WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Swarovski Aktiengesellschaft v. Zhang chao

Case No. D2013-1964

1. The Parties

Complainant is Swarovski Aktiengesellschaft of Triesen, Liechtenstein, represented by LegalBase (Pvt) Limited, Sri Lanka.

Respondent is Zhang chao of Shenzhen, Guangdong Province, China.

2. The Domain Name and Registrar

The disputed domain name <swarovski-online.net> is registered with 35 Technology Co., Ltd. (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on November 19, 2013. On November 19, 2013, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On November 20, 2013, the Registrar transmitted by email to the Center its verification response confirming that Respondent is listed as the registrant and providing the contact details. On November 21, 2013, the Center sent an email communication to the parties in both Chinese and English regarding the language of the proceeding. On the same day, Complainant confirmed its request that English be the language of the proceeding. Respondent did not comment on the language of the proceeding by the specified due date.

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 Respondent of the Complaint in both Chinese and English, and the proceedings commenced on November 27, 2013. In accordance with the Rules, paragraph 5(a), the due date for Response was December 17, 2013. Respondent did not submit any response. Accordingly, the Center notified Respondent’s default on December 18, 2013.

The Center appointed Yijun Tian as the sole panelist in this matter on December 24, 2013. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

4. Factual Background

Complainant, Swarovski Aktiengesellschaft, is a company incorpated in Triesen, Liechtenstein. Complainant is a world leading producer of cut crystal, genuine gemstones and created stones with production facilities in 18 countries, distribution to 42 countries and a presence in more than 120 countries.

Complainant has exclusive rights in several well-known registered SWAROVSKI trademarks (hereafter “SWAROVSKI Marks”) globally, including China since 1987. It also owns the domain names <swarovski.com> (since January 11, 1996) and <swarovski.net> (since April 16, 1998).

Respondent is Zhang chao of Shenzhen, Guangdong Province, China. The disputed domain name <swarovski-online.net> was registered on October 24, 2013, long after the SWAROVSKI Marks became internationally famous.

5. Parties’ Contentions

A. Complainant

(a) Complainant is the exclusive owner of trademark rights in the SWAROVSKI Marks.

- Complainant is the world’s leading producer of cut crystal, genuine gemstones and created stones.

- Complainant has registered the SWAROVSKI Marks globally, including China since 1987.

In 2012, Complainant’s products were sold in 1,250 of its own boutiques and through 1,100 partner-operated boutiques worldwide and its approximate worldwide revenue in 2012 was EUR 3.08 billion.

SWAROVSKI Marks have become famous and well-known in China and worldwide.

- Complainant has registered several domain names, including <swarovski.com> and <swarovski.net>.

(b) The disputed domain name was improperly registered and is being improperly used.

Respondent registered the disputed domain name on October 24, 2013, and is operating an online shop with content in the English language that offers for sale various purported Swarovski products e.g., “Swarovski Necklaces”, “Swarovski Bracelets”, “Swarovski Earrings” and more.

Respondent is using the disputed domain name to confuse consumers into believing that Respondent’s website (the “Infringing Website”) is an official Complainant’s website and/or Respondent is affiliated with or authorised to sell products by Complainant.

The “About Us” section of the Infringing Website states “[t]here’s no doubt that when it comes to luxury, no label is recognized more than our products as they are crafted with the highest-quality materials, design and workmanship.” However, Respondent is not an authorised seller of Swarovski products, and Complainant does not guarantee the authenticity or quality of the products that are being sold at the Infringing Website.

Respondent does not at any point identify itself as being independent from Complainant. Respondent is creating the impression that the Infringing Website is an official Swarovski website and Respondent is an authorised seller of Swarovski products.

The disputed domain name is a blatant infringement of the SWAROVSKI Marks and no bona fide use is being made of the disputed domain name. Respondent is trying to pass itself off as Complainant and is exploiting the goodwill associated with the SWAROVSKI Marks in order to obtain commercial gain.

Previous UDRP panels have recognised that consumers expect to find a trademark owner on the Internet at a domain name comprised of the company’s name or mark.

Respondent has used the SWAROVSKI Marks in the disputed domain name so as to cause confusion among Internet users between the disputed domain name and Complainant approved websites.

Misdirecting Internet users to the disputed domain name takes advantage of the behaviour pattern identified in Dr. Michael Crichton v. Alberta Hot Rods, WIPO Case No. D2002‑0872 for commercial gain.

This type of initial interest confusion or diversion of traffic is illegal because it wrongfully capitalises on Complainant’s goodwill in the SWAROVSKI Marks to divert Internet traffic to the Infringing Website.

