WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Lancaster Steel Service, Inc. v. FTRA/Appraisal.com/Mark Yellen
Case No. D2006-0158
1. The Parties
The Complainant is Lancaster Steel Service, Inc., Lancaster, New York, United States of America, represented by Bloom, Cole & Shonn, LLP, United States of America.
The Respondents are FTRA/Appraisal.com and Mark Yellen, Williamsville, New York, United States of America.
2. The Domain Names and Registrar
The disputed domain names <lancastersteel.com> and <lancastersteel.net> (the “Domain Names”) are registered with Network Solutions, LLC (“Registrar”).
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 6, 2006. On February 7, 2006, the Center transmitted by email to Network Solutions, LLC a request for registrar verification in connection with the domain names at issue. On February 8, 2006, Network Solutions, LLC transmitted by email to the Center its verification response confirming that “FTRA” is listed as the registrant and providing the contact details for the administrative, billing, and technical contacts. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), 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 Respondents of the Complaint, and the proceedings commenced March 2, 2006. In accordance with the Rules, paragraph 5(a), the due date for Response March 22, 2006. The Respondent Mark Yellen filed a Response with the Center on March 22, 2006.
The Center appointed W. Scott Blackmer, Frederick M. Abbott and Richard D. Rosenbloom as panelists in this matter on April 18, 2006. 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.
By Procedural Order No.1, dated May 2, 2006, the Panel asked for further information from the parties. The Complainant and the Respondent Mark Yellen both submitted Supplemental Filings on May 7, 2006, in response to Procedural Order No.1.
4. Factual Background
The Complainant is a New York corporation headquartered in Lancaster, New York. It has been engaged in the business of fabricating steel products to customer specifications since 1963. The Complainant gives its name in this proceeding as Lancaster Steel Service, Inc., but the Corporation and Business Entity Database of the New York State Division of Corporations shows that the company is actually incorporated as “Lancaster Steel Service Company, Inc.” The latter form of the name is the one that appears in the corporation’s own press releases and on its New York service mark registration described below.
The Complainant asserts that it has “long-standing common law rights” in the marks LANCASTER STEEL and LANCASTER STEEL SERVICE. Neither is a federally registered mark. The Complainant holds a service mark registered by the State of New York on December 15, 2005, for a graphic composite of the stylized letters “L” and “S” and the words “Lancaster Steel Service.” The date of first use of this mark is given as November 1, 1995.
Sheldon Yellen is president of the Complainant corporation, as he was at the time the Domain Names were registered in September 1999. His brother, the Respondent Mark Yellen, was employed by the Complainant in 1995 and 1996, but not at the time the Domain Names were registered.
The Respondent Mark Yellen is a shareholder in the Complainant corporation and is involved in several business ventures unrelated to the Complainant. Notably, since October 1999 he has served as president and chief executive officer of the Respondent Appraisal.com, Inc. (“Appraisal.com”), a Delaware corporation that provides Internet-based real estate appraisal services. According to the Declaration of Mark Yellen, Appraisal.com is the successor to Respondent FTRA. The New York State Division of Corporations Business Entity Database indicates that FTRA LLC was registered as a New York limited liability company in 1998, and is currently inactive. Mark Yellen states that Appraisal.com used “FTRA” as a mark until approximately February 2003.
The parties agree that the Respondent Mark Yellen registered the Domain Names in September 1999. They disagree as to whether he registered the Domain Names on his own behalf or on behalf of the Complainant, and the parties have not submitted any documentary evidence on that point dating from 1999.
According to the Respondent Mark Yellen, he registered both Domain Names originally in his own name and on his own behalf. He has registered many domains in his name with the Registrar, and he has also registered numerous domains with the Registrar on behalf of FTRA LLC and its successor Appraisal.com. He avers that in approximately August 2004, he asked the Registrar to combine all of these domain names in a single “administrative view” for ease of management, and at that time the registrant for the Domain Names was changed to “FTRA.” Mark Yellen asserts that he has attempted unsuccessfully since that time to correct the name of the registrant for the Domain Names, which are now locked because of the current dispute over their ownership. In his capacity as president of Appraisal.com, Mark Yellen states in his Declaration that neither Appraisal.com nor its predecessor FTRA LLC claim any ownership of the Domain Names, and that the Registrar’s record of “FTRA” as the registrant is in error. Mark Yellen is currently shown as the administrative, technical, and billing contact for both Domain Names.
