WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Elliot De La Valiere v. Stephane Clavel
Case No. D2016-2333
1. The Parties
The Complainant is Elliot De La Valiere of Kyiv, Ukraine, represented by Juscutum Attorneys Association, Ukraine.
The Respondent is Stephane Clavel of Kyiv, Ukraine, represented by Revision Legal, United States of America.
2. The Domain Name and Registrar
The disputed domain name <uprincess.com> is registered with Register.com (the “Registrar”).
3. Procedural History
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on November 16, 2016. On November 16, 2016, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On November 16, 2016, 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 and 4, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on November 23, 2016. In accordance with the Rules, paragraph 5, the due date for Response was December 12, 2016. At the Respondent’s request an automatic extension of the Response due date was granted until December 17, 2016 under paragraph 5(b) of the Rules. The Response was filed with the Center on December 16, 2016.
The Center appointed Luca Barbero as the sole panelist in this matter on December 29, 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.
The decision due date was extended to January 19, 2017.
4. Factual Background
The Complainant is the founder of the U PRINCESS project in Ukraine, created at the beginning of 2013. Said project consists in a noncommercial activity connected to the provision of various benefits and exclusive privileges for select young women, via the issuance of a nominative card to the participants who have passed competitive selection of an independent jury rating their appearance and style. The U PRINCESS card is aimed at showing the prestige and recognition of the beauty and style of its card owners and gives a variety of the privileges such as invitation and access to closed presentations, benefit fashion evenings and other exclusive events, VIP-service in elite restaurants, special offers from popular fashion brands, discounts on fitness trainings and traveling.
The privileges provided by the U PRINCESS card are being supplied in close cooperation with various popular brands in Ukraine and in the world such as Lee Cooper, Brocard, Karen Millen, Ukrainian Fashion Week and Sportlife, some of which are also sponsors of the events which are held under the aegis of the project. By the time of existence of the project, more than 1,000 young women in Ukraine have become its participants.
The official web site of the project is available at “www.uprincess.net” since February 2, 2013, and the correspondent domain name <uprincess.net> was registered on January 22, 2013. The project is also promoted through a dedicated Facebook page.
The Respondent has provided marketing and IT consultancy services to the Complainant in connection with its project since 2013. According to an agreement between the Complainant and the Respondent signed in June 2013, the Respondent was provided the opportunity to buy 10 per cent of the shares in a future company which would have been created and to which all the activity and assets of the U PRINCESS project should have been transferred during subsequent 12 months. The company Uprincess S.A. was registered in Panama in October 2015. The Complainant is president of the company, while the Respondent was secretary.
The Complainant is the owner of the following trademark registrations in Ukraine (collectively referred hereinafter as “the U PRINCESS-related trademarks”):
- No. 190906 for PRINCESS CARD, filed on August 29, 2013 and registered on September 10, 2014, for services of class 35;
- No. 190907 for U PRINCESS CARD, filed on August 29, 2013 and registered on September 10, 2014, for services of class 36;
- No. 190908 for U PRINCESS, filed on August 29, 2013 and registered on September 10, 2014, for services of class 36.
The disputed domain name <uprincess.com> was registered on November 29, 2014 and is pointed to a web site which displays information about the U PRINCESS card and whose layout and content is very similar to those of the web site “www.uprincess.net”.
5. Parties’ Contentions
The Complainant states that the Respondent registered the disputed domain name in its own name without any agreement or notification to the Complainant, and that the Complainant became aware about the registration de facto after it, but “has agreed with the persuasions of the Respondent which proposed to make this domain basic for the Project under the assurance of the domain was registered on the name of the Complainant”.
The Complainant alleges that a conflict with the Respondent arose when the Respondent had the idea to create a separated VIP-zone in a beach club where the participants of the project could take a rest and relax in the sun. It also claims that the Respondent started to regularly disturb the participants and to offer them to take a water ride on his board in the river. As such actions of the Respondent could cause serious damage to the business reputation of the Project, and undermine the participants’ trust in it, the Complainant canceled future reservation of the VIP section for the project in the beach club.
