WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Yellowstone Mountain Club LLC v. Offshore Limited D and PCI.
Case No. D2013-0097
1. The Parties
Complainant is Yellowstone Mountain Club LLC of Big Sky, Montana, United States of America, represented by Duane Morris & Heckscher, LLP, United States of America.
Respondents are Offshore Limited D. of Miami Beach, Florida, United States of America, for two of the disputed domain names <yellowstoneclub.net>, <yellowstoneclubscandal.com>; and PCI of Bellevue, Washington, United States of America, for the disputed domain name <theyellowstoneclub.org>.1 Both are represented by Stillman and Associates, United States of America.
2. The Domain Name and Registrar
The disputed domain names <yellowstoneclub.net>, <yellowstoneclubscandal.com>, and <theyellowstoneclub.org> are registered with Network Solutions, LLC (the “Registrar”).
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on January 15, 2013. On January 16, 2013, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name <yellowstoneclub.net>. On January 18, 2013, the Registrar transmitted by email to the Center its verification response confirming that the Respondent was listed as the registrant and providing the contact details for this disputed domain name <yellowstoneclub.net>.
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 February 4, 2013. In accordance with the Rules, paragraph 5(a), the due date for Response February 24, 2013. The Response was filed with the Center February 22, 2013.
On March 6, 2013, Complainant submitted a supplemental filing to the Center, including a proposed amended Complaint, requesting that the Panel add two additional domain names, <theyellowstoneclub.org> and <yellowstoneclubscandal.com>, to the proceeding. The Center replied on March 7, 2013, acknowledging receipt and advising that this matter would be referred to the Panel upon appointment. By Administrative Panel Procedural Order dated March 13, 2013, the Panel added these two additional domain names to the proceeding, ordered the Center to request Registrar verification for them, and directed that Respondent submit any additional Response it deemed appropriate, limited to the two additional domain names, by March 23, 2013. By direction of the Panel this date was extended through March 26, 2013. An amended Response was submitted to the Center on March 26, 2013.2
On March 13, 2013, the Center transmitted by email to the Registrar a request for registrar verification in connection with the additional disputed domain names <theyellowstoneclub.org> and <yellowstoneclubscandal.com>. On March 13, 2013, the Registrar transmitted by email to the Center its verification response confirming that the Respondent “Offshore Limited D” was listed as the registrant of the disputed domain name <yellowstoneclubscandal.com> and that Respondent “PCI” was the registrant of the disputed domain name <theyellowstoneclub.org>, and providing the respective contact details.3
The Center appointed M. Scott Donahey, Richard G. Lyon and Neil, J. Wilkof as panelists in this matter on March 8, 2013. The Panel finds that it was properly constituted. Each member of 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
Complainant operates the Yellowstone Club, an exclusive golf and ski residential community near Big Sky, Montana, United States of America. It holds two trademarks registered on the Principal Register of the United States Patent & Trademark Office (“USPTO”) for YELLOWSTONE CLUB, the earlier of which is dated February 2007, and recites a date of first use in commerce of January 1997. The Yellowstone Club has been in business since about 1997. Starting in 2008, Complainant was involved in extensive, widely publicized, and highly contentious bankruptcy proceedings that have only recently concluded.
Respondent, which used a privacy service or assumed name for its registrations of the disputed domain names,4 is a critic of Complainant. Each of the websites at the disputed domain names contains virtually identical content, consisting of media articles, press clippings, bankruptcy court filings, other public documents, and related commentary. All content is highly critical of Complainant, the bankruptcy court, and assorted third parties involved with Complainant and the bankruptcy proceedings. Respondent registered the disputed domain names in late 2012 or early 2013.
5. Parties’ Contentions
Complainant contends as follows:
1. Complainant has rights in YELLOWSTONE CLUB by reason of its USPTO-registered marks for that term. The disputed domain name <yellowstoneclub.net> is identical to these marks except for the generic top-level domain (“gTLD”), which is of no moment in comparing the mark and the disputed domain name. The disputed domain name <theyellowstoneclub.net> is confusingly similar to these marks, as the addition of the definite article “the” does not obviate confusion. Nor does the addition of “scandal” in the third disputed domain name. Policy precedent holds that adding even a derogatory word to a recognized mark does not prevent consumer confusion.
2. Respondent has never been known by the term ”Yellowstone Club”, and Complainant has not authorized Respondent to use the YELLOWSTONE CLUB marks. Anticipating Respondent’s criticism site defense, Complainant contends that:
“WIPO panels have repeatedly rejected [such a defense] when the domain name is identical to the Complainant’s trademark, reasoning that the right to criticize does not necessarily extend to registering and using a domain name that is identical or confusingly similar to the complainant’s trademark. This is particularly true when the trademark alone is used as the domain name because that may be understood by Internet users as impersonating the trademark owner.”
(Complaint, page 10).
Further, the criticism sites at the disputed domain names target not Complainant or its goods and services but third parties involved in earlier management of Complainant or Complainant’s bankruptcy proceedings, thus weakening any free speech arguments and providing another basis for denying Respondent recourse to the safe harbor of paragraph 4(c)(iii) of the Policy. Respondent’s hiding its identity similarly weakens any claim of true criticism.
3. Respondent was well aware of Complainant and its mark when it registered the disputed domain names, as illustrated by their contents. Other indicia of bad faith include Respondent’s hiding its identity, use of the sites as part of a “smear campaign,” and a placing a hyperlink on each site to the personal website of one of Complainant’s founders, a central figure in Complainat’s bankruptcy proceedings and a longtime critic of Complainant’s present owners and management.