It is undisputed that the Complainant has consistently used the Domain Name <lancastersteel.com> as the URL for its corporate website. The Panel notes that a February 2002 press release published on that website refers to the Complainant’s “new Internet presence” at “www.lancastersteel.com.” That domain is also used for the Complainant’s corporate email accounts, which currently number over forty.
The Domain Name <lancastersteel.net> currently resolves to a website and weblog operated by the Respondent Mark Yellen and labeled “Mark H Yellen, Internet Visionary, Organizational Architect, Venture Capitalist.”
In August 2002, the Respondent Mark Yellen received an email notice from the Registrar concerning the renewal of both Domain Names. He forwarded the notice by email to his brother Sheldon Yellen, the Complainant’s president, with his own message, “Shelly: You need to take care of this: Your domain names are expiring.” It is undisputed that the Complainant paid the Registrar to renew the registration of both Domain Names in 2002 and again in July 2005.
In October 2005, the Registrar sent Sheldon Yellen, the Complainant’s president, a standard request for confirmation of the accuracy of registration data on both Domain Names, as he was at that time listed as the administrative contact for both. Employing the user id and password apparently provided earlier by the Respondent Mark Yellen, Sheldon Yellen changed the name of the registrant to “Lancaster Steel Service Company” and changed the contact names in all categories to his own. The Registrar notified the Respondent Mark Yellen, who had been listed as the technical and billing contact, of these changes. Mark Yellen promptly objected to Sheldon Yellen and to the Registrar, asserting his ownership of the Domain Names. The brothers each sent the Registrar letters claiming the right to control the Domain Names. In the face of these conflicting claims, the Registrar changed the name of the registrant back to “FTRA” and placed a lock on the Domain Names so that further changes could not be effected. On December 5, 2005, the Registrar informed the Yellen brothers that it would not modify the registrations until it received either a notarized bilateral agreement or an order from a court or arbitrator.
Shortly thereafter, on December 15, 2005, counsel for the Complainant sent a letter to the Respondent Mark Yellen asserting rights to the mark LANCASTER STEEL SERVICE and threatening to sue Mark Yellen “and/or Appraisal.com” unless they surrendered all claims to the Domain Names. Following discussion of counsel’s possible conflicts of interest, new counsel for the Complainant sent a letter dated January 19, 2006 to “Appraisal.com, Inc., Attn: Mark H. Yellen” claiming that the Complainant “has exclusively used the mark ‘Lancaster Steel’ for over 40 years” and demanding transfer of the Domain Names.
The Respondent Mark Yellen replied on January 30, 2006, in a letter stating that he registered the Domain Names for himself and that Appraisal.com, Inc. “claims no ownership of the domain names <lancastersteel.com> and <lancastersteel.net>, which belong to me personally.” In this letter, the Respondent Mark Yellen asserted that his brother Sheldon Yellen had given him “permission” to register the Domain Names in 1999, commenting that “our customers are too stupid to use email or surf the web.” Mark Yellen challenged the Complainant’s trademark claims and offered to facilitate any changes the Complainant desired with respect to DNS pointing, website hosting, or the choice of email provider. Finally, the Respondent Mark Yellen sent the Complainant two invoices dated January 30, 2006, for “licensing fees” in the amount of $2400 for each Domain Name (plus sales tax) for using the Domain Names for the period “1/1/2006 – 12/31/2007.” (The latter date may have been erroneous, since Mark Yellen refers to the charge elsewhere as an “annual” fee.) The Complainant initiated the current UDRP proceeding less than a week later.
In response to the Panel’s Procedural Order No. 1, the parties offered clarification on several points. Replying to the Panel’s request for information about LANCASTER STEEL as a common law mark, the Complainant furnished an affidavit of its president, Sheldon Yellen, who has been employed by the Complainant since 1991. He asserts that the Complainant has used the names “Lancaster Steel” and “Lancaster Steel Service, Inc.” “interchangeably” throughout the period of his employment. He also asserts that this has been the case since 1963, based on conversations with the former president of the Complainant corporation, his father Jack Yellen. Sheldon Yellen states that the Complainant’s press releases and media stories about the Complainant often refer to the Complainant simply as “Lancaster Steel,” and he provides URLs for statements published online by state agencies and a customer that refer to the Complainant as “Lancaster Steel.”
