WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Price Costco International, Inc. v. Salem Najjarine

Case No. DAU2017-0020

1. The Parties

The Complainant is Price Costco International, Inc. of Issaquah, Washington, United States of America ("US" or "United States"), represented by Banki Haddock Fiora, Australia.

The Respondent is Salem Najjarine of Cabramatta West, New South Wales, Australia.

2. The Domain Name and Registrar

The disputed domain name <costcobusinessdelivery.com.au> is registered with Synergy Wholesale Pty Ltd. (the "Registrar").

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the "Center") on August 4, 2017. On the same date, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On August 7, 2017, the Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the Respondent's contact details.

The Center verified that the Complaint satisfied the formal requirements of the .au Dispute Resolution Policy (the "Policy" or ".auDRP"), the Rules for .au Dispute Resolution Policy (the "Rules"), and the WIPO Supplemental Rules for .au Domain Name Dispute Resolution Policy (the "Supplemental Rules").

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on August 11, 2017. In accordance with the Rules, paragraph 5(a), the due date for Response was August 31, 2017. The Respondent did not submit any response. Accordingly, the Center notified the Respondent's default on September 1, 2017.

The Center received a number of email communications from the Respondent between September 3, 2017 and September 11, 2017.

The Center appointed James A. Barker as the sole panelist in this matter on September 19, 2017. 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 part of a large US-based corporate group, Costco. Costco operates an international chain of membership warehouse stores, which provide a broad range of retail and wholesaling services to consumers and business members.

The first Costco warehouse opened in 1983 in Seattle, United States. As of August 2016, Costco operates 734 warehouses at locations in the United States, Canada, Mexico, United Kingdom of Great Britain and Northern Ireland, Taiwan Province of China, Republic of Korea, Japan, Australia, France, Iceland and Spain, had more than 88.9 million members worldwide, and had annual revenues of more than USD 119 billion.

The Complainant is the entity within the Costco corporate group that owns and licenses intellectual property rights outside the United States pertaining to Costco's business operations in those countries. Costco trades under the name Costco in all jurisdictions in which it is based. Costco operates a business delivery service for its US-based operations. US-based business members can order products from Costco online and have those goods delivered by Costco. The first Australian Costco warehouse opened in 2009 in Docklands, Victoria. As of the date of the Complaint, Costco operates eight warehouses in Australia throughout Victoria, New South Wales, Queensland and South Australia.

The Complainant is the registrant of the domain name <costco.com.au>. The corresponding website has been used to promote the Costco business in Australia since at least October 2009.

The Complainant is the owner of 17 Australian trade mark registrations incorporating the term "Costco". These marks are registered for a wide variety of retail and wholesale goods and services. Relevantly to the Complaint these include:

- COSTCO, Class 16 Printed matter and publications (Australian Trade Mark 616581), registered from November 22, 1993;

- COSTCO, Class 35 Distribution services and class 39 Storage and delivery services (Australian Trade Mark 626506), registered from April 6, 1994;

- COSTCO WHOLESALE, Class 39 Delivery of goods by ground transportation (Australian Trade Mark 786731), registered from February 25, 1999;

- COSTCO, Class 39 Delivery of goods by ground transportation; floral delivery services (Australian Trade Mark 943556), registered from February 12, 2003; and

The Complainant is also the owner of numerous trade mark registrations incorporating the term "Costco" in other jurisdictions.

As confirmed by the Registrar, the Respondent registered the disputed domain name on October 11, 2015.

5. Parties' Contentions

A. Complainant

The Complainant says that the disputed domain name is confusingly similar to its COSTCO mark. The disputed domain name contains the entirety of the Complainant's trade mark COSTCO with the addition of the suffix "deliveryservices". The addition of the suffix "deliveryservices" does not avoid confusing similarity between the mark COSTCO and the disputed domain name. COSTCO is the distinctive feature of the disputed domain name. While business delivery services are not presently operational in Australia, the term "delivery service" is descriptive of services offered by Costco in the US.

The Complainant says that the Respondent has no rights or legitimate interests in the disputed domain name. The Respondent is not ordinarily known by the trade mark COSTCO, nor has he been licensed by the Complainant to use any of the COSTCO marks.