Respondent contends as follows:
1. Complainant’s trademark rights are limited in scope to services related to a particular real estate development, and two of the marks include Complainant’s logo. Complainant’s marks consist of two “generic” words, and the principal word “Yellowstone” is used by many other trademark and website owners; that word is best known in connection with Yellowstone National Park. Complainant therefore has not shown sufficient secondary meaning in the YELLOWSTONE CLUB mark to demonstrate a likelihood of confusion. The “look and feel” of Respondent’s websites makes plain to any Internet user that Respondent is not in any way related to Complainant. Respondent uses none of Complainant’s marks or logos on its sites, and each site includes an “explicit” and “prominent” disclaimer of affiliation with Complainant.
2. After noting that Respondent is not a competitor of Complainant, Respondent summarizes its principal defense thus:
“Respondent is making a legitimate, non-commercial or fair use of the domain name, without intent for commercial gain whatsoever, and clearly does not misleadingly divert customers or dilute or tarnish the trademark, if any, of Complainant, other than as fair commentary based on public records, filings with various courts, state and federal, and other publicly available information. Respondent has a First Amendment right to publish truthful information and opinion on the proceedings involving the Yellowstone Club and therefore is merely exercising its constitutional right to free speech and freedom of the press in legitimately using ‘yellowstoneclub.net’ along with a clear and unambiguous disclaimer.”
(Response, page 5).
3. Respondent’s conduct fits none of the examples of evidence of bad faith enumerated in paragraph 4(b) of the Policy. Fair criticism of Complainant injures Complainant or its business no more than any other uncomplimentary article in the press. Respondent’s websites at the disputed domain names consist entirely of investigative journalism and contain no unrelated hyperlinks or other commercial content.
6. Discussion and Findings
In this Policy proceeding Complainant bears the burden of proof, by a preponderance of the evidence, to demonstrate each of the following Policy elements:
(i) the disputed domain name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
(ii) Respondent has no rights or legitimate interests in respect to the disputed domain name; and
(iii) the disputed domain name has been registered and is being used in bad faith.
A. Applicability of the Policy to this Dispute
The Panel first must consider two arguments that it should not proceed to a decision in this proceeding but leave the parties to the courts.
The Panel raises the first of these on its own initiative. A Policy proceeding sometimes involves but one disputed matter among several already being, or threatened to be litigated, between the parties. When overarching business disputes are inextricably intertwined with entitlement to a disputed domain name or when factual issues common to a broader dispute are at issue in a Policy proceeding, panels have sometimes denied the complaint6 or have exercised their discretion under paragraph 18(a) of the Rules to dismiss the Complaint without prejudice.7 These panels have recognized that their very limited brief does not extend to resolution of the underlying business dispute or that the subject of the dispute is more suited to development of a complete record through discovery and confrontation than resolution on the limited pleadings authorized by the Policy. Here, both parties acknowledge years of contentious legal proceedings and political controversy directly related to the ownership and particularly to the bankruptcy proceeding of Complainant. The contents of the pleadings and their respective exhibits leave no doubt that Complainant and Respondent disagree with each other on just about everything regarding that bankruptcy, and that the bankruptcy case included contract and tort claims far beyond the scope of the Policy.
But neither party asks for resolution of any of those other matters in this Policy proceeding, and each party states unequivocally that there are no other pending proceedings between the parties. (See Rules, paragraphs 3(b)(xi) and 5(b)(vi); Complaint, paragraph 16; Response, paragraph 8). Complainant has carefully limited this case to transfer of the three disputed domain names; there is no request that the Panel consider the merits of anything but entitlement to the disputed domain names in accordance with the three factors set out in paragraph 4(a) of the Policy. The Policy determination does not depend upon an issue disputed in litigation or bankruptcy. The record does not show that ownership of the disputed domain names is at issue in any other legal proceedings. Complainant’s case does not turn upon the truth or falsity (or degree of either) of the content on Respondent’s websites8 In fact, the parties here do not dispute the operative facts necessary for the Panel to render a decision, though of course they disagree on the conclusions to be drawn from those facts. In these circumstances, a majority of the Panel deems it appropriate to proceed to a decision.
The majority notes that in his dissent in this case the Presiding Panelist raises a broader and more serious challenge to the Panel’s jurisdiction. Echoing and skillfully expanding upon the dissenting opinion in Aspis Liv Försäking AB v. Neon Network, LLC, WIPO Case No. D2008-0387, he argues that the Policy was not intended to and should not be applied in any case in which no commercial elements are present. The Presiding Panelist refers to deliberations leading to adoption of the Policy. As such, if the position proposed by the Presiding Panelist in his dissent is adopted, the dissent’s proposed rule —"in all circumstances no commercial use means no bad faith"— will yield a brighter line distinction than does most Policy precedent. Moreover, such a rule would resolve the ongoing disagreement among UDRP panels over whether a criticism site ipso facto furnishes a right or legitimate interest in a disputed domain name. However enticing, the Panel majority cannot join the Presiding Panelist. Two fundamental reasons require this Panel to continue interpreting the Policy in a more nuanced manner.
