WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Sunovion Pharmaceuticals Inc. v. Brandings
Case No. D2011-1536
1. The Parties
The Complainant is Sunovion Pharmaceuticals Inc. of Marlborough, Massachusetts, United States of America (“United States”), represented by Latham & Watkins LLP, United States.
The Respondent is Brandings of Beverly Hills, California, United States, represented by J. William Geranios, Ph.D., United States.
2. The Domain Name and Registrar
The disputed domain name <buylunesta.com> (“Domain Name”) is registered with GoDaddy.com, Inc. (“Registrar”).
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on September 13, 2011. On September 13, 2011, the Center transmitted by email to Registrar a request for registrar verification in connection with the disputed domain name. On September 13, 2011, Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details.
The Center verified that the 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 September 16, 2011. In accordance with the Rules, paragraph 5(a), the due date for Response was October 6, 2011. The Response was filed with the Center on October 2, 2011.
The Center appointed W. Scott Blackmer as the sole panelist in this matter on October 7, 2011. 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.
Both parties subsequently submitted supplemental filings, as discussed further below.
4. Factual Background
The Complainant, formerly known as Sepracor Inc., is a pharmaceutical company organized as a Delaware corporation and headquartered in Massachusetts, United States. The Complainant produces a prescription sleep drug called “lunesta”, which is approved by the United States Food and Drug Administration (FDA) and classified as a controlled substance.
The Complainant holds numerous trademark registrations for LUNESTA, including United States Trademark Registration No. 3,133,744 (registered August 22, 2006, following an intent-to-use application filed on October 23, 2003). It is undisputed that the Complainant has marketed and sold a sleep drug under the LUNESTA mark since April 2005, and that the drug is advertised under that name in the United States and other countries.
The Complainant has registered at least 16 domain names incorporating the LUNESTA mark, including <lunesta.com>, <lunestafacts.com>, <lunestacentral.com>, and <lunesta-information.com>. These are used for websites that provide information about the drug and encourage visitors to discuss it with a healthcare professional.
According to the Response, the “Respondent is a global naming architecture firm specializing in the development of company names and domains. The Respondent maintains over 6,000 domain name registrations.” It does not appear from the record or from the business entity database of the California Secretary of State that the Respondent is a registered legal entity. It may be a trade name or alter ego for the Respondent’s representative in this proceeding, Mr. Geranios. There is a website at “www.brandings.com” that advertises the service of helping start-up enterprises find a suitable name and register a corresponding domain name.
The Respondent was not the initial registrant. In fact, the Response includes domain history information from DomainTools.com showing that the Domain Name has changed hands more than 30 times since the initial registration. The Respondent reports that it acquired the Domain Name on January 23, 2011 through the Registrar’s auction procedure, following the expiration of the prior registration in December 2010.
The Domain Name resolves to a landing page headed with the Domain Name and a banner message indicating that the Domain Name may be purchased:
“The domain name may be available for acquisition. Contact Brandings [followed by a telephone number].”
The Complaint attaches a screen shot from the Respondent’s website at “www.brandings.com” advertising the Domain Name for sale for USD 1,695. The page on the Respondent’s website that is devoted to the Domain Name touts it as a “premium domain name” suitable for use online and as a company name, “concise and highly brandable, evocative, search engine friendly, strong long term potential”, a “cool domain name” that is “expandable in high growth industries.”
A footer on the landing page to which the Domain Name resolves says that the page is provided “courtesy of” the Registrar, which asserts copyright. The page displays a photograph of a man with two women sharing an exotic drink, as well as category links for “short skirts”, hidden cameras, vibrators, movies and DVDs, pole dancing poles, boys’ underwear, and “short shorts.” These in turn present what appear to be pay-per-click (PPC) advertising links for a variety of commercial products and services including dating and escort services, sex toys, “bathroom spy cameras”, adult films, and the like. These pages do not appear to refer to the Complainant’s sleep drug or competing products.
5. Parties’ Contentions
The Complainant contends that the Domain Name is confusingly similar to the Complainant’s LUNESTA mark, which it incorporates in its entirety, and that the Respondent has no rights or legitimate interests in the Domain Name. The Complainant infers that the Respondent registered and uses the Domain Name in bad faith, with the intention of either selling it to the Complainant or deriving commercial gain by misleading Internet users to visit a website not associated with the Complainant.
The Response characterizes the Respondent as “a transitory, intermediary participant facilitating a transaction between interested, qualified parties.” Concretely, it appears that the Respondent is in the business of buying domain names and selling them to others, sometimes with additional services to help customers choose business names and develop websites for their new enterprises. The Respondent asserts that “as an intermediary,” the Respondent “has a legitimate and ‘fair use’ of the Domain Name during the period of development to acquisition.”