The Complainant provides evidence of an historical search for the Australian Business Number listed on the WhoIs search for the disputed domain name (36 102 418 848). This reveals that the Respondent was, from November 4, 2015 to January 1, 2016, the owner of the Australian registered business names Costco Business Delivery and Costco Delivery. A search of the Australian Securities Investment Commission for these business names indicates that that they were registered on November 4, 2015 and cancelled less than two months later on January 1, 2016. It is a settled principle under the auDRP that the registration of an Australian Business Name does not, by itself, establish that a respondent has rights or legitimate interests in the domain name that corresponds to the business name. A respondent must also have shown that it has traded under the business name in good faith.

The Complainant submits that the fact that the business names were registered for less than two months is evidence that they were never actually used to trade by the Respondent. Furthermore, the results of Google searches of the terms "Costco business delivery" and "Costco delivery" show no connection at all to the Respondent. Accordingly, the Complainant submits that the Respondent is not commonly known by the disputed domain name.

The webpage to which the disputed domain name currently resolves is a parking page. Under the auDRP, the use of a domain name to resolve to a parking page is generally not considered a bona fide offering of goods or services.

Lastly, the Complainant says that the disputed domain name has been registered and used in bad faith. The disputed domain name was registered by the Respondent at some time in late 2015. The registration post-dates, by many years, both the registration of the COSTCO marks by the Complainant and the commencement of the Costco business in Australia. It is inconceivable that the Respondent did not know of the Complainant's marks or the Costco business at the time of registration of the disputed domain name.

The Complainant says that the Respondent's conduct amounts to passive holding of the disputed domain name. Passive holding of a domain name can constitute bad faith when considering other circumstances, for instance a complainant having a well-known trade mark and there being no obvious reason or justification for the respondent's selection of a domain name.

The Complainant points out that the Policy, paragraph 4(b)(v), describes the following as being evidence of bad faith: "if any of your representations or warranties as to eligibility or third party rights given on application or renewal are, or subsequently become, false or misleading in any manner." The Complainant says that it can be inferred that the registration and subsequent cancellation of the business names, at the same time as the registration of the disputed domain name, shows an intention by the Respondent to manufacture a genuine connection between him and the disputed domain name that did not actually exist. Any representations or warranties given as to that connection were false and misleading.

B. Respondent

The Respondent did not reply to the allegations against him.

On September 3, 2017, the Respondent sent an email to the Center, stating inter alia that "This email is to address that I have submitted an e ticket to delete the domain name on 31st of August. Unfortunately it cannot be done manually and needs to be done from their end. They advised me to wait for the time lapse then let it delete itself, however I did advised them that it had to be done urgently as requested by WIPO. They complied and now I'm just waiting from their end for deletion of the domain name."

Following a communication from the Complainant's representative, the Center confirmed that that the disputed domain name would remain locked by the Registrar for the pendency of these proceedings. The Complainant confirmed that it did not wish to suspend this matter and asked that it be allowed to proceed. On September 11, 2017, the Respondent sent an email stating inter alia that "I would like to request a suspension of the proceedings and agree to the settlement. I would like the auDRP proceedings to be suspended so I could cancel the domain name, which I have tried my best to do." In response to a further communication from the Complainant's representative, indicating that it wished the proceedings to continue, the Respondent sent another email on September 11, 2017, stating in part "Then I will transfer the domain name. […] I'm trying to solve this matter and get rid of this disputed domain name but you decide to proceed with proceedings, it makes no sense."

6. Discussion and Findings

For the Complaint to succeed, under paragraph 4(a) of the Policy, the Complainant must prove that:

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

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

(iii) the disputed domain name was registered in bad faith or subsequently used in bad faith.

The onus is on the Complainant to establish each of the above circumstances.

The Panel notes that the Policy is, with some notable exceptions discussed below, substantially similar to the Uniform Domain Name Dispute Resolution Policy ("UDRP") and, as such, the Panel has drawn on authority concerning the UDRP, in relation to similar terms of the Policy.

A. Consent to Transfer

As noted above, the Respondent sent several emails, indicating that he was seeking to divest himself of the disputed domain name or reach some settlement, and claiming that he could not understand why he was unable to do this. The Respondent did not otherwise deny the allegations against him.

