WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Souq.com FZ LLC v. Benny Bertelsen, Advanced Digital Solutions
Case No. D2015-2261
1. The Parties
1.1 The Complainant is Souq.com FZ LLC of Dubai, United Arab Emirates, represented by Eversheds, LLP, United Arab Emirates.
1.2 The Respondent is Benny Bertelsen, Advanced Digital Solutions of Dubai, United Arab Emirates, represented by The Trademark Company, PLLC, United States of America.
2. The Domain Name and Registrar
2.1 The disputed domain name <thesouq.com> (the “Domain Name”) is registered with GoDaddy.com, LLC (the “Registrar”).
3. Procedural History
3.1 The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on December 13, 2015. On December 14, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Name. On December 14, 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.
3.2 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”).
3.3 In accordance with the Rules, paragraphs 2 and 4, the Center formally notified the Respondent of the Complaint, and the proceeding commenced on December 18, 2015. On January 7, 2016, the Respondent requested an extension of the Response due date. The Center extended the Response due date to January 11, 2016 in accordance with the Rules, paragraph 5(b). The Response was filed with the Center on January 11, 2016.
3.4 The Center appointed Matthew S. Harris, Tony Willoughby and Frederick M. Abbott as panelists in this matter on February 5, 2016. 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
4.1 The Complainant is a company based in Dubai (United Arab Emirates), which operates a retail website and online marketplace for third party sellers from the domain name <souq.com>, which was registered on February 1, 1996. It has grown into the largest e-commerce platform in the Arab world, featuring more than 400,000 products across various categories, attracting on average over 31 million unique visits per month. In addition to its headquarters in Dubai it has commercial offices in Egypt, Saudi Arabia and Kuwait, with technical and development centres in Jordan and India.
4.2 The Complainant is the owner of numerous trade marks in various countries across the Arab world, as well as a Community trade mark. They include:
(i) Jordanian trade mark no. 84197 filed on February 15, 2006 in class 35;
(ii) UAE trade mark no. 78353 filed on March 7, 2006 in class 35;
(iii) Community trade mark no. 01157799 filed on September 3, 2012 in classes 35, 36 and 42.
4.3 Each of the trade marks appears to take the form of a stylised representation of the text “souq.com” (and/or an Arabic variant of the same) as follows:
4.4 The Respondent would appear to be an individual based in Dubai (United Arab Emirates).
4.5 The Domain Name was first registered on or about November 21, 2008. On or about December 21, 2013, it was purchased by the Respondent. Subsequent to that purchase the Domain Name has been used for a retail website offering for sale various third party products.
5. Parties’ Contentions
5.1 The Complainant explains the background and origin of its business. Its core customers appear to be in various countries in the Middle East. It contends that last year it earned in excess of USD 300 million in revenue and has a website ranking of 10 in Egypt, 12 in Saudi Arabia and 7 in the United Arab Emirates.
5.2 The Complainant claims that over the past 5 years it has invested USD 50 million in advertising and to have attracted a high degree of media coverage for its activities. It also provides evidence of media coverage that predates this in the form of various online and print newspaper articles and advertisements including the following:
(i) An online article in ITP Technology dated November 28, 2005 referring to “Maktoob’s recently launched Souq.com auction site” which is said to boast “approximately 3,300 UAE users and has to date generated over $54,495 (AED 200,000)” in the United Arab Emirates.
(ii) An advertisement appearing in a February 2016 edition of Time Out Dubai.
(iii) An online article in ITP Business dated February 12, 2006 which stated that it has been “six months since Souq.com burst onto the Middle East scene” and records the fact that the business had in that period made around 10,000 transactions, secured 15,000 registered users and having achieved turnover in January 2006 of USD 272,000.
(iv) An article in Arabian Business in February 2006 that refers to the “rapid growth of Souq.com”.
(v) An article in the Khaleej Times in March 2006 recording that at that time “Souq.com has 4,000 Products Online. 15,000 Buyers/Sellers and the Web site has topped the 1.5 million in terms of hits”.
