WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

NKL Associates S.R.O. v. Domain Administrator, Fundacion Privacy Services LTD

Case No. D2020-0416

1. The Parties

The Complainant is NKL Associates S.R.O., United States of America (“United States”), represented by Fischer Law, P.L., United States.

The Respondent is Domain Administrator, Fundacion Privacy Services LTD, Panama.

2. The Domain Name and Registrar

The disputed domain name <xnxx2.com> is registered with Media Elite Holdings Limited dba Register Matrix (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 21, 2020. On February 21, 2020, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On February 21, 2020, 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 the Complainant on February 24, 2020, providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. The Complainant filed amended Complaints on February 26 and 27, 2020.

The Center verified that the Complaint together with the amended Complaints 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 February 28, 2020. In accordance with the Rules, paragraph 5, the due date for Response was March 19, 2020. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on March 20, 2020.

The Center appointed Andrew D. S. Lothian as the sole panelist in this matter on March 24, 2020. 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 engaged in the provision of adult entertainment services via a website at “www.xnxx.com” (“the Complainant’s website”). Extracts from the Internet Archive “Wayback Machine” show that the Complainant’s website has been operated as an online adult entertainment business since at least June 6, 2002, originally by the Complainant’s predecessors in title.

The Complainant owns a United States trademark registration for the word mark XNXX.COM under registration No. 4363782, registered on July 9, 2013, under international class 41, with a claimed first use in commerce date of June 1, 2004. The Complainant also owns a European Union trademark registration for the word mark XNXX under registration No. 11946217, registered on November 26, 2013, in international class 41.

The disputed domain name was created on July 19, 2006. Little is known regarding the Respondent. According to historic screenshots dated 2010 and 2019 produced by the Complainant, the website associated with the disputed domain name features pay-per-click (“PPC”) links directing to adult entertainment services in competition with the Complainant. An extract from a domain name aftermarket website also produced by the Complainant shows that the disputed domain name has been offered for sale in the sum of USD 19,500.

The Registrant Organization field on the WhoIs record for the disputed domain name, as produced by the Complainant, listed the registrant of the disputed domain name as “Fundacion Privacy Services LTD”, suggesting that it might be a privacy service. However, upon verification by the Registrar, no alternative or underlying registrant was disclosed.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the disputed domain name is identical or confusingly similar to a trademark in which it has rights; that the Respondent has no rights or legitimate interests in the disputed domain name; and, that the disputed domain name has been registered and is being used in bad faith.

The Complainant notes that the distinctiveness of its XNXX.COM trademark and rights have been recognized by panels in previous cases, namely WGCZ S.R.O. v. WhoIsProtectService.net / Ivan Makarov, supra and WGCZ S.R.O. v. WhoIsProtectService.net Protectservice, Ltd. / AVO Ltd AVO Ltd, WIPO Case No. D2014-0545, the latter of which found that the addition of the “n” element as the second letter of such mark affords a degree of distinctiveness which is only heightened by the renown developed as a result of the very substantial Internet traffic to the Complainant’s website.

The Complainant narrates its registered rights and describes the chain of title by which it acquired the relative rights and goodwill. The Complainant asserts that it also has extensive common law rights in the XNXX trademark, noting that it has used this in online international commerce since 2002 and adding that by 2004 its use of such mark was extensive. The Complainant provides data from Google Trends, which it says shows that there was a steady rise in Internet user interest in the search terms “xnxx.com” and “xnxx”, starting in 2004 and explaining that the former term showed a sharp rise throughout 2005 while interest in the latter term increased at a slower rate. The Complainant argues that the data shows that Internet users were not looking for “xnxx” as a generic term but for the Complainant’s website specifically.

The Complainant asserts that its mark has achieved secondary meaning both in the press and in the relevant marketplace, adding that the Complainant’s website is currently one of the most popular adult entertainment websites in the world, having approximately 16.3 million unique visitors in the United States every month and being the 181st most visited site globally and 157th most visited in the United States, together with being the second most popular website in the adult category of Internet analytics agency “Alexa”. The Complainant produces media coverage stating that, in its category, the Complainant’s website is the sixth most popular website on the Internet.

