WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Candi Controls, Inc. v. Whois Privacy Protection Service Inc. / Domain Vault LLC

Case No. D2016-0818

1. The Parties

Complainant is Candi Controls, Inc. of Oakland, California, United States of America ("U.S."), represented by Paradigm Counsel LLP, U.S.

Respondent is Whois Privacy Protection Service Inc. of Kirkland, Washington, U.S. / Domain Vault LLC of Dallas, Texas, U.S.

2. The Domain Name and Registrar

The disputed domain name <candi.com> is registered with Name.com LLC (the "Registrar").

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the "Center") on April 26, 2016. On April 26, 2016, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On the same date 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 April 28, 2016 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 May 9, 2016.

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 and 4, the Center formally notified Respondent of the Complaint, and the proceedings commenced on May 9, 2016. In accordance with the Rules, paragraph 5, the due date for a Response was May 29, 2016.

On May 29, 2016, a submission was filed with the Center on behalf of Novo Point, LLC, a party that seeks to intervene as a respondent in this proceeding. Complainant submitted a Supplemental Filing on May 31, 2016. Novo Point, LLC submitted a reply email on the same date.

The Center appointed Georges Nahitchevansky as the sole panelist in this matter on June 6, 2016. 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.

On June 13, 2016, the Panel issued Procedural Order No. 1 that invited the parties to make supplemental filings regarding the request of Novo Point, LLC to intervene as a respondent in this proceeding. On June 20, 2016, Novo Point, LLC submitted a Supplemental Filing. On June 22, 2016 the Panel issued Procedural Order No. 2 granting Complainant additional pages for its reply and on June 25, 2016 Complainant submitted a reply. On June 27, 206 Novo Point, LLC submitted an unsolicited Supplemental Filing and on the same day Complainant filed a reply.

4. Request of Novo Point, LLC to Intervene

Before turning to the merits of the matter, the Panel must first determine whether Novo Point, LLC ("Novo Point") should be allowed to intervene and be considered a respondent in this proceeding. Novo Point has submitted close to 500 pages of exhibits in support of its contentions that it has standing to be the Respondent in this proceeding. Complainant opposes Novo Point's request to intervene in this proceeding.

Novo Point alleges that it is the beneficial owner of the disputed domain name and that Respondent Domain Vault LLC ("Domain Vault") is not the legal or beneficial owner of the disputed domain name, as Domain Vault allegedly misappropriated the disputed domain name and other domain names from Novo Point. In support of that contention, Novo Point has submitted voluminous documents that purport to show that the disputed domain name has been under the same beneficial ownership since 2002 and that "Domain Vault is an imposter without legal rights" (Novo Point's submission at p. 4). Complainant argues that Novo Point was not the registrant of the disputed domain name at the time the Complaint was filed, had no direct or indirect ownership or agency relationship with Domain Vault, and that Novo Point lost control of the disputed domain name as a result of a U.S. federal district court order transferring the disputed domain name, and other domain names, that had been part of a receivership in a federal court action in the U.S. District Court, Northern District of Texas, to an individual by the name of Lisa Katz who then transferred the disputed domain name to Domain Vault.

In determining whether Novo Point has standing to intervene in this proceeding as the purported "respondent," the question before the Panel is under what circumstances can a non-party appear and intervene as a third party in a UDRP proceeding. The Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") define the term "respondent" as "the holder of a domain-name registration against which a complaint is initiated" (see Rule 1). The Rules, however, are silent as to what the term "holder" means and which parties are included in the meaning of "holder." Neither the Rules, nor the Policy, prevent a finding that a person or entity other than the named respondent can be treated as the holder or owner of the domain name at issue. Indeed, prior UDRP Panels that have considered the meaning of "holder" have expanded the concept from meaning solely the party that is the actual listed registrant in the concerned registrar's Whois records of a domain name to include a beneficial or underlying owner of the disputed domain name. See, e.g., Avon Products Inc. v. Jongsoo Lee, WIPO Case No. D2001-0272 (allowing a non-party to file a response where the listed registrant was a nominee registrant); PHE, Inc. v. Aisha Haider, WIPO Case No. D2007-0992 (finding that the named registrant might not exist and that a non-party was the beneficial and underlying owner of the disputed domain name). Thus, whether Novo Point can intervene and become the Respondent in this proceeding turns on a determination of whether the evidence before the Panel establishes that Novo Point is the beneficial owner of the disputed domain name.

