WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
A.T. Ferrell Company, Inc. v. David Ibach Jr. / Ferrell-Ross Roll Manufacturing, Inc.
Case No. D2015-0156
1. The Parties
The Complainant is A.T. Ferrell Company, Inc. of Bluffton, Indiana, United States of America (“USA”), represented by Faegre Baker Daniels LLP, USA.
The Respondent is David Ibach Jr. of Hereford, Texas, USA / Ferrell-Ross Roll Manufacturing, Inc. of Amarillo, Texas, USA, represented by Easterwood, Boyd & Simmons, P.C., USA.
2. The Domain Name and Registrar
The disputed domain name <ferrellross.com> is registered with DomainPeople, Inc. (the “Registrar”).
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on January 30, 2015. On January 30, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On January 30, 2015, 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 February 13, 2015. In accordance with the Rules, paragraph 5(a), the due date for Response was March 5, 2015. On March 4, 2015, the Center received the Respondent’s request for an extension of time to file its Response. On March 5, 2015 the Center transmitted by email to the Complainant a request regarding its approval of the extension of time. On March 5, 2015, the Center received the Complainant’s agreement to the Respondent’s requested extension of time. On March 6, 2015 the Center transmitted by email to the Parties the confirmation of the extension of time, indicating the due date for Response was March 16, 2015. The Response was filed with the Center on March 15, 2015.
The Center appointed Richard G. Lyon as the sole panelist in this matter on April 2, 2015. The Panel finds that it was properly constituted and has jurisdiction to decide this administrative proceeding. The Panel has submitted his Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.
On April 8, 2015, the Complainant submitted a Supplemental filing entitled "Complainant’s Reply To Response Filed By David Ibach, Jr. And Ferrell-Ross Roll Manufacturing, Inc." Later that day the Respondent's representative by email to the Center requested the opportunity to reply to this filing should the Panel admit it.
On April 9, 2015, at the Panel's direction the Center advised the parties: "The Panel disallows the Complainant’s Supplemental Filing in accordance with settled Policy precedent. See WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition, paragraph 4.2, Consensus View. The Panel will include further explication in his Decision. The Panel requests that neither party submit any further communication to the WIPO Center without the Panel’s express direction.”
The operative portion of paragraph 4.2 of the WIPO Overview 2.0 provides: "The party submitting its filing would normally need to show its relevance to the case and why it was unable to provide that information in the complaint or response. Most panels that have allowed unsolicited filings have also tended to require some showing of 'exceptional' circumstances." The cases that have led to this Consensus View make clear that "exceptional circumstances" ordinarily refers to matters that the party making the submission could not reasonably have anticipated when it submitted its original pleading – manufactured evidence,1 a post-pleading UDRP or court decision that bears on the proceeding,2 an event occurring subsequently to the original pleading,3 for example.
The Complainant's filing addresses two matters – a more detailed argument on the contention (see section 5.A.2 below) that its grant of certain rights to the Respondents should be strictly circumscribed, and a request that the Panel discount any reliance upon the Respondent's contention that the Complainant's late chairman expressly authorized the Respondents' registration of the disputed domain name (see section 5.B below) on standard hearsay grounds. While acknowledging that admission of a supplemental filing lies within the Panel's sound discretion, the Complainant offers no reason why either matter could not have been anticipated and addressed in the Complaint, or anything else that makes its contents exceptional. The former topic is merely reargument of a contention in the Complaint; the latter amounts to a legal argument on an issue that the Panel must decide for himself: see Rules, paragraph 10(d): "The Panel shall determine the admissibility, relevance, materiality and weight of the evidence." In short, the Complainant's supplemental filing is an ordinary reply brief.
Accordingly the Panel denies leave to admit the Complainant's supplemental filing, noting also that nothing in the supplemental filing would alter this Decision.
4. Factual Background
The following facts are undisputed.
Since 1964 the Complainant has sold heavy equipment such as roller mills, sifters, flaking mills, roll, pin and vibrating feeders, chest type steamers, and flake and pellet coolers, for use in the fields of agriculture, industry, food processing, and waste processing. The Complainant obtained a trademark for FERRELL-ROSS, registered on the principal register of the United States Patent & Trademark Office (USPTO) in 1995. The Complainant's principal website is <ferrell-ross.com>.