The Complainant submits that the disputed domain name merely adds a “2” after the Complainant’s mark, noting that this does nothing to lessen the likelihood of confusion created by the disputed domain name. The Complainant contends that no facts exist that would lead a reasonable person to conclude that the Respondent has any rights or legitimate interests in the disputed domain name. The Complainant asserts that the disputed domain name has been used for a commercial purpose to provide links to services directly competitive with those offered by the Complainant and that the Respondent will accordingly be unable to demonstrate rights or legitimate interests therein. The Complainant contends that capitalizing on the fame of a trademark in order to sell goods or services that directly compete with the trademark owner is not a bona fide offering of goods or services or a legitimate noncommercial or fair use, adding that the Respondent is profiting financially from the disputed domain name and chose this to profit from the goodwill of the Complainant’s XNXX mark.

The Complainant asserts that the disputed domain name was registered long after the Complainant began use of its XNXX mark and accrued common law rights, adding that all available evidence shows that after the disputed domain name was registered it began to offer links to the Complainant’s competitors. The Complainant submits that the Respondent cannot claim any rights or legitimate interests based on familiarity with either the general public or the relevant market, and that no evidence indicates that the Respondent is commonly known by the text of the disputed domain name, nor should this be presumed by the Panel. The Complainant adds that the Respondent cannot use the disputed domain name for a legitimate purpose because it is identical or confusingly similar to the Complainant’s mark.

The Complainant asserts that as its common law rights were well-established in 2002 and were well known by 2004, any claim by the Respondent that it was not aware of the Complainant’s mark when it registered the disputed domain name is not credible, adding that even if the Respondent were to claim that the Complainant’s common law rights were not established by the date of registration, it has engaged in speculative registration, which can be held to be in bad faith where it has been made in full knowledge of the likely use of the trademark by the Complainant. The Complainant submits that should the Panel find that the Respondent did not have actual knowledge of the Complainant’s mark when it registered the disputed domain name, constructive knowledge of a mark is properly applied in UDRP proceedings.

The Complainant submits that the Respondent desired to disrupt the Complainant’s business and to divert Internet traffic away from the Complainant’s website after users mistakenly arrived at the disputed domain name having searched for “xnxx” on a search engine, adding that the Respondent hoped to create a likelihood of confusion amongst the consuming public as to the source, sponsorship, affiliation, or endorsement of the website located at the disputed domain name. The Complainant argues that the Respondent could not possibly have come up with the disputed domain name as a domain name independently and then, coincidentally, launched a site that contains links to Complainant’s competitors. The Complainant notes that the Respondent is offering to sell the disputed domain name for a grossly inflated price exceeding its associated out-of-pocket costs, adding that this is clear evidence of bad faith. The Complainant concludes that it is reasonable for the Panel to find that there is the potential for reasonable confusion arising from users looking for the Complainant’s mark being directed to the Respondent’s website or another online location, no matter where the actual destination may be.

B. Respondent

The Respondent did not reply to the Complainant’s contentions.

6. Discussion and Findings

To succeed, the Complainant must demonstrate that all of the elements enumerated in paragraph 4(a) of the Policy have been satisfied:

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

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

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

A. Identical or Confusingly Similar

There are two parts to the inquiry under the first element of the Policy, which functions primarily as a standing requirement. The Panel must first examine whether the Complainant has UDRP-relevant rights in a trademark. It is not necessary for the purposes of the first element inquiry that such mark pre-date the creation date of the disputed domain name itself. Secondly, the Panel assesses identity or confusing similarity by comparing such rights of the Complainant as have been identified to the disputed domain name, typically in a straightforward side-by-side comparison. For the purposes of this exercise, the generic Top-Level Domain (“gTLD”), in the case of the disputed domain name, “.com”, is typically disregarded.

