WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Audi AG v. Stratofex

Case No. D2012-1894

1. The Parties

The Complainant is Audi AG of Ingolstadt, Germany, represented by HK2 Rechtsanwälte, Germany.

The Respondent is Stratofex of California, United States of America.

2. The Domain Name and Registrar

The disputed domain name <audicity.com> (the “Domain Name”) is registered with Tucows Inc. (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on September 24, 2012. On September 24, 2012, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Name. On September 24, 2012, the 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 27, 2012. In accordance with the Rules, paragraph 5(a), the due date for Response was October 17, 2012. No official Response was filed with the Center however, three email communications were received from the Respondent prior to October 17, 2012.

The Center appointed Nicholas Smith as the sole panelist in this matter on November 2, 2012. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

4. Factual Background

The Complainant is a German corporation with its principal office in Ingolstadt, Germany. The Complainant is a leading international car manufacturer. In 2011 the Complainant manufactured 1,363,788 cars and received revenue amounting to 44.096 million EUR.

The Complainant has held trade mark registrations for AUDI (the “AUDI Mark”) internationally, including the United States, the location of the Respondent. The AUDI Mark has been registered in the United States since at least 1997. The Complainant also maintains an official website at “www.audi.com”. In 2012 the Complainant introduced a new showroom in London called “Audi City London”. Audi City London operates as a “digital showroom” which uses technology to display every possible combination of Complainant’s products in a limited space. The Complainant plans to open 20 more Audi City showrooms by 2015.

The Domain Name <audacity.com> was created on September 15, 2001. The Domain Name redirects to a website (“Respondent’s Website”) that consists of what appears to be an old photo of San Francisco. Previously, the Respondent’s website has at various times contained photos of an electric guitar and the message “Somebody set us up the bomb!”

5. Parties’ Contentions

A. Complainant

The Complainant makes the following contentions:

(i) that the Domain Name is identical or confusingly similar to the Complainant’s AUDI Mark;

(ii) that the Respondent has no rights nor any legitimate interests in respect of the Domain Name; and

(iii) that the Domain Name has been registered and is being used in bad faith.

The Complainant is the owner of the AUDI Mark. It owns a trade mark registration for the AUDI Mark in the United States, the location of the Respondent. The AUDI Mark is well-known and of strong reputation. Past UDRP panels have found the AUDI Mark to be distinctive and famous (see Audi AG v. Mike Gillespie, Gillespie Auto Group, WIPO Case No. D2007-1850).

The Domain Name consists of the AUDI Mark in its entirety with the addition of the word “city”. The addition of the descriptive term “city” to the AUDI Mark cannot avoid a finding of confusing similarity as numerous panel decisions have found that a descriptive element cannot remove the overall impression made on the public by a trade mark which is the dominant part of the domain name (Stanworth Development Limited v. Traffic Label Limited, WIPO Case No. D2011-0683). The combination of a famous trademark and “city” is common as a designation of a space devoted to the product. Thus the addition of the word “city” is not sufficient to avoid a likelihood of confusion.

The Respondent has no rights or legitimate interests in the Domain Name. The Respondent is Stratofax or the natural person Paul Steffan who was behind Stratofax. Neither of these entities are permitted to use the Complainant’s trade marks or have acquired their own rights to the Domain Name. The Respondent is not an authorised user of the AUDI Mark nor is the Respondent authorised or affiliated with the Complainant.

The Respondent is not making a legitimate noncommercial or fair use of the Domain Name. For the last two years, the Respondent’s Website consists of a single symbol, and for at least three years before that the Respondent’s Website displayed no content at all. As the Respondent is not taking any steps to actually use the Domain Name cannot argue that he is making a noncommercial or fair use of the Domain Name, (see Hero Honda Motors Limited v. Rao Tella, WIPO Case No. D2000-0365). Furthermore, the lack of any active use of the Domain Name means that there is no indication that the Respondent is or has used, or is making 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.

The Domain Name was registered and is being used in bad faith. The AUDI Mark is a world-famous mark. The Respondent must have had actual and constructive knowledge about Complainant’s AUDI Mark when acquiring the Domain Name. Furthermore, failure to respond to a cease and desist letter can constitute additional evidence of Respondent’s bad faith (Alstom v. Yulei, WIPO Case No. D2007-0424). The Complainant sent a cease and desist letter to Respondent on August 23, 2012 that the Respondent failed to respond to.

