WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Costco Wholesale Corporation, Costco Wholesale Membership, Inc. v. Costco Administration

Case No. D2017-0781

1. The Parties

The Complainant is Costco Wholesale Corporation and Costco Wholesale Membership, Inc. of Issaquah, Washington, United States of America (“United States”), represented by Law Office of Mark J. Nielsen, United States.

The Respondent is Costco Administration of Kaisten, Switzerland.

2. The Domain Name and Registrar

The disputed domain name <costcoadministration.com> is registered with Ascio Technologies Inc. (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on April 18, 2017. On April 19, 2017, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On April 20 2017, 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 April 26, 2017. In accordance with the Rules, paragraph 5, the due date for Response was May 16, 2017. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on May 18, 2017.

The Center appointed Antony Gold as the sole panelist in this matter on June 1, 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 Costco Wholesale Membership Inc., a California corporation, and Costco Wholesale Corporation, a Washington corporation. The first-named company is a subsidiary of the second-named company and owns the United States trade marks and domain names which are used by the Complainant.

The Complainant provides warehouse club merchandising and related services. It has traded under the COSTCO trade mark since 1983 and presently operates over 729 warehouse stores worldwide, including over 508 COSTCO-branded warehouse stores in the United States. The Complainant’s sales in the fiscal year 2016 were USD 116 billion.

The Complainant has a large number of trade mark registrations for COSTCO. These include, by way of example only, United States trade mark No. 2029565 for the word mark COSTCO in class 35, applied for on March 20, 1995 and registered on January 14, 1997. It has an extensive Internet presence, with many online retail stores. The Complainant has a large domain name portfolio including <costco.com>, <costco.ca> and <costco.co.uk>.

The disputed domain name was registered by the Respondent on February 5, 2017. It points to an active website which comprises a box with a heading at the top “LIVE CHAT WITH OUR SUPPORT TEAM”. Beneath that is a further heading “Welcome to Support” and underneath that is a short paragraph: “Welcome to our live chat. Please start your chat now and we will put you in touch with one of our agents”. The remainder of the box comprises spaces into which the Internet user is required to insert his or her name, email address and question in order to start a chat.

5. Parties’ Contentions

A. Complainant

The Complainant says that the disputed domain name is confusingly similar to a trade mark or service mark in which it has rights. In support of this contention, the Complainant has provided details of its numerous trade mark registrations for COSTCO in the United States as well as in the European Union, the United Kingdom of Great Britain and Northern Ireland and other territories. These take a variety of forms, including word only, stylized and word and device registrations. Specific details of one of the Complainant’s United States trade marks are set out above.

The Complainant says that “Costco” is a coined name developed by its founders and it does not believe that there are any legitimate third-party trade mark registrations for COSTCO in any of the countries in which it trades.

The Complainant says that the addition of a common term such as “administration” to its COSTCO trade mark does not prevent the disputed domain name from being confusingly similar to its trade mark. In support of this contention, it refers to a number of decisions of other panels under the Policy including Quixtar Investments, Inc. v. Dennis Hoffman, WIPO Case No. D2000‐0253 in which the panel said that a domain name comprising the complainant’s trade mark and the generic term “mortgage” has “little if any, affect on a determination of legal identity between the domain name and the mark”. The Complainant refers also to a number of decisions under the Policy in which it has been involved, including Costco Wholesale Corporation and Costco Wholesale Membership Inc. v. Yezican Industries and Domains By Proxy, Inc., WIPO Case No. D2007‐0638 in which the panel said that “adding the common English words ʻmyʼ and ʻbookʼ in the Domain Name [<mycostcobook.com>] does not avoid confusing similarity with the COSTCO mark.”

Moreover, the Complainant says that, because it has significant administrative operations, the addition of a common term such as “administration” to the COSTCO trade mark exacerbates, rather than reduces, the confusing similarity between the Complainant’s trade mark and the disputed domain name. This is because Internet users are apt to assume that the webpage to which the disputed domain name points relates in some way to the operation of the Complainant’s administrative structures.