Mark Yellen, in reply to the Panel’s Procedural Order No. 1, furnished the Declaration discussed above, clarifying his period of employment with the Complainant and responding to the Panel’s questions concerning the original registrant of the Domain Names and the circumstances in which the name of the registrant was changed to that of the inactive company “FTRA.”
5. Parties’ Contentions
The Complainant asserts rights in the LANCASTER STEEL and LANCASTER STEEL SERVICE marks and argues that it never gave the Respondents permission to use those marks other than on behalf of the Complainant. The Complainant states that the Domain Names are confusingly similar to the LANCASTER STEEL SERVICE mark that the Complainant has used continuously for over 60 years and has recently registered in New York.
The Complainant observes that the Respondent Mark Yellen claims an interest in the Domain Names and that the Respondents Appraisal.com and FTRA do not. The Complainant asserts that Mark Yellen, Appraisal.com, and FTRA have not conducted business under the name “Lancaster Steel” nor made non-commercial or fair use of the Domain Names. The Complainant contends that the Domain Names were registered on its behalf and that the Respondents have no rights or legitimate interests in them.
The Complainant concludes that the Respondent Mark Yellen’s recent attempt to charge the Complainant “licensing fees,” after registering the Domain Names on the Complainant’s behalf, is evidence of his bad faith. The Complainant also asserts that the Domain Name <lancastersteel.net> has not been used since registration beyond pointing to an “inactive” Domain Name Server, and the Complainant argues that such “passive use” of this Domain Name is further evidence of bad faith.
No Response was filed expressly on behalf of FTRA or Appraisal.com. In his Declaration submitted in response to the Panel’s Procedural Order No. 1, Mark Yellen states unequivocally, as president of Appraisal.com and its predecessor FTRA LLC, that those companies have no interest in the Domain Names.
The Respondent Mark Yellen, who does claim ownership of the Domain Names, submitted a Response in his own behalf repeating many of the points made in his January 30, 2006 letter to the Complainant’s counsel, in which he claimed to have registered the Domain Names for himself and not for the Complainant or for the Respondent Appraisal.com. He contests the Complainant’s claims to LANCASTER STEEL as a mark, pointing out that it is not registered and arguing that there is no evidence that the Complainant has done business under that name. Attached to the Response are printouts of web pages showing that other companies use the name “Lancaster Steel” or describe products as “Lancaster Steel.” The Respondent Mark Yellen argues that “Lancaster Steel” is too generic to be protected as a word mark and points out that the recent New York registration is for a graphic logo rather than for the words “Lancaster Steel.”
The Respondent Mark Yellen asserts a legitimate interest in the Domain Names with the following rationale: in 1999, he recognized that the term “Lancaster Steel” was too generic to trademark and intended to use the Domain Names for a “commentary web site about Complainant.” Until he has “completed his commentary web site,” he has “allowed Complainant a limited-use license of the names for their own web site and email usage.” He now points the Domain Name <lancastersteel.net> to a website about his own activities and interests, while continuing to allow the Complainant to use <lancastersteel.com> for its corporate website. With regard to his recent demand for what he characterizes as “annual” licensing fees of $2400 for each Domain Name, Mark Yellen claims that this amount is “obviously much lower” than his out-of-pocket costs including “registration and renewal fees, name server maintenance costs (Respondent is hosting the name servers to which the domain names resolve) legal fees and other hosting costs.”
The Respondent Mark Yellen refers to an “ongoing dispute” with the Complainant regarding the ownership and management of the Complainant corporation, of which he is a shareholder. He also asks the Panel to make a finding of reverse domain name hijacking and order the Complainant to pay his legal fees and costs in this proceeding.