The Respondent argues that there was no bad faith in acquiring the Domain Name “fairly” in an “open, public, aftermarket auction” for the purpose of ultimately selling it to a third party, and that the interim use by the Registrar for a PPC parking website was beyond the Respondent’s control and does not reflect bad faith use by the Respondent.
6. Discussion and Findings
Paragraph 4(a) of the Policy provides that, in order to divest a respondent of a domain name, a complainant must demonstrate each of the following:
(i) the 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 domain name; and
(iii) the domain name has been registered and is being used in bad faith.
Under paragraph 15(a) of the Rules:
“A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”
A. Supplemental Filings
The Rules enjoin panels to conduct Policy proceedings “with due expedition” (paragraph 10) and make no provision for supplemental filings other than at the request of the panel (paragraph 12). The panel in The E.W. Scripps Company v. Sinologic Industries, WIPO Case No. D2003-0447, made these general observations about such requests:
“The principles which should be applied in exercising this discretion have been considered in numerous cases decided under the Policy and Rules. (citations omitted) The principles adopted and confirmed in these decisions are that additional evidence or submissions should only be admitted in exceptional circumstances, such as where the party could not reasonably have known the existence or relevance of the further material when it made its primary submission; that if further material is admitted, it should be limited so as to minimize prejudice to the other party or the procedure; and that the reasons why the Panel is invited to consider the further material should, so far as practicable, be set out separately from the material itself.”
The Complainant in this proceeding submitted a “Supplemental Filing” after receiving the Response, replying to the Respondent’s statements concerning its recent acquisition of the Domain Name, its alleged lack of control over the parking website associated with the Domain Name, and the absence of revenues to the Respondent resulting from the advertising links on the website. The Respondent submitted a reply, stating among other things that it has now directed the Registrar to remove advertising links from the landing page associated with the Domain Name and reporting that it has modified its advertisement for the sale of the Domain Name on the Respondent’s website to say that the Domain Name is available “to authorized subsidiaries, affiliates, resellers, vendors, suppliers, out-source providers and other authorized entities.”
The Panel accepts these supplemental filings for consideration, to the extent that they address new information and arguments. However, as the discussion below makes clear, these points are not material to the determination of the Respondent’s rights or legitimate interests in the Domain Name, or to its bad faith in the registration and use of the Domain Name within the meaning of the Policy.
B. Identical or Confusingly Similar
The Complainant indisputably holds registered trademark rights in the LUNESTA mark, which the Domain Name incorporates in its entirety. Adding the generic word “buy” to the Domain Name does nothing to reduce the likelihood of confusion with the mark, particularly since the word appears to be relevant to Internet users seeking to buy the commercial product branded LUNESTA. The Complainant itself uses multiple domain names adding such relevant, generic terms to the name “lunesta.”
Accordingly, the Panel finds the Domain Name confusingly similar to the Complainant’s mark for purposes of the first element of the Complaint.
C. Rights or Legitimate Interests
The Policy, paragraph 4(c), lists nonexclusive circumstances under which a respondent could demonstrate rights or legitimate interests in a domain name, including:
“(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 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.”
The Respondent’s intended use of the Domain Name (to sell it to a third party for use in a new business) and its actual use of the Domain Name (allowing it to be used for months for PPC advertising links) are both commercial. These are not noncommercial fair uses of the Domain Name for purposes of the Policy, paragraph 4(c)(iii). There is also no evidence in the record that the Respondent or its business was ever known by a corresponding name (paragraph 4(c)(ii)).
Moreover, the Respondent does not explain how either the Respondent or any person other than the Complainant could legitimately use the Domain Name – which incorporates a fanciful, registered, well-known trademark -- in connection with a bona fide offering of goods or services. A bona fide offering is not one that violates trademark or Policy rights. There is no indication in the record that the Respondent sought the Complainant’s permission to use the mark or that the Respondent (before this proceeding) restricted its offer to purchasers with such rights or permissions. The Respondent has not demonstrated plans or efforts to develop websites for retail pharmacies or other potentially legitimate resellers, and the Respondent has not shown that the Complainant’s licensing policies are such that there is a market for such uses of the Domain Name.
The Panel finds that the Complainant has made a prima facie case that the Respondent has no rights or legitimate interests to use the LUNESTA trademark in the Domain Name, and the Respondent has not rebutted this conclusion with persuasive evidence of such rights or legitimate interests. Thus, the second element of the Complaint has been established.