The addition of the term “online” as a suffix to the SWAROVSKI Marks does not lessen the confusing similarity between the disputed domain name and Complainant’s mark.

Furthermore, several UDRP panels have held that the use of a hyphen in a domain name is insignificant and does little to avoid confusing similarity with Complainant’s SWAROVSKI Marks.

Numerous UDRP panels have found that coupling a common word with complainant’s mark or even a word similar to complainant’s mark in a domain name, especially a well-known mark like the SWAROVSKI Marks, does not negate a finding of confusing similarity but serves to reinforce the similarity.

Previous UDRP panels have also held that a domain name is confusingly similar to a trademark when the domain name incorporates the mark in its entirety.

(d) Respondent has no legitimate interests or rights in the disputed domain name.

Complainant’s rights in the SWAROVSKI Marks have been recognised by several UDRP panels.

Respondent has no connection or affiliation with Complainant and has not received any license or consent, express or implied, to use the SWAROVSKI Marks in a domain name or in any other manner.

Respondent has never been known by the disputed domain name and has no legitimate interest in the SWAROVSK Marks or the name “Swarovski”.

The disputed domain name is being used to advertise purported Swarovski products and the disputed domain name misdirects Internet traffic to the Infringing Website. Such a use is contrary to a bona fide offering of goods or services or a legitimate interest.

Respondent’s misappropriation of the disputed domain name was no accident. Respondent’s use of the SWAROVSKI Marks is clearly for the purpose of misleading consumers into believing that the Respondent and the Infringing Website are associated with or approved by Complainant.

Previous UDRP panels have held that when a respondent chooses to incorporate a well-known trademark (like the SWAROVSKI Marks) into a domain name without the authorisation of the trademark holder, it cannot be considered a bona fide offering.

(e) The disputed domain name was registered and is being used in bad faith.

(i) the disputed domain name has been registered in bad faith

Respondent has registered the disputed domain name in bad faith because it was registered with the knowledge of Complainant’s rights in the SWAROVSKI Marks, as it is inconceivable that Respondent was unaware of Complainant’s rights in the SWAROVSKI Marks.

Respondent’s selection of the disputed domain name, which wholly incorporates the SWAROVSKI Marks, cannot be a coincidence as “Swarovski” is not a descriptive or generic term; it is a famous and well-known trademark.

The Infringing Website offers for sale a variety of Swarovski products such as “Necklaces”, “Bracelets” and more. Registration of a famous mark, like the SWAROVSKI Marks, as a domain name by an entity that has no legitimate relationship with the mark is itself sufficient to demonstrate bad faith.

Previous UDRP panels have found that coupling a descriptive word with a complainant’s mark or even a word similar to a complainant’s mark in a domain name constitutes bad faith on the part of Respondent.

(ii) The disputed domain name is being used in bad faith

Respondent has done nothing to identify itself as being independent from Complainant.

Many UDRP panels have held that the use of a domain name by a registrant for the sale of products, that are similar or identical to complainant’s products, is consistent with the finding of bad faith use under the Policy. And a respondent’s very method of infringement, i.e., by using the exact SWAROVSKI Marks to lure consumers to its website demonstrates bad faith use under the Policy.

Respondent’s registration and use of the disputed domain name creates “initial interest confusion”, which attracts Internet users to the Infringing Website because of its purported affiliation with Complainant.

Registration of a famous mark, like the SWAROVSKI Marks, as a domain name by an entity that has no legitimate relationship with the mark is itself sufficient to demonstrate bad faith.

Respondent is attempting to attract consumers for commercial gain to the disputed domain name by creating confusion among consumers by utilising the SWAROVSKI Marks. Respondent, without valid consent, utilises the SWAROVKI Marks throughout the Infringing Website and offers products identical to or similar to Swarovski products for sale.

B. Respondent

Respondent did not reply to Complainant’s contentions.

6. Discussion and Findings

6.1 Language of the Proceeding

The language of the registration agreement for the disputed domain name is Chinese. Pursuant to the Rules, paragraph 11, in the absence of an agreement between the parties, or specified otherwise in the registration agreement, the language of the administrative proceeding shall be the language of the registration agreement. From the evidence presented on the record, no agreement appears to have been entered into between Complainant and Respondent to the effect that the language of the proceeding should be English. Complainant filed initially its Complaint in English, and has requested that English be the language of the proceeding for the following reasons:

(a) The content on the Infringing Website is in English;

(b) Respondent appears to operate internationally in English.