The Respondent David Ibach Jr. is a former executive employee of the Complainant. In 2003 Mr. Ibach left the Complainant's employ in connection with his establishing his own business through the acquisition of certain assets and rights of what was then the Complainant's operations in Amarillo, Texas USA. Two agreements of the parties set out certain rights and obligations of the parties following the establishment of the new business, which took the name Ferrell-Ross Roll Manufacturing, Inc. (the other Respondent): a Manufacturer's Representative Agreement (MRA) and a Severance Agreement. The MRA has been periodically renewed or novated by the parties; the most recent MRA is dated 2010. The MRA and Severance Agreement remain in force.
Mr. Ibach registered the disputed domain name in June 2003, after the effective date of the Severance Agreement and before the closing of his acquisition of the Amarillo operations and subsequent commencement of operations as Ferrell-Ross Roll Manufacturing, Inc. The Respondents have used the disputed domain name to market the latter company's products, including both the products of the Complainant that it is authorized to sell under the MRA and third party products, some of which may compete with other products sold by the Complainant.
5. Parties’ Contentions
Both parties refer to the MRA and Severance Agreement in support of their contentions. The following provision (paragraph 4) of the Severance Agreement is at the center of these arguments. This provides in pertinent part: “After Closing [Respondent Ibach] shall operate the Business under a name that includes the trade name 'Ferrell-Ross.’”
A. Complainant
The Panel summarizes the Complainant's contentions as follows:
1. The Complainant has rights in FERRELL-ROSS by reason of its USPTO-registered trademark. The disputed domain name differs from that mark only by deletion of the hyphen between the two names and is thus obviously confusing similar. The mark is distinctive and the Respondent, a former employee, selected the disputed domain name for its similarity.
2. The Respondents lack rights or legitimate interests in the disputed domain name and have not used it for a bona fide offering of goods and services. Although acknowledging the Respondents' right to use the Ferrell-Ross name for its business, the Complainant contends that no document expressly authorizes the Respondents to use the Complainant’s mark in a domain name. One of the Complainant’s officers submits a declaration that to the best of his knowledge “Complainant never authorized Respondent to use the Disputed Domain [Name] to sell and promote the goods and services of others.” The MRA strictly limits the Respondents’ use of the Complainant's trademark and expressly prohibits its use in connection with competing products: “During the term of this Agreement, the Representative shall have the right to use the trademarks of A.T. Ferrell relating to the Products in promoting the sales of the Products in the Territory and for the purpose of describing himself as an authorized sales representative of the Products, but for no other purpose whatsoever.”
Citing WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”), paragraph 2.3, the Complainant argues first that the Respondents fail to meet the requirements for resellers set out in Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903, because (among other things) it sells third party products at the disputed domain name, and second that the minority view “that, without express authority of the relevant trademark holder, a right to resell or distribute that trademark holder’s products does not create a rightto use a domain name that is identical, confusingly similar, or otherwise wholly incorporates the relevant trademark” should apply to this case. Ibid.
3. The Complainant cites cases4 that it claims hold that bad faith is established “where [sic] a domain registration is maintained combined with continuing abusive use,” especially when as here the domain name owner fails accurately and completely to disclose the relationship between domain name owner and manufacturer. The Complainant alleges many instances of the Respondents’ use of the FERRELL-ROSS mark in violation of the MRA provision quoted in the second preceding paragraph in addition to selling other manufacturers’ products.
Summing up the Complainant’s contentions under paragraphs 4(a)(ii) and 4(a)(iii) of the Policy: “the facts make a prima facie showing that Respondent does not enjoy legitimate rights to and has used the Disputed Domain in bad faith where (1) Respondent is not using the site to sell only trademarked goods, (2) Respondent is not accurately disclosing Respondent’s relationship with the Complainant, and (3) Respondent had no permission to register the Disputed Domain and continues to use the Disputed Domain. For these reasons, the Disputed Domain should be transferred to the Complainant.”
The Complainant, anticipating a defense based upon the twelve years that have passed since establishment of the Respondents’ business and commencement of this proceeding, cites WIPO Overview 2.0, paragraph 4.10, for the proposition that laches is not a defense in a Policy proceeding.