A question is whether these communications from the Respondent amount, in effect, to a consent to transfer the disputed domain name. As noted in The Cartoon Network LP, LLLP v. Mike Morgan, WIPO Case No. D2005-1132 (the "Cartoon Network case"): "[A] genuine unilateral consent to transfer by the Respondent provides a basis for an immediate order for transfer without consideration of the paragraph 4(a) elements. Where the Complainant has sought transfer of a disputed domain name, and the Respondent consents to transfer, then pursuant to paragraph 10 of the Rules the Panel can proceed immediately to make an order for transfer. This is clearly the most expeditious course (see Williams-Sonoma, Inc. v. EZ-Port, WIPO Case No. D2000-0207)."

The panel in the Cartoon Network case also outlines two other approaches that panels have taken in response to a consent to transfer:

- Some panels have held that the consent to transfer is effectively a concession that the three elements of the Policy have been satisfied, and ordered transfer on this basis. Qosina Corporation v. Qosmedix Group, WIPO Case No. D2003-0620; DESOTEC N.V. v. JACOBI CARBONS AB, WIPO Case No. D2000-1398.

- Still other panels have proceeded to analyze whether the evidence submitted satisfies the three elements of the Policy. Société Française du Radiotéléphone-SFR v. Karen, WIPO Case No. D2004-0386; Eurobet UK Limited v. Grand Slam Co, WIPO Case No. D2003-0745.

Before proceeding to any of these approaches, however, the Panel would need to determine that the Respondent has genuinely consented to the transfer of the disputed domain name. The Respondent did not explicitly agree to a "transfer". However, none of the communications from the Respondent raise objections to a finding in favour of the Complainant. The Respondent appears only to express frustration that the proceedings are continuing despite his indication of an intention to "cancel the domain name". In light of these communications from the Respondent, the Panel does not consider that the Respondent has unequivocally agreed to the transfer of the disputed domain name. To ensure fairness to both Parties, as required under paragraph 10(b) of the Rules, the Panel considers that an agreement to transfer should not be established from anything other than a clear statement to this effect from the Respondent.

However, and in accordance with paragraph 10(d) of the Rules, the Panel considers that the above-mentioned communications from the Respondent are relevant to this dispute. How they are relevant is less clear. There appear to be three ways to approach them:

One is that the Respondent genuinely, if somewhat unclearly, consents to the transfer of the disputed domain name. Given the ambiguity of the communications, however, the Panel considers it appropriate to proceed to a decision on the merits.

A second possibility is that the Respondent is feigning a desire to cancel the disputed domain name in an effort to draw out these proceedings. As mentioned above, in response to the communications from the Respondent, the Complainant confirmed that it wished these proceedings to continue and did not seek a suspension. In accordance with the Complainant's request, and consistent with the procedure under the Policy and Rules, the Panel also considers that it would be appropriate to proceed to a decision on the merits.

A third possibility is that the Respondent does not contest the allegations against him. However, this much may already be established by the failure of the Respondent to submit a formal Response to the allegations against him. As noted by section 4.3 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition ("WIPO Overview 3.0"), "Noting the burden of proof on the complainant, a respondent's default (i.e., failure to submit a formal response) would not by itself mean that the complainant is deemed to have prevailed; a respondent's default is not necessarily an admission that the complainant's claims are true." The general position under the Policy is the same. See section 4.6 of the auDA Overview of Panel Views on Selected auDRP Questions First Edition ("auDA auDRP Overview 1.0").

Accordingly, the Panel has proceeded to consider each of the relevant elements of the Policy, as follows.

B. Identical or Confusingly Similar

There is no dispute that the Complainant has rights in its COSTCO mark and uses that mark in Australia in connection with its business.

The Panel finds that the disputed domain name is confusingly similar to the Complainant's mark. It is well-established under the Policy that the entire incorporation of mark in a domain name can be sufficient, on its own, for a finding of confusing similarity. The addition of the term "businessdelivery" only serves to reinforce that confusion. As noted in section 1.9 of the auDA auDRP Overview 1.0:

"The addition of merely generic, descriptive, or geographical wording to a trademark or name in a domain name would normally be insufficient, of itself, to avoid a finding of confusing similarity under the first element of the auDRP. In such a situation, panels have usually found the incorporated trademark or name to constitute the dominant or principal component of the domain name. However, in certain cases panels have come to a different conclusion, where a trademark or name (especially one that is of a descriptive nature) is incorporated or subsumed within other words or textual elements of the domain name so that the trademark or name is not clearly the dominant component of the domain name."