(d) Swarovski is an international brand with registered marks in multiple jurisdictions whose international business primarily operates in English.

Respondent did not make any submissions with respect to the language of the proceeding and did not object to the use of English as the language of the proceeding.

Paragraph 11(a) of the Rules allows the Panel to determine the language of the proceeding having regard to all the circumstances. In particular, it is established practice to take paragraphs 10(b) and (c) of the Rules into consideration for the purpose of determining the language of the proceeding. In other words, it is important to ensure fairness to the parties and the maintenance of an inexpensive and expeditious avenue for resolving domain name disputes. (Whirlpool Corporation, Whirlpool Properties, Inc. v. Hui'erpu (HK) electrical appliance co. ltd., WIPO Case No. D2008-0293; Solvay S.A. v. Hyun-Jun Shin, WIPO Case No. D2006-0593). The language finally decided by the Panel for the proceeding should not be prejudicial to either one of the parties in its abilities to articulate the arguments for the case. (Groupe Auchan v. xmxzl, WIPO Case No. DCC2006-0004). WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”) further states:

“in certain situations, where the respondent can apparently understand the language of the complaint (or having been given a fair chance to object has not done so), and Complainant would be unfairly disadvantaged by being forced to translate, the WIPO Center as a provider may accept the language of the complaint, even if it is different from the language of the registration agreement”. (WIPO Overview 2.0, paragraph 4.3; see also L’Oreal S.A. v. Munhyunja, WIPO Case No. D2003-0585).

The Panel has taken into consideration the fact that Complainant is a company from Liechtenstein, and Complainant will be spared the burden of dealing with Chinese as the language of the proceeding. The Panel has also taken into consideration the fact that the Infringing Website is in English and the disputed domain name includes the Latin characters “Swarovski” and the English word “online” (Compagnie Gervais Danone v. Xiaole Zhang, WIPO Case No. D2008-1047).

On the record, Respondent appears to be a Chinese individual and is thus presumably not a native English speaker, but the Panel finds that persuasive evidence in the present proceeding to suggest that Respondent has sufficient knowledge of English. In particular, the Panel notes that, based on the evidence provided by Complainant, (a) the disputed domain name <swarovski-online.net> is registered in Latin characters and particularly in English language, rather than Chinese script; (b) the Infringing Website is an English-based website and Respondent is apparently doing business in English through this website (Annex J to the Complaint); (c) the Infringing Website appears to have been directed to users around the world (particularly English speakers) rather than Chinese speakers; (d) the Center has notified Respondent of the proceeding in both Chinese and English, and Respondent has indicated no objection to Complainant’s request that English be the language of the proceeding; (e) the Center informed Respondent that it would accept a Response in either English or Chinese.

Considering these circumstances, the Panel finds the choice of English as the language of the present proceeding is fair to both parties and is not prejudicial to either one of the parties in his or her ability to articulate the arguments for this case. Having considered all the matters above, the Panel determines under paragraph 11(a) of the Rules that English shall be the language of the proceeding, and the decision will be rendered in English.

6.2. Discussion and Findings

Paragraph 4(a) of the Policy requires that Complainant must prove each of the following three elements to obtain an order that the disputed domain names should be cancelled or transferred:

(i) the disputed domain name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights;

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

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

On the basis of the evidence introduced by Complainant and in particular with regard to the content of the relevant provisions of the Policy, (paragraphs 4(a), (b), (c)), the Panel concludes as follows:

A. Identical or Confusingly Similar

The Panel finds that Complainant has rights in the SWAROVSKI Marks acquired through registration. The SWAROVSKI Marks have been registered worldwide including in China, and Complainant has a widespread reputation in producing cut crystal, genuine gemstones and created stones.

The disputed domain name <swarovski-online.net> comprises the SWAROVSKI Marks in their entirety. The disputed domain name only differs from Complainant’s trademark by the additions of a hyphen “-” and the term “online” to the SWAROVSKI Marks. This does not eliminate the confusing similarity between Complainant’s registered trademark and the disputed domain name.

Previous UDRP panels have consistently held that a domain name is identical or confusingly similar to a trademark for purposes of the Policy “when the domain name includes the trade mark, or a confusingly similar approximation, regardless of the other terms in the domain name” (Wal-Mart Stores, Inc. v. Richard MacLeod d/b/a For Sale, WIPO Case No. D2000-0662).