The Complainant states that it notified the Respondent of this decision via SMS, in which it also pointed out that it would be glad to restart the cancelled reservation, if the Respondent would be ready to stop its behavior in order to resolve the conflict. The Complainant had also added that, in the case in which the Respondent would not resolve the conflict, the Complainant would return it the money and stop the partnership. As the Respondent did not reply to that message, the Complainant decided to send another SMS message in which, again, it assured the Respondent that it would be ready to continue the partnership relying on the Respondent’s rationality and hoping to resolve the problem. In answer to the last message, the Respondent disabled access to the web site at the disputed domain name as to the Complainant and its employees. The Complainant claims that the Respondent, having the access to the web site, the design of which is a full copy of the original and official site of the project, now misrepresents its web site as the original one and itself as the true owner of the project.
The Complainant also informs the Panel that the Respondent made two mailouts using the email addresses of the project’s participants which it had collected during the time of working with the Complainant. The Complainant states that in those emails, the Respondent pretended to be the owner of the project, misled the participants and defamed the Complainant. As a result, in such situation the Complainant had to make its own mailout to the participants explaining the situation and warning them to keep away from the Respondent.
Besides, the Complainant asserts that, on its new site, the Respondent placed a form of authorization for the project’s participants which requests from them to fill out the data of their account in social networks or number of their U PRINCESS card. The Complainant highlights that, with the help of such form, the Respondent illegally collects the data of the participants by inducing them to believe that they have entered to the official site of the project. The Complainant stresses that its web site available at <uprincess.net> has no authorization of the participants via account in social networks as the only identification for them is the ID of their U PRINCESS card and the related password. Such illegal collection of the participants’ data would carry a threat for them and the project in a whole.
The Complainant points out that the Respondent’s rapid actions and its peremptory attitude give no chance for peaceful settlement of the conflict that arose. Taking that into account, the Complainant suggests that the intentions of the Respondent was unfair from the beginning, and that the registration of the disputed domain was made with the purpose of obtaining unfair advantage in negotiation with the Complainant and further misappropriation of assets of the project and also deriving personal benefits in a manner which is unacceptable for the project. The Complainant highlights that the Respondent’s actions are violating lawful rights of the real owner of the trademark and project in a whole, causing damages to its business reputation and also jeopardizing the security of the project participants’ data, making confusion for them and other users.
The Complainant also informs the Panel that, before the filing of the Complaint, the Complainant tried to resolve the issue via negotiation with the Respondent as it was looking for the opportunity of dialogue and peaceful settlement of the issue.
The Complainant highlights that the U PRINCESS-related trademarks were registered in the name of the Complainant because, at the time of the filing, the company was yet to be established and necessity to apply with application as quick as possible was determined by the purpose of obtaining earliest priority of the application.
The Complainant contends that the disputed domain name <uprincess.com> is “fully similar” to the Complainant’s trademark.
The Complainant states that the Respondent has no rights or legitimate interests in respect of the disputed domain due to the following reasons:
- The Complainant is the original founder and actual owner of the rights on the project;
- The agreement between the parties has not been executed. Also, the subject of the agreement was only the intentions of the parties that considered the opportunity of a limited partnership with the Respondent, which would have been transferred 10 per cent of the shares in the future company. Under the terms of the agreement, the parties were able to waive from their previous intentions and stop partnership at any time;
- The subject of the agreement is limited to the purchase of shares of the company and the agreement does not provide or give right to the Respondent to register the disputed domain name in its own name bypassing the Complainant. The Complainant asserts that the disputed domain name was registered by the Respondent by virtue of fraud since, at the time of the first meeting with the Respondent, the Complainant had already made a major contribution, and run the project, to which the Respondent tried to join, performing a technical consultant role;
- The Complainant’s consent to the registration of the disputed domain name was obtained as a result of fraud and, therefore, the Respondent cannot demonstrate that it has legal rights or interests in respect of the disputed domain name;
- Since the partnership between the parties had ceased, the Respondent lost any ground for the domain name registration;
- The disputed domain name could not be used in good faith for the Respondent’s goods or services, as it was registered with the purpose of placing on it the information about the project of the Complainant and, at the moment, the Respondent’s web site is a complete copy of the original web site of the Complainant;
- The Respondent has not been known under the disputed domain name since it performed only a technical role after the creation of the project, whose founder was the Complainant, which always took all the key decisions regarding the project;
- The Respondent’s use of the disputed domain name cannot be considered as bona fide since, at the time being, the disputed domain name is pointed to a copy of the site of the Complainant with the intention to mislead users into believing that the project promoted therein be operated by the Respondent.