(vi) An article in Alwaba News dated April 17, 2006 that refers to “Souq.com reporting over AED 2 million in transactions conducted on its portal last month” and describes “Souq.com … as the premier destination for online auctions in the UAE and Jordan”.
(vii) An article in the Emirates Evening Post in late July 2006 and similar articles in other publications in early August 2006 which reports a scheme by the Complainant whereby the proceeds on online auctions are donated to charitable causes in Lebanon.
(viii) An article in 7 Days dated January 22, 2007 in which Souq.com features and in which it is recorded that it was at that time hosting 18,000 online auctions a month.
(ix) An article in the Local dated February 2, 2007 in which Souq.com is recorded as having 120,000 unique visitors per month and over 45,000 registered users.
5.3 The Complainant contends that the dominant part of the Domain Name is “souq.com”, which is said to be identical to the Complainant’s mark. It refers in this respect to several decisions under the UDRP that involved domain names that comprised another’s mark to which the word “the” had been added.
5.4 The Complainant contends that the Respondent has no rights or legitimate interests in the Domain Name. It claims that it is inconceivable that the Respondent was not aware of the Complainant’s business and trade mark at the time the Domain Name was registered and asserts that the Complainant has provided the Respondent with no licence or authorisation to use its trade mark. It is contended that:
“the Respondent has intentionally chosen a domain name based on the Complainant’s trademark in order to benefit from the fame and goodwill associated with Souq.com and to thereby generate traffic to its own site, which looks and feels like it would be sponsored by the Complainant.”
5.5 The Complainant further maintains that the circumstances of the Respondent’s registration and use of the Domain Name are such that this is a case where the domain name has been used “primarily for the purpose of disrupting the business of a competitor” within the scope of paragraph 4(b)(iii) of the Policy. It also contends that the Respondent has sought to confuse the Complainant’s customers by diverting them to the Domain Name for financial gain and that this activity falls within the scope of paragraph 4(b)(iv) of the Policy.
5.6 The Respondent contends that the various marks relied upon by the Complainant are “merely descriptive for [the] Complainant’s online marketplace for vendors to display their products”. He accepts that the additional term “the” in the Domain Name is not a distinctive term, but in the circumstances of this case “provides enough difference in order for consumer confusion to be unlikely” and gives the Domain Name a completely different impression than the Complainant’s claimed mark.
5.7 The Respondent further contends that it can establish rights and legitimate interests in the Domain Name. He claims that the Domain Name was purchased “for the primary purpose of selling [the Respondent’s] inventory received from authorized distributors at prices dictated by those distributors.” The Domain Name is said to have been used for this purpose for 2 years and the Respondent maintains that no products “in direct competition” with the Complainant have been available on the website operating from the Domain Name.
5.8 The Respondent denies that it was his object to create a false impression of affiliation between the Respondent and the Complainant and is “willing to add a disclaimer to his website to make this point clear”. He further claims that there is no evidence to support the contention that the Domain Name either was registered or used in bad faith. So far as registration is concerned he claims that the Respondent was “unaware of [the] Complainant’s claimed rights to [the] Complainant’s Mark as [the] Respondent was under the impression that the term “souq” was descriptive and was very common.”
6. Discussion and Findings
6.1 To succeed in these proceedings the Complainant must make out its case in all respects under paragraph 4(a) of the Policy. Namely, the Complainant must prove that:
(i) the Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights (paragraph 4(a)(i)); and
(ii) the Respondent has no rights or legitimate interests in respect of the Domain Name (paragraph 4(a)(ii)); and
(iii) the Domain Name has been registered and is being used in bad faith (paragraph 4(a)(iii)).
6.2 The Panel will address each of these requirements in turn.
A. Identical or Confusingly Similar
6.3 As far as the Panel can tell, none of the marks relied upon by the Complainant comprise text marks alone. They each take the form of a stylised representation of the text “Souq.com” with the “Souq” element somewhat larger than the “.com” element.