First and most importantly in the majority’s opinion, the language of the Policy itself does not support the dissent’s unqualified approach. The “legislative history” of the Policy’s adoption doubtless furnishes valuable insight into its meaning and grist for interpreting its provisions, but it cannot trump the words chosen for the Policy itself. Paragraph 4(c)(iii), the only section of the Policy to use the word “noncommercial,” qualifies that adjective with the word “legitimate,” belying the strict construction of “noncommercial” advocated by the dissent and indicating that “noncommercial” alone is not an absolute bar to a proceeding. One of the four examples of evidence of bad faith in Policy, paragraph 4(b) does not distinguish between commercial and noncommercial use. Nor does Policy, paragraph 4(a), the clause in the Policy giving panels jurisdiction to decide disputes within its ambit, or Policy, paragraph 2, which speaks in terms of “infringe[ment] or violat[ion of] someone else's rights” – not just commercial rights – when registering domain names. Since the Policy’s adoption, panels have consistently applied the Policy to proceedings involving certain noncommercial misuse of domain names. See especially SEB and Grouped SEB UK Limited v. Dim soft Limited, WIPO Case No. D2013-0252 (non-profit complainant; no commercial content) and Countryside Alliance Limited v. David Pearce, Anti-Censorship Alliance, WIPO Case No. D2001-0862 (competing non-profits, no commerce). In assessing bad faith, the panel noted: “The Panel also finds that the domain names in issue have been registered primarily for disrupting the Complainant's business.”); see also e.g.,The Baltimore Museum of Art, Inc. v. Mo Domains, WIPO Case No. D2005-0720 (non-profit complainant, no commerce involved); Texans For Lawsuit Reform, Inc. v. Kelly Fero, WIPO Case No. D2004-0778 (non-profit complainant, no commercial element); Ukrainian World Congress v. Daniel Steel, WIPO Case No. D2004-0658 (non-profit complainant, no commerce involved); Justice for Children v. R neetso / Robert W. O’Steen, WIPO Case No. D2004-0175 (non-profit complainant; no commercial element in case); PepsiCo, Inc. v. "The Holy See", WIPO Case No. D2003-0229 (criticism site, no commercial element).
Second, the Panel majority believes that the dissent’s proposed rule would frustrate rather than promote the underlying purpose of the Policy: an abbreviated and relatively quick and inexpensive administrative proceeding to address a limited class of abusive domain name registrations. The dissent would apparently exclude from bringing Policy proceedings a significant category of mark owners – charitable institutions and governmental entities, for example – unless a respondent made some commercial use of their marks, something that might be difficult for one not engaged in commerce to demonstrate. That would run counter to the Policy’s primary focus on abusive registration.
Paragraph 4(a) of the Policy’s limited grant of jurisdiction to UDRP panelists prescribes and carefully limits the scope of Policy proceedings. As the dissent’s proposed approach would add an additional and unnecessary qualifier, the Panel majority respectfully declines to accept it.
The majority now turns it attention to the three Policy elements.
B. Identical or Confusingly Similar
Complainant has proven this Policy element as to all three disputed domain names. Complainant has demonstrated rights (which Respondent does not deny) in YELLOWSTONE CLUB by reason of its registrations for this mark, in whole or in material part. Each disputed domain name has YELLOWSTONE CLUB, Complainant’s registered mark, as its dominant feature. For purposes of paragraph 4(a)(i) of the Policy, that fact establishes confusing similarity to the mark; the addition of the definite article or other common word to the dominant feature does not obviate confusion, even if the additional word be derogatory. See, e.g., Société Air France v. Mark Allaye-Chan, WIPO Case No. D2009-0327, involving the domain name <airfrance-suck.com>. Respondent’s contentions that “Yellowstone” may be more renowned as the name of a national park than as a part of Complainant’s marks, that others may have marks that use that word, and that Respondent does not use Complainant’s mark on its websites matter naught in comparing the written, aural, and other sensate elements of Complainant’s marks to those of the disputed domain names. That comparison establishes confusing similarity.
C. Rights or Legitimate Interests
Complainant asserts and Respondent acknowledges that Complainant has not authorized Respondent to use its name, Yellowstone Club, nor has Respondent ever been commonly known by the disputed domain names. The burden of production thus shifts to Respondent to provide evidence of a right or legitimate interest, with the ultimate burden of proof remaining with Complainant. WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition ("WIPO Overview 2.0"), paragraph 2.1.
Respondent’s principal argument, quoted in Section 5.B. above, and evidence of a right or legitimate interest is its use of the websites maintained at the disputed domain names for legitimate criticism of Complainant and its business. The Panel’s examination of these websites indicates that each consists entirely of extracts from public records and Respondent’s opinion of Complainant, Complainant’s business practices, and the long-running legal proceedings and political maneuvers involving Complainant, Respondent, and many other parties. The websites’ content is strictly criticism, without any apparent commercial accoutrements.
Whether a criticism site brings a respondent within the safe harbor of paragraph 4(b)(ii) of the Policy9 is an issue that has split panelists since the adoption of the Policy more than a decade ago. As stated in the WIPO Overview 2.0, paragraph 2.4, there exist two lines of authority on this question, as follows.
"View 1: The right to criticize does not necessarily extend to registering and using a domain name that is identical or confusingly similar to the complainant's trademark. That is especially the case if the respondent is using the trademark alone as the domain name (i.e, <trademark.tld>) as that may be understood by Internet users as impersonating the trademark owner. Where the domain name comprises the protected trademark plus an additional, typically derogatory term (e.g., <trademarksucks.tld>), some panels have applied View 2 below."
" View 2: Irrespective of whether the domain name as such connotes criticism, the respondent has a legitimate interest in using the trademark as part of the domain name of a criticism site if such use is fair and noncommercial."
For the reasons stated below, the Panel majority believes that Respondent lacks a right or legitimate interest in the two disputed domain names that incorporate Complainant’s marks without a substantive modifier, <yellowstoneclub.net> and <theyellowstoneclub.org>. As to those domain names, Respondent is, without authority, intentionally holding itself out as Complainant in order to mislead Internet users seeking Complainant and thereby to expand the group of Internet users who will read the content of its websites. That does not, in the view of the Panel majority, generate a right or legitimate interest in Respondent’s use of Complainant’s mark. See WIPO Overview 2.0, paragraph 2.4, View 1, supra., and cases there cited.
