WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Paolo Mastrogiuseppe v. Greg Marucchi

Case No. D2015-0375

1. The Parties

The Complainant is Paolo Mastrogiuseppe of Bedfordview, South Africa, represented by Spoor & Fisher Attorneys, South Africa.

The Respondent is Greg Marucchi of Johannesburg, South Africa, represented by Richard Meaden & Associates, South Africa.

2. The Domain Name and Registrar

The Disputed Domain Names <aviatoreveloce.com> and <espressoveloce.com> are registered with Tucows Inc.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on March 4, 2015. On March 4, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Disputed Domain Names. On March 4, 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 March 16, 2015. On the same date the Respondent submitted a communication to the Center by email. In accordance with the Rules, paragraph 5(a), the due date for Response was April 5, 2015. The Response was filed with the Center on April 2, 2015.

The Center appointed Charné Le Roux as the sole panelist in this matter on April 16, 2015. 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 Complainant is a private individual resident in South Africa. He is the inventor of coffee machines created in the form of V8, V10 and V12 car engines and engineered with state of the art techniques and high quality components. These machines are sold under the trade marks ESPRESSO VELOCE and AVIATORE VELOCE. During 2012 the Complainant applied for registration of various designs relating to these coffee machines. In the same year, a business relationship was established between the Complainant and the Respondent in terms of which the Respondent was responsible for the marketing and sale of the ESPRESSO VELOCE and later the AVIATORE VELOCE coffee machines.

The Complainant obtained two registrations in South Africa for the trade mark ESPRESSO VELOCE, for goods in classes 11 and 28, dated December 13, 2012. The Complainant also applied to register the trade mark AVIATORE VELOCE in South Africa on February 14, 2014, also in classes 11 and 28. These two applications are still pending, although already accepted by the Registrar of Trade Marks.

In March 2012 a company was incorporated under the name LODINET (PTY) LTD, in respect of which the Complainant was the sole director. It traded under the name and style of ARTE MECCANICA and was licensed to use the ESPRESSO VELOCE and AVIATORE VELOCE trade marks in connection with coffee machines which it manufactured and sold. On April 11, 2013, the Respondent became the second director of the company and on September 3, 2013 the company formally changed its name to ARTE MECCANICA (PTY) LTD. The Respondent acquired a 49% interest in ARTE MECCANICA (PTY) LTD in July 2013.

Substantial marketing and promotion of the coffee machines bearing the two trade marks referred to have been undertaken not only in South Africa, but throughout Europe, Asia, the United Arab Emirates and the United States of America. The relationship between the Respondent and the Complainant broke down during 2014.

The Disputed Domain Name <espressoveloce.com> was registered on May 20, 2012 and the Disputed Domain Name <aviatoreveloce.com> was registered on March 26, 2013. Both were registered in the name of the Respondent. At the date of the Complaint, the websites associated with the Disputed Domain Names feature respectively the ESPRESSO VELOCE and AVIATORE VELOCE coffee machines.

5. Parties’ Contentions

A. Complainant

The Complainant submits that he has acquired rights in the ESPRESSO VELOCE and AVIATORE VELOCE trade marks as a consequence of:

a) the registration of his ESPRESSO VELOCE trade mark in South Africa in December 2012;

b) his use and promotion of both trade marks since 2010 and 2012 respectively, not only in South Africa, but also around the world.

In support of the Complainant’s common law rights, various articles in South African and foreign online and printed media were provided, with dates from July 2012 onwards. All these articles refer to the Complainant as the inventor and originator of the ESPRESSO VELOCE and AVIATORE VELOCE coffee machines.

The Complainant contends that the Disputed Domain Names are identical to the Complainant’s ESPRESSO VELOCE and AVIATORE VELOCE trade marks.