The Panel is satisfied that the Complainant has UDRP-relevant rights in its registered trademarks for the terms XNXX and XNXX.COM. Comparing the former mark to the second level of the disputed domain name, it can be seen that these are alphanumerically identical, with the exception of the addition of the figure “2” after the letters “xnxx” in the disputed domain name. It is well-understood in cases under the Policy that the addition of other terms to a trademark (whether descriptive, geographical, pejorative, meaningless, or otherwise) would not prevent a finding of confusing similarity under the first element (see section 1.8 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”)).

In addition to citing its registered trademarks, the Complainant seeks to establish its ownership of a common law mark for the term XNXX. There is no doubt in the Panel’s mind that the Complainant’s mark is well known today and that the Complainant has considerable goodwill vested in its XNXX mark based upon the independent media coverage that it has produced, which shows that said mark is used in connection with one of the most popular websites in its particular line of business both globally, and nationally in the United States. The question of when these rights were established is not relevant to the first element analysis but, in the present case, it is important for the assessment of the third element under the Policy and will be discussed in the relevant section below.

The Panel finds that the disputed domain name is confusingly similar to the Complainant’s trademark and therefore that the first element under the Policy has been established.

B. Rights or Legitimate Interests

Paragraph 4(c) of the Policy lists several ways in which the Respondent may demonstrate rights or legitimate interests in the disputed domain name:

“Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, shall demonstrate your rights or legitimate interests to the domain name for purposes of paragraph 4(a)(ii):

(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.”

The consensus of previous decisions under the Policy is that a complainant may establish this element by making out a prima facie case, not rebutted by the respondent, that the respondent has no rights or legitimate interests in a domain name. In the present case, the Complainant submits that there are no facts in existence that would lead a reasonable person to conclude that the Respondent has any rights or legitimate interests in the disputed domain name, that the disputed domain name has been used for a commercial purpose which does not constitute a bona fide offering of goods or services, that the Respondent is capitalizing on the fame of the Complainant and profiting financially from the goodwill of the Complainant’s XNXX mark by way of directly competing services, and that there is no evidence that the Respondent is known by the text of the disputed domain name. The Panel is satisfied that these submissions are sufficient to establish the requisite prima facie case. The burden of production therefore shifts to the Respondent to bring forward evidence of rights or legitimate interests in the disputed domain name.

The Respondent has chosen not to engage with the present proceeding and did not offer any submissions or evidence which might have supported a claim of rights or legitimate interests in respect of the disputed domain name. The Panel has not been able to determine any likely rights or legitimate interests which the Respondent might have claimed had it otherwise participated. In these circumstances, the Panel finds that the Respondent has failed to rebut the Complainant’s prima facie case and accordingly that the second element under the Policy has been established.

C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy provides four, non-exclusive, circumstances that, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith:

“(i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or

(ii) you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or

(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website or other on line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location or of a product or service on your website or location.”

The principal focus of the Complainant’s case under this head is that the Respondent intentionally registered the disputed domain name to benefit commercially from confusion between the disputed domain name and the Complainant’s mark. The Complainant asserts that the Respondent is redirecting users arriving at the website associated with the disputed domain name to a variety of PPC hyperlinks which lead to services in competition with those of the Complainant. This is effectively a submission in terms of paragraph 4(b)(iv) of the Policy.

One potential obstacle to the Complainant’s case on registration and use in bad faith is that its registered trademarks postdate the creation of the disputed domain name by a number of years, so that the Respondent could not have had these in contemplation at the time when the disputed domain name was registered in 2006 (see, generally, the discussion in section 3.8 of the WIPO Overview 3.0). The Complainant however asserts that it had established unregistered or common law trademark rights in the XNXX mark by that date.

The independent media coverage and Internet traffic analysis produced by the Complainant are of recent date and do not assist the Complainant on this particular issue. The Panel therefore turns to examine such evidence as has been produced by the Complainant of its rights in the term XNXX dating from before 2006. This consists of entries from the Internet Archive “Wayback Machine” dated 2002 and 2004 showing the Complainant’s website at those dates, together with an analysis of search terms related to the Complainant’s website from “Google Trends” for the period between January 2004 and April 2006. As the Panel understands it, "Google Trends" is a service which takes a representative sample of the Google search engine’s database to show the popularity of a given term relative to the site’s total search volume (see the discussion in UNIQA Insurance Group AG v. Emir Kurtovic, Agencija Raptor, WIPO Case No. D2019-2522).