The Panel majority states at the outset that this conclusion does not depend in any way upon the nature of the content at Respondent’s websites or Respondent’s unquestioned rights to free speech, freedom of the press, or right to petition the government for a redress of a grievance (without reference to any specific national legal system with respect to these rights). The issue is not the legitimacy of these rights. The question in this Policy proceeding is instead whether there is a right or legitimate interest in the disputed domain names, which comprise Complainant’s YELLOWSTONE CLUB mark for that purpose. As stated in The Laurel Pub Company Limited v. Peter Robertson / Turfdata, WIPO Case No. DTV2004-0007:
"The Panel recognizes that the Respondent has a right to free speech and a legitimate right to host a complaint site about the Complainant on the Internet. However, in the view of the Panel this is a completely different thing and should not be confused with having a legitimate right to the Domain Name in question in this case."
By selecting a domain name that is essentially <trademark.tld>, a critic typically intends to lure to its website Internet users seeking information about the owner of the mark that it has appropriated, and thus to increase the audience for the criticism. Respondent here has acknowledged that this was the reason he selected the disputed domain names. As such, in the view of the Panel majority, it is deception that causes the harm to Internet users. Once at the website, an Internet user is exposed to the criticism that he neither sought nor expected. This damage cannot be corrected by a disclaimer or by prompt recognition from the site’s content that its author was not the mark owner; in the view of the Panel majority, neither of these matters comes to the assistance of the Respondent. As stated by the Panel in Justice for Children case, supra:
“Decisions under the Policy focus upon a respondent’s use of another’s mark in a domain name to attract Internet users to respondent’s site. This is true in typosquatting cases and in cases where a respondent selected his domain name in anticipation of subsequent sale to the mark owner. The content of Respondent’s sites in these two categories of cases – cases in which respondents almost uniformly lose – is irrelevant to the harm to the mark owner and to the unwary consumer. That harm results from the confusion caused by the initial attraction to the site by means of borrowing the complainant’s mark. And that is exactly the harm the Policy was adopted to address.”
Respondent has misrepresented itself as Complainant for Respondent’s own benefit to achieve more readers of its criticism. The Panel majority believes it has no right or legitimate interest in doing so.
Applying this same analysis to the third disputed domain name, <yellowstoneclubscandal.com>, dictates a different result. An Internet user who enters that domain name into her browser knows, or should know, that she is not headed to a website likely to be controlled by Complainant. There is no diversion and no misrepresentation. As to that disputed domain name, Respondent has demonstrated a right or legitimate interest.
The distinction under paragraph 4(a)(ii) between <trademark.tld> and <trademark+derogatory word.tld> was earlier drawn in Joseph Dello Russo M.D. v. Michelle Guillaumi, WIPO Case No. D2006-1627 (majority opinion) and in that decision was based upon the notion that <trademark+derogatory word.tld> was itself an act of free speech, and as such entitled to First Amendment (free speech) protection. While that rationale would apply to this proceeding, as Respondent (as well as Complainant) is a resident of the United States, here the Panel majority prefers to rest its conclusion upon a more general ground. So long as the disputed domain name itself does not create the lack of a right or legitimate interest by misleading the public as to source, a purely criticism site constitutes “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”, that is therefore within paragraph 4(c)(iii)’s safe harbor.
The present case illustrates why the WIPO Overview 2.0’s “View 1”, applied as in this case, in no way chills Respondent’s free speech rights. If it be clear, or should be clear, to a browsing Internet user that he or she is not headed to the mark owner’s site – as is the case with <yellowstoneclubscandal.com> -- the domain name owner’s microphone is wide open.
It might be said that Respondent must transfer two of the disputed domain names simply as a result of having the bad luck to draw two panelists who adhere to a variant of the “View 1” approach. In reply, the Panel majority notes that Respondent and Complainant both had the appropriate opportunity to express their preferences regarding panelist candidates in this three-member Panel composed in accordance with the Policy and, if Respondent be dissatisfied with the result, it is free to take this dispute to court, where nothing in this decision is binding upon either party.
It might also be said, as the Presiding Panelist does in his dissent, that the result of the Panel majority is “ineffectual” because Respondent’s criticism will remain posted on the Internet. That charge misses both the purpose of the rule advanced by the Panel majority and the Policy’s limited scope. On the latter issue, the Policy gives the Panel no power in terms of outcome beyond an order of transfer (or cancellation), or not, of the disputed domain names. Nothing in the Policy authorizes restriction in any manner of the content of any website, even one maintained by a respondent at a disputed domain name. Complainant does not ask for this and in fact the Panel majority has carefully avoided any commentary or judgment on the content of any of Respondent’s websites beyond finding it to be noncommercial criticism. As to the efficacy of the Panel majority’s order, the result of this case (assuming that a dissatisfied party does not pursue relief in court) will relieve Complainant of use by Respondent of Complainant's soapboxes for its criticism, and Internet users seeking Complainant by the common practice of using a known mark plus a gTLD will not be deceived. That is exactly what the Policy was intended to do and all that the Policy can do.
D. Registered and Used in Bad Faith
Respondent argues, and the dissent correctly notes, Respondent’s conduct does not fit precisely into any of the four examples of evidence of bad faith set forth in paragraph 4(b) of the Policy. There is no claim or evidence that Respondent has sought to sell the disputed domain name to Complainant or anyone else; Complainant has not shown that Respondent has engaged in a pattern of depriving mark owners of domain names corresponding to their marks; Respondent is not a competitor of Complainant; and there is no evidence of direct commercial gain resulting from Respondent’s use of the disputed domain names.