The Domain Name is not in use. The Respondent’s Website simply shows a symbol with no further explanation. It is consensus view of the existing panel decisions that inactive use of domain names can constitute bad faith (Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003). There is no conceivable legitimate active use of the Domain Name by the Respondent. Any commercial use would necessarily infringe the Complainant’s trade marks.

B. Respondent

The Respondent did not file a formal response to the Complaint, however Paul Steffan, the administrative contact and the person behind the Respondent sent or copied three e-mails to the Center on October 2, 3, and 16 respectively. The content of these emails is summarized below.

The Respondent registered the Domain Name because it is a play on the words “audacity” and “audio”. He did not think of the Complainant when he came up with the Domain Name. Rather he registered the Domain Name to host his music work, which is an obsession of his.

The Respondent has held the Domain Name for many years and uses it primarily for email for family and some friends as well as for sharing personal music projects and field recordings that he makes, i.e. “AUDI-o related projects”.

While there has been little content on the Respondent’s Website, the Respondent has used various sub domains from the Domain Name such as “www.olsen.audicity.com”, which was used to share old family photos when the Respondent’s grandfather died, and “www.media.audicity.com” which was used to reference sound files.

The Respondent has also used the Domain Name as a secondary email address that he directs mailing lists that he signs up to and an address he uses when he purchases software. The Respondent is not interested in selling the Domain Name, nor has he registered a large number of domain names for commercial purposes.

6. Discussion and Findings

A. Identical or Confusingly Similar

To prove this element the Complainant must have trade or service mark rights and the Domain Name must be identical or confusingly similar to the Complainant’s trade or service mark.

The Complainant is the owner of the AUDI Mark, having registrations for AUDI as a trade mark in the United States, the location of the Respondent.

The Domain Name consists of the AUDI Mark and the word “city”. As such the AUDI Mark is recognisable within the Domain Name. The Panel finds that the Domain Name is confusingly similar to the Complainant’s AUDI Mark. Consequently, the requirement of paragraph 4(a)(i) of the Policy is satisfied.

B. Rights or Legitimate Interests

To succeed on this element, a complainant must make out a prima facie case that the respondent lacks rights or legitimate interests in the domain name. If such a prima facie case is made out, then the burden of production shifts to the respondent to demonstrate rights or legitimate interests in the domain name.

Paragraph 4(c) of the Policy enumerates several ways in which a respondent may demonstrate rights or legitimate interests in a domain name:

“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):

(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 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.” (Policy, paragraph 4(c))”.

The Respondent is not affiliated with the Complainant in any way. He has not been authorised by the Complainant to register or use the Domain Name or to seek the registration of any domain name incorporating the AUDI Mark or a mark similar to the AUDI Mark. There is no evidence that the Respondent is commonly known by the Domain Name or any similar name.

The Respondent claims that he has used the Domain Name as an email for family and some friends as well as for sharing personal music projects. However the Respondent, in his communications with the Center, provided very limited evidence in support of its claims about how it was using the Domain Name. Given the personal circumstances (mentioned in his email communication sent or copied to the Center) affecting the Respondent at the time it responded to the Complaint, it may be possible for the Respondent to provide additional evidence in support of its claims of use.

In such circumstances Panels often seek the provision of further evidence by the parties see Auto-C, LLC v. MustNeed.com, WIPO Case No. D2004-0025; Fratelli Carli S.p.A. v. Linda Norcross, WIPO Case No. D2006-0988. Given the Panel’s finding under the bad faith element it has not been necessary to seek further evidence from the Respondent, nor reach a final conclusion under this ground.

C. Registered and Used in Bad Faith

For the purposes of paragraph 4(a)(iii) of the Policy, the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of the Domain Name in bad faith:

(i) circumstances indicating that the Respondent has registered or has 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 trade mark or service mark or to a competitor of the Complainant, for valuable consideration in excess of its documented out-of-pocket costs directly related to the Domain Name; or

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

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

(iv) by using the Domain Name, the Respondent has intentionally attempted to attract, for commercial gain, Internet users to its website or other online location, by creating a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the Respondent’s website or location or of a product or service on the Respondent’s website or location.