This is not a case where the Complainant's mark is subsumed within another word. It is clearly distinguishable in the disputed domain name. It is also notable that the disputed domain name corresponds to a domain name (<costcobusinessdelivery.com>) that the Complainant uses in connection with its business in the US.

For these reasons, the Panel finds that the Complainant has established its case under paragraph 4(a)(i) of the Policy.

C. Rights or Legitimate Interests

At a minimum, the burden on the Complainant under this element is to establish a prima facie case against the Respondent. See section 2.1, WIPO Overview 3.0. A prima facie case is one that is credible in the absence of evidence to the contrary. This general position under the Policy is the same as that under the UDRP: see the auDA auDRP Overview 1.0, paragraph 2.1.

The Complainant has established a prima face case against the Respondent in relation to this second element under the Policy. The burden of production is therefore on the Respondent to rebut that argument. The Respondent has provided no substantive case in reply to the Complaint.

There is otherwise little evidence in the case file that would, on its own, suggest that the Respondent might have some right or legitimate interest in the disputed domain name. The Respondent's only communications in connection with this case suggest only that he is seeking some way to get rid of the disputed domain name. In none of the Respondent's communications on record does he claim any rights or legitimate interests in the disputed domain name. The Panel also considers that it is unlikely that the Respondent could demonstrate such rights or legitimate interests, given the Complainant's extensive portfolio of marks, and the circumstances of bad faith discussed further below.

Accordingly, the Panel finds that the Complainant has established its case for the purpose of paragraph 4(a)(ii) of the Policy.

D. Registered or Subsequently Used in Bad Faith

Unlike the UDRP, the Policy provides that the Complainant can establish its case by showing that the disputed domain name was registered or used in bad faith.

The disputed domain name in this case was registered in 2015. The Panel considers that the evidence strongly suggests that the disputed domain name was both registered and has been used in bad faith.

The Respondent's registration of the disputed domain name significantly post-dates the Complainant's registration of its marks. In Australia, these include marks registered as early as 1993. The Complainant's mark appears to be well-known and does not appear to be a term with a common meaning or association unconnected to the Complainant. The Respondent has chosen a domain name that is confusingly similar to the Complainant's marks. Further, the Respondent's addition of the term "businessdelivery" corresponds exactly to a term that the Complainant uses in connection with its business in the US and a domain name the Complainant registered in the ".com" space. The Respondent himself does not contest the Complainant's allegation that he must have been aware of its mark when he registered the disputed domain name.

These facts suggest to the Panel that the Respondent registered the disputed domain name to take some unfair advantage of its association with the Complainant's mark. The evidence is not clear as to what that specific purpose might have been. There was no evidence that the disputed domain name was used in connection with an active website. Regardless, only the Respondent can attest to his actual intention. He has chosen not to provide any explanation. Without such an explanation, there is a reasonable inference that the registration was done to misleadingly suggest some connection with the Complainant. The Panel therefore finds that the disputed domain name was at least registered in bad faith.

Although strictly unnecessary to go further, the Panel also notes that it would find that the disputed domain name was also used in bad faith. The evidence indicates that the Respondent has passively held the disputed domain name pointing it only to a parking website. It is well-established that such a passive holding of a domain name, taken in conjunction with other evidence of bad faith conduct as appears in the present case, amounts to use in bad faith within the terms of paragraph 4(a)(iii) of the Policy. See Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003. The circumstances of the registration of the disputed domain name, set out above, point to intentional misleading conduct that would have continued past the time of the registration itself.

The evidence in the Complaint (set out above) also puts doubt over whether the Respondent was entitled to register the disputed domain name under auDA's eligibility requirements. Those requirements relevantly include that the registrant was "trading under a registered business name in any Australian State or Territory". However at the time the disputed domain name was registered in October 2015, there is no evidence that the Respondent had any relevant business name. There is no evidence that the Respondent met any other eligibility criteria for the registration of the disputed domain name. As outlined in section 3.2A of the auDA auDRP Overview 1.0: there is evidence of bad faith registration or use of a domain name where the respondent registered the domain name despite not meeting the applicable eligibility requirements.

For these reasons, the Panel finds that the Complainant has established its case for the purpose of paragraph 4(a)(iii) of the Policy.

7. Decision

For all 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 <costcobusinessdelivery.com.au> be transferred to the Complainant.

James A. Barker
Sole Panelist
Date: October 3, 2017