B. Respondent
The Respondents contest several factual assertions made by the Complainant and, more fundamentally, the Complainant’s characterization of this case as a simple manufacturer-distributor dispute. Rather, thanks to paragraph 4 of the Severance Agreement quoted above, the “Respondent’s use of Complainant’s trade name is based on a specific written authorization.” In a declaration submitted with the Response, Mr. Ibach cites as additional evidence of authorization the express approval, in connection with his acquisition of the Amarillo operations, of Complainant’s then chairman and principal owner to the Respondents’ use of the Ferrell-Ross name in the new business including specifically his use of the disputed domain name and consequent set-up of employee email addresses making use of it.
The Panel summarizes the Respondents’ contentions as follows:
1. While not contesting the Complainant’s trademark rights, the Respondents assert that by reason of the MRA and Severance Agreement, which grant to the Respondents certain rights to use the mark, all the Respondents’ use of the mark has been in conformance with the rights granted to them, no confusion can be demonstrated. The Complainant points out no instance of actual confusion in the twelve years since registration.
2. The Respondents offer three bases for a finding that they have used the disputed domain name for a bona fide offering of goods and services:
a. Since closing their acquisition of the Complainant’s Amarillo operations in 2003 the Respondents have continuously offered their goods and services for sale at the disputed domain name. This use was consistent with the language and intent of the MRA and Severance Agreement. At all times since 2003 the Complainant has been aware of the Respondents’ business and use of the disputed domain name. The Respondents’ use thus clearly is bona fide under paragraph 4(c)(i) of the Policy.
b. The Complainant acquiesced in the Respondents’ registration and use of the disputed domain name until commencing this proceeding in early 2015, twelve years of active use following registration. This acquiescence was not merely passive. The Respondents are listed on the Complainant’s website as a regional representative of Complainant, and the disputed domain name is listed there as a means of contacting the Respondents.
c. Paragraph 4 of the Severance Agreement and the Complainant’s chairman’s express consent constitute the Complainant’s authorization to use the FERRELL-ROSS mark in the disputed domain name.
3. The Complainant has demonstrated no bad faith in registration or use of the disputed domain name. Registration was undertaken with the Complainant’s express authorization. All use has been in accordance with the parties’ agreements and has resulted, among other things, in considerable benefit to the Complainant, whose products and services the Respondents sell.
6. Discussion and Findings
At first glance it might seem that the Panel must decide whether the absence of an express written prohibition on use of a mark in a domain name allows use or not in a domain name, at least in the circumstances of this case – whether, as the Complainant alleges, express authorization is necessary, or, as the Respondents allege, in the absence of an express prohibition a right to use may be implied from the Complainant’s admitted grant of a right to use its mark in the Respondent’s business name. However much the Panel might be tempted to enter that thicket, the better course is to refrain, for there are two other obvious reasons that direct the disposition of this case.
A. Registration in Bad Faith
Complainant presents no credible evidence that the Respondents registered the disputed domain name in bad faith. Registration took place in 2003 in connection with the Respondents’ acquisition of the Complainant’s Amarillo operations. At that time and for years thereafter the parties – manufacturer and sales representative – exchanged regular, perhaps daily, emails to or from the Respondents’ address that incorporated the disputed domain name. The Complainant included the disputed domain name as the Respondents’ contact address on the Complainant’s website. There is no way the Complainant was unaware of the Respondents’ registration or use of the disputed domain name at a time long before commencement of this dispute, and probably from the outset. After years of permitted – given its use to sell the Complainant’s products, it is fair to say encouraged—use the Panel cannot impute bad faith in registration to the Respondent. Acquiescence in and profiting from a respondent’s use of a domain name may also serve to establish a respondent’s legitimate interest. Authorize.Net LLC v. Cardservice High Sierra, WIPO Case No. D2008-0760; see also National Futures Association v. John L. Person, WIPO Case No. D2005-0690.
Medizin-Orthopadie-Technik GmbH v. Amoena de Mexico, S.A. de C. V., WIPO Case No. D2012-1144, cited by the Complainant, is distinguishable on several grounds. First, the language of the distribution agreement at issue in that case unequivocally terminated the respondent's right to use any of the complainant’s intellectual property upon termination of the distribution agreement. Here nothing is offered to extinguish the Respondents’ unequivocal right (indeed duty) to incorporate Ferrell-Ross in its corporate name. Second, the record in this case does not indicate that the Complainant commenced this proceeding immediately following the Respondents’ conduct that it alleges violates the MRA; acquiescence appears to have continued for some time following an initial complaint.5 Third, in Medizin-Orthopadie the operative agreement had been terminated; here the Severance Agreement and MRA remain in force.