Generally a respondent “may not avoid likely confusion by appropriating another's entire mark and adding descriptive or non-distinctive matter to it”. (The Argento Wine Company Limited v. Argento Beijing Trading Company, WIPO Case No. D2009-0610; General Electric Company v. CPIC NET and Hussain Syed, WIPO Case No. D2001-0087; PCCW-HKT DataCom Services Limited v. Yingke, ADNDRC Case No. HK0500065).

Mere additions of “-” and the descriptive term “online” as suffixes to Complainant’s mark fails to distinguish. By contrast, it may increase the likelihood of confusion.

Thus, the Panel finds that the additional suffixes are not sufficient to negate the confusing similarity between the disputed domain name and the SWAROVSKI Marks.

The Panel therefore holds that the Complaint fulfils the first condition of paragraph 4(a) of the Policy.

B. Rights or Legitimate Interests

Paragraph 4(c) of the Policy provides a list of circumstances any of which is sufficient to demonstrate that Respondent has rights or legitimate interests in the disputed domain name:

(i) use of, or preparations to use, the disputed domain name in connection with a bona fide offering of goods or services;

(ii) the fact that Respondent has commonly been known by the disputed domain name; or

(iii) legitimate noncommercial or fair use of the disputed domain name.

The overall burden of proof on this element rests with Complainant. However, it is well established by previous UDRP panel decisions that once a complainant establishes a prima facie case that a respondent lacks rights or legitimate interests in a domain name, the burden of production shifts to the respondent to rebut the complainant’s contentions. If the respondent fails to do so, a complainant is deemed to have satisfied paragraph 4(a)(ii) of the Policy. (Danzas Holding AG, DHL Operations B.V. v. Ma Shikai, WIPO Case No. D2008-0441; WIPO Overview 2.0, paragraph 2.1 and cases cited therein).

Complainant has rights in the SWAROVSKI Marks globally (international registration), including registrations in China since 1987 – which long precedes Respondent’s registration of the disputed domain name (October 24, 2013).

Respondent is not an authorized dealer of Swarovski-branded products. Complainant has therefore established a prima facie case that Respondent has no rights or legitimate interests in the disputed domain name and thereby shifted the burden to Respondent to produce evidence to rebut this presumption (The Argento Wine Company Limited v. Argento Beijing Trading Company, supra; Do The Hustle, LLC v. Tropic Web, WIPO Case No. D2000-0624; Croatia Airlines d.d. v. Modern Empire Internet Ltd., WIPO Case No. D2003-0455).

Based on the following reasons the Panel finds that Respondent has no rights or legitimate interests in the disputed domain name:

(a) There has been no evidence adduced to show that Respondent is using the disputed domain name in connection with a bona fide offering of goods or services. Respondent has not provided evidence of a legitimate use of the disputed domain name or reasons to justify the choice of the word “Swarovski” in its business operation. There has been no evidence to show that Complainant has licensed or otherwise permitted Respondent to use the SWAROVSKI Marks or to apply for or use any domain name incorporating the SWAROVSKI Mark and Respondent has, through the use of a confusingly similar domain name and webpage contents, created a likelihood of confusion with the SWAROVSKI Marks. Noting also that apparently no clarification as to Respondent’s relationship to Complainant is made on the Infringing Website, potential partners and end users are led to believe that the Infringing Website “www.swarovski-online.net” is either Complainant’s site or a site of an official authorized partner of Complainant, which it is not.;

(b) There has been no evidence adduced to show that Respondent has been commonly known by the disputed domain name. There has been no evidence adduced to show that Respondent has any registered trademark rights with respect to the disputed domain name. Respondent registered the disputed domain name <swarovski-online.net> on October 24, 2013. The disputed domain name is confusingly similar to Complainant’s SWAROVSKI Marks.

(c) There has been no evidence adduced to show that Respondent is making a legitimate noncommercial or fair use of the disputed domain name. By contrast, according to the information provided by Complainant, Respondent was in actuality advertising, offering and selling purported Swarovski products at the Infringing Website “www.swarovski-online.net”.

The Panel finds that Respondent has failed to produce any evidence to establish its rights or legitimate interests in the disputed domain name. The Panel therefore holds that the Complaint fulfils the second condition of paragraph 4(a) of the Policy.

C. Registered and Used in Bad Faith

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

(i) circumstances indicating that Respondent has registered or acquired the disputed domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registrations to Complainant who is the owner of the trademark or service mark or to a competitor of Complainant, for valuable consideration in excess of Respondent’s documented out-of-pocket costs directly related to the disputed domain name; or

(ii) Respondent has registered the disputed domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that Respondent has engaged in a pattern of such conduct; or

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

(iv) by using the disputed domain name, Respondent has intentionally attempted to attract, for commercial gain, Internet users to Respondent’s websites or other on-line location, by creating a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s websites or location or of a product.

