WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Storm Guard Franchise Systems, LLC v. Domain Hostmaster, Whois Privacy Services Pty Ltd., Customer ID: 50451538860866 / Kwangpyo Kim, Mediablue Inc

Case No. D2015-0241

1. The Parties

Complainant is Storm Guard Franchise Systems, LLC of Fort Worth, Texas, United States of America (“United States”), represented internally.

Respondent is Domain Hostmaster, Whois Privacy Services Pty Ltd., Customer ID: 50451538860866 of Fortitude Valley, Queensland, Australia / Kwangpyo Kim, Mediablue Inc of Gwang-ju, Republic of Korea, represented by ESQwire.com PC, United States.

2. The Domain Name and Registrar

The disputed domain name <stormguard.com> (the “Domain Name”) is registered with Fabulous.com (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 16, 2015. On February 16, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On February 17, 2015, the Registrar transmitted by email to the Center its verification response disclosing registrant and contact information for the disputed domain name which differed from the named Respondent and contact information in the Complaint. The Center sent an email communication to Complainant on February 18, 2015, providing the registrant and contact information disclosed by the Registrar, and inviting Complainant to submit an amendment to the Complaint. Complainant filed an amended Complaint on February 20, 2015.

The Center verified that the Complaint together with the amended 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 Respondent of the Complaint, and the proceedings commenced February 23, 2015. In accordance with the Rules, paragraph 5(a), the due date for Response March 15, 2015. The Response was filed with the Center March 15, 2015. Complainant filed a supplemental filing on March 20, 2015.

The Center appointed Willem J. H. Leppink, The Hon Neil Brown Q.C. and Nicholas Weston as panelists in this matter on April 7, 2015. 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.

4. Factual Background

The following facts are undisputed.

Complainant, Storm Guard Franchise Systems LLC, is a franchisor of roofing and exterior restoration franchises. Complainant has approximately 23 franchisees throughout the Eastern half of the United States of America. Complainant and all of its franchisees use the “Storm Guard” marks in association with their business. Complainant operates its main website at “www.stormguardrestoration.com” and “www.stormguard.co”.

Complainant owns a United States trademark for the word “STORM GUARD” and for a black, white, yellow and red figurative word “Storm Guard” in the United States. (Hereinafter together referred to as the “Trademark”). The Trademark is registered for services in class 37.

The Domain Name was registered by Respondent on February 6, 2014.

5. Parties’ Contentions

A. Complainant

Insofar as relevant, Complainant contends the following.

The Domain Name is identical to the Trademark. The sole difference is that the Domain Name does not have a space between the words “Storm” and “Guard”.

Respondent has no legitimate rights in respect of the Domain Name and is only seeking to sell the Domain Name for a profit far in excess of what it originally paid for the Domain Name.

Because a transfer of a domain name amounts to a new registration, the date that Respondent registered the Domain Name is February 6, 2014, the date on which Respondent acquired the Domain Name. The content shown on the website to which the Domain Name resolves, has changed too and the landing page states now that the Domain Name is for sale.

Respondent has made no legitimate commercial use of the Domain Name, but instead only seeks to sell the Domain Name. Respondent does not offer any goods or services for sale and does not provide any information or other content at the Domain Name. Respondent is not known by the name “stormguard.com” or “Storm Guard”.

Although, Complainant has informed Respondent of the Trademark and even though Respondent has not made any legitimate use of the Domain Name, Respondent demands payment of USD 85,000 to transfer the Domain Name to Complainant. Respondent’s actions are clear evidence of bad faith and therefore the Domain Name should be transferred to Complainant.

Complainant made an offer to purchase the Domain Name for USD 500 and USD 5,000 but Respondent replied that the lowest Respondent would expect is USD 85,000.

Under the Policy, an offer to sell the Domain Name for valuable consideration in excess of the documented out-of-pocket costs directly related to the Domain Name is not only evidence of, but conclusively establishes that, the Domain Name has been registered and is being used in bad faith. Therefore, bad faith is clear and has been conclusively established.

The fact that third parties may have a legitimate interest in the Domain Name, which Complainant argued does not excuse Respondent’s bad faith use of the Domain Name or prevent the panel from transferring the Domain Name to Complainant.

Respondent has no legal rights to the Domain Name. Respondent acquired the Domain Name on or about February 6, 2014, well after Complainant filed an application for the Trademark.

Respondent is attempting to profit on the sale of the Domain Name that is identical to the Trademark, which Domain Name was registered long after Complainant began using and registered the Trademark.