However, the examples of bad faith in paragraph 4(b) are expressly non-exclusive and the notion of bad faith is sufficiently inclusive to cover circumstances such as those raised in the present case. Accordingly, the Panel majority believes that Respondent's intentionally holding itself out as Complainant to lure Internet users to its site is bad faith within the meaning of the Policy. See the example posited by the panel in Grupo Costamex, SA de C.V. v. Stephen Smith and Oneandone Private Registration / 1&1 Internet Inc., WIPO Case No. D2009-0062, and his conclusion, equally applicable to Respondent’s conduct. There, the panel stated that,
“many people would find it difficult to ascribe the labels ‘fair’, ‘legitimate’, or ‘in good faith’ to the conduct of the [the hypothetical respondent] in that situation. Many would see it as dishonest, or at least borderline so, and would wonder whether acceptance of such conduct is really a necessary price which must be paid to safeguard the widely (but not universally) acknowledged value of freedom of expression.”
The Panel majority finds that same is true with respect to the two offending disputed domain names.
As Respondent admittedly intended to deceive when it selected the two offending disputed domain names, as to them the Panel majority is of the view that Complainant has demonstrated bad faith both in registration and use with respect to the disputed domain names <yellowstoneclub.net> and <theyellowstoneclub.org>.
For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, by majority vote the Panel orders that the disputed domain names <yellowstoneclub.net> and <theyellowstoneclub.org> be transferred to Complainant.
The Panel unanimously orders that as to the disputed domain name <yellowstoneclubscandal.com> the Complaint is denied.
M. Scott Donahey
Presiding Panelist (dissenting)
Richard G. Lyon
Neil J. Wilkof
I. This Matter Should Be Dismissed As Inappropriate For Relief Under The Policy
A. Additional Facts
The majority’s statement of facts omits several facts that the dissenting panelist considers essential to an understanding of the basis of the first part of the dissent. Accordingly, it is necessary to set out those additional facts, prior to engaging in an analysis.
1. The identity of Respondent
The majority identify Respondents as two in number: Offshore Limited D, for the disputed domain names <yellowstoneclub.net> and <yellowstoneclubscqandal.com>; and PCI for the disputed domain name <theyellowstoneclub.org>.10 However, Complainant repeatedly contends that there is only one actual or controlling Respondent, Timothy Blixseth, founder and former owner of Complainant. Complainant’s allegations in this regard read as follows:
“Complainant is informed and believes that the true identity of the Respondent is Tim Blixseth (and/or one or more persons or entities acting under his direction and control). Mr. Blixseth is the former founder of the Yellowstone Club, and he has his own personal and financial interests in disrupting the ongoing operations of Complainant. Mr. Blixseth has repeatedly attempted to disrupt and undermine Complainant’s business in connection with the bankruptcy proceedings for his own personal and financial gain, both in the bankruptcy proceedings and in other legal matters. For instance Mr. Blixseth has attempted in the bankruptcy proceedings to set aside the sale of the Yellowstone Club to its current owners, and ‘www.yellowstoneclub.net’ is just another effort by Mr. Blixseth to undermine the ongoing operations of the club.”
Complaint, pages 10-11.
“As set forth in its original Complaint, Complainant is presently unaware of the true identity of the person or entity responsible for registering the infringing domain names, but Complainant is informed and believes that the true identity of Respondent is Tim Blixseth, the former founder of Complainant Yellowstone Mountain Club, LLC, and/or one or more persons or entities acting under his direction and control. This statement is supported by the fact that Mr. Philip Stillman, counsel of record in this proceeding for Offshore Limited D, represents Mr. Blixseth in connection with various litigation surrounding the Yellowstone Club. Attached hereto as Annex 2 is a true and correct copy of a filings [sic] by Mr. Stillman on behalf of Mr. Blixseth, which advocates the same grand conspiracy theory alleged on the websites at the disputed domain names. Any assertion that Respondent Offshore Limited D and the fictitious name ‘Clark Kent’ are different registrants is belied by the fact that ‘www.theyellostoneclub.org’ displays virtually the same content found on ’www.yellowstoneclub.net’ and ‘www.yellowstoneclubscandal.com’”.
Amended Complaint, page 4.
“Currently, ‘www.yellowstoneclub.net’ and ‘www.theyellowstoneclub.org’ both contain a single, shared contact email address of ‘[xxxxxxxx]@gmail.com.’ The real person or persons behind Offshore Limited D have also set up a Twitter account that directly links ‘www.yellowstoneclub.net’ and ‘www.theyellowstoneclub.org’ together. On the Twitter account homepage, both of these disputed domain names are expressly referenced and demonstrate that both domain names are under the control of Respondent Offshore Limited D, which as noted above is acting at the direction, or under the control, of Mr. Blixseth and/or one or more persons or entities acting on his behalf.”
Amended Complaint, page 5.
“[G]iven Mr. Blixseth’s history with the Complainant, Mr. Blixseth was plainly aware of Complainant’s trademarks and official website at the time he registered the Infringing Sites.” Amended Complaint, page 9.
2. Content of the Websites at the Disputed Domain Names
The gravamen of the Complaint is that Respondent is using the material posted on the web sites to depict the current owners of Complainant and certain of its principals and to depict other third parties as “bad” persons or entities, engaged in conduct that may be considered either tortious or criminal.
Complainant alleges that the real purpose of the web sites to which the three domain names at issue resolve is to publicly “smear” the owners of Complainant and others.
“[T]he Infringing Sites are not simply ‘gripe’ or ‘criticism’ sites but instead really constitute part of a coordinated online smear campaign by Mr. Blixseth, or those acting at his direction or under his control, to attack others, including his ex-wife Edra, the bankruptcy judge involved in the Yellowstone Club bankruptcy, and creditors and the owners of the club.”