The Complainant also contends that the Respondent lacks rights or legitimate interests in the Disputed Domain Names, in that:

a) the Respondent has not used or prepared to use the Disputed Domain Names in connection with the bona fide offering of goods and services. In support of this argument, the Complainant submits that the early business relationship between the parties in 2012 was on the basis that the Respondent was employed as a salesman, in terms of which he would market and sell the coffee machines bearing the ESPRESSO VELOCE and AVIATORE VELOCE trade marks on behalf of the Complainant. During the same time, the company ARTE MECCANICA (PTY) LTD (of which the Respondent became a director a year later) was provided a verbal license to manufacture and sell the coffee machines. The Complainant contends that the nature of the Respondent’s involvement with the Complainant’s products precludes the Respondent, in the absence of the Complainant’s consent and cooperation (as is the case here), from offering the products in any way. The Complainant points out that ARTE MECCANICA (PTY) LTD has, since the relationship between the parties broke down in 2014, also had its license to manufacture and sell the coffee machines withdrawn by the Complainant;

b) the Respondent was instructed by the Complainant to register the Disputed Domain Names in the Complainant’s name and that his contrary actions were in direct conflict with these instructions;

c) the Respondent is retaining the Disputed Domain Names with the sole purpose of frustrating the Complainant in enforcing his rights in his trade marks;

d) the Respondent is not commonly known by the Disputed Domain Names; and

e) the Respondent is not making legitimate, noncommercial or fair use of the Disputed Domain Names since they are retained by the Respondent only to frustrate the Complainant and to mislead potential consumers by creating the impression that he is able to provide goods bearing the Complainant’s trade marks, which is not the case. The Complainant points out that the South African design registration numbers which appear on the websites associated with the Disputed Domain Names are for design registrations registered in the name of the Complainant.

The Complainant further contends that the Disputed Domain Names were registered and are being used in bad faith. He states that the Respondent’s use of the Disputed Domain Names is intentional and in order to attract the Complainant’s possible high end clients for commercial gain. He submits that his potential clients will be attracted by the Disputed Domain Names on the assumption that there is a link between the Complainant and the Respondent. The Complainant also argues that the Disputed Domain Names were registered primarily for the purpose of disrupting the business of the Complainant. He states that the websites associated with the Disputed Domain Names do not contain any contact particulars for the Complainant and that he is not able to properly advertise his ESPRESSO VELOCE and AVIATORE VELOCE products for customers to purchase. He is thus unable to use the Disputed Domain Names to continue the marketing and sales of the above stated products. The Complainant also indicates that he does not have access to any of the content on the websites nor to any quote requests or messages lodged through the message portal. The Complainant states that he does not know how these requests are being handled, if at all, and submits that it is severely impacting his business.

The Complainant requests that the Disputed Domain Names be transferred to him.

B. Respondent

The Respondent communicated to the Center shortly before filing his response. However, as this communication includes the argument subsequently contained in the Response, no further reference will specifically be made to it.

The Respondent contends, in connection with the relationship between the parties, that they were personal friends and that the Complainant’s wife was employed by the Respondent. He states that during December 2011, the Complainant presented him with a drawing of the proposed ESPRESSO VELOCE coffee machine and in April, 2012, with a prototype. The Respondent was very impressed with his machine and states that in approximately May 2012, the Complainant agreed to sell to the Respondent 25% of the business in the companies ARTE MECCANICA (PTY) LTD and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD, on the basis that these corporate entities would manufacture, market and sell the ESPRESSO VELOCE and later the AVIATORE VELOCE coffee machines. No evidence in connection with this agreement was provided, however. The Respondent submits that in May 2012, the prototype of the ESPRESSO VELOCE coffee machine was exhibited in Johannesburg, South Africa where the first one was sold. The Respondent indicates that in June 2012, both parties consulted with intellectual property lawyers which resulted in the registration of the intellectual property associated with the ESPRESSO VELOCE product in the name of the Complainant.