B. Respondent

Respondent has submitted a lengthy Response. Insofar as relevant for this matter, Respondent contends the following.

Respondent takes no issue with respect to Complainant’s alleged Trademark. Complainant is using the Trademark in connection with the common and descriptive meaning of the words, and the Domain Name was used in connection with provision of storm protection related products since 1999. Through the years, it was sold to Respondent in 2013. Such facts are relevant to the discussion of Respondent’s right’s and legitimate interest in the Domain Name, and its lack of bad faith registration and use of the Domain Name.

Respondent contends that it has rights and a legitimate interest in the Domain Name, since the Domain Name has been used in connection with its common descriptive meaning before Respondent registered the Domain Name. It is generally noted that a respondent may have a right to register and use a domain name to attract Internet traffic based on the appeal of a commonly used descriptive term, even when the domain name is confusingly similar or identical to a complainant’s registered mark.

If there is any doubt that Respondent registered the Domain Name solely based on its descriptive nature, and not because of Complainant’s Trademark, the Panel should consider Respondent’s many other non-trademark domain names most notably two other “guard” related “.com” domain names: <doorguard.com> and <soilguard.com> as well as common word domain names. Such pattern of descriptive domain name registration supports an inference that the descriptive Domain Name was not registered with the intent to target a trademark.

Respondent’s legitimate interest is bolstered by the fact that it uses the Domain Name to display advertising links related to the descriptive terms “storm” and “guard”. These links are not selected by Respondent, but they were auto-generated by an established third-party domain monetization service. Respondent’s use of the Domain Name is clearly a use in connection with the bona fide offering of goods and services.

The fact that Respondent responded to Complainant’s inquiry to purchase the Domain Name is not improper and it does not make its use of the Domain Name illegitimate. To the contrary, a business based on reselling domain names satisfies the legitimate interest prong of the Policy, provided there is no evidence a trademark was targeted by the registrant.

Accordingly, Respondent has demonstrated that it has rights and a legitimate interest in the Domain Name and therefore, the Complaint must be dismissed.

There is no evidence of bad faith registration or use. Respondent registered the Domain Name simply because it incorporated a descriptive term that became available when its prior owner decided to sell the Domain Name.

Absent specific proof of intent to profit from Complainant’s mark, bad faith registration cannot be established. Where the prior owner is using a domain name in connection with its common meaning and offers for sale, it is a signal to Respondent that there is no competing third-party trademark claim. Moreover, there is no evidence that Respondent had knowledge of Complaint’s Trademark when it purchased the Domain Name.

Accordingly, the Panel should conclude that Respondent did not have knowledge of Complainant’s Trademark and that Respondent, therefore, did not target Complainant with the registration of the Domain Name. Bad faith cannot be established. Also the fact that Respondent responded to Complainant’s unsolicited offer to purchase the Domain Name is not evidence of bad faith.

6. Discussion and Findings

Pursuant to paragraph 4(a) of the Policy, Complainant must prove each of the following three elements:

(i) the Domain Name is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and

(ii) Respondent has no rights or legitimate interests in respect of the Domain Name; and

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

A. Identical or Confusingly Similar

Complainant must demonstrate that it has rights in a trademark and, if so, the Domain Name must be shown to be identical or confusingly similar to the trademark.

Complainant has proven ownership of the Trademark identified above. The Panel finds that the Domain Name is identical to the Trademark. The Domain Name incorporates the Trademark in its entirely.

The Panel is therefore satisfied that the first element of the Policy is met.

B. Rights or Legitimate Interests

Complainant states that Respondent has no legitimate rights in respect of the Domain Name and is only seeking to sell the Domain Name for a profit far in excess of what Respondent originally paid for the Domain Name. Furthermore, Complainant states that Respondent does not offer any goods or services for sale and does not provide any information or other content at the Domain Name. Respondent is not known by the name “stormguard.com” or “Storm Guard”.

Respondent does not agree with Complainant and relies on the nature of his business and the descriptive or generic nature of the terms in the Domain name. As already noted, he says he is a reseller of domain names which consist of generic terms and that is perfectly legitimate under the Policy.

It is clear that Respondent has no rights in respect of the Domain Name. The question is whether Respondent has a legitimate interest.

It is certainly true that it is permissible under the Policy to register generic terms and exploit them for their value as generic terms. However, it is not permissible to register a “generic” term as a domain name and exploit it for the value it has as a trademark where it is someone’s trademark. The registration and use must flow from the generic nature of the term, not the term’s significance as a trademark. Fifth Street Capital LLC v. Fluder (aka Pierre Olivier Fluder), WIPO Case No. D2014-1747.