Amended Complaint, page 12.
“As Respondent admits, the targets of the sites are not Complainant or its goods and services but other, third-parties [sic] involved in Complainant’s bankruptcy proceedings and tangential litigation involving Mr. Blixseth.” Amended Complaint, page 13.
“Internet searches have disclosed that Offshore Limited D is the registrant of multiple domain names associated with Dennis Montgomery, a former business partner of Edra Blixseth and current collaborator with Mr. Blixseth. Attached hereto as Annex 10a is a true and correct copy of a Whois database searches [sic] for www.pcinx.com registered to Offshore Limited D. That is the website for a company called Pacific Coast Innovations, or PCI, for which Mr. Montgomery worked. Mr. Montgomery is also presently assisting Mr. Blixseth in connection with the multitude of litigation involving Mr. Blixseth. Attached hereto as Annex 10b is a true and correct copy of a declaration Mr. Montgomery executed to assist Mr. Blixseth in the Blixseth divorce proceedings and discussing [sic] his involvement with PCI. Thus there is no question in Complainant’s mind that Mr. Blixseth and/or those acting at his direction are behind the Infringing Sites.
Mr. Blixseth is the former founder of Yellowstone Club, and he alone has a personal and financial interest in disrupting the ongoing operations of Complainant and the targets of this online smear campaign. Mr. Blixseth has repeatedly attempted to disrupt and undermine Complainant’s business and the bankruptcy proceedings for his own personal and financial gain, and is currently appealing various rulings in the bankruptcy matters. For instance, Mr. Blixseth has attempted in the bankruptcy proceedings to set aside the sale of the Yellowstone Club to its current owners, and the Infringing Sites are just another effort by Mr. Blixseth to undermine the ongoing operations of the club and others.
Mr. Blixseth (or others acting at his direction), posing as an anonymous “journalist’ continues to send harassing emails to persons mentioned on his sites with a link to www.yellowstoneclub.net asking for ‘comments.’
Respondent has also sent similar emails and Tweets to investors of Cross Harbor Partners, the current owner of Complainant, in order to smear Cross Harbor Partners and disrupt its business relationships. In fact, Respondent recently used the site and a fake Twitter account to harass, publically, the former president of ICANN who recently visited the Yellowstone Club, alleging that Complainant is attempting to influence these proceedings and thereby impugning the integrity and impartiality of the Panel in this case.”
Amended Complaint, page 15-16.
3. Other Litigation
There are multiple litigations involving Complainant, its owners, the putative Respondent, and other third parties.
The annexes to the pleadings filed in this case are replete with screen shots of articles and web pages detailing the multiple and complex disputes and litigations between and among Complainant, and/or its current owners, the putative Respondent, and/or various third parties. Those disputes and litigations include, but are not limited to, the following:
a. Allegations of fraud and criminal activities by the putative Respondent against his former wife in divorce proceedings;
b. Litigation between the minority shareholders of Complainant against Complainant and Respondent;
c. Litigation brought by Credit Suisse challenging the bankruptcy of Complainant;
d. Litigation brought by the unsecured creditors of Complainant against Credit Suisse, alleging fraudulent transfers;
e. Litigation brought by the putative Respondent against the creditors of Complainant and Complainant;
f. Litigation by the putative Respondent’s son against Credit Suisse, alleging fraud;
g. Accusations in the divorce proceedings that Complainant had conspired with the ex-wife of the putative Respondent to commit fraud;
h. Litigation by the putative Respondent to set aside the Bankruptcy Court award.
See Complaint, Annex 9; Response, Annexes 1 and 2; Amended Complaint, Annexes 2, 10b, 13, and 15; Supplemental Response to Amended Complaint, Annexes 1, 2, and 3.
1. In this Panel’s view, this is a classic case involving multiple complex disputes and litigations in which the Panel should refrain from acting.
The claims regarding the disputed domain name are not claims against a cybersquatter brought under the Policy, although both Complainant and Respondent attempt to cloak them as such. Rather, the dispute concerning the use of the disputed domain names is only the tip of the iceberg of multiple and complex legal disputes and litigations involving not only the Complainant and its current owners and the putative Respondent, the founder and former owner of Complainant, but also numerous other third parties largely concerning the ownership and control of Complainant. In such cases, involving allegations well outside the scope of the Policy and where there are issues of credibility, discovery, and the powers of the courts, Panels have refrained from acting, deferring to the court processes designed for the handling of such disputes.
For just one recent example, in the case of Proskauer Rose LLP v. Leslie Turner, WIPO Case No. D2011-0675, the panel unanimously dismissed a case related to litigations involving allegations of theft which were brought against a law firm by the putative respondents or his or her agents. The majority11, writing for the unanimous panel on the issue of the dismissal of the case as inappropriately brought, analyzed the situation before them thusly:
“The Panel unanimously believes that this is not a clear case of cyber squatting [sic] which the Policy was designed to address. Rather, this looks like a protracted and contentious dispute among numerous parties, several of whom are not before the Panel in this proceeding, that has spilled into the arena of Internet domain names. All parties are free to pursue their respective positions and interests in other fora better suited to consider evidence and grant appropriate relief. As set forth in his concurring opinion, the Panel member who disagrees with the majority’s reasoning on the legitimacy of criticism sites joins the Panel in finding this dispute better suited for the national courts and in the circumstances of this case not appropriate for resolution under the Policy.”
Id (emphasis in original).