6. Discussion and Findings
Under Paragraph 15(a) of the Rules,
“A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”
Paragraph 4(a) of the Policy provides that in order to divest a Respondent of the Domain Names, the Complainant must demonstrate each of the following:
(i) the Domain Names are identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and
(ii) the Respondent has no rights or legitimate interests in the Domain Names; and
(iii) the Domain Names have been registered and are being used in bad faith.
A. Suspension or Termination
The “Ongoing Dispute” section of the Response submitted by the Respondent Mark Yellen, who is not represented by counsel in this proceeding, might be read as a request to suspend or terminate this proceeding. Annex C to the Response is a March 16, 2005, letter from Mark Yellen’s counsel to the Complainant raising several issues concerning Mark Yellen’s shareholder rights and the conduct of the Complainant’s officers in managing the company.
Paragraph 18(a) of the Rules gives the Panel discretion to suspend or terminate a UDRP proceeding where the Domain Name is the subject of other legal proceedings:
(a) In the event of any legal proceedings initiated prior to or during an administrative proceeding in respect of a domain-name dispute that is the subject of the complaint, the Panel shall have the discretion to decide whether to suspend or terminate the administrative proceeding, or to proceed to a decision.
There is no evidence here, however, that a legal proceeding of any kind has been initiated, and the March 16, 2005 letter from Mark Yellen’s counsel makes no reference to the ownership of the Domain Names. The Panel accordingly does not find it necessary or appropriate to suspend or terminate this proceeding.
B. Identical or Confusingly Similar
The Domain Names consist of the words “Lancaster Steel,” plus the top-level domain names (.com and .net) that are immaterial for purposes of a UDRP proceeding. LANCASTER STEEL is not a registered mark, but the Complainant claims that it is a common law mark that may serve as the basis for a complaint under the Policy.
The Affidavit of Sheldon Yellen asserts that the Complainant has long used LANCASTER STEEL as a mark, “interchangeably” with LANCASTER STEEL SERVICE, and that customers and state agencies refer to the Complainant as “Lancaster Steel.” The Affidavit states that “Lancaster Steel” appears in company press releases and media coverage concerning the Complainant but offers no examples. To the contrary, the Panel notes that the corporate website to which the Domain Name <lancastersteel.com> resolves refers to the Complainant only as “Lancaster Steel Service Company, Inc.” or “Lancaster Steel Service.” The press releases found on the website (dated from 2002 to 2004) all use those two forms of the name, never “Lancaster Steel.” The Affidavit includes URLs to third-party websites demonstrating that the New York State Department of Transportation, the office of the Governor of the State of New York, and a customer, Ascension Industries, have all referred to the Complainant as “Lancaster Steel.” In the Panel’s view, these casual uses of a shortened form of the Complainant’s corporate name are insufficient to establish that LANCASTER STEEL is a common law mark associated with the Complainant’s goods or services.
The Complainant has been in business for over forty years but offers no evidence that it ever applied to register LANCASTER STEEL as a mark or advertised and sold goods or services under that name. It is doubtful that LANCASTER STEEL could be registered as a mark, since it consists of a geographic name (there are several “Lancasters” in North America and England) and the common English word for a metal. As the Panel observed in Pet Warehouse v. Pets.Com, Inc., WIPO Case No. D2000-0105, citing the United States federal Seventh Circuit Court of Appeals in Mil-Mar Shoe v. Shonac, 75 F. 3d 1153, 1161 and n.15 (7th Cir. 1996):
“it is possible for two generic terms taken together to achieve trademark or service mark status by achieving a sufficient level of secondary meaning in the relevant community. However, the burden on the party making a claim to distinctiveness or secondary meaning in such a case is high because of the disinclination of the courts to take words of ordinary meaning out of common usage.”
Additionally, the Respondent Mark Yellen furnishes several examples of the term “Lancaster Steel” used as an apparently generic description of a geographic source or type of steel not necessarily associated with the Complainant (“Lancaster Steel Home Model,” “Lancaster steel silo pipe,” a Florida company named “Lancaster Steel Co., Inc.” – and a “Lancaster Steel Knife Set” sold by a Dominican Republic import company of which the Respondent Mark Yellen is a director). These examples suggest that “Lancaster Steel” is descriptive rather than distinctive.
