WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

K-BOX, LLC v. Nicole Lewis, Marketing Cohorts

Case No. D2018-1933

1. The Parties

Complainant is K-BOX, LLC of Tulsa, Oklahoma, United States of America (“United States” or “USA”), represented by Brown Patent Law, PLLC, United States.

Respondent is Nicole Lewis, Marketing Cohorts of Tulsa, Oklahoma, United States, self-represented.

2. The Domain Name and Registrar

The disputed domain name <kboxmobilestorage.com> is registered with GoDaddy.com, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on August 24, 2018. On August 27, 2018, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On August 27, 2018, the Registrar transmitted by email to the Center its verification response confirming that 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 Respondent of the Complaint, and the proceedings commenced on August 31, 2018. In accordance with the Rules, paragraph 5, the due date for Response was September 20, 2018. The Response was filed with the Center on September 20, 2018.

The Center appointed Frederick M. Abbott as the sole panelist in this matter on October 3, 2018. 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

Complainant is the owner of registration for the service mark K-BOX MOBILE STORAGE on the Principal Register of the United States Patent and Trademark Office (USPTO), registration number 5,545,933, registration dated August 21, 2018, in international class 39, covering rental of portable storage containers, as further specified, claiming date of first use and first use in commerce of March 31, 2016. Complainant is the owner of a Certificate of Trademark Registration at the Office of the Secretary of State of the State of Oklahoma (USA) for the trademark K-BOX, registration number 12615014, registration dated May 3, 2017, in state class No. 105, covering, inter alia, storage of consumer goods and commercial goods through the rental of mobile self-contained storage units.

On March 31, 2016, shortly following commencement of its mobile storage business under the name K-BOX MOBILE STORAGE, Complainant’s initial website designer, Robert Spencer, registered the disputed domain name, <kboxmobilestorage.com>, at Complainant’s request. Shortly thereafter, Complainant launched a commercial website at the address of the disputed domain name. Complainant continues to conduct business under the service mark K-BOX MOBILE STORAGE.

According to the Registrar’s verification, Respondent currently is registrant of the disputed domain name. According to the Registrar’s verification, the creation date of the record of registration for the disputed domain name is March 31, 2016. The Registrar has not indicated the date on which the disputed domain name was transferred to Respondent from Robert Spencer. The Registrar’s most recently listed update of registration information is April 2, 2018. According to Complainant, the disputed domain name was transferred to Respondent on May 11, 2017.¹ Respondent does not contest the fact of the transfer as of that date, although the parties (as indicated below) are in dispute regarding whether Respondent was authorized to undertake such transfer.

Complainant engaged Respondent to provide services with respect to website design and social media presence through discussion and exchange of correspondence (including email) in March 2017. By email of March 22, 2017 to Complainant’s web-designer, Robert Spencer, Respondent proposed a lump sum fee for web design, plus upfront and monthly fees with respect to performing search engine optimization (SEO) services. As part of that email, Respondent indicated “Will also need current hosting and website passwords and login information”. An undated quote from Respondent to Complainant similarly indicated “We need all passwords to every aspect of KBOX Domain DNS, Password, LOGOS, Twitter, Instagram Youtube, Google, etc”. Complainant received and paid an invoice from Respondent on April 14, 2017. That invoice repeats the need for passwords, but does not include any terminology regarding transfer of ownership of registration of the disputed domain name, holding domain name registration for security purposes, or similar language. There is no fixed term of contract duration set forth in the documents referenced above.

Respondent has submitted an invoice form dated April 14, 2017 which is different than that provided by Complainant. Respondent’s invoice submitted in this proceeding includes the following statement:

“Basic Legal Stuff: Upon payment of deposit for the above listed items, K-BOX, LLC owners have agreed to quoted price and service schedule for no less than two years. Legal disputes and resolution must take place within Tulsa, OK with legal fees to be paid by the filing party. Domains are secured by Marketing Cohorts and ownership will be released at contracts end”.

In addition, Respondent has transmitted a copy of email correspondence it transmitted to Complainant on May 1, 2017 detailing difficulties Respondent was having accessing Complainant’s website because it did not have necessary information from the original registrant, Robert Spencer. Respondent stated, inter alia:

“I am still needing to find out who has ownership of Kboxmobilestorage@[...] because that is the account that KBOX Youtube would need to be set up in to maintain the name since there is no Trademark. Holly has been working to find the information, it is not an easy process trouble shooting who and where and when it was set up because of security protocols. She has been patient with me collecting information for hours over the last few weeks because things changed once we got into the website and more questions came up”.

This email from Respondent to Complainant does not include any reference to transfer of ownership of the disputed domain name.

Respondent transmitted a second invoice to Complainant dated July 21, 2017. That invoice was paid by Complainant on July 28, 2017. That invoice does not include any reference to passwords and/or transfer of ownership of registration of the disputed domain name. Complainant indicates that at or about that time, Complainant advised Respondent that it wanted to limit Respondent’s monthly services to SEO. Complainant indicates that it advised Respondent that it wished for ownership of the disputed domain name to be transferred from Complainant’s website designer (Robert Spencer) to one of the co-owners of Complainant, and that at no time did it authorize Respondent to transfer ownership of the disputed domain name to Respondent.