Here, the background ownership history of the disputed domain name is convoluted at best.¹ The disputed domain name was originally registered by an entity by the name of Confectionery and Novelty Design International. In or about May 2002 the disputed domain name was then registered by Compana, LLC ("Compana"), a company owned and controlled by an individual by the name of Jeffrey Baron ("Baron"). Starting in 2005 up through November 2010, the disputed domain name was held under various privacy listings, including Spam Free Registration Service, Private Whois and Oakwood Services, Inc. Novo Point maintains that at all relevant times Compana was the actual owner of the disputed domain name as well as the registrar for the disputed domain name. Compana apparently changed its name to Ondova Limited Company ("Ondova") at some point prior to 2010.

In spring 2009, a litigation involving a contractual dispute between Netsphere, Inc. and Jeffrey Baron commenced in the U.S. District Court for the Northern District of Texas (the "Netsphere Action"). While that litigation was pending, Ondova declared bankruptcy which stayed the Netsphere Action. During the Ondova bankruptcy litigation, and the Netsphere Action, Baron apparently hired and fired multiple attorneys. While the bankruptcy creditors and Ondova eventually agreed to a settlement – a settlement that included a confirmation that Novo Point owned certain domain names, including the disputed domain name –Baron continued to hire new attorneys. A number of the attorneys claimed that they had not been paid by Baron and started to file claims for payment in the bankruptcy proceeding. As a result, the district court, at the request of the bankruptcy court, appointed a receiver in or about December 2010. The assets of Baron and a number of other entities, including the Village Trust and Novo Point, where then placed under the control of the court-appointed Receiver.

Baron appealed the receivership order and in or about December 2012, the U.S. Court of Appeals for the Fifth Circuit reversed the district court order appointing the Receiver, and ordered a remand to the district court for the expeditious winding up of the receivership. The process was to be managed by the district court. That process was apparently put on hold as a result of an involuntary bankruptcy proceeding that was brought against Baron by his attorneys in December 2012. The involuntary bankruptcy proceeding was later dismissed by agreement, and in early 2014 the district court announced that it would begin winding down the receivership in accordance with the Fifth Circuit's 2012 order. By order dated February 28, 2014 the district court ordered the receiver to turn over the assets of Novo Point and another company, Quantec, LLC ("Quantec"), to Lisa Katz ("Katz"), who had been acting as Novo Point's designated representative in the Netsphere Action.

In or around that time, a dispute arose between Baron, Novo Point and Quantec, and persons acting on their behalf, as to the person who had authority to receive the Novo Point and Quantec assets and manage the companies. Baron apparently claimed that an individual by the name of David McNair ("McNair") had been appointed as the new manager of Novo Point and Quantec and that McNair had terminated Katz's employment contract and authority to manage and control the affairs of Novo Point and Quantec.

The disputed domain name, along with other domain names apparently turned over to Katz pursuant to the U.S. district court's order of February 28, 2014, appear to have then been moved at some point after March 2014 by Katz to Respondent Domain Vault LLC ("Domain Vault"), a Virginia company incorporated in March 2014. Domain Vault, according to Novo Point and Complainant, is connected to Katz.

Since the U.S. district court order of February 28, 2014, Baron, Katz, McNair, Novo Point, Quantec and others have been involved in multiple litigations in the U.S., the Cook Islands, and possibly Australia, which seek to enjoin Katz from continuing to exercise authority or control over the assets previously ordered to be turned over to Katz and/or to obtain a return of assets or monies obtained by Katz. These litigations are currently pending and no final orders have issued.

At this point, Novo Point and Complainant agree that the disputed domain name is in the possession of Domain Vault, a company that Novo Point admits it does not directly or indirectly control and which it has no connection to. Novo Point argues that Domain Vault improperly obtained the disputed domain name, as well as other domain names, through Katz, and accordingly should be allowed to intervene in this proceeding. Whether the transfer to or from Katz was improper is essentially the subject of the many pending litigations involving Katz, Novo Point and Baron. The Panel here is not in a position to determine whether the transfer orchestrated by Katz to Domain Vault was improper or to determine whether or not Katz had the necessary authority or control over the assets of Novo Point. The February 28, 2014 order from the U.S. District Court clearly ordered a turn-over of the assets of Novo Point to Katz. Whether Katz then exceeded her authority or somehow acted improperly in transferring the disputed domain name is well beyond the scope of this UDRP proceeding, and is clearly a matter to be resolved before the relevant court.

