WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Costco Wholesale Corporation, and Costco Wholesale Membership Inc. v. Ming Tan aka Tan Ming

Case No. D2010-2018

1. The Parties

The Complainants are Costco Wholesale Corporation, and Costco Wholesale Membership Inc. of Issaquah, Washington, United States of America, represented by Law Office of Mark J. Nielsen, United States of America.

The Respondent is Ming Tan aka Tan Ming of Shenzhen, Guangdong, the People’s Republic of China.

2. The Domain Name and Registrar

The disputed domain name <elecostco.com> is registered with HiChina Zhicheng Technology Ltd.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on November 23, 2010. On November 23, 2010, the Center transmitted by email to HiChina Zhicheng Technology Ltd. a request for registrar verification in connection with the disputed domain name. On November 24, 2010, HiChina Zhicheng Technology Ltd. transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details. On November 29, 2010, the Center transmitted an email to the parties in both Chinese and English language regarding the language of proceedings. On December 1, 2010, the Complainants confirmed their request that English be the language of proceeding. The Respondent did not comment on the language of 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 the Respondent of the Complaint, and the proceedings commenced on December 6, 2010. In accordance with the Rules, paragraph 5(a), the due date for Response was December 26, 2010. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on December 28, 2010.

The Center appointed Jonathan Agmon as the sole panelist in this matter on January 13, 2011. 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 Complainants, Costco Wholesale Corporation, and Costco Wholesale Membership Inc. are the owners of Costco, the largest membership warehouse club chain in the United States.

Costco currently operates over 570 warehouse stores worldwide, including in the United States, Puerto Rico, Unincorporated Territory of the United States, Australia, Canada, Japan, Republic of Korea, Mexico, Taiwan, Province of China, and the United Kingdom. In 2010, the Complainants had revenue of USD 75 billion. The Complainants employ 147,000 employees worldwide.

Since the establishment of Costco in 1983, the Complainants have been using the COSTCO mark in connection with their services.

Costco’s warehouse stores and websites offer a wide range of merchandise and services, including various electronic devices.

The Complainants by themselves and through wholly owned affiliated companies are the owners of multiple trademark registrations for the mark COSTCO around the world. For example: Chinese trademark registration No. 1427776 – COSTCO, with the registration date of March 23, 1999; United States trademark registration No. 1318685 –COSTCO, with the registration date of May 2, 1985; United States trademark registration No. 2029565 –COSTCO, with the registration date of January 14, 1997; United States trademark registration No. 2299958 –COSTCO, with the registration date of December 14, 1999; European Community trademark registration No. 00612564 –COSTCO, with the registration date of May 12, 2000, and many others.

The Complainants also developed their presence on the Internet, and are the owners of domain names, which contain the mark COSTCO. For example: <costco.com>, <costco.co.uk>and <costco.co.jp>.

The disputed domain name was registered on August 3, 2010.

Currently, the disputed domain name resolves to website which offers for sale, various electronic devices, including cellular phones, computers, laptops and mp3 players.

Until recently, the website operating under the disputed domain name displayed a logo of the word “ElECostco”, with the words “ElE” and “Costco” appearing in different colors. Currently, the website displays a logo with the word “Takeurphone” with the word “Take” appearing in dark red and the word “urphone” appearing in blue.

5. Parties’ Contentions

A. Complainants

The Complainants argue that the disputed domain name is identical or confusingly similar to the COSTCO trademark, in which the Complainants have rights, seeing that it incorporates the COSTCO trademark as a whole.

The Complainants further argue that the disputed domain name consists of an elision of “elec”, a shortened form of the word “electronics” and Costco’s well‐known registered trademark.

The Complainants further argue that the addition of the abbreviation “elec” to the Complainants’ well-known trademark does not mitigate confusing similarity between the disputed domain name and the Complainants’ COSTCO trademark. In fact, the Complainants argue that the addition of the abbreviation “elec” increases risk of confusion, due to the fact that the Complainants engage in the sale of a wide variety of electronic products, including cell phones.

The Complainants further argue that the Respondent does not make legitimate use in the disputed domain name.

The Complainants further argue they had not licensed or otherwise permitted the Respondent to use their COSTCO trademark and they are not affiliated or otherwise connected to the Respondent.

The Complainants further argue that the Respondent is not generally known by the disputed domain name, or has acquired trademark rights in the term “Costco”.

The Complainants further argue that the disputed domain name is likely to mislead or confuse the public as to its source or origin.