With reference to the bad faith requirement, the Complainant contends that the Respondent had no right to register the disputed domain name and did so in fraudulent way, assuring the Complainant that the registration was performed in the name of the Complainant.
The Complainant asserts that the Respondent registered the disputed domain name primarily for the purpose of disrupting the business of a competitor and used it to attract Internet users to its web site, by creating a likelihood of confusion with the Complainant’s trademark.
As to the agreement between the parties, the Complainant states that, even interpreting its provisions more widely than they are, the Respondent registered the disputed domain name not in the name of the company, which had already been established at the time of registration of the disputed domain name, but in its own name, and the agreement in any case could not give the Respondent the right to register it in its own name. Further, if the provisions of the agreement had been performed, the Complainant could at any time use the 90 per cent of his shares in its sole discretion to transfer it back to the control of any person, including itself.
The Complainant underlines that the Respondent had not received the consent in full, because it has provided untrue information about the registration. In addition, the Respondent both now and previously has not been using the disputed domain name for bona fide selling of the Respondent’s own products or services, and the disputed domain name is used to host the copy of the web site of the Complainant.
The Complainant notes that the disputed domain name was registered by the Respondent to use it solely within the project of the Complainant, under the terms of the agreement with it. However, the subsequent behavior of the Respondent clearly indicates violation of the terms of such agreement.
The Complainant concludes stating that there are three different ways of qualifying the registration of the disputed domain name:
i) If we agree that the disputed domain name was registered only within the agreement between the parties, the basis for such registration is no longer in effect due to the termination of the agreement. However, under the agreement the Respondent was not directly allowed to register the disputed domain name. Moreover, even if we presume so, the registration of the disputed domain name was supposed to be in the name of the company, not in the name of the Respondent itself;
ii) If the registration of the disputed domain name was made within the scope of the agreement in which the Respondent who is supposed to be only awarded with 10 per cent of the shares in the company, we need to conclude that the Respondent understood and agreed with the terms de facto stating that it has not any right except the right for 10 per cent of income. Thus, in any event it has no right to control the disputed domain name and make any decisions with regards to it. The legal status of the Respondent under the agreement does not allow him to obtain any titles or rights in regards to the project, in particular in relation to the trademarks or the disputed domain name. At the same time, the Complainant, due to its 90 per cent of the shares, would be able to manage and control the disputed domain name at its sole direction;
iii) If the registration of the disputed domain name would be deemed not the subject of the agreement and the Respondent has exceeded its rights under it, the disputed domain name was clearly registered by the Respondent in bad faith, without right to do such at the time of registration, but being aware of the activity of the Complainant. By registering the disputed domain name in its own name, the Respondent was doing so outside of the scope of the agreement in its own interest. Moreover, the agreement had a strict subject without any reference to the registration of the disputed domain name and, however, was not fully performed by the parties.
The Respondent states that it paid USD 20,000 to the Complainant in exchange for 10 per cent of the shares of the to-be-formed company U Princess S.A., and that it worked with the Complainant both by providing it with technical and legal support, but also by paying the Complainant USD 18,000 beyond its initial USD 20,000 contribution, hosting events in its home for the business, and utilizing its home as the business’s office.
The Respondent also indicates that it designed and maintained the U PRINCESS web site and database and helped with the general strategy of the business. As a component of this general strategy, the Respondent began developing a new web site and negotiating with the third party who previously owned the disputed domain name because the “.com” generic Top-Level Domain (“gTLD”) suffix is a more valuable and brandable destination for potential clients.
The Respondent asserts that the Complainant was fully aware that the Respondent was purchasing the disputed domain name and that the Respondent paid USD 2,500 for the disputed domain name of its own funds. Once it did, the new web site was migrated to the disputed domain name. The Respondent states that the Complainant was fully aware of this and even asked the Respondent to provide it with a copy of the web site source code. The Respondent did so, and the Complainant used that copy, after the dispute between the parties arose, to create a clone of the web site at its domain name <uprincess.net>.
The Respondent informs the Panel that, in October 2015, the Complainant asked the Respondent to form the Panama corporation UPrincess S.A. because Respondent had more experience with forming offshore companies than the Complainant, and the Respondent proceeded accordingly.
The Respondent underlines that, under the terms of the agreement with the Complainant, the Complainant was to transfer all assets to the new company UPrincess S.A., but failed to do so. The parties continued to operate the U PRINCESS brand under UPrincess S.A. until the summer of 2016, when a dispute arose.