6.4 The word “souq” is obviously an ordinary word describing a form of market. The Panel understand the word to have an Arabic derivation but it is also a word that is understood (sometimes spelled somewhat differently) in English.
6.5 This, therefore, raises the question to what extent a panel under the Policy should recognise that a complainant has rights in the textual element of a device mark, when there is a legitimate question as to whether the complainant could have obtained trade mark rights in the textual element alone.
6.6 This is an issue that was addressed at some length by the panel in Jobs on the Net Limited, Andrew Middleton v. International New Media Limited, WIPO Case No. D2011-1531. Having considered various previous decisions on this issue the panel suggested that so far as the Policy is concerned the correct approach is only to disregard such a mark if the textual element relied upon was so “completely devoid of distinctive character that it is incapable of distinguishing the Complainant’s goods and services”.
6.7 The Panel does not think that in applying this test the Complainant’s mark should be disregarded in this case. The reason for this (even if one ignores the technical point that the Complainant’s Community Trade Mark appears to extend beyond services for which the word “souq” might be said to be descriptive) is that the textual element of the relevant marks is not “Souq” alone but “Souq.com”. The Panel is aware that many trade mark registries are wary of concluding that a mark is distinctive where it comprises a descriptive term combined with a Top-Level Domain such as “.com”. Nevertheless, the Panel does not consider “Souq.com” to have been completely devoid of distinctive character at the time that these proceedings were commenced.
6.8 An important factor in this respect is that there is plenty of material before the Panel in the form of press articles and the like that suggests that at least by the time the Complainant’s UAE trade mark was registered in 2006, the “Souq.com” element of the mark had achieved at least some degree of public recognition in that territory as the name of the Complainant’s business and that recognition has steadily increased since that date.
6.9 Further, the Panel rejects the Respondent’s contention that the addition of the definitive article “the” in the Domain Name results in a completely different impression from that obtained from the Complainant’s marks. It is a wholly non-distinctive addition. In the circumstances, the Panel holds that the Domain Name is confusingly similar to a trade mark in which the Complainant has rights. The Complainant has therefore made out the requirements of paragraph 4(a)(i) of the Policy.
B. Rights or Legitimate Interests
6.10 The Respondent has not put forward any case to the effect that the term “thesouq.com” is a name by which the Respondent has become commonly known by reason of its two years trading from the Domain Name and therefore does not appear to claim rights or legitimate interests under paragraph 4(c)(ii) of the Policy.
6.11 Therefore, the key question in this case both so far as rights or legitimate interests and bad faith is concerned is why the Respondent has chosen to register and use the Domain Name. Was it because of the descriptive meaning of the word “souq” or was it because of the Domain Name’s associations with the Complainant’s trade mark in which that term appears? The first may provide a right or legitimate interest but the second does not; as to which see paragraph 2.2 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”).
6.12 The Panel has not found this question easy. It is also possible that the Domain Name was registered with both possibilities in mind. Nevertheless, for the reasons that are given later on in this decision in its discussion of bad faith, the Panel has concluded that at the time that the Domain Name was chosen, the term “Souq.com” was well known as one that was being used in a trade mark sense by the Complainant as a name for its business, and that the Domain Name was chosen and has been subsequently used predominantly because of its similarity to, and associations with, that name. Given that conclusion, the Panel holds that the Respondent has no rights or legitimate interests in the Domain Name. The Complainant has therefore made out the requirements of paragraph 4(a)(ii) of the Policy.
C. Registered and Used in Bad Faith
6.13 The Complainant contends that it is “inconceivable” that the Respondent was not aware of the Complainant and its trade mark rights at the time that the Domain Name was registered. The Panel accepts that the Respondent was aware of the Complainant and that the Complainant was using the term “Souq.com” in a trade mark sense as a name for its business at that time.
