WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Novartis AG v. David Kendall
Case No. D2002-0502
1. The Parties
1.1 The Complainant is Novartis AG, a corporation organized under the laws of Switzerland, having its principal place of business at Lichtstrasse 35, 4056 Basel, Switzerland.
1.2 The Respondent is David Kendall. Respondentís contact information lists his address as 1645 W. 1000 N., Provo, Utah 84604, United States of America.
2. The Domain Name and Registrar
2.1 The disputed domain name is <theraflu.com>.
2.2 The registrar of the disputed domain names is iHoldings.com Inc., d.b.a. DotRegister.com located at 13205 SW 137th Avenue, Suite #133, Miami, Florida 33168, United States of America.
3. Procedural History
3.1 Complainant initiated the proceeding by filing a complaint, received by the WIPO Arbitration and Mediation Center (the "Center") on May 29, 2002. At the request of WIPO, the Complainant filed an amended complaint on June 10, 2002.
3.2 On June 18, 2002, all formal requirements for the establishment of the complaint were checked by the Center and found to be in compliance with the Uniform Domain Name Dispute Resolution Policy (the "Policy"), adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) on August 26, 1999, (with implementing documents approved on October 24, 1999), 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"). The Panel accepts the WIPO checklist as evidence of proper compliance with the Policy, Rules, and Supplemental Rules.
3.3 On June 18, 2002, the Center transmitted notification of the complaint and commencement of the proceedings to Respondent.
3.4 On July 10, 2002, the Center transmitted notification of Respondent's default to the Respondent.
3.5 On August 12, 2002, the Center invited the undersigned to serve as panelist in this administrative proceeding, subject to receipt of an executed Statement of Acceptance and Declaration of Impartiality and Independence ("Statement and Declaration"). On August 13, 2002, the undersigned transmitted by facsimile the executed Statement and Declaration to the Center.
3.6 On August 15, 2002, Complainant and Respondent were notified by the Center of the appointment of the undersigned sole panelist as the Administrative Panel (the "Panel") in this matter. The Center notified the Panel that, absent exceptional circumstances it would be required to forward its decision to the Center by August 29, 2002. Pursuant to the Panelís request, the decision deadline was extended to September 6, 2002.
The Panel has not received any further requests from Complainant or Respondent regarding further submissions, waivers or extensions of deadlines, and the Panel has not found it necessary to request any further information from the parties. The proceedings have been conducted in English.
4. Factual Background
4.1 Complainant Novartis AG owns the rights to the registered trademark THERAFLU for "cough and cold preparation," which was registered August 18, 1987 as U.S. Reg. No. 1,452,879, with a claimed first use as early as October 30, 1986. Complainant also owns numerous trademark registrations for THERAFLU in other countries.
4.2 The Respondent registered the domain name <theraflu.com> on or about July 23, 2001. The domain name is not currently active.
5. Partiesí Contentions
Complainant, Novartis AG is a Swiss Corporation with its principal place of business in Basel, Switzerland. Novartis AG is one of the largest pharmaceutical companies in the world and is the owner of numerous trademark registrations, including THERAFLU (An exception is the Canadian trademark registration for THERAFLU, which is owned by a subsidiary). THERAFLU, as noted on the above cited trademark registrations, is sold as a cough and cold preparation.
Complainant has continuously used the trademark THERAFLU in the United States since the product's launch in 1986 and much prior to that date in other parts of the world. THERAFLU products are sold primarily in powder form, for mixing with hot water (a caplet version is also available). Throughout this period, sales of THERAFLU products have been robust, making the product a mainstay in the cold and flu remedy marketplace. The Complainant's sales of THERAFLU products were $67.4MM in 1997, $63.6MM in 1998, 79.1 MM in 1999, $81.5MM in 2000 and $76.9MM in 2001.
Complainant has extensively advertised and promoted its THERAFLU products since the product's commercial launch. The Complainant's advertising expenses directly attributable to the THERAFLU products were $12.3MM in 1997, $12.1MM in 1998, $11.4MM in 1999, $13.7MM in 2000 and $10.0MM in 2001.
The combined sales and advertising activity has led to significant notoriety and customer recognition for the THERAFLU brand. According to a C/F/A/S tracking study conducted in January 2000, the total brand awareness of THERAFLU is 88%. THERAFLU is the No. 1 hot liquid and the only brand to successfully launch a hot liquid cold and flu formula. Overall, THERAFLU is the 5th largest brand in the adult cold/cough category.
Complainant intends to capitalize on the massive name recognition and good will in its THERAFLU mark by launching a web site to promote the products and provide helpful health care information under the domain name theraflu.com. This is a URL that consumers would naturally turn to when seeking information on the product.