The Respondent summarizes the facts of the dispute which arose within the parties as follows. The Respondent had paid USD 20,000 to a beach club to secure a deal for U PRINCESS members for the summer. The Complainant “became jealous of the Respondent’s relationship with one UPrincess member and informed the Respondent that he was no longer allowed to come to the beach club” and, following a discussion during an event, the Complainant accessed the web site at the disputed domain name and began deleting all of the members of the web site from the related database. Upon realizing that the Complainant was deleting the database, the Respondent immediately revoked the Complainant’s access to the web site. Once the risk of deletion was removed, the Respondent restored the Complainant’s access to the web site. The Complainant subsequently cloned the web site at the disputed domain name and began using the web site content at the domain name <uprincess.net>. Therefore, the Respondent was forced to issue a copyright takedown notice to have this content removed.
The Respondent states that the dispute between the parties is outside of the scope of the Policy and, therefore, the Complaint must be dismissed. Specifically, the Respondent contends that, to adequately determine this case, the Panel would need to first determine whether the 2013 agreement between the parties is effective. If it is, then the Panel would next need to determine if the Respondent is an owner of the U PRINCESS-related trademarks cited in the Complaint because the agreement states that the Complainant was to “transfer to the Company all of the activity, trademarks and assets linked to the business the [Complainant] is currently conducting under the commercial name “UPrincess”. In addition, since the agreement also states that, upon signing the agreement, the Respondent was “deemed to a percent of the assets and activity of the UPrincess operation, equivalent to the percent of Shares that have been bought,” the Respondent would be entitled to 10 per cent ownership of the disputed domain name. Next, the Panel would need to examine whether the Complainant’s failure to form UPrincess S.A. within the time period stated within the agreement constituted a breach of that agreement and, since the Respondent not only paid for the formation of UPrincess S.A., but also contributed tens of thousands of dollars to its operation, including USD 18,000 paid beyond his initial contribution of USD 20,000 to the Complaint, the Panel would need to examine whether those acts evidenced that, even after the parties formed UPrincess S.A., the assets should have been transferred to that entity. The Respondent alleges that such a transfer, if the Panel were to find that such a duty existed, should have included all of the U PRINCESS-related trademarks, as well as the disputed domain name and <uprincess.net>. Thus, the Panel would also need to examine whether the Complainant even has standing to bring this UDRP proceeding, which likely should have been brought in the name of UPrincess S.A., if at all.
The Respondent also states that, even if this dispute was found within the scope of the Policy, the Complainant failed to establish the requirements prescribed by paragraph 4(a) of the Policy, since i) the Complainant was to transfer all the U PRINCESS-related trademarks to UPrincess S.A.; ii) the Respondent has rights and legitimate interests in the disputed domain name as either a shareholder of UPrincess S.A. or under the prior agreement of the parties; and iii) the Respondent did not register and use the disputed domain name in bad faith since it registered it for the purpose of operating the U PRINCESS business of which it is a 10 per cent shareholder. The Respondent concludes that it cannot be deemed to have registered and used the disputed domain name in bad faith when it is both the rightful owner of the trademark contained within that disputed domain name under the prior agreement between the parties and a shareholder in UPrincess S.A., the very entity that the Complainant was supposed to transfer the trademarks to under the terms of their agreement.
6. Discussion and Findings
According to paragraph 15(a) of the Rules: “A Panel shall decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable”. Paragraph 4(a) of the Policy directs that the Complainant must prove each of the following:
(i) that the disputed domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;
(ii) that the Respondent has no rights or legitimate interests in respect of the disputed domain name; and
(iii) that the disputed domain name has been registered and is being used in bad faith.
A. Identical or Confusingly Similar
The Complainant has provided evidence of ownership of trademark registrations valid in Ukraine for U PRINCESS alone (No. 190908) and in combination with the term “card” (No. 190907).
The Panel finds that the disputed domain name <uprincess.com> is identical to the Complainant’s trademark U PRINCESS, since it encompasses the trademark in its entirety with the mere addition of the gTLD “.com”, which can be disregarded for the purpose of comparison according to paragraph 4(a)(i) of the Policy. The disputed domain name is also confusingly similar to the Complainant’s trademark U PRINCESS CARD, since the disputed domain name comprises the dominant portion of that trademark.