My fellow Panelist in the present matter stated in his separate opinion in the Proskauer case, supra., (following his brief dissent as to another issue):
“[I]n my view the Complaint must be denied on the other ground stated by the Panel. Complainant and others are battling Respondent and others over a slew of domain names and assorted issues of tort law. The Response in this case lists some (perhaps all?) of the other individuals engaged in these other proceedings. The Policy itself and Policy precedent do not permit consolidation of these other proceedings under the limited mandate of the Policy; even if consolidation were possible that would do nothing about the charges of defamation (and other torts) and countercharges of harassment (and other torts). Decisions in this or any of the other Policy proceedings are subject to subsequent challenge in court, where the panels’ findings are not binding. Given the parties’ history that may well happen here.
Like the Panel, I think it better that all matters be addressed in a forum that has the jurisdiction and competence to do so than that the Policy be stretched, in a case that is not clearly cyber squatting, [sic] merely to give one party or the other an edge in the litigation that will inevitably follow.”
I agree with the reasoning of my esteemed co-Panelist in the Proskauer decision, supra.,, as well as that quoted from the majority of the Panel. I believe that such reasoning applies a fortiori in the present matter.
2. The majority decision provides no real relief to Complainant
As noted, supra, in Section A.2, the gravamen of the Complaint filed in this matter is that Respondent is using the material posted on the web sites to which the three disputed domain names resolve to depict the current owner of Complainant and certain of its principals and also certain other third parties as “bad” persons and entities engaged in conduct that may be considered either tortious or criminal, or both. As the three web sites to which the three disputed domain names resolve are virtually identical in content, the transfer to Complainant of two of the domain names, while leaving the third in Respondent’s possession, accomplishes nothing. The content to which Complainant objects will continue to be posted on the Internet by Respondent. This Panel should not engage in such ineffectual acts.
II. There Is No Commercial Gain Resulting From The Use Of The Trademark, An Essential Element Of The Policy.
A. The Policy Seeks To Prevent Domain Name Registrants From Profiting From The Good Will Which A Trademark Holder Has Developed In His Mark
WIPO conducted two extensive domain name processes, holding hearings in locations around the globe, seeking the views of all interested parties as to the nature and extent of a policy protecting the good will of the trademark owners, while preserving the rights of domain name registrants. Final Report of the First WIPO Internet Domain Name Process, April 30, 1999, pages 22 and 23. The result of the First WIPO Internet Domain Name Process was the creation of the Policy and the inclusion of the Policy in every contract for the registration of a domain name in a gTLD.
In the Second ICANN Staff Report concerning the implementation of the Policy as adopted, the Report stated:
“The Recommended Policy Is Minimalist in its Resort to Mandatory Resolution. In contrast to the policy currently followed by NSI, the policy adopted by the Board in Santiago, as set forth in the final WIPO report and recommended by the DNSO and registrar group, calls for administrative resolution for only a small, special class of disputes. Except in cases involving "abusive registrations" made with bad-faith intent to profit commercially from others' trademarks (e.g., cybersquatting and cyberpiracy), the adopted policy leaves the resolution of disputes to the courts (or arbitrators where agreed by the parties) and calls for registrars not to disturb a registration until those courts decide.”
Second ICANN Staff Report, 4(c) (emphasis added).
The four examples of bad faith registration and use included in the Policy as adopted embody the concept of a Policy limited to bad faith commercial exploitation of trademarks:
“(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 owner of the trademark 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
(ii) you have 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 you have engaged in a pattern of such conduct; or
(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; 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.”
Policy, paragraph 4(b) (emphasis added).
Likewise, the examples of rights and legitimate interests that a Respondent may show also embody the commercial use concept:
(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 tarnish12 the trademark or service mark at issue”
Policy, paragraph 4(c) (emphasis added).
In this Panel’s assessment, so long as a registrant and user of a domain name is not using that domain name to profit from or recognize commercial gain from the use of the trademark of another, there is not bad faith registration and use. In the present case, this Panelist finds no evidence of such bad faith registration and use. Complainant alleges such commercial gain by arguing that Respondent’s links to charities that Respondent supports on the web sites to which the disputed domain names resolve are an encouragement to users to donate to these charities. Complaint, page 10; Amended Complaint, page 14. But even if the use of links to charities could be viewed as an invitation to an Internet user to donate to one or more of these charities, there is no evidence that Respondent would profit from or commercially gain by such donations.
B. American Doctrine Of Initial Interest Confusion
1. The doctrine of initial interest confusion involves a commercial transaction.
Although never mentioned by name in the majority opinion, the legal theory that apparently underlies it is the American legal doctrine of initial interest confusion. The two cases on which the majority decision chiefly relies, Justice for Children v. R. neetso / Robert W. O’Steen, WIPO Case No. D2004-0175 and Joseph Dello Russo, M.D. v. Michelle Guillaumi, WIPO Case No. D2006-1627 (majority opinion,) both expressly name and rely on the initial interest confusion doctrine. Both decisions were the product of the same learned co-Panelist who joined the majority in dismissing the complaint in the Proskauer decision, supra.
One of the seminal cases in the development of the American doctrine was that of Brookfield Communications, Inc. v. West Coast Entertainment Corp., 174 F.3d 1036 (9th Cir. 1999). In Brookfield, the justices devised a now familiar “billboard example” in order to illustrate initial interest confusion stemming from the use of metatags at web sites in order to attract search engines.13 With apologies to the justices, I have slightly updated the example, but it follows closely the example for illustration of the doctrine.
