Solar Gmbtl & Co K.G. v Mads Kragh, WIPO Case No. D2001-0373; Jerome Stevens Pharmaceuticals Inc v. Watson Pharmaceuticals, WIPO Case No. D2003-1029. In the latter case the panel stated that: “… Thus, if one had a legitimate use at one point, yet no longer is legitimately using the domain name, the Policy doesn’t prohibit a finding of no legitimate use pursuant to paragraph 4(a)(ii).”

Following these decisions, on this ground the Panel reaches a similar conclusion to the panel in the previous case involving the Complainant.

D. Registered and Used in Bad Faith

For the Complainant to establish its case under paragraph 4(a)(iii) of the Policy, it must be shown that the disputed domain name was both registered and used in bad faith. Int. Lasy Ltd. v. Cameleon Informatique et Robotique Inc., WIPO Case No. D2003-0701; NetDeposit, Inc. v. NetDeposit.com, WIPO Case No. D2003-0365.

The Panel finds that the Respondent has used the disputed domain name in bad faith. Although the Respondent provides some evidence apparently to the contrary, the evidence more clearly suggests that the distributorship agreement between the parties was terminated with effect from April 30, 2010. With that agreement terminated, the justification for the Respondent’s registration was effectively lost. Miele, Inc. v. Absolute Air Cleaners and Purifiers, WIPO Case No. D2000-0756. Despite the termination of that agreement, the Respondent continues to use a website to offer Complainant’s goods without authorisation or disclosure.

However, the Panel cannot find that the Respondent registered the disputed domain name in bad faith. Primarily this is because the Complainant, on its own evidence, explicitly authorised the Respondent to register the disputed domain name in 2006. (Paragraph 5, Declaration of the CEO of the Complainant, attached to the Complaint.)

The Complainant argues that this registration should be retrospectively deemed to have been done in bad faith, because of the subsequent termination of the Respondent’s position as a sales agent of the Complainant. The Panel does not consider that such an approach is consistent with the majority of panel decisions, where a respondent has registered a disputed domain name with the consent of a complainant, in accordance with a distributorship or similar agreement. E.g. Int. Lasy Ltd. v. Cameleon Informatique et Robotique Inc., WIPO Case No. D2003-0701; Miele, Inc. v. Absolute Air Cleaners and Purifiers, WIPO Case No. D2000-0756. Urbani Tartufi s.n.c. v. Urbani U.S.A., WIPO Case No. D2003-0090; Magic Marine v. Randall Ames and Aquata USA, LLC, WIPO Case No. D2002-0991; Celebrity Signatures International, Inc. v. Hera's Inc. Iris Linder, WIPO Case No. D2002-0936; Milwaukee Electric Tool Corp. v. Bay Verte Machinery, Inc., WIPO Case No. D2002-0774; Media Image, Inc. v. Casual Day.com, WIPO Case No. D2002-0322; e-Duction, Inc. v. John Zuccarini, d/b/a The Cupcake Party & Cupcake Movies, WIPO Case No. D2000-1369. Similarly, the previous case involving the Complainant referred to the case of Green Tyre Company Plc. v. Shannon Group, WIPO Case No. D2005-0877, in which the panel stated that “Considering the Complainant’s explicit permission for registration of the Domain Name by the Respondent in the present case, the Panel finds that the Respondent did not have the requisite bad faith when it registered the Domain Name.”

It is true that cases are not uniformly in the same direction. For example, the panel in Greyson International, Inc. v. William Loncar, WIPO Case No. D2003-0805 refers to a number of previous cases in which registration in bad faith was inferred from a subsequent business falling out between the parties. The panel in that case articulated that view as follows: “the rationale of the panel decisions cited in the preceding paragraph appears to be as follows: The domain name was registered by the distributor/web designer for the distributor/web designer's use under certain conditions or for certain discrete purposes. If the conditions no longer obtain or the use exceeds the specified purposes, registration in bad faith may be inferred, because the complained-of use (e.g., use after the distributor has been terminated or after the web designer has completed its specified tasks), if contemplated by the parties at the time of the registration would have been bad faith.”

The key point in this decision rests on the words “at the time of the registration”. That is, the issue is whether bad faith at the time of registration can be inferred from subsequent conduct. As further stated by the panel in Greyson International supra “Unless there is clear evidence that at the time of registration the respondent intended to exceed his brief, the Panel does not see how a finding of registration in bad faith can be squared with the Policy's plain language. Stated conversely, the Panel does not believe that a respondent should be presumed to have registered a domain name in bad faith solely because he subsequently used the domain name in bad faith.”

The Panel in this case takes a similar view. It follows that the Panel finds that the Complainant has not established that the disputed domain name was registered in bad faith.

The Panel is aware that this outcome is different to that in the previous case involving the Complainant: SPECS GmbH v. SPECS Scientific Instruments, Inc. d/b/a SPECS Technologies Corporation, supra. In that case, as here, it appears that the then respondent registered the disputed domain names under a distribution arrangement which was subsequently terminated by the Complainant. The then panel found in the Complainant’s favor on the issue of bad faith, in the circumstances of that case. In particular, the then panel found that there was sufficient evidence to support an inference that the then respondent registered the domain name in dispute primarily for the purpose of disrupting the business of a competitor, which constitutes bad faith under paragraph 4(b)(iii) of the Policy.

However, the Panel in this case does not consider that there is sufficient evidence in this case to support an inference of bad faith at the time of registration of the disputed domain name The Complainant’s evidence is primarily directed toward establishing bad faith from the Respondent’s subsequent conduct, particularly after the date of the termination of the Respondent as its sales agent. While this evidence goes towards the issue of bad faith use, there is little evidence in the Complainant that would support a finding of bad faith at the time of registration.

There is no doubt a broader business dispute between the parties relating to the terminated sales agency. However the purpose of the Policy is to resolve only allegations of cybersquatting. As noted by the panel in Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903: "It is important to keep in mind that the Policy was designed to prevent the extortionate behaviour commonly known as cybersquatting. It cannot be used to litigate all disputes involving domain names." The nature of the business relationship between the parties, when the disputed domain name was registered, and the subsequent falling out between them, does not suggest that this is a classic issue of cybersquatting.

7. Decision

For all the foregoing reasons, the Complaint is denied.

James A. Barker
Sole Panelist
Dated: September 24, 2010

 

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