The Complainant asserts that the Respondent has no rights or legitimate interests in the disputed domain name. It says that the Respondent has not used the disputed domain name in connection with a bona fide offering of goods or services, that it owns no trade mark registrations for the disputed domain name, or any part of it, and that it has not been commonly known by the disputed domain name. It says that the Respondent has registered the disputed domain name purely as a device to drive Internet traffic to its website by deceiving consumers into believing that the Respondent is associated in some way with the Complainant. The Complainant refers to Sanrio Company, Ltd. v. Neric Lau, WIPO Case No. D2000‐0172, in which the panel said that the respondent “cannot be said to have legitimately chosen the [<sanriosurprises.com>] domain name unless it was seeking to create an impression of an association with Complainants. Since there is no such authorized association, Respondent’s interests in the domain name cannot be said to be legitimate.”

Lastly, the Complainant says that the Respondent registered and is using the disputed domain name in bad faith. So far as bad faith registration is concerned, the Complainant points out that its first trade mark registrations for COSTCO were obtained in 1985 and that, by 2016, its business very substantial, with an annual turnover of approximately USD 116 billion. Because the COSTCO brand was so well known by the time of the Respondent’s registration of the disputed domain name on February 5, 2017, the Complainant says that the Respondent must have been aware of its rights as at the date of registration. The Complainant says that the Respondent’s only conceivable business purpose in registering the disputed domain name was to profit from the deceptive diversion of Internet users to its own website. For this reason, the Complainant says that the Respondent’s conduct falls within the circumstances amounting to bad faith registration described at paragraph 4(b)(iv) of the Policy, namely that the Respondent has “intentionally attempted to attract, for commercial gain, Internet users to [its] website or other online location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of [its] website or location or of a product or service on [its] website or location.”

So far as bad faith use is concerned, the Complainant says that the Respondent is using the disputed domain name in order to attract Internet users looking for the Complainant to its own website. The Complainant says, in addition, that the Respondent’s suspicious website and invitation to live chats cannot exist for legitimate and lawful purposes because it is likely that the names and email addresses collected by the Respondent will not be used lawfully and that users are likely mistakenly to believe that the live chat sessions are sponsored or hosted by the Complainant. Such conduct, the Complainant says, is also within the circumstances described at paragraph 4(b)(iv) of the Policy.

B. Respondent

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

6. Discussion and Findings

Dealing, first, with the Respondent’s failure to serve a response to the Complaint, paragraph 14(b) of the Rules provides that if a party, in the absence of exceptional circumstances, does not comply with a provision of, or requirement under these Rules, the Panel shall be entitled to draw such inferences from this omission as it considers appropriate.

Paragraph 4(a) of the Policy requires that the Complainant proves each of the following three elements in order to succeed in its Complaint:

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

(ii) the Respondent has no rights or legitimate interests with respect to 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

The Complainant has produced extensive evidence of its registered trade mark rights in multiple jurisdictions in COSTCO. Details of one of those trade marks are set out above. The Panel therefore finds that the Complainant has rights in COSTCO.

The disputed domain name comprises the Complainant’s COSTCO trade mark followed by the word “administration” and the generic Top-Level-Domain (“gTLD”) suffix “.com”, which is ignored for the purpose of considering similarity or identicality. The Panel agrees with the Complainant’s submission that, in the context of a large, international business, the addition of the term “administration” to COSTCO does not serve to prevent the disputed domain name from being confusingly similar to the Complainant’s trade mark because Internet users are likely to assume that the disputed domain name points to a web page which hosts some form of administrative facility of the Complainant.

Accordingly, the Panel finds that the disputed domain name is confusingly similar to a trade mark in which the Complainant has rights.

B. Rights or Legitimate Interests

The Policy sets out at paragraph 4(c) examples of circumstances, without limitation, by which a respondent may demonstrate rights or legitimate interests in a disputed domain name.

How these provisions are usually applied in practice is explained in the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Jurisprudential Overview 3.0”). This says that the consensus view of panelists is that “[w]hile the overall burden of proof in UDRP proceedings is on the complainant, panels have recognized that proving a respondent lacks rights or legitimate interests in a domain name may result in the often impossible task of ʻproving a negativeʼ, requiring information that is often primarily within the knowledge or control of the respondent. As such, where a complainant makes out a prima facie case that the respondent lacks rights or legitimate interests, the burden of production on this element shifts to the respondent to come forward with relevant evidence demonstrating rights or legitimate interests in the domain name. If the respondent fails to come forward with such relevant evidence, the complainant is deemed to have satisfied the second element.”