On information and belief, the Respondent, David Kendall, is a citizen of the United States and a resident of the State of Utah. (Prior to June 4, 2002, the owner was Automatic Web of Orem Utah, believed to be an unincorporated business owned and operated by Mr. Kendall). The new address as provided to the concerned registrar is 1645 W. 1000 N., Provo, Utah, 84604. On information and belief, David Kendall is not and has never been employed or affiliated with Complainant nor any company related to the Complainant. Complainant has not authorized the Respondent to use its THERAFLU trademark as a domain name or in any other fashion.
Queuing the domain name <theraflu.com> into a web browser's address query window does not resolve to any web page, not even a "parked" web page. Complainant conducted a search on the SAEGIS search system "http://www.saegis.com" to determine if the respondent holds other domain names that appear to reflect the trademarks of third parties. While this search system incorporates the WHOIS databases of several major registrars, the concerned registrar, Dotregistrar.com, is not among them. It appears from the search that Automatic Web of Provo, Utah, a company for which David Kendall is the sole contact, and the record owner of the subject domain name until very recently, was also the owner, until very recently, of at least one additional domain name, <mydisneyonline.com> that clearly highlights a famous third party trademark. This address did not resolve to any web site. A further search conducted in preparation for this Amended Complaint did not locate that domain name, indicating that it has been recently delisted.
Several domain names registered to the Respondent are connected to actual businesses. The domain names <showcasepontiac.com>, <powellvolvo.com>, and <chapmandodge.com> all lead to automobile dealerships in Phoenix or Scottsdale, Arizona, United States of America.
On January 31, 2002, Complainant sent an e-mail to the Respondent, via its administrative contact, David Kendall <email@example.com>, advising Mr. Kendall of Complainant's rights to the THERAFLU trademark and requesting that it immediately transfer the domain name to Complainant. Complainant did not receive any response to this letter.
The domain name <theraflu.com> is identical to Complainant's registered, famous and unique THERAFLU trademark. It has long been settled in these proceedings beyond cavil or doubt that a top level domain indicator such as ".com" does not affect the domain name's identicality or confusing similarity.
The Respondent should be considered as having no rights or legitimate interests in respect of the domain name <theraflu.com>. The trademark THERAFLU has been registered in the United States to the Complainant since August 18, 1987 and has been in continuous use in the United Sates and elsewhere in the world since before that time. The Respondent is making no use of the domain name or, to the best of Complainant's information and belief, has made no preparations to use the domain name either in connection with a bona fide offering of goods or services or in connection with a legitimate noncommercial or fair use. There is no basis to even conceive that the Respondent is commonly known by the name "Theraflu". The Complainant's THERAFLU mark is coined and so well known in the United States that it is difficult to conceive of a use of the domain name by a U.S. entity or person not having prior permission from the Complainant that could be considered legitimate.
The term THERAFLU is a coined word without any meaning in any language known to the Complainant. The word has no significance other than that of being the Complainant's famous trademark. The panel will readily find that a search on the Internet for the term "theraflu" will only show results that relate to the Complainant's products. This is clear evidence that there is no conceivable good faith reason for the Respondent to have adopted the domain name <theraflu.com>.
The Respondent obtained the domain name <theraflu.com> with at least constructive knowledge of the Complainantís trademark rights. Actual or constructive knowledge of the Complainant's rights in the Trademark is a factor supporting bad faith.
The Respondent could not have registered the trademark in good faith. Given the registration, uniqueness and fame of Complainant's THERAFLU mark, it is virtually inconceivable that it chose the domain name <theraflu.com> without being aware of the Complainant's pre-existing rights. Additionally, there is virtually no commercial use which could be made of the Domain Name that would not infringe the legal rights of the Complainant and be misleading upon the public.
As noted above the Respondent has registered various other domain names, at least one of which, <mydisneyonline.com> incorporates a famous trademark of a third party. This, at the very least, indicates that Respondent is aware of the value of domain names that incorporate the trademarks of others and "collects" these names from time to time for their possible future value. Additionally, as noted above, the search of domain names does not even include the registrar involved in this action, as that database is not made readily available for searching by owner name.
The mark THERAFLU is registered and is widely known in the United States, where the Respondent resides, and was widely known at the time Respondent registered the domain name at issue. Respondent had registered at least one other domain name corresponding to another well-known trademark. Respondent failed to respond to a letter from Complainant. There is no conceivable legitimate use to which Respondent's <theraflu.com> can be put.