UDRP Panels faced with claims based on common law marks have required evidence that the name has become a distinctive identifier associated with the complainant or its goods and services. Evidence of a protectible “secondary meaning” might include the length and amount of sales under the mark, the nature and extent of advertising, consumer surveys, and media recognition. See, e.g., Amsec Enterprises, L.C. v. Sharon McCall, WIPO Case No. D2001-0083 (insufficient evidence that “American Background” had acquired a secondary meaning). The Complainant has not supported its claim to a LANCASTER STEEL mark with such evidence in this proceeding.
The Complainant also claims LANCASTER STEEL SERVICE as a common law and registered mark to which the Domain Names are confusingly similar. This name is more distinctive than “Lancaster Steel” alone, and it appears in the company’s press releases. The Respondent Mark Yellen does not directly dispute the Complainant’s assertion that it has used this name since 1963, and the words “Lancaster Steel Service” are featured in the logo registered by New York as a service mark, with first use indicated in 1995. It is not material for this element of the Complaint that the mark was registered only recently, after the dispute over the Domain Names arose, since the Policy, paragraph 4(a)(i), does not address the timing of a complainant’s acquisition of rights to a trademark or service mark. See, e.g., Iogen Corporation v. IOGEN, WIPO Case No. D2003-0544. (The timing of a Complainant’s acquisition of rights to a mark may be relevant to the third element, bad faith, as discussed further below in connection with that element.)
The New York service mark is not federally registered (typically with much more review than a state registration entails), and is therefore entitled to less deference as proof of the Complainant’s rights to a mark; it is also a composite of words and graphics, while the Domain Names, of course, display only the words. But here, as in Randan Corp. v. Rapazzini Winery, WIPO Case No. D2003-0353, n.1 (a decision cited by the Respondent), the evidence of the state-registered mark is supported by uncontested allegations – and some documentary evidence – of long-term continuous use of the name in association with the Complainant’s services. In the view of a majority of the Panel, LANCASTER STEEL SERVICE narrowly qualifies as “a trademark or service mark in which the Complainant has rights” for purposes of supporting a complaint under the Policy.
The Domain Names are similar to the LANCASTER STEEL SERVICE mark in that they merely omit the word “service.” Confusing similarity is more difficult to establish for such a relatively weak mark, especially since there is evidence of other parties using the term “Lancaster Steel.” Given the Complainant’s long-term use of the mark, however, the Panel finds that there is a substantial possibility of confusion with the Domain Names. Indeed, it may reasonably be inferred that the Respondent Mark Yellen himself acted on the assumption that the Domain Names would be associated with the Complainant; by his own account, he registered the Domain Names “in order to utilize them at some point in the future for a commentary web site about Complainant.”
The Panel majority finds, therefore, that the Complainant satisfies the first Policy element with respect to the mark LANCASTER STEEL SERVICE.
C. Rights or Legitimate Interests
The Policy’s non-exhaustive list of possible grounds for establishing rights or legitimate interests in a Domain Name includes the following (Policy, paragraph 4(c)):
(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or
(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or
(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.
The Respondents FTRA and Appraisal.com make no claim to any right or legitimate interest in the Domain Names. They have not submitted Responses, and the Respondent Mark Yellen, as president of Appraisal.com (successor to the inactive FTRA LLC), expressly disclaims any interest in their behalf.
The Respondent Mark Yellen himself does not claim to have done business under a name corresponding to the Domain Names. He provided with his Declaration an advertisement for a “Lancaster Steel Knife Set” offered by a Dominican Republic company of which he says he is a director, Hiram Marcus LTD, PVT. However, he does not state that he has used or plans to use the Domain Names in connection with this offering of goods.
Instead, Mark Yellen states plainly that his reason for registering the Domain Names was “in order to utilize them at some point in the future for a commentary web site about Complainant.” This statement is made twice in the Response (once under the heading “The Domain Names Were Registered with a Future Trademark in Mind,” although there is no explanation of the reference to a “future trademark”).