At this juncture, there is no court order or finding that Novo Point should be the owner of the disputed the domain name or that assets that were turned over to Katz, including the disputed domain name, should be turned over to Novo Point or should be held in trust or for the benefit of Novo Point. As Novo Point does not control the disputed domain name, has no connection to Domain Vault and does not directly or indirectly control Domain Vault, Novo Point cannot be construed to be the beneficial owner of the disputed domain name for purposes of paragraph 1 of the Rules. At best, Novo Point is a party that has a potential claim against Katz and Domain Vault, but it certainly is not a "holder" within the scope of the definition of Respondent under Rule 1 for purposes of this proceeding.

Accordingly, this Panel declines to allow Novo Point to intervene in this proceeding.

Having resolved Novo Point's request to intervene, the Panel now turns to the merits of the matter.

5. Factual Background

Complainant Candi Controls, Inc. is a software company that provides control systems and integration systems for smart buildings. Complainant is based in Oakland, California and was founded in 2009. Complainant has submitted as Annex 7 a copy of its U.S. trademark registration for the CANDI CONTROLS mark. Complainant also owns the domain name <candicontrols.com>, which is used to direct commercial and individual consumers to Complainant's website concerning Complainant's services.

The disputed domain name <candi.com>, as explained above, has had a long and convoluted history but was registered in the name of Domain Vault after March 2014. The disputed domain name resolves to a web page with click-through links.

6. Parties' Contentions

A. Complainant

Complainant asserts that in or about 2009 it coined the phrase "Cloud-Assisted Network-Device Integration", or CANDI for short, to describe its technology. Complainant also asserts that it has, since 2009, continuously used the mark CANDI in connection with its services, either as part of the mark CANDI CONTROLS or standing alone (since at least 2011), and that it owns common law rights in CANDI as well as a trademark registration for CANDI CONTROLS. Complainant has also licensed the mark WORKS WITH CANDI in association with Complainant's proprietary platform and application program interface for networking solutions.

Complainant contends that the disputed domain name is identical to the non-generic or descriptive portion of Complainant's trade name and Complainant's CANDI CONTROLS, CANDI and WORKS WITH CANDI marks.

Complainant argues that Respondent lacks any rights or legitimate interests in the disputed domain name, because CANDI is not a generic or descriptive term and because Respondent obtained the disputed domain name after Complainant had established trademark rights in CANDI and then only used such for a landing page that features third party links and advertisements from advertisers that Respondent is not affiliated with.

Finally, Complainant asserts that Respondent registered and has used the disputed domain name in bad faith since Complainant has prior established trademark rights in CANDI, the disputed domain name is identical to Complainant's CANDI trademark, the term "candi" is not a generic or descriptive term in the English language (but a term coined by Complainant), and the disputed domain name has been used by Respondent to earn advertising dollars from traffic mistakenly diverted to the disputed domain name. Complainant also asserts that Respondent has a pattern of having registered and used domain names in bad faith given that Respondent has lost at least ten prior UDRP proceedings. Complainant also maintains that Respondent's use of "robot.txt" to block the ability of "Archive.org" to access past contents of the disputed domain name is without justification and an indicator of bad faith. Lastly, Complainant argues that bad faith registration and use needs to be considered from the date Domain Vault acquired the disputed domain name on or after March 12, 2014.

B. Respondent

Respondent did not reply to Complainant's contentions.

7. Discussion and Findings

Under paragraph 4(a) of the Policy, to succeed Complainant must satisfy the Panel that:

(i) the disputed domain name is identical or confusingly similar to a trademark or service mark in which Complainant has rights;

(ii) Respondent has no rights or legitimate interests in respect of the disputed domain name; and

(iii) the disputed domain name was registered and is being used in bad faith.

Paragraph 4.6 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition ("WIPO Overview 2.0") states:

"4.6 Does failure of a respondent to respond to the complaint (respondent default) automatically result in the complainant being granted the requested remedy?

Consensus view: A respondent's default does not automatically result in a decision in favor of the complainant […] the complainant must establish each of the three elements required by paragraph 4(a) of the UDRP. Although a panel may draw appropriate inferences from a respondent's default (e.g., to regard factual allegations which are not inherently implausible as being true), paragraph 4 of the UDRP requires the complainant to support its assertions with actual evidence in order to succeed in a UDRP proceeding".

Thus, although in this case Respondent has failed to respond to the Complaint, the burden remains with Complainant to establish the three elements of paragraph 4(a) of the Policy by a preponderance of the evidence. See The Knot, Inc. v. In Knot We Trust LTD, WIPO Case No. D2006-0340.