D. Registered and Used in Bad Faith
The Policy’s non-exhaustive list of instances of bad faith in paragraph 4(b) includes the following cited by the Complainant:
“(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 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 your documented out-of-pocket costs directly related to the domain name; 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 complainant's 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.”
The Complainant asserts that the LUNESTA mark is famous throughout the United States. While the record in this proceeding is insufficient to determine whether the mark is “famous” in the sense recognized by United States trademark law, it is clear that the mark is fanciful and distinctive, and that the mark has been widely advertised in the United States for more than six years. To determine bad faith in the registration of the Domain Name, the relevant date is not when the Domain Name was first created for another registrant but rather the date on which the current registrant, the Respondent, acquired the Domain Name registration, which was in January 2011. It is undisputed that the Complainant’s LUNESTA mark was well-known by that time, particularly in the United States, where both the Complainant and the Respondent are located. The Respondent does not deny prior knowledge of the trademark, and the Respondent does not claim to have invented the name “lunesta” independently.
Under these circumstances, where there is no evidence of any generic, dictionary sense of the Domain Name, it is more probable than not that the Domain Name was chosen precisely because it includes a well-known trademark. The trademark value of the Domain Name is its potential to attract Internet users interested in the Complainant’s heavily advertised sleep drug, who could then be diverted to a commercial website for another business, or to a landing page with PPC advertising links for any number of commercial goods and services. If even a small percentage of site visitors viewed the website or clicked on PPC advertising links, the Domain Name would have potential value beyond the nominal cost of keeping it registered.
The Respondent argues that there is no bad faith because the Respondent acquired the Domain Name fairly in an open auction and never developed an active website for it. Instead, the Domain Name has since been parked by the Registrar, which generates the PPC advertising links displayed on the landing page, for which the Respondent states that it is not compensated. This is plausible, given the Registrar’s practice of “parking” domain names until a related website is developed.
However, the Respondent does not deny that as the owner of the Domain Name registration, it could have taken steps to prevent the display of PPC advertising links associated with the Domain Name over the ten months that have elapsed since the Respondent became the registrant. For example, the Respondent could have directed the Registrar to use a different template or to display nothing other than an error message or an “under construction” notice. The Respondent could have displayed its own content. If the Registrar were unresponsive, the Respondent could have moved the registration to another registrar. The registrant ultimately controls a domain name and is responsible for its use. A brief interval in which a registrar displays a default template may not be sufficient to establish bad faith. But allowing the registrar or others to make commercial use of a domain name for an extended time, exploiting a trademark owned by another, suggests at the least a disregard for the trademark rights of others, which is itself an indication of bad faith.
Moreover, the Respondent has offered the Domain Name publicly for sale and touted it as “highly brandable, evocative, search engine friendly”, when there is no evident legitimate use for the Domain Name other than by the Complainant or by a party acting with its permission. See, e.g., Sony Kabushiki Kaisha v. sony.net, WIPO Case No. D2000-1074 (where the domain name could “only sensibly refer to the Complainant”, “there is no obvious possible justification for the Respondent’s selection” other than the trademark value of the domain name). The Respondent has also allowed the Domain Name to be used for commercial gain for nearly a year, attracting Internet users with a name that incorporates the Complainant’s distinctive and well-advertised trademark. This traffic may generate sales for third parties and PPC advertising revenues for the Registrar, but it also provides evidence of the value of the Domain Name in attracting Internet users. This would logically enhance the price the Respondent could obtain for the Domain Name.
The Panel concludes, therefore, that the Domain Name was registered and used in an effort to mislead Internet users for commercial gain, or alternatively to sell the Domain Name to the Complainant itself for a price in excess of out-of-pocket costs. These motivations both reflect bad faith for purposes of the Policy, paragraph 4(b). Despite lengthy submissions in this proceeding, the Respondent has not advanced any plausible, legitimate, alternative reason for selecting the Domain Name.
The Respondent’s argument that there was no bad faith because the Respondent purchased the Domain Name in an automated public auction is legally unsound. The fact that the Domain Name was for sale does not establish that any purchaser unconnected with the Complainant could use the Domain Name without violating trademark law or the Policy. It merely suggests that the Respondent, which is in the business of helping entrepreneurs brand new ventures, should consult a trademark lawyer before adding to its portfolio a Domain Name that includes a distinctive and well-known brand that already belongs to someone else.
The Panel concludes that the third element of the Complaint has been established.
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 <buylunesta.com> be transferred to the Complainant.
W. Scott Blackmer
Dated: October 23, 2011