The Panel reads his statement as invoking Paragraph (4)(c)(iii) of the Policy. But Mark Yellen is not “making a legitimate noncommercial or fair use” of either Domain Name, and there is no evidence that he has ever done so, or that he has taken steps to do so, in more than six years since the Domain Names were registered in 1999. The Domain Name <lancastersteel.com> has only been used for the Complainant’s corporate website, with Mark Yellen’s undisputed knowledge and acquiescence. And there is no evidence that the Domain Name <lancastersteel.net> has ever been used for a “commentary web site about Complainant.” Instead, the website to which that Domain Name resolves discusses Mark Yellen’s own predominantly commercial and professional activities and interests, which is not a use encompassed by Paragraph (4)(c)(iii) of the Policy.
The Panel concludes that none of the Respondents demonstrates a right or legitimate interest in either Domain Name.
D. Registered and Used in Bad Faith
As discussed in the preceding section, the Respondents FTRA and Appraisal.com do not claim a right or legitimate interest of any kind in the Domain Names, and they have advanced no good-faith reason to register or use the Domain Names. The Panel concludes that FTRA and its successor Appraisal.com cannot in good faith maintain the registration of the Domain Names.
The Respondent Mark Yellen does assert a legitimate reason for registering and using the Domain Names. He says that his father Jack Yellen, who was then chairman of the Complainant’s board of directors, “requested that Respondent register the names and keep them as his own in order to provide for ‘future opportunities.’“ This statement is ambiguous as to whether the “future opportunities” were those of the Complainant corporation, of which Mark Yellen remained a minority shareholder, or referred to his own separate business interests. Mark Yellen asserts that the opportunity he had in mind was to launch a “commentary web site about Complainant,” but it is unlikely that he shared this intention with his father and brother, who were running the Complainant corporation. As discussed above, the Panel does not give credence to this motivation, since Mark Yellen has not, in over six years, taken steps to launch such a commentary website.
Instead, Mark Yellen stood by while the Complainant used the Domain Name <lancastersteel.com> for its corporate website and email accounts, and while the Complainant (at his urging) arranged and paid for the renewal of the registrations for both Domain Names. There is no evidence of a “licensing” agreement between the parties. Mark Yellen claims he had “permission” from his brother Sheldon, the Complainant’s president, to register the names for himself, while the Complainant claims that the understanding was that Mark Yellen was registering the Domain Names in the company’s behalf. The subsequent course of conduct over the next six years is consistent with the latter interpretation. The Complainant used <lancastersteel.com> and paid for the renewal of both registrations. In connection with renewal in August 2002, Mark Yellen wrote to his brother Sheldon, the Complainant’s president, “Shelly: You need to take care of this: Your domain names are expiring.”
Ultimately, the factual and legal questions of ownership and agency may be better left to a court to resolve. For purposes of this UDRP proceeding, however, it is sufficient to conclude that under either interpretation, the Respondent Mark Yellen’s conduct with respect to the Domain Names reflects bad faith. It is bad faith even if Mark Yellen registered the Domain Names for himself and then lulled the Complainant into reasonably thinking they were “your domain names,” paying for their renewals, and coming to rely on one of them for its corporate website and email accounts and then, years later, presenting a bill for “licensing fees.”
In the Panel’s view, the demand for licensing fees also implicates Policy, Paragraph 4(b)(i), which describes one of several (non-exclusive) instances of bad faith:
(i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name[.]
Mark Yellen claims that his “annual” licensing fees of $2400 for each Domain Name are “obviously much lower” than his out-of-pocket costs, although he does not itemize or document those costs. He mentions “registration and renewal fees,” although it appears that the Complainant paid for the renewals. He also mentions “name server maintenance costs,” although the Complainant reports that it pays another company for the actual web hosting for its corporate website. Finally, Mark Yellen alludes to “legal fees” (although he represents himself in this proceeding), without demonstrating how these are “out-of-pocket costs directly related” to the Domain Names. The Policy refers to “documented” costs, and Mark Yellen has documented none of them. The sum of $2400 annually per name appears to the Panel to exceed the customary registration and maintenance costs contemplated by the Policy, and the Panel concludes that the belated insistence on “licensing” fees is either an attempt to profit from Domain Names in which the Respondents have no rights or legitimate interests, or simply a form of illegitimate leverage in the ongoing dispute over control and management of the Complainant corporation. In either case, Mark Yellen’s conduct reflects bad faith.