The Panel notes from the Internet Archive evidence that the Complainant’s website was already operating under the XNXX brand in its chosen field as early as 2002. Furthermore, from the “Google Trends” data, it is possible to identify a clear trend of rising public interest between January 2004 and April 2006 in the domain name <xnxx.com> used for the Complainant’s website. While it is somewhat more limited in extent than the Panel would have preferred, this unchallenged evidence of the Complainant is sufficient on balance to make the reasonable inference that, in the four years leading up to the date of registration of the disputed domain name, the Complainant had built up a reputation in the Complainant’s website and relative domain name by way of actual public recognition which gave rise to a secondary meaning in the term “xnxx” and in the domain name <xnxx.com> to denote the Complainant’s adult entertainment services. Given this background, it is not unreasonable to infer that the Complainant’s reputation and ability to generate search engine queries would have come to the Respondent’s knowledge and that the Respondent’s motivation for the registration of the disputed domain name was the creation of an intentional typographical variant of the Complainant’s domain name in order to benefit from the related Internet traffic, which it directed to PPC links.

This conclusion is also broadly supported by the nature of the disputed domain name itself, which couples the letters “xnxx”, as featured in the domain name of the Complainant’s website, to the figure “2”. There is no evidence before the Panel indicating that the letters “xnxx” are generic, or that they are descriptive of adult entertainment services. As the panel found in WGCZ S.R.O. v. WhoIsProtectService.net Protectservice, Ltd. / AVO Ltd AVO Ltd, supra, the addition of the letter “n” is a distinctive feature of the Complainant’s <xnxx.com> domain name which is unlikely to be selected by another party independently or by coincidence. Accordingly, in all of the above circumstances, the Panel considers that the Complainant has made out its case on registration and use in bad faith in terms of paragraph 4(b)(iv) of the Policy.

The Panel notes for completeness that there are further indicia of registration and use in bad faith in the present matter in addition to the circumstances described in paragraph 4(b)(iv) of the Policy. The first is the fact that the disputed domain name has been offered for sale for a large sum of money, yet does not appear to have any objective value other than that it references the Complainant’s XNXX mark. This suggests that the Respondent may have registered the disputed domain name primarily for the purpose of selling it to the Complainant or to a competitor for an amount in excess of its out-of-pocket costs in terms of paragraph 4(b)(i) of the Policy. Secondly, the disputed domain name has been registered in the name of an apparent privacy service, yet with the same privacy service underlying it or indeed no different underlying registrant at all. Where a privacy service is revealed to be underlying another privacy service, this is sometimes referred to as a “Russian doll” scenario (see, for example, Matvil Corporation v. Private Registration / PrivacyProtect.org, WIPO Case No. D2011-0841). Given, in the present case, that the website associated with the disputed domain name appears on balance to be trademark-abusive, the Panel considers that the use of a privacy service in the manner described is more probably than not an attempt on the part of a bad faith Respondent to conceal its identity from the Complainant and the Panel. Thirdly, the Respondent has been provided with an opportunity to address the Complainant's contentions on this topic, to explain the intent behind its registration and use of the disputed domain name and to set out any alleged good faith motivation. The fact that it has decided not to do so can likewise be regarded as an indicator of registration and use in bad faith (see, for example, Alcoholics Anonymous World Services, Inc., v. Lauren Raymond, WIPO Case No. D2000-0007).

In all of the above circumstances, the Panel finds that the disputed domain name has been registered and is being used in bad faith and accordingly that the third element under the Policy has been established.

7. Decision

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 <xnxx2.com> be transferred to the Complainant.

Andrew D. S. Lothian
Sole Panelist
Date: April 7, 2020