There are no circumstances that indicate that the Respondent has registered the Domain Name primarily for the purpose of selling, renting, or otherwise transferring the Domain Name registration to the Complainant. The Domain Name has been registered for more than 10 years, and there is no evidence that the Respondent has ever attempted to sell the Domain Name. Furthermore, when asked by the Complainant to transfer the Domain Name, the Respondent refused without making a counter-offer, citing the costs that the transfer would impose on him in changing his various email addresses.

There is no evidence that the Respondent has engaged in a pattern of conduct of registering domain names (including the Domain Name) to prevent trade mark owners from registering a corresponding domain name. The Respondent admits to registering five or six additional domain names for personal purposes but there is no evidence that they reflect a trade mark or that the Respondent has used them to prevent an entity from reflecting its marks in a corresponding domain name.

There is no evidence that the Respondent has intentionally attempted to attract, for commercial gain, Internet users to its website or other online location, by creating a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the Respondent’s Website. The Domain Name was first registered in 2001. Since that period there have been various images on Respondent’s Website, including an old photo of San Francisco, a photo of an electric guitar, a photo of an individual that is presumably Paul Steffan, and a blank page with the message “Somebody set us up the bomb!”. None of the uses of the Domain Name, either as a webpage or as an email address, appear to be for commercial gain.

There is no evidence that any of the four circumstances listed in paragraph 4(b) of the Policy as evidence of bad faith exist in the present proceeding. However the list of circumstances is non-exhaustive, see TV Globo Ltda. v. Radio Morena, WIPO Case No. D2000–0245. The Complaint makes the following additional arguments that the Respondent has registered and used the Domain Name in bad faith.

a) When the Respondent “knew or should have known” of the registration and use of the Complainant’s trade marks prior to the registration of the domain name, bad faith should be found.

b) The non-reaction to a cease and desist letter can constitute additional evidence of the Respondent’s bad faith (Alstom v. Yulei, WIPO Case No. D2007-0424).

c) The Domain Name has been passively held, and given that the Respondent knew or should have known of the AUDI Mark at the time of the registration, the passive holding of the Domain Name amounts to bad faith.

d) There is no conceivable plausible actual or contemplated active use of the Domain Name that would not infringe the Complainant’s rights.

The Panel finds that the Complainant’s arguments are insufficient to prove that the Respondent registered and used the Domain Name in bad faith.

The mere fact that the Respondent may have heard of the AUDI Mark at the time of registration does not automatically result in a finding of bad faith. The Domain Name was registered in 2001. The Complainant did not open up its first “audi city” dealership until 2012. There is no evidence that at the time of registration of the Domain Name, the combination of “audi” and “city” would ever be a combination that would ever be of interest to the Complainant or have any value to third parties. The suggestion implied in the Complaint that the Respondent (who, based on the evidence before the Panel, has never registered domain names to sell them), registered the Domain Name in anticipation that the Complainant would be interested in <audacity.com> or that the Domain Name would somehow have some value, and then held onto the Domain Name for 11 years until the Complainant decided to brand its dealerships “Audi City”, is simply implausible.

The Respondent claims that he did not consider the Complainant when registering the Domain Name. Rather, the reason he chose to register the Domain Name was as a play on the words "audacity" and "audio". While the Respondent has not provided any evidence in support of his claimed reason, his claimed reason is considerably more plausible than the Complainant’s suggestion. On that basis alone it is difficult to find on the balance of probabilities that the Domain Name was registered in bad faith.

In respect of the Respondent’s failure to respond to the Complainant’s cease and desist letter, the case of Alstom v. Yulei, WIPO Case No. D2007-0424, quoted in the Complaint, is not authority for the proposition that the failure to reply to a cease and desist letter can constitute additional evidence of the Respondent’s bad faith. In that decision the panel suggested it would have been pertinent for the respondent to provide an explanation of its choice in the disputed domain name and that the failure of the respondent to respond to the allegations in the complaint (emphasis added) was relevant to a finding of bad faith. In this Case the Respondent has responded to the Complaint and provided an explanation for its registration of the Domain Name.