A. Identical or Confusingly Similar

Ownership of a trademark registration is generally sufficient evidence that a complainant has the requisite rights in a mark for purposes of paragraph 4(a)(i) of the Policy, WIPO Overview 2.0, paragraph 1.1. Complainant has provided evidence that it owns a trademark registration for the mark CANDI CONTROLS and that it has made some use of the mark CANDI, standing alone prior to when Respondent obtained the disputed domain name in 2014. It should be noted that while Complainant has provided some limited evidence of past and current use of CANDI standing alone on Complainant's website and in past patent applications (which is not trademark use) it is not altogether clear to the Panel when common law rights arose in CANDI or what the extent of those rights might be. Suffice it to say that the earliest evidence of trademark use of CANDI standing alone is from January 28, 2011 on Complainant's website.

As Complainant has established some rights in CANDI, the remaining question under the first element of the Policy is whether the disputed domain name (typically disregarding the generic Top-Level Domain ".com") is identical or confusingly similar with Complainant's mark. See B & H Foto & Electronics Corp. v. Domains by Proxy, Inc. / Joseph Gross, WIPO Case No. D2010-0842.

In the instant proceeding, the disputed domain name is essentially identical or confusingly similar to Complainant's CANDI CONTROLS and CANDI marks, as it incorporates the CANDI mark in its entirety. The Panel therefore finds that Complainant has satisfied the requirements of paragraph 4(a)(i) of the Policy in establishing its rights in the CANDI CONTROLS and CANDI marks and in showing that the disputed domain name is identical or confusingly similar to those marks.

B. Rights or Legitimate Interests

Under paragraph 4(a)(ii) of the Policy, the complainant must make at least a prima facie showing that the respondent possesses no rights or legitimate interests in a disputed domain name, Malayan Banking Berhad v. Beauty, Success & Truth International, WIPO Case No. D2008-1393. Once the complainant makes such a prima facie showing, the burden of production shifts to the respondent, the burden of proof always remains on the complainant.

Although Respondent has defaulted and not submitted a response, the Panel must nevertheless assess the sufficiency of the evidence provided by Complainant to determine whether Complainant has shown by a preponderance of the evidence that Respondent does not possess any rights or legitimate interests in the disputed domain name. See The Knot, Inc. v. In Knot We Trust LTD, supra; Bootie Brewing Company v. Deanna D. Ward and Grabebootie Inc., WIPO Case No. D2003-0185.

In support of its contention that Respondent lacks any rights or legitimate interests in the disputed domain name, Complainant argues that CANDI is a coined term that has no generic or descriptive meaning and that Respondent acquired the disputed domain name after Complainant obtained trademark rights in CANDI and then only used such to redirect web traffic to a landing page with pay-per-click ("PPC") links and advertisements for profit. Complainant has submitted a screen shot from February 2016 showing the PPC links at the landing page posted at the disputed domain name.

Panels that have considered whether or not the use of a disputed domain name with a landing page with PPC links or advertisements creates rights or a legitimate interest have generally found that such use in and of itself does not confer rights or legitimate interests arising from a bona fide offering of goods or services or from a legitimate noncommercial or fair use. See, e.g., Trade Me Limited v. Vertical Axis Inc, WIPO Case No. D2009-0093; Nedbank Limited v. Gregg Ostrick, GNO, Inc., WIPO Case No. D2016-0515. Nevertheless, panelists have recognized situations where the use of landing pages with PPC links or advertisements might be permissible, particularly where the disputed domain name has both a generic or common meaning as well as a trademark value, the domain name is not being used to exploit the goodwill associated with another's trademark, and the PPC links that appear genuinely relate to the generic or common meaning of the domain name at issue and not to the trademark value associated with the domain name. See WIPO Overview 2.0 at paragraph 2.6. In general, the accepted view is that where the PPC links or advertisements are based on the trademark value of the domain name, or the trademark value of the domain name is being exploited to redirect web traffic or mislead consumers to a website with advertisements or PPC links, such is evidence of an abusive registration and does not confer rights or a legitimate interest. See, e.g., mVisible Technologies, Inc. v. Navigation Catalyst Systems, Inc., WIPO Case No. D2007-1141; Champagne Lanson v. Development Services/MailPlanet.com, Inc., WIPO Case No. D2006-0006.