UDRP panels have generally recognized that use of a domain name to post parking and landing pages or “pay-per-click (‘PPC’) links” may be permissible in some circumstances. However, this would not of itself confer rights or legitimate interests arising from a bona fide offering of goods or series, especially where resulting in a connection to goods or services competitive with those of the rights holder.

The Panel has established that a number of the advertising links on the website behind the Domain Name are inconsistent with a genuine use of the descriptive meaning of the words “storm” and “guard”, such as the links to “4CHAN”, “MEME” and “Albuquerque”. The Panel finds that in this particular situation Respondent has done too little to show a legitimate interest when creating this landing page.

Therefore the Panel is satisfied that the second element of the Policy is met.

C. Registered and Used in Bad Faith

Under the third requirement of the Policy, Complainant must establish that the Domain Name has been both registered and used in bad faith by Respondent.

Although Respondent could have known about the Trademark and could have been aware of Complainant and its business when Respondent registered the Domain Name, Complainant has not provided convincing evidence supporting that fact.

Therefore, the Panel finds that there is no actual evidence that Respondent actually knew Complainant when Respondent registered the Domain Name. The Panel also takes into consideration that the two elements of which the Trademark consist, i.e., “storm” and “guard” are not such an unusual combination. The Panel could therefore not easily conclude that Respondent, who is located in the Republic of Korea, could have known about the brand under which Complainant sells its products when registering the Domain Name.

Furthermore, Respondent cannot be blamed that Complainant opened the dealings on acquiring the Domain Name. Above that, it was Complainant who tried to purchase the Domain Name several times for different amounts. The fact that Respondent replied and informed Complainant that the Domain Name was for sale for a higher amount does certainly not prove registering a Domain Name with the intention of selling it to Complainant.

In these circumstances, the Panel majority finds that Complainant has not established the third requirement under the Policy.

7. Decision

For the foregoing reasons, the Complaint is denied.

Willem J. H. Leppink
Presiding Panelist

The Hon Neil Brown Q.C.
Panelist

Nicholas Weston
Panelist (Dissenting)
Date: April 21, 2015


Dissenting Opinion

I agree with the majority Panelists on all but one point: I respectfully disagree with the Panel majority’s ground on Registration and Use in Bad Faith.

At the time of registration, the onus was on Respondent to make the appropriate enquiries to ensure that the registration of the Domain Name does not infringe or violate the third party rights. The Response makes no mention of the appropriate enquiries having been made. Paragraph 2 of the Policy clearly states: “It is your [the domain name holder’s] responsibility to determine whether your domain name registration infringes or violates someone else’s rights”. Respondent’s apparent lack of any good faith attempt to ascertain whether or not the Domain Name was infringing someone else’s trademark, bearing in mind there are numerous registrations of this mark in various jurisdictions, for example by conducting trademarks searches or search engine searches, supports a finding of bad faith (see Mobile Communication Service Inc. v. WebReg, RN, WIPO Case No. D2005-1304; L’Oreal v. Domain Park Limited, WIPO Case No. D2008-0072; Bouygues v. Chengzhang, Lu Ciagao, WIPO Case No. D2007-1325; Media General Communications, Inc. v. Rarenames, WebReg, WIPO Case No. D2006-0964; mVisible Technologies, Inc. v. Navigation Catalyst Systems, Inc., WIPO Case No. D2007-1141; Grundfos A/S v. Texas International Property Associates, WIPO Case No. D2007-1448). Further, in this Panelist’s view, it is in breach of the “Fabulous.com Domain Registration Agreement” for breach of the warranty (at paragraph 10.1): “You warrant that the registration or renewal of the Registered Name is made in good faith and that, to the best of your knowledge and belief, neither the registration nor renewal of the Registered Name nor the manner in which it is or shall be used, either directly or indirectly, infringes the intellectual property rights or other legal rights of any third party. A breach of this warranty shall constitute a material breach of this Registration Agreement.”

The absence of evidence from Respondent that it conducted search engine searches or any follow up trade marks registration searches, even in the country applicable to the registration agreement, before choosing a domain name to park PPC links on and divert traffic to its parking page means that there was no basis to signing up to that statement. It also means, in this Panelist’s view, that Complainant has met its evidentiary burden that there is bad faith pursuant to paragraph 4(a)(iii) of the Policy.

The dissenting panelist finds that the Domain Name should be transferred to Complainant.

Nicholas Weston
Panelist (Dissenting)
Date: April 21, 2015