The Complainants further argue that the Respondent registered the disputed domain name in an attempt to attract, for commercial gain, Internet users to his website by creating a likelihood of confusion with the Complainants’ marks.

The Complainants further argue that the Respondent was aware of the Complainants’ existence and of the COSTCO trademark at the time he registered the disputed domain name.

For all of the above reasons, the Complainants request the transfer of the disputed domain name.

B. Respondent

The Respondent did not reply to the Complainants’ contentions.

6. Discussion and Findings

A. Procedural Issue – Language of the Proceedings

Paragraph 11(a) of the Rules provides that:

“Unless otherwise agreed by the Parties, or specified otherwise in the Registration Agreement, the language of the administrative proceeding shall be the language of the Registration Agreement, subject to the authority of the Panel to determine otherwise, having regard to the circumstances of the administrative proceeding.”

The language of the Registration Agreement for the disputed domain name is Chinese.

The Complainants requested that the language of proceedings should be English.

The Panel cites the following with approval:

“Thus, the general rule is that the parties may agree on the language of the administrative proceeding. In the absence of this agreement, the language of the Registration Agreement shall dictate the language of the proceeding. However, the Panel has the discretion to decide otherwise having regard to the circumstances of the case. The Panel’s discretion must be exercised judicially in the spirit of fairness and justice to both parties taking into consideration matters such as command of the language, time and costs. It is important that the language finally decided by the Panel for the proceeding is not prejudicial to either one of the parties in his or her abilities to articulate the arguments for the case.” (Groupe Auchan v. xmxzl, WIPO Case No. DCC2006-0004).

The Panel finds that in the present case, the following should be taken into consideration upon deciding on the language of proceedings:

a) The disputed domain name <elecostco.com > consists of an elision of ”elec”, a shortened form of the English word “electronics”, and the Complaint’s COSTCO trademark;

b) The website, to which the disputed domain name resolves, is operating and offers the sale of goods while using the English language;

c) The Respondent did not object to the Complainants’ request that English be the language of proceedings.

Upon considering the above, the Panel decides to render the Complainants’ request and rules that English be the language of proceedings.

B. Identical or Confusingly Similar

Paragraph 4(a)(i) of the Policy requires the Complainants to show that the disputed domain name is identical or confusingly similar to a trademark or service mark in which the Complainants have rights.

A registered trademark provides a clear indication that the rights in the mark shown on the trademark certificate belong to its respective owner. The Complainants, by themselves and through wholly owned affiliated companies are the owners of multiple trademark registrations for the mark COSTCO around the world. For example: Chinese trademark registration No. 1427776 – COSTCO, with the registration date of March 23, 1999; United States trademark registration No. 1318685 – COSTCO, with the registration date of May 2, 1985; United States trademark registration No. 2029565 – COSTCO, with the registration date of January 14, 1997; United States trademark registration No. 2299958 – COSTCO, with the registration date of December 14, 1999; European Community trademark registration No. 00612564 – COSTCO, with the registration date of May 12, 2000, and many others.

The disputed domain name <elecostco.com> differs from the registered COSTCO trademark by the additional prefix “ele” and the additional gTLD “.com”.

The disputed domain name integrates the Complainants’ COSTCO trademark in its entirety, as a dominant element.

The additional prefix “ele” does not serve sufficiently to distinguish or differentiate the disputed domain name from the Complainants’ COSTCO trademark, as it is a suggestive element that may refer to the selling and marketing of electronic devices that are regularly sold by the Complainants, and as such is insignificant.

Previous WIPO UDRP panels have ruled that the mere addition of a non-significant element does not sufficiently differentiate the domain name from the registered trademark: “The incorporation of a trademark in its entirety is sufficient to establish that a domain name is identical or confusingly similar to the Complainant’s registered mark” (Britannia Building Society v. Britannia Fraud Prevention, WIPO Case No. D2001-0505). Also, “the trademark RED BULL is clearly the most prominent element in this combination, and that may cause the public to think that the domain name <redbull-jp.net> is somehow connected with the owner of RED BULL trademark” (Red Bull GmbH v. PREGIO Co., Ltd., WIPO Case No. D2006-0909).

Indeed, “[t]he mere addition of a descriptive term to an identical trademark has been repeatedly held by previous panels as not sufficient to avoid confusion between the domain name and the trademark” (Red Bull GmbH v. Chai Larbthanasub, WIPO Case No. D2003-0709).