The Panel concludes that the circumstances referred to in paragraph 4(b)(iv) of the Policy are applicable to the present case and upon the evidence of these circumstances and other relevant circumstances, it is adequate to conclude that Respondent has registered and is using the disputed domain name in bad faith.

a) Registered in Bad Faith

The Panel finds that Complainant has a widespread reputation in the SWAROVSKI Marks with regard to its products. Complainant has registered its SWAROVSKI Marks internationally, including registrations in China (since 1987). Moreover, according to the information provided by Complainant, Respondent states “MADE WITH SWAROVSKI ELEMENTS” on the Infringing Website. Furthermore, Respondent goes on to state that “Swarovski is a world-renowned company specializing in uniquely and precisely cut crystal glass and luxury products […]”. The Infringing Website offers for sale a variety of Swarovski products such as “Swarovski Bracelet”, “Swarovski Earring”, “Swarovski Necklace” and more.

Respondent would not have advertised products purporting to be Swarovski products on the Infringing Website if it was unaware of Complainant’s reputation. In the other words, it is not conceivable that Respondent would not have had actual notice of Complainant’s trademark right at the time of the registration of the disputed domain name. The Panel therefore finds that the SWAROVSKI Marks are not ones those traders could legitimately adopt other than for the purpose of creating an impression of an association with Complainant. (The Argento Wine Company Limited v. Argento Beijing Trading Company, supra).

Moreover, Respondent has chosen not to formally respond to Complainant’s allegations. According to the panel’s decision in The Argento Wine Company Limited v Argento Beijing Trading Company, supra, “the failure of the Respondent to respond to the Complaint further supports an inference of bad faith”. (See also Bayerische Motoren Werke AG v. (This Domain is For Sale) Joshuathan Investments, Inc., WIPO Case No. D2002-0787). Thus, the Panel concludes that the disputed domain name was registered in bad faith with the intent to create an impression of an association with Complainant’s Swarovski branded products.

b) Use in Bad Faith

Complainant has adduced evidence to prove that by using a confusingly similar disputed domain name, Respondent has “intentionally attempted to attract, for commercial gain, Internet users to Respondent’s websites” offering Complainant’s SWAROVSKI branded products and services without authorization. Complainant claimed that Respondent is trying to pass itself off as Swarovski and is exploiting the goodwill associated with the SWAROVSKI Marks in order to obtain “commercial gain”.

To establish an “intention for commercial gain” for the purpose of this Policy, evidence is required to indicate that it is “more likely than not” that intention existed (The Argento Wine Company Limited v. Argento Beijing Trading Company, supra; Wal-Mart Stores, Inc. and Wal-Mart China Co. Ltd v. Liangchenyong, ADNDRC Case No. HKcc-0800008).

Given the widespread reputation of the SWAROVSKI Marks (as well as the affiliation statement on the Infringing Website - mentioned above), the Panel finds that the public is likely to be confused into thinking that the disputed domain name has a connection with Complainant, contrary to fact. There is a strong likelihood of confusion as to the source, sponsorship, affiliation or endorsement of the Infringing Website. In other words, Respondent has, through the use of a confusingly similar domain name and webpage contents, created a likelihood of confusion with the SWAROVSKI Marks. Noting also that apparently no clarification as to Respondent’s relationship to Complainant is made on the Infringing Website, potential partners and end users are led to believe that the Infringing Website “www.swarovski-online.net” is either Complainant’s site or a site of an official authorized partner of Complainant, which it is not. Moreover, Respondent has not responded to the Complaint. The Panel therefore concludes that the disputed domain name is being used by Respondent in bad faith.

In summary, Respondent, by choosing to register and use a domain name which is confusingly similar to Complainant’s trademark, intended to ride on the goodwill of Complainant’s trademark in an attempt to exploit, for commercial gain, Internet users destined for Complainant. In the absence of evidence to the contrary and rebuttal from Respondent, the choice of the disputed domain name and the conduct of Respondent as far as the Infringing Website to which the disputed domain name resolves is indicative of registration and use of the disputed domain name in bad faith.

The Panel therefore holds that the Complaint fulfils the third condition of paragraph 4(a) of the Policy.

7. Decision

For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the disputed domain name <swarovski-online.net> be transferred to Complainant.

Yijun Tian
Sole Panelist
Dated: January 21, 2014