In relation to the Complainant’s passive holding argument, the mere failure to maintain an active website at a domain name does not automatically result in a finding of bad faith. The WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”) notes in relation to cases in which the domain name is passively held:

“With comparative reference to the circumstances set out in paragraph 4(b) of the UDRP deemed to establish bad faith registration and use, panels have found that the apparent lack of so-called active use (e.g., to resolve to a website) of the domain name without any active attempt to sell or to contact the trademark holder (passive holding), does not as such prevent a finding of bad faith. The panel must examine all the circumstances of the case to determine whether the respondent is acting in bad faith. Examples of what may be cumulative circumstances found to be indicative of bad faith include the complainant having a well-known trademark, no response to the complaint having been filed, and the registrant's concealment of its identity. Panels may draw inferences about whether the domain name was used in bad faith given the circumstances surrounding registration, and vice versa.”

In the present case the Respondent has claimed that it has used the Domain Name for a number of purposes that are not visible on the Respondent’s Website. They include sharing old family photos, to reference his sound files and as an email address. The Respondent did not provide any evidence of such uses. However when examining all the circumstances of the case the matters listed below would suggest that, despite the fact that there has been limited active use of the Respondent’s Website, this is not a case where bad faith on the basis of passive holding should be found.

a) The Respondent has provided a plausible explanation of the reason he registered the Domain Name. Passive holding should only result in a finding of bad faith if the panel considers that the reason why a domain name was registered was for the purposes of cybersquatting. This is not the case in this proceeding.

b) The Respondent’s claimed examples of use of the Domain Name, while not supported by evidence, are also plausible. It is not uncommon for individuals to register a domain name to be used as an e-mail address or for private purposes.

c) The Respondent’s evidence of its use of the Domain Name is supported by the fact that the Domain Name has been registered for 11 years. Given the implausibility of the suggestion that the Respondent passively held the Domain Name for 11 years in case the Complainant started using “Audi City” as a dealership brand, the fact that the Respondent has continued to renew the registration of the Domain Name would suggest that it had been used by the Respondent during that time, possibly in the manner suggested in the Respondent’s e-mails.

d) The Respondent has never hidden its identity (it has clearly provided contact details that were sufficient for notice of the Complaint to reach him in the present proceeding) and has provided an informal response to the present proceeding.

e) There is no evidence that the Respondent is a domain name trader or has ever registered any other domain names for illegitimate commercial purposes.

In relation to the Complainant’s argument that there is no conceivable plausible actual or contemplated active use of the Domain Name that does not infringe the Complainant’s rights, the Panel notes that the Respondent appears to have held and used the Domain Name for the past 10 years without apparently infringing the Complainant’s rights. The present stated use of the Domain Name (for email addresses and occasionally for the Respondent to share personal information and music using sub-domains) does not appear to infringe the Complainant’s trade marks though the Panel does not make a formal finding on that ground. There is no positive obligation on a domain name registrant to maintain an active website at the domain name. If the Complainant considers that the Respondent’s present (or future use) of the Domain Name infringes its trade mark rights then it is free to commence proceedings against the Respondent in a court of competent jurisdiction.

In this case the Respondent has provided a plausible reason for registering a Domain Name. It has maintained the registration for 11 years, and claims to have used the Domain Name extensively for personal purposes during that time. From 2001-2012 the term “Audi City” was not in common use and there was no reason for the Respondent to consider that the Complainant would find that combination of words valuable. The Respondent has never used the Domain Name for commercial purposes, nor has he attempted to sell the Domain Name.

This case illustrates the widely recognised principle that the Policy is designed to deal with clear cases of cybersquatting, see Clockwork IP LLC, One Hour Air Conditioning Franchising, LLC v. Elena Wallace, WIPO Case No. D2009-0485 (“UDRP proceedings are for clear cases of cybersquatting, not for resolving trademark infringement and/or trademark dilution disputes or other matters more appropriately dealt with through the courts”). In the present case, the Panel finds that the record simply does not yield clear evidence of cybersquatting, circumstances that bring the case within the provisions of paragraph 4(b) of the Policy, or other facts showing that Respondent registered and used the Domain Name in bad faith.

7. Decision

For the foregoing reasons, the Complaint is denied.

Nicholas Smith
Sole Panelist
Date: November 7, 2012