Furthermore, previous WIPO UDRP panels have decided in a similar case, Costco Wholesale Membership, Inc., Costco Wholesale Corporation v. Yong Li, WIPO Case No. D2004-0296, that “the addition of a generic term in the domain name <costcotires.com> is descriptive and does not mitigate the phonetical and visual confusing similarity”.

It has also been decided that the addition of the gTLD “.com” to a disputed domain name does not avoid confusing similarity. See F. Hoffmann-La Roche AG v. Macalve e-dominios S.A., WIPO Case No. D2006-0451, and Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003. Thus, the gTLD “.com” is without legal significance since the use of a gTLD is technically required to operate the domain name.

Consequently, the Panel finds that the Complainants have shown that the disputed domain name is identical or confusingly similar to trademarks in which the Complainants have rights.

C. Rights or Legitimate Interests

Once the Complainants establish a prima facie case that the Respondent lacks rights or legitimate interests in the disputed domain name, the burden shifts to the Respondent to show that it has rights or legitimate interests in respect to the disputed domain name (Policy, paragraph 4(a)(ii)).

In the present case, the Complainants alleged that the Respondent has no rights or legitimate interests in respect of the disputed domain name.

The Panel finds that the Complainants established such a prima facie case inter alia due to the fact that the Complainants had not licensed or otherwise permitted the Respondent to use their COSTCO trademark or a variation of it. The Respondent did not provide any evidence to show any rights or legitimate interests in the disputed domain name. Thus, the Respondent did not rebut the Complainants’ prima facie case.

Accordingly, the Panel finds that the Respondent has no rights or legitimate interests in respect of the disputed domain name.

D. Registered and Used in Bad Faith

The Complainants must show that the Respondent registered and is using the disputed domain name in bad faith (Policy, paragraph 4(a)(iii)). Paragraph 4(b) of the Policy provides circumstances that may prove bad faith under paragraph 4(a)(iii).

The Complainants submitted evidence, which shows that the Respondent registered the disputed domain name well after the Complainants registered their trademark. According to the evidence filed by the Complainants and a trademark search performed by the Panel, the Complainants, by themselves and through wholly owned affiliated companies, own a registration for the COSTCO trademark since the year 1985. It is suggestive of the Respondent’s bad faith in these particular circumstances that the trademark, owned by the Complainants, was registered long before the registration of the disputed domain name (Sanofi-Aventis v. Abigail Wallace, WIPO Case No. D2009-0735).

Paragraph 4(b)(iv) of the Policy provides that it will be considered bad faith registration and use by the respondent, if by using the domain name it had intentionally attempted to attract, for commercial gain, Internet users to the websites or other on-line locations to which the disputed domain name is resolved to, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the websites or locations or of a product or service on the websites or locations to which the domain name resolved to.

The Complainant’s submitted evidence showing that the Respondent’s used the Complainants’ mark to promote similar or identical goods to the goods being offered by the Complainants. Such use is clear evidence that the Respondent registered and is using the disputed domain name with knowledge of the Complainants and of the use the Complainants are making in their well-known COSTCO trademark, and indicates that the Respondent’s primary intent with respect to the disputed domain name is to trade off the value of these. The Respondent’s actions therefore constitute bad faith. See Herbalife International, Inc. v. Surinder S. Farmaha, WIPO Case No. D2005-0765, stating that “the registration of a domain name with the knowledge of the complainant’s trademark registration amounts to bad faith”.

Furthermore, the disputed domain name is confusingly similar to the Complainants’ trademark. Previous WIPO UDRP panels ruled that “a likelihood of confusion is presumed, and such confusion will inevitably result in the diversion of Internet traffic from the Complainant’s site to the Respondent’s site” (See Edmunds.com, Inc v. Triple E Holdings Limited, WIPO Case No. D2006-1095). To this end, prior WIPO UDRP panels have established that attracting Internet traffic by using a domain name that is identical or confusingly similar to a registered trademark may be evidence of bad faith under paragraph 4(b)(iv) of the UDRP.

Based on the evidence presented to the Panel, including the late registration of the disputed domain name, the similarity between the disputed domain name and the Complainants’ well-known trademark and the Respondent’s use of the disputed domain name to sell goods that are regularly sold by the Complainants, the Panel draws the inference that the disputed domain name was registered and used in bad faith.

Accordingly, having regard to the circumstances of this particular case, the Panel finds that the Complainants have met their burden under paragraph 4(a)(iii) 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 <elecostco.com> be transferred to the Complainant, Costco Wholesale Membership Inc.

Jonathan Agmon
Sole Panelist
Dated: January 26, 2011