The Respondent then lists various instances over the course of July 2012 to mid 2014 during which both the Respondent and the Complainant or sometimes the Respondent alone, promoted the said products. The Respondent submits that in mid 2013 the Complainant agreed to sell to the Respondent 49% of the share capital in ARTE MECCANICA (PTY) LTD. The Respondent provided evidence in support of the existence of the said company, his appointment as director in April 2013 and also the agreement between the parties in connection with the share transfer in July 2013. The Respondent states that at the same time, the Complainant agreed to sell to him also the same percentage of shares in the company ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD. However, no evidence was provided in connection with this company nor any agreement referencing a share transfer as stated.

The Respondent states in connection with his rights and legitimate interest in the Disputed Domain Names that although the design and trade mark rights in respect of the ESPRESSO VELOCE product was registered in favour of the Complainant, it was agreed that the Complainant would transfer these rights to ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD, which would in turn license ARTE MECCANICA (PTY) LTD to utilize the intellectual property. He states that this agreement was subsequently extended to the AVIATORE VELOCE product which was launched in March 2014. The Respondent does not provide evidence in support of the agreement reached between the parties for a transfer of the intellectual property rights other than handwritten notes which he states were made during a consultation with intellectual property lawyers in August 2014. He indicates that this consultation was held between him, the Complainant and the lawyers with the intention to give effect to the aforesaid agreement.

The Respondent claims that at all relevant times the Complainant had consented to the Respondent and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD utilizing the ESPRESSO VELOCE and AVIATORE VELOCE trade marks. He submits that he has been intimately involved with ARTE MECCANICA (PTY) LTD and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD to promote these trade marks.

The Respondent denies that the Disputed Domain Names were registered and are being used in bad faith. He contends that in September 2014, when he returned from a business trip, he was refused access to the business premises of ARTE MECCANICA (PTY) LTD and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD. He states that he has not had access to their records since and that this prevented him from fulfilling his fiduciary duties as a director. The Respondent submits that the Complainant subsequently sent threatening messages to him and provided examples of some of them. The Respondent argues that the Complainant has unclean hands and did not disclose all the facts relating to the matter.

The Respondent submits that the Complainant is not the sole shareholder and director of ARTE MECCANICA (PTY) LTD and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD and is not in a position, single-handedly, to control the business affairs of these companies. He contends that the Complainant has hijacked his business interests in ARTE MECCANICA (PTY) LTD, ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD and the ESPRESSO VELOCE and AVIATORE VELOCE products and that the growth of the business associated with these products was directly attributed to his attendances. The Respondent states that as a shareholder in the companies, he has made use of the ESPRESSO VELOCE and AVIATORE VELOCE trade marks and Disputed Domain Names in relation to the goods manufactured and states that, as a consequence of such use, he is substantively associated with the products and has retained the Disputed Domain Names under these circumstances.

The Respondent argues that the Complainant consented to his use of the trade marks and that there is an obligation on him to transfer the intellectual property rights vesting in the said trade marks to ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD.

The Respondent contends that the registration of the Disputed Domain Names in his name was made with the knowledge and consent of the Complainant.

The Respondent finally indicates that he instituted legal proceedings in connection with the spoliation of his rights, out of the High Court in Johannesburg, South Africa, under Case no. 38854/2014.

The Respondent asks that the Complaint be dismissed.

6. Discussion and Findings

In accordance with paragraph 4(a) of the Policy, for this Complaint to succeed in relation to the Disputed Domain Names, the Complainant must prove on a balance of probabilities:

(i) that the Disputed Domain Names are identical or confusingly similar to a trade mark or service mark in which he has rights;

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

(iii) that the Disputed Domain Names have been registered and are being used in bad faith.

A. The South African Court Proceedings

The Respondent refers to proceedings launched out of the High Court, Johannesburg, South Africa to address the Complainant’s action of denying him access to the businesses conducted by the companies ARTE MECCANICA (PTY) LTD and ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD, which as a director and shareholder, he claims he is entitled to. The Respondent did not submit a stamped copy of the legal proceeding that had been filed with the Court. Nevertheless, for the purposes of this proceeding, the Panel assumes that the legal proceeding referred to has been filed as stated.