Upon receiving notification of the initiation of this proceeding, and a copy of the complaint, on or about May 31, 2002, the Respondent, David Kendall, as administrative contact, transferred the ownership of the subject domain name from Automatic Web, believed to be a unincorporated business owned and operated by Mr. Kendall, to himself. The domain name ownership transfer occurred on June 4, 2002, after the Respondent received notification of this proceeding, but before the Respondent could be prevented form making such a transfer. This "transfer" did not change how the domain name was being used and it is apparent that the domain name was transferred to the current Respondent in an effort to evade service and frustrate the progress of this proceeding.
Further, the "new" Respondent, like the "original" Respondent, has obtained the registration and used the domain name in bad faith. As noted above, the "new" Respondent obtained registration of the domain name after the "original" Respondent received notification of this proceeding. At that time the "new" Respondent was acting as the administrative contact for the "original" Respondent. Thus, at the time the "new" Respondent took possession of the domain name, he had knowledge of the Complainantís rights.
Respondent did not file a response to the complaint.
6. Discussion and Findings
6.1 The Policy is addressed to resolving disputes concerning allegations of abusive domain name registration. The Panel will confine itself to making determinations necessary to resolve this administrative proceeding.
6.2 It is essential to dispute resolution proceedings that fundamental due process requirements be met. Such requirements include that a respondent has notice of proceedings that may substantially affect its rights. The Policy and the Rules establish procedures intended to assure that the respondent is given adequate notice of proceedings commenced against them, and a reasonable opportunity to respond (see, e.g., paragraph 2(a) of the Rules).
6.3 The Center forwarded notification of the complaint to the Respondent via post/courier and email in accordance with the contact details found in the appropriate WHOIS database. The Center also forwarded notification of default to the Respondent via email.
6.4 Based on the methods employed to provide the Respondent with notice of the complaint and default the Panel is satisfied that the Center took all steps reasonably necessary to notify the Respondent of the filing of the complaint and initiation of these proceedings. The Panel also finds that the failure of the Respondent to furnish a reply is not due to any omission by the Center.
6.5 Paragraph 4(a) of the Policy sets forth three elements that must be established by a Complainant to merit a finding that a Respondent has engaged in abusive domain name registration, and to obtain relief. These elements are that:
(i) Respondentís domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and
(ii) Respondent has no rights or legitimate interests in respect of the domain name; and
(iii) Respondentís domain name has been registered and is being used in bad faith.
In the administrative proceeding, the complainant must prove that each of these three elements is present.
6.6 As the Respondent has failed to submit a response to the complaint, the Panel may accept as true all of the allegations of the complaint. Talk City, Inc. v. Michael Robertson, WIPO Case No. D2000-0009, (February 29, 2000).
6.7 Based upon the registered trademark for THERAFLU and the continuous use of the mark, the Complainant clearly has rights in the mark.
6.8 The Panel agrees with the Complainant and finds that the <theraflu.com> domain name is identical to the registered trademark THERAFLU, and that the Complainant has established that it has rights in the mark THERAFLU, pursuant to paragraph 4(a)(i) of the Policy.
6.9 Paragraph 4(c) of the Policy lists several circumstances, without limitation, that if found by the Panel shall demonstrate the Respondent's rights or legitimate interests to the domain name for purposes of paragraph 4(a)(ii). In particular, paragraph 4(c) states:
(i) before any notice to you [Respondent] of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or
(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or
(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.
6.10 There is no evidence in the record that would indicate that Respondent has any rights or legitimate interests in respect of the domain name <theraflu.com>.
6.11 The Panel finds that the Respondent has no rights or legitimate interests in respect of the domain name <theraflu.com> pursuant to paragraph 4(a)(ii) of the Policy.
6.12 Paragraph 4(b) of the Policy lists several factors, without limitation, that if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith.
6.13 Complainant sets forth six reasons that it argues constitute bad faith registration and use of the domain name: (1) the term THERAFLU is a coined term that has become a famous trademark; (2) that Respondent had at least constructive knowledge of Complainantís trademark rights when the domain name was registered; (3) there could be no good faith basis for registering the domain name; (4) the Respondent has registered other domain names incorporating famous trademarks including <mydisneyonline.com>; (5) Respondentís failure to use the domain name; and (6) transfer of the domain name from the original registrant to its administrative contact after notice of the initial complaint. Based on all of these circumstances, including the fact that the Respondent failed to contest the Complainantís allegations, the Panel finds that the <theraflu.com> domain name was registered and is used in bad faith.
6.14 The Panel finds the Complainant has established that the Respondent has registered and is being used the domain name <theraflu.com> in bad faith, pursuant to paragraph 4(b)(iv) of the Policy.
As the Complainant, Novartis AG, has established that the Respondent, David Kendall, has engaged in abusive registration of the domain name <theraflu.com> within the meaning of paragraph 4(a) of the Policy, the Panel orders that the domain name <theraflu.com> be transferred to the Complainant.
R. Eric Gaum
Dated: September 6, 2002