The Panel accepts the Complainant’s contentions that the Respondent is not a licensee of the Complainant nor is it otherwise permitted to register and use the disputed domain name by the Complainant, nor is it aware of any evidence that might support a claim by the Respondent to rights or legitimate interests in the disputed domain name.

Notionally, the Respondent appears to have a possible claim to a legitimate interest in the disputed domain name by the fact that its name is stated to be “Costco Administration”. Paragraph 4(c)(ii) of the Policy provides that a legitimate interest might be found if a respondent has been commonly known by a disputed domain name, even if it has acquired no trademark or service mark rights. However, there is no evidence of any sort put forward to show that the Respondent is “commonly” known by the disputed domain name. For this ground to be made out, simply acquiring a domain name and providing registrant details which correspond exactly to the domain name itself is wholly inadequate. There is nothing at all to rebut the obvious inference that the naming of the registrant as “Costco Administration” is a sham intended to create the impression of a genuine interest on the part of the Respondent in the disputed domain name.

Save for this possible point, which the Panel finds is without substance, there is no evidence that any of the circumstances set out at paragraph 4(c) of the Policy are likely to be applicable. Accordingly, the Complainant has made out a prima facie case that the Respondent has no rights or legitimate interests in the disputed domain name and, as a consequence, the burden of production shifts to the Respondent to seek to dispel this inference. As there has been no communication at all from the Respondent, it has not satisfied this burden.

The Panel therefore finds that the Respondent has no rights or legitimate interests with respect to the disputed domain name.

C. Registered and Used in Bad Faith

The Complainant has established that as at the date of registration of the disputed domain name in February 2017, its business was operated on a very substantial scale internationally and its COSTCO trade mark had been registered as a trade mark and used in many jurisdictions. The evidence submitted indicates, on at least a balance of probabilities, that the Respondent would have been aware of the Complainant’s trade mark as at the time of registration of the disputed domain name.

The Panel also accepts the Complainant’s assertion that it is not possible to conceive of a good faith use to which the Respondent could have put the disputed domain name as at the date of registration. In this respect, the WIPO Jurisprudential Overview 3.0 explains that; “Panels have consistently found that the mere registration of a domain name that is identical or confusingly similar (particularly domain names comprising typos or incorporating the mark plus a descriptive term) to a famous or widely-known trademark by an unaffiliated entity can by itself create a presumption of bad faith.”

This approach is evident in, for example, the decision in Walgreen Co. v. Muhammad Azeem / Wang Zheng, Nicenic International Group Co., Limited, WIPO Case No. D2016-1607, relating to the domain name <walgreenonlinepharmacy.com>, in which the panel said: “Given the circumstances of the case, in particular the extent of use of the Complainant’s trademark, the reputation and the distinctive nature of the mark, it is inconceivable to the Panel in the current circumstances that the Respondent registered the disputed domain name without prior knowledge of the Complainant and the Complainant’s mark. Further, the Panel finds that the Respondent could not have been unaware of the fact that the disputed domain name it chose could attract Internet users in a manner that is likely to create confusion for such users.”

So far as bad faith use is concerned, it is difficult to know exactly what benefit or advantage the Respondent seeks to derive from pointing the disputed domain name to a page which purports to operate a chat line. However, the Panel accepts the Complainant’s submission that it is not possible to conceive of a good faith intent in establishing a chat line service which appears on the webpage to which the disputed domain name points, particularly in the absence of any explanatory wording on the webpage about its purpose. But even in the highly improbable eventuality that the intent behind the chatline was innocuous, the Respondent is plainly using the confusion generated by the disputed domain name in order to attract Internet users to its website in order to obtain personal and/or financial information from such users. As the Complainant has submitted, such conduct falls within the provisions of paragraph 4(b)(iv) of the Policy, namely that the Respondent is intentionally attempting to attract, for commercial gain, Internet users to its website by creating a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of its website or of a product service on its website.

The Panel accordingly finds that the disputed domain name was registered and used in bad faith.

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 <costcoadministration.com> be transferred to the Complainant Costco Wholesale Membership, Inc.

Antony Gold
Sole Panelist
Date: June 15, 2017