From the record in this case, it is not evident that Respondent was ever aware of Complainant and its CANDI CONTROLS and CANDI marks. While Complainant maintains that CANDI is not a generic or descriptive term in the English language, but a term coined by Complainant, the Panel notes that "Candi" is and has been used as a female first name and is a common misspelling or fanciful spelling for the term "candy". Indeed, the evidence submitted by Complainant shows that the disputed domain name was originally registered to a candy or confectionary company and for many years (up until late 2012) the disputed domain name was used with landing pages with links related to candy or names.

In addition, the evidence provided by Complainant does not establish that CANDI is a famous or well-known mark owned by Complainant. Indeed, the record has little evidence regarding the notoriety of the CANDI mark even in Complainant's own industry. Consequently, the fact that Complainant has developed some trademark rights in CANDI CONTROLS and CANDI in relation to its software products and services does not provide Complainant with broad rights over all things that use the term, mark, or name CANDI. Put another way, Complainant's rights in CANDI appear to be limited and do not extend broadly to all classes of trademarks.

Given that there is little evidence in the record regarding the extent or strength of Complainant's rights in CANDI, it is difficult for the Panel to conclude that the use of the disputed domain name with click through advertisements establishes per se a lack of rights, legitimate interests or bona fide use. The question then is whether there is any evidence to suggest that Respondent has sought to exploit the trademark value of the disputed domain name as opposed to its generic or common name connotations. Here, the only evidence provided shows a 2016 landing page with links to candy and wedding related promotions and to Candi Borobudur, a 9th Century Buddhist Temple and UNESCO World Heritage site. There is no evidence of any links that concern or relate to Complainant or Complainant's services or which promote goods or services that compete with those of Complainant. Moreover, there is no evidence that the use of CANDI is being done to mislead and redirect consumers looking for Complainant or its services to the landing page at <candi.com> in order to garner a financial interest.

Notably, while Complainant argues that the use of "robot.txt" has blocked the ability of "Archive.org" to access past contents of the disputed domain name, Complainant has provided a domain name report from "DomainTools.com" that includes screen shots up through the end of 2012 and from February 2016. None of these screen shots reveal any usage of the disputed domain name with landing pages that contain PPC links related to Complainant, its services or Complainant's CANDI trademark. Indeed, Complainant itself admits that it tried to acquire the disputed domain name in late 2012 and in 2015, but provides no screen shots showing what, if anything, was posted at the disputed domain name at that time. Complainant simply states that when anything was displayed at all at the disputed domain name it was just the hosting of unrelated third party advertising. Nor has Complainant provided any evidence showing that Respondent did anything with the disputed domain name to mislead consumers looking for Complainant and its services in order to redirect them to Respondent's landing page.

The fact that Respondent has been found to have registered and used domain names in bad faith in the past is certainly evidence of a pattern of bad faith and certainly would be more potent here if there were some evidence that Respondent was seeking to exploit the trademark value of CANDI as a trademark of Complainant. Such evidence, however, was not submitted, and links to items unrelated to Complainant and based on other uses of "candi" (such as the food item candy, or a geographic location) simply does not establish a lack of rights, legitimate interests or bona fide use in this instance. In this regard, it should be noted that Respondent appears to have obtained the disputed domain name through a February 2014 U.S. District Court order that turned over control of multiple domain names, including the disputed domain name, to Katz who then moved the disputed domain name to Respondent. See Section 4 supra. In the Panel's view, had the use of the disputed domain name prior to or after the turn over been done to exploit a trademark association with CANDI as a trademark, then Respondent's lack of legitimate interests would likely be apparent. Here, the evidence provided by Complainant shows use of the disputed domain name in connection with PPC links related to "candy" or "female names" from 2005 until late 2012, and a February 2016 landing page with links to promotions for "candy", "weddings" or "geographic locations". There is simply no evidence of any use of the disputed domain name to take advantage of Complainant's trademark rights in CANDI CONTROLS or CANDI.

The Panel thus concludes that Complainant has failed to meet its burden of this Policy element.

C. Registered and Used in Bad Faith

Given that Complainant has not established the second element of lack of rights or legitimate interests, the Panel does not need to address the issue of bad faith registration and use.

8. Decision

For the foregoing reasons, the Complaint is denied.

Georges Nahitchevansky
Sole Panelist
Date: July 7, 2016

¹ The facts regarding ownership of the disputed domain name are drawn from the submissions by Novo point and Complainant and the many decisions that have issued in the U.S. District Court, Northern District of Texas and the U.S. Court of Appeals for the Fifth Circuit in relation to the Netsphere Action, the Ondova bankruptcy proceedings and related litigations described below.