Therefore, the Panel finds that the Complainant has proven the requirement prescribed by paragraph 4(a)(i) of the Policy.
B. Rights or Legitimate Interests
The Complainant is required to make a prima facie case that the Respondent lacks rights or legitimate interests and, once such prima facie case is made, the burden of production shifts to the Respondent to submit appropriate allegations or evidence demonstrating rights or legitimate interests in the disputed domain name. If the Respondent fails to demonstrate rights or legitimate interests in the disputed domain name in accordance with paragraph 4(c) of the Policy or on any other basis, the Complainant is deemed to have satisfied paragraph 4(a)(ii) of the Policy. See Malayan Banking Berhad v. Beauty, Success & Truth International, WIPO Case No. D2008-1393; Accor v. Eren Atesmen, WIPO Case No. D2009-0701; and WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”), paragraph 2.1.
The Panel finds that the Complainant has made a prima facie case and that the Respondent has failed to demonstrate rights or legitimate interests in the disputed domain name in accordance with paragraph 4(c) of the Policy for the following reasons.
The Respondent has been a partner and consultant of the Complainant. According to an agreement between the parties, they established a company, in 2015, in which the Complainant held 90 per cent and the Respondent 10 per cent of the shares. There is no reference in the 2013 agreement or elsewhere in the correspondence submitted by the parties that the Respondent might have been expressly authorized by the Complainant to register the disputed domain name in its own name.
Moreover, the Respondent claims to have registered the disputed domain name for the benefit of the project in which it was involved with the Complainant and it is clear that the Respondent acted in the project as a technical and marketing consultant without having rights to make any autonomous decision. Indeed, the Respondent itself mentioned that it was secretary of the company which was presided by the Complainant.
Therefore, the Panel finds that the Respondent cannot claim that it has been commonly known by the disputed domain name as an individual, business or other organization.
The evidence on records shows that the business partnership between the parties has been de facto terminated as a consequence of discussions between the parties in 2016. Despite the termination of the parties’ relationship the Respondent continues to use the disputed domain name for the U Princess web site. As the Respondent admits, the disputed domain name was registered as a general business strategy for the benefit of the parties’ joint venture U Princess project and the new web site was designed in his capacity as the technical consultant and a business partner. The Respondent’s subsequent blocking of the Complainant’s access and continued control of the disputed domain name and operation of the U Princess web site though, even there is a broaden dispute between the parties, cannot be considered to be “in connection with the bona fide offering of goods or services”, and is not a legitimate use of the disputed domain name; to allow otherwise would endorse unfair leveraging as a bona fide practice.
In view of the above, the Panel finds that also the requirement prescribed by paragraph 4(a)(ii) of the Policy has been met.
C. Registered and Used in Bad Faith
Based on the documents and statements submitted by the parties, the Respondent was clearly aware of the Complainant’s trademarks at the time of the registration of the disputed domain name since, at that time, it was cooperating in the Complainant’s business as a technical and marketing consultant and had signed an agreement with the Complainant concerning the establishment of a company in which it would have held 10 per cent of the shares while the Complainant would have held the majority (90 per cent).
As indicated above, the evidence leads the Panel to the inference that the Respondent was not authorized to register the disputed domain name in its own name. As Complainant asserts and the Respondent does not refute, when the Complainant became aware of the disputed domain name registration, he reluctantly agreed with the understanding that the registration would be in the Complainant’s name. Instead, the Respondent registered the disputed domain name in his name and never transferred the ownership to the Complainant or the company U Princess S.A.
The parties’ business partnership has since ceased, yet the Respondent maintains controls of the disputed domain name and the U Princess website, at one point even revoking the Complainant’s access to it. In view of the above, the Panel finds that the Respondent’s actions amount to bad faith, particularly since the contents of the web site to which it resolves are apt to misled users into believing that the web site and the services promoted therein are controlled or approved by the Complainant or affiliated with it, while this is not – or no longer ‑ the case. In the Panel’s view, the Respondent’s registration and use of the disputed domain name represents an abusive threat hanging over the Complainant’s head, which falls squarely within the meaning of bad faith under the Policy, paragraph 4(a)(iii).
Therefore, the Panel finds that the disputed domain name was registered and is being used in bad faith.
For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the disputed domain name <uprincess.com> be transferred to the Complainant.
Date: January 20, 2017