6.14 So far as registration is concerned, the relevant date is December 2013 when the Respondent acquired the Domain Name (see paragraph 3.7 of the WIPO Overview 2.0). The Panel accepts that “Souq.com” as a name for the Complainant’s business had become very well known in the United Arab Emirates and Dubai in particular, by that date. The Respondent is also located in Dubai. He has also used the Domain Name since registration for online retail sales of various goods. Notwithstanding the Respondent’s claims that he does not compete with the Complainant, his activities are sufficiently similar to those of the Complainant that any claim that the Respondent was not aware of the Complainant when the Domain Name was acquired would not be credible.
6.15 Further, the Respondent does not really claim that he was unaware of the Complainant at that time. The Response has been carefully crafted but this point is not really addressed. The key passage in the Response is as follows:
“Further, Respondent did not register the domain name in order to profit off of Complainant’s purported business goodwill, nor did Respondent register the Disputed Domain Name. At the time of registration of the domain, Respondent was unaware of Complainant’s claimed rights to Complainant’s Mark as Respondent was under the impression that the term SOUQ was descriptive and was very common. As such, Respondent was unaware that any one company claimed exclusive rights to the mark.”
6.16 The Respondent when stating that he did not register the Domain Name is not denying that the Domain Name was acquired and registered in the Respondent’s name in December 2013. This is openly admitted elsewhere in the Response. So the Respondent when referring to registration of the Domain Name appears to be referring to the date of initial registration of the Domain Name, i.e. in 2008. However, this is not the relevant date.
6.17 Further, even if this is not right, the Respondent only denies that he was aware of the “Complainant’s claimed rights to Complainant’s Mark as Respondent was under the impression that the term SOUQ was descriptive and was very common” [emphasis added]. In other words, the Respondent does not deny that he was aware of the Complainant or the fact that the Complainant used the name “Souq.com” for the business. Instead, he appears to deny that he was aware that the Complainant claimed any rights in the word “souq” alone at that time.
6.18 The fact that the Respondent was aware of the Complainant and its use of the name “Souq.com” does not get the Complainant home so far as bad faith registration is concerned. There also needs to have been an intent on the part of the Respondent to take some unfair advantage of the Complainant’s trade mark rights. Whether this is so notwithstanding the fact that “souq” is an ordinary descriptive word, is the central issue in this case.
6.19 Ultimately, the Panel is of the view that the Respondent’s predominant intent was to take such unfair advantage of the Complainant’s rights. The reason for this is that the Complainant does not claim rights in, and the Respondent did not just choose a domain name that used, the word “souq” alone. The relevant text in the Complainant’s mark is “souq.com”. As has already been described in this decision the Panel accepts that by at least the date the Domain Name was registered, it was a term that had become very well known in Dubai as one that referred to the Complainant. Given this and on balance the Panel concludes that the Respondent’s choice of the Domain Name that incorporated the entirety of the term “souq.com” with the non-distinctive word “the” placed at the beginning, was to take advantage of the Domain Name’s association with the Complainant’s name and mark. In particular, the Respondent chose the Domain Name with the knowledge and hope that such association would result in Internet users being drawn to the Respondent’s intended website.
6.20 Further, when the Domain Name was subsequently used for the Respondent’s intended website, that was use in bad faith falling within the scope of paragraph 4(b)(iv) of the Policy.
6.21 It may be that given the descriptive nature of the term “souq” and in the honest and perhaps not unreasonable belief that no one was entitled to claim exclusive rights in that word alone so far as retail activities are concerned, the Respondent thought he was entitled to adopt a domain name that used that term in a descriptive sense. But the Respondent went further than this and chose a domain name that reproduced the Complainant’s “souq.com” name in its entirety to which was added a wholly non-distinctive word.
6.22 In the circumstances, the Complainant has made out the requirements of paragraph 4(a)(iii) of the Policy.
7.1 For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the Domain Name, <thesouq.com>, be transferred to the Complainant.
Matthew S. Harris
Frederick M. Abbott
Date: February 18, 2016