In some UDRP proceedings, a complainant’s bad-faith argument is undercut by the fact that it acquired its trademark rights only after the dispute arose, casting doubt on the respondent’s bad faith in registering and using the similar domain name. The Complainant here obtained a state-registered service mark after the parties had each sought to change the registration of the Domain Names to reflect their respective ownership claims. However, the Panel majority finds supporting evidence of rights to the LANCASTER STEEL SERVICE mark antedating the New York registration, and it also finds other evidence of bad faith on the part of the Respondent Mark Yellen, as discussed above. Thus, in this instance, the late registration of the mark is not fatal to the Complainant’s Policy claims.
The Panel majority concludes that the Complainant has established this third element of the UDRP Complaint.
E. Reverse Domain Name Hijacking
The Respondent Mark Yellen asks for a finding of Reverse Domain Name Hijacking. This is defined in the Definitions section of the Rules as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name.”
Paragraph 15(e) of the Rules provides as follows:
“If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.”
The Rules do not provide for monetary relief in such a case, as the Respondent Mark Yellen mistakenly suggests. In any event, the Panel concludes that the Complaint was not brought in bad faith.
For all the foregoing reasons, in accordance with Paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the Domain Names <lancastersteel.com> and <lancastersteel.net> be transferred to the Complainant.
W. Scott Blackmer
Richard D. Rosenbloom
Dated: May 11, 2006
I am in agreement with much of the well-written Panel majority decision. However, because of disagreement on a particular issue I cannot join in favor of Complainant.
The majority finds that Complainant has some common law service mark rights in the stylized term “LANCASTER STEEL SERVICE”. The majority also finds that Complainant has not established trademark rights in the term “LANCASTER STEEL”. I am in accord with the majority on these points.
Following from this, the majority determines that the disputed Domain Names, <lancastersteel.com> and <lancastersteel.net> are confusingly similar to a trademark or service mark in which Complainant has rights. While acknowledging that Complainant does not have trademark rights in “LANCASTER STEEL”, its long history of use of “LANCASTER STEEL SERVICE” and the fact that Respondent intended to reflect the name of Complainant’s business in the disputed Domain Names is found to establish that Internet users would associate the disputed Domain Names with Complainant.
The difficulty from my standpoint is that Respondent has made a prima facie case that Complainant could not establish trademark rights in “LANCASTER STEEL”. The term appears to be used by other businesses in similar lines of commerce, and it is a combination of a geographic designation with a common noun that would require a substantial showing of secondary meaning. It is curious to this panelist that Complainant has been in business for over 40 years and has filed a state service mark registration for a stylized version of “LANCASTER STEEL SERVICE”, but has provided no evidence that it sought (or obtained) state or federal trademark registration for “LANCASTER STEEL”, even at the late stage where it began to anticipate a dispute with Respondent. This is not to say that Respondent is necessarily correct and that, in the context of a more complete presentation of evidence, Complainant could never establish rights in “LANCASTER STEEL”, but rather that Respondent has made a prima facie showing that it could not.
By finding that the disputed Domain Names using the words “lancastersteel” are confusingly similar with “LANCASTER STEEL SERVICE”, the Panel majority, in my view, is according Complainant greater trademark rights than it possesses. It is, in effect, being granted rights in a mark which it does not own, and as to which there is unrebutted evidence it could not own. Such a finding raises a systemic issue with respect to application of the Policy. There are many instances in which generic and commonly descriptive terms, which could not be protected as trademarks, are combined – either with other generic or commonly descriptive terms, or with other terms – in a way which allows them to acquire secondary meaning and to serve as trademarks. The holders of rights in such combined trademark terms should not be permitted to reduce the combinations and use the generic or commonly descriptive portions in which they do not have rights against third parties. To allow this is to effectively permit circumvention of trademark rules against granting rights in certain terms. See Sidamsa-Continente Hipermercados, S.A. v. Rose Communications, S.L., WIPO Case No. D2000-1748. Cf. Barcelona.Com v. Excelentisimo Ayuntamiento De Barcelona, 330 F.3d 617 (4th Cir. 2002). A complainant, in my view, should not be able to “back into” trademark rights under the Policy.
Frederick M. Abbott