The Policy does not bar either a complainant or a respondent from seeking judicial remedies. A panel also has, in terms of paragraph 18(a) of the Rules, discretion to suspend, terminate or continue an administrative proceeding where a disputed domain name is the subject of other pending legal proceedings (See WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition, paragraph 2.2 (“WIPO Overview 2.0”)).

Taking into account the evidence presented in this case, the nature of the court proceedings referred to by the Respondent (which do not appear to involve the Disputed Domain Name), the validity of the Respondent’s rights claim in the ESPRESSO VELOCE and AVIATORE VELOCE trade marks (which will be dealt with in more detail below) and the fact that neither party has made any request for the Panel to terminate or suspend this proceeding, the Panel decides in its discretion to continue these proceedings.

B. Identical or Confusingly Similar to a Mark in which the Complainant has Rights

The Complainant has furnished evidence of a registration in his name for the trade mark ESPRESSO VELOCE, appearing on the South African Trade Marks Register. The Complainant has also furnished evidence of use of the marks ESPRESSO VELOCE and AVIATORE VELOCE in commerce sufficient to establish trademark rights for the purposes of the Policy. The Respondent does not deny that a reputation attaches to the mentioned trade marks. The Respondent furthermore does not deny that the Disputed Domain Names are identical to the ESPRESSO VELOCE and AVIATORE VELOCE trade marks. The contentious issue in respect of this Policy requirement revolves around the identity of the owner of the intellectual property in the stated trade marks.

The Complainant’s argument is that as the inventor of the trade marks and associated highly specialized products, and based on the evidence of ownership that he has submitted, he maintains ownership in the trade marks. The Respondent’s argument regarding ownership is convoluted and contradictory. He states firstly that there was an agreement between the parties for the rights in the trade marks (and associated intellectual property rights in the products) to be transferred to the company ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD, with ARTE MECCANICA (PTY) LTD acting as licensee. He does not provide any evidence in support of this argument. The Respondent then goes on to argue that as a consequence of his promotion and sale of the ESPRESSO VELOCE and AVIATORE VELOCE products he has acquired rights in these trade marks which entitle him to the Disputed Domain Names.

The evidence presented in this proceeding shows that the use that has been made of both trade marks gave rise to a reknown in the trade marks and that members of the public associate the trade marks with the Complainant. Furthermore, there is no evidence that any proceedings have been instituted to cancel the trade mark registration for ESPRESSO VELOCE that subsists in the Complainant’s name or that the application to register the mark AVIATORE VELOCE, also in the Complainant’s name, will be opposed. Absent such evidence the recordal on of the South African Trade Marks Register of the two trade marks in the Complainant’s name carries significant weight.

Against this factual background and in terms of established trade mark law, the Respondent could not, in his own right, have acquired any rights in the ESPRESSO VELOCE and AVIATORE VELOCE trade marks. The Respondent’s directorship and shareholding in ARTE MECCANICA (PTY) LTD certainly could not have had this effect and, in any event, the role of this company is not in dispute, with both parties agreeing that it acted, at least until the Complainant withdrew his license, as an authorized user of the trade marks. Consequently, any rights that would have arisen as a result of the company’s use of the trade marks would have accrued to the trade mark owner, being the Complainant. Accordingly, the Panel finds that the Complainant has succeeded in showing that the Disputed Domain Names are identical to the trade marks in which he has rights.

C. Rights or Legitimate Interests

Paragraph 4(a)(ii) of the Policy requires in effect the Complainant to prove a negative, namely that the Respondent lacks rights or legitimate interest in the Disputed Domain Names. This is accomplished as follows:

“a complainant is required to make out a prima facie case that the respondent lacks rights or legitimate interests. Once such a prima facie case is made, the burden of production shifts to the respondent to come forward with appropriate allegations or evidence demonstrating rights or legitimate interests in the domain name. If the respondent fails to come forward with such appropriate allegations or evidence, the complainant is generally deemed to have satisfied paragraph 4(a)(ii) of the UDRP. If the respondent does come forward with some allegations or evidence of relevant rights or legitimate interests, the panel then weighs all the evidence with the burden of proof always remaining on the complainant.”WIPO Overview 2.0 at paragraph 2.1.