Imagine that CVS Pharmacy has a drugstore just off a busy highway at Exit 7, and Walgreen’s Pharmacy has a drugstore beside Exit 8 to the same highway. CVS Pharmacy puts up a billboard that advertises that the nearest Walgreen’s location is just adjacent to Exit 7. A driver suffering from a headache who happens to be a regular customer of Walgreen’s sees the billboard, exits the highway at Exit 7, but is unable to find the Walgreen’s store. However seeing the CVS Pharmacy outlet, the driver pulls in and buys some aspirin. At the point of sale, the driver is not confused that he is buying aspirin from Walgreen’s. However, initially he thought that by exiting at Exit 7, he would find a Walgreen’s drugstore from whom he could purchase the aspirin. Under the American doctrine of initial interest confusion, CVS Pharmacy would be profiting from the initial interest confusion resulting from the driver searching for the Walgreen’s outlet. This doctrine necessarily involves a resultant purchase, so it involves a commercial transaction.14 The majority’s application of the doctrine in a noncommercial setting is therefore misplaced.
2. The theory of initial interest confusion.
American legal scholars have been quite critical of the initial interest confusion doctrine and have recommended its demise. See, e.g., “Initial Interest Confusion: Standing at the Crossroads of Trademark Law,” 27 Cardozo L.Rev. 105 (2005); “Abolish Trademark Law’s Initial Interest Confusion and Permit Manipulative Internet Search Practices,” The Journal of Business, Entrepreneurship & the Law, Issue 1, Article 2 (2009).
In September 2006, the International Trademark Association (“INTA”) passed the following resolution:
“WHEREAS, initial interest confusion is a doctrine which has been developing in U.S. trademark cases since the 1970s, which allows for a finding of liability where a plaintiff can demonstrate that a consumer was confused by a defendant’s conduct at the time of interest in a product or service, even if that initial confusion is corrected by the time of purchase;
WHEREAS, the initial interest confusion doctrine has been used more frequently since the development of the Internet, in the context of domain name disputes, metatag use, and keyword advertising, and courts seem to apply different standards to cases of initial interest confusion on the Internet than they do in the bricks and mortar world;
WHEREAS, existing case law has developed in an inconsistent fashion, with no definitive test for initial interest confusion, and no clarity as to the factors a court should consider in deciding initial interest confusion cases; and
WHEREAS, clarity and certainty in the initial interest confusion doctrine would benefit both plaintiffs and defendants in trademark infringement cases by bringing greater predictability to such litigation.
BE IT RESOLVED, that INTA recommends that courts recognize that the initial interest confusion doctrine is not separate from a likelihood of confusion analysis. It is simply a timing question as to when confusion occurs, which recognizes confusion that is dispelled before an actual sale occurs may be actionable. Courts should consider initial interest confusion claims, whether in brick and mortar cases or Internet cases, under traditional likelihood of confusion tests and should consider each element of such tests, as well as related defenses, based on the facts of each case.”
Scholars have now begun to predict the demise of the doctrine. “More Evidence that the Initial Interest Confusion Doctrine is Dying,”, Eric Goldman, Professor of Law and Director, High Tech Law Institute, Santa Clara University School of Law, June 15, 2012, (available at “blog.ericgoldman.org/archives/2012/06/more_evidence_t.htm”).
Had there been agreement that the present matter involved issues outside the scope of the Policy, the discussion of the Policy’s limitations and the initial interest doctrine would not have been necessary. If the Policy is to be expanded to embrace noncommercial consideration, it is not for panelists to create that expansion. Any such change should come from a consensus of the stakeholders.
M. Scott Donahey
Presiding Panelist (dissenting)
Date: April 12, 2013
1 This Decision refers to the Respondents collectively as “Respondent.”
2 The Panel refers to the Amended Complaint as the “Complaint” and the Amended Response as the “Response.”
3 Complainant asserted in its Supplemental Filing that by reason of almost identical conduct, and also because of pre-Complaint correspondence between the parties, that the three websites were under common control. Respondent did not deny this. For these reasons the Panel deemed it appropriate to consolidate these proceedings.
4 Complainant alleges that Respondent is controlled by one of the founders and a former principal of Complainant. Respondent denies this allegation.
5 This refers to the First Amendment to the Constitution of the United States of America, which provides: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”
6 E.g., Clover Gifts Inc. v. Airs Fragrance Products, WIPO Case No. D2005-0776; Lockheed Martin Corporation v. Lynn Dixon, WIPO Case No. D2005-0045; Greyson International, Inc. v. William Loncar, WIPO Case No. D2003-0805.
8 These facts distinguish this case from the decisions of the panel majority and concurring panel member (also a member of the Panel majority in this case) in Proskauer Rose LLP v. Leslie Turner, WIPO Case No. D2011-0675, relied upon by the dissent. As noted in the “Opinion Concurring in Part and Concurring in the Decision”, that case involved active and ongoing litigation that both parties identified, and the parties’ separate requests for determination of matters outside the Policy. This is simply not the situation in this case.
9 Paragraph 4(c)(iii) reads in pertinent part:
“How to Demonstrate Your Rights to and Legitimate Interests in the Domain Name in Responding to a Complaint. When you receive a complaint, you should refer to Paragraph 5 of the Rules of Procedure in determining how your response should be prepared. Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, shall demonstrate your rights or legitimate interests to the domain name for purposes of Paragraph 4(a)(ii):
(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.”
10 Annex 1c to the Amended Complaint, a printout of the publicly-available WhoIs information for <theyellowstoneclub.org> identifies the registrant as “Clark Kent.” The Registrar, in its verification response of March 13, 2013, confirmed that the Registrant of the disputed doman name was “PCI”.
11 The third panelist, a learned co-Panelist in the present case, dissented on other grounds.
12 In the Second ICANN Staff Report on Implementation Documents for the uniform Dispute Resolution Policy, the staff states “’[T]arnishment’ in paragraph 4(c)(iii) is limited to acts done with intent to commercially gain.” Id., at end note 2.
13 Search engines no longer examine metatags in the course of their web search activity, so the technology referred to is long outdated.