Fourth, and most importantly, in this case the conduct complained of might at best support a finding of use in bad faith were the Panel to adopt the Complainant’s contract interpretation. But nothing in the record suggests anything from which the Panel could reasonably infer bad faith at the time of registration many years earlier. This Panel has long indicated his skepticism at finding bad faith in registration based solely upon claimed post-registration breach of contractual conditions said to attach to the earlier registration. See, e.g., Greyson International, Inc. v. William Loncar, WIPO Case No. D2003-0805, fn.13-15 and accompanying text; Eastman Sporto Group LLC v. Jim and Kenny, WIPO Case No. D2009-1688 (“unless bad faith use subsequently to registration forms a basis for an inference of Respondent’s bad faith at the time of registration, it cannot alone satisfy the complainant’s burden of proof under paragraph 4(a)(iii) of the Policy.”) (emphasis in original). Adopting the Medizin-Orthopadie approach in this case would in effect allow the Complainant to use the Policy as an alternative to a breach of contract action that, if it exists, is a matter for the national courts.
B. Right or Legitimate Interest.
The Respondents have demonstrated that they “(as an individual, business, or other organization) have been commonly known by the domain name, even if [they] have acquired no trademark or service mark rights,” and so have established a right or legitimate interest in the disputed domain name, see Policy, paragraph 4(c)(ii). In this case the Respondent has been known by the name Ferrell-Ross since its creation in 2003, with the full knowledge and consent of the Complainant. Incorporation of “Ferrell-Ross” into the Respondents’ corporate name was not merely permitted, it was required by paragraph 4 of the Severance Agreement (“[Respondent shall operate the Business under a name that includes the trade name ‘Ferrell-Ross'’”)(emphasis added). For twelve years the Respondents have done so, in no small part to the Complainant's benefit as well as their own.6
The defenses in paragraphs 4(c)(i) and 4(c)(ii) exist to prevent forfeiture of a domain name identified with its owner in connection with legitimate business operations, to bar a transfer of a business web address after its owner has made substantial investments in developing the business, as is certainly true of these Respondents and this case.
They also illustrate why there is no need to import into the Policy a more specific defense based solely on the passage of time between registration and commencing a proceeding. Each of paragraphs 4(c)(i) and 4(c)(ii) has a low threshold, lower generally than demonstrating laches in civil litigation. A respondent that cannot clear one of those thresholds lacks grounds for showing reasonable reliance upon a mark owner's inaction such that any claimed laches defense would fail.
The Complainant has failed to demonstrate that the Respondents lack a right or legitimate interest in the disputed domain name, or that the Respondents registered the disputed domain name in bad faith.
7. Decision
For the foregoing reasons, the Complaint is denied.
Richard G. Lyon
Sole Panelist
Date: April 10, 2015
1 E.g., Edward G. Linskey Jr. v. Brian Valentine, WIPO Case No. D2006-0706.
2 E.g., Twitter, Inc. v. Geigo, Inc., WIPO Case No. D2011-1210.
3 E.g., Wall-Street.com, LLC v. Marcus Kocak / Internet Opportunity Entertainment (Sports) Limited, Sportingbet PLC, WIPO Case No. D2012-1193.
4 Medizin-Orthopadie-Technik GmbH v. Amoena de Mexico, S.A. de C. V., WIPO Case No. D2012-1144; Research in Motion Ltd. v. One Star Global LLC, WIPO Case No. D2009-0227.
5 In his declaration Mr. Ibach notes that the Complainant first objected to Respondents’ use of the disputed domain name for third party products in 2010, five years before commencement of this proceeding.
6 Note that the precedent that has developed around the Oki Data decision rarely involve a distributor respondent whose legitimately registered business name (as opposed to the domain name at issue) includes the complainant-manufacturer's mark. See, e.g., cases cited at WIPO Overview 2.0, paragraph 2.3. Two of the cases cited by the Complainant, Research in Motion Limited v. One Star Global LLC, WIPO Case No. D2009-0227 and General Electric Company, GE Osmonics Inc. v. Optima di Federico Papi, WIPO Case No. D2007-0645, involved respondents whose business names did not incorporate the complainant's mark or otherwise could meet paragraph 4(c)(ii)’s criteria.