The nature of the early relationship between the parties, prior to the Respondent being appointed as a director of ARTE MECCANICA (PTY) LTD in April 2013 and subsequently acquiring shares in it, is not entirely clear. The Complainant claims that the Respondent was employed as a salesman. The Respondent seems to indicate that the relationship was more akin to a partnership, although this is not directly stated. However, the fact that the Complainant was the inventor and designer of the ESPRESSO VELOCE and AVIATORE VELOCE products, that he asked the Respondent to register the Disputed Domain Names (the parties disagree about whose name the Complainant instructed should be recorded as registrant), that the Complainant subsequently applied to register the trade marks in his own name and that he agreed to sell shares in ARTE MECCANICA (PTY) LTD to the Respondent, all indicate that the Respondent would not have been in a position to promote and sell these products without the assistance and approval of the Complainant and that he acted, at the time, under authority of the Complainant. The role of the Respondent was formalized in April 2013 when he was appointed as a director of ARTE MECCANICA (PTY) LTD, which company acted as the Complainant’s licensee through which the products were manufactured and sold. In this position, the Respondent, as an employee of the said company, would have acted under its authority. The Respondent could therefore not have had a legitimate, bona fide, interest in the Disputed Domain Names in his own name.

It is also clear from the evidence that the Disputed Domain Names are not being used nor that any preparations are being made to use them in connection with a bona fide offering for sale of the Complainant’s goods. .

The Panel finds that the Complainant has discharged his onus in respect of this Policy requirement.

D. Registered and used in bad faith

For reasons similar to those above, the Panel finds that the Respondent has registered and used the Disputed Domain Names in bad faith. The Respondent clearly can not claim any legitimate personal right in the Disputed Domain Names and the Panel accepts the Complainant’s version that he instructed the Respondent to register the Disputed Domain Names in the Complainant’s name. It would simply be illogical for the Complainant to authorize the registration of the Disputed Domain Names in the Respondent’s name (as claimed by the Respondent) and then to make an application to register the trade marks that are the subject of the Disputed Domain Names, in the Complainant’s name. The Respondent was in any event at all times aware of the Complainant’s registration and proposed registration of the ESPRESSO VELOCE and AVIATORE VELOCE trade marks in the Complainant’s name and appears to have accepted this all along, until, it seems, he was refused access to the premises and records of ARTE MECCANICA (PTY) LTD. The Panel finds that the registration of the Disputed Domain Names (in the Respondent’s own name) was in bad faith.

The Respondent’s version, that there was a subsequent agreement between the parties that the intellectual property rights in the trade marks ESPRESSO VELOCE and AVIATORE VELOCE would be transferred from the Complainant to ARTE MECCANICA MASTROGIUSEPPE (PTY) LTD, is not supported by the evidence and is not accepted for the purposes of this decision by the Panel. Even if there was such an agreement, it would not assist the Respondent, seeing that the Respondent is claiming a personal right in the Disputed Domain Names.

Clearly, the only motivation for the Respondent’s continued retention of the Disputed Domain Names is to disrupt the Complainant’s business and to use it as leverage against the Complainant in settling the dispute in connection with the Respondent’s shareholding of and directorship in the company ARTE MECCANICA (PTY) LTD with the Complainant. The Respondent’s conduct in this respect supports a finding of bad faith use on his part and the Panel finds that the Complainant has succeeded in discharging his burden of proof in terms of paragraph 4(b) of the Policy.

7. Decision

Pursuant to paragraph 4(i) of the Policy and paragraph 15 of the Rules, the Panel therefore finds that the Complainant has satisfied all of the required elements and that the Disputed Domain Names <aviatoreveloce.com> and <espressoveloce.com> should be transferred to the Complainant.

Charné Le Roux
Sole Panelist
Date: April 30, 2015