Subsequent to the aforesaid exchanges, Respondent transmitted an invoice dated August 21, 2017 which included fees for services that Complainant alleges it had previously terminated. Respondent objected to termination of the fee for services arrangement on the terms proposed by Complainant, and Respondent refused to accept a check in payment for the August 21, 2017 invoice from Complainant. Complainant transmitted correspondence to Respondent confirming its intention to terminate the arrangement between the parties, and demanding access to the passwords to accounts then being operated by Respondent. Complainant received an additional invoice from Respondent dated October 10, 2017, accompanied by correspondence from Respondent. In that invoice and correspondence, Respondent listed a number of complaints regarding Complainant’s conduct, and demanded payment of monthly fees alleged to be owed plus a lump sum payment based on termination of what Respondent alleged to be a year-long contract term. Complainant and Respondent met on October 10, 2017. Complainant alleges this is when it first learned of the transfer of the disputed domain name to Respondent. The total amount alleged by Respondent to be due from Complainant was USD 7,200.

By letter dated December 12, 2017, Complainant offered to settle all outstanding issues with Respondent, including Respondent’s transfer to Complainant of ownership of registration of the disputed domain name, and control over Complainant’s other accounts. Complainant indicates that Respondent rejected its offer. Respondent indicates that Complainant was directed to contact its attorney, which Complainant failed to do.

Sometime prior to April 2, 2018, Respondent directed the disputed domain name away from Complainant’s business content to a parking page. On or about April 2, 2018, Respondent redirected the disputed domain name to the website of a direct competitor of Complainant that is also a client of Respondent, U-Box Rentals. Complainant indicates that this redirection has caused substantial confusion among his customer base, and among prospective customers. Respondent has stated that the disputed domain name was redirected to Complainant’s competitor through an error of an employee, and that the error has since been corrected.

Complainant has provided a copy of a civil complaint filed against Respondent in federal district court in the Eastern District of New York, Assunta Fusco Mintz, et. al., v. Marketing Cohorts, et. al., Case No. 2:18-cv-04159-JFB-SIL (E.D.N.Y.), filed July 20, 2018.

The registration agreement between Respondent and the Registrar subjects Respondent to dispute settlement under the Policy. The Policy requires that domain name registrants submit to a mandatory administrative proceeding conducted by an approved dispute resolution service provider, one of which is the Center, regarding allegations of abusive domain name registration and use (Policy, paragraph 4(a)).

5. Parties’ Contentions

A. Complainant

Complainant contends that it owns rights in the service marks K-BOX and K-BOX MOBILE STORAGE. Complainant alleges that rights in the K-BOX MOBILE STORAGE service mark are evidenced by registration at the USPTO, and established by use in commerce as early as March 31, 2016. Complainant contends that rights in the K-BOX trademark are evidenced by registration in the State of Oklahoma, USA, and by use in commerce.

Complainant argues that the disputed domain name is identical or confusingly similar to its K-BOX MOBILE STORAGE service mark. Complainant contends that the disputed domain name is confusingly similar to its K-BOX trademark because the dominant feature of the trademark is recognizable in the disputed domain name.

Complainant alleges that Respondent lacks rights or legitimate interests in the disputed domain name because: (1) Complainant has never licensed or authorized Respondent to use its K-BOX MOBILE STORAGE service mark or to hold ownership of the disputed domain name, to transfer ownership of the disputed domain name to itself, or to transfer registration of the disputed domain name to anyone other than Complainant’s co-owner; (2) Respondent has not made use or demonstrable preparations to use the disputed domain name in connection with a bona fide offering of goods or services; (3) Respondent has not been commonly known by the disputed domain name; (4) Respondent is not making a legitimate noncommercial or fair use of the disputed domain name; (5) Respondent attempted to disguise its unauthorized transfer of the disputed domain name by use of a privacy shield; (6) Respondent has refused to return control of the disputed domain name to Complainant, and has redirected the disputed domain name to a parking page and to a direct competitor of Complainant.

Complainant contends that Respondent registered and is using the disputed domain name in bad faith because: (1) Respondent transferred the disputed domain name to itself contrary to direct instructions from Complainant; (2) Respondent undertook this transfer in a manner designed to conceal its activity from Complainant; (3) Respondent has refused to return control of the disputed domain name to Complainant while increasing its “ransom demands”; (4) Respondent initially redirected the disputed domain name to a parking page with no contact information for Complainant; (5) Respondent’s conduct caused confusion in fact among Complainant’s customers and prospective customers; (6) Respondent subsequently redirected the disputed domain name to a direct competitor of Complainant; (7) Respondent’s conduct represents registration and use primarily for the purpose of disrupting the business of a competitor; (8) Respondent has used the disputed domain name to intentionally attract for commercial gain Internet users to another online location by creating confusion as to Complainant’s affiliation with, sponsorship or endorsement of that other online location, and; (9) as evidenced by a third-party civil complaint filed against Respondent, Respondent has engaged in a pattern of conduct of registering domain names to prevent others from incorporating their trademarks in corresponding domain names.

Complainant requests the Panel to direct the Registrar to transfer the disputed domain name to Complainant.

B. Respondent

Respondent alleges that Complainant’s trademark registration was completed only after Respondent made Complainant aware that it had not completed its trademark registration application process.

Respondent contends that the disputed domain name was transferred to Respondent at the request of Complainant. Respondent argues that ownership of the disputed domain name has not been kept secret from Complainant. Respondent states that it did not wish to take ownership of the disputed domain name, but did so at the request of Complainant.

Respondent contends that Complainant’s threat to terminate its contract was not valid because “they were out of contract”.

Respondent does not dispute the similarity of Complainant’s business name and the disputed domain name.

Respondent contends that its contract with Complainant was to be paid monthly over the course of the contract and that its “initial invoice include these parameters and marked the beginning of the contract. This initial invoice including a deposit for the website was paid and therefore seen and understood by the Complainant”.

“Respectfully, it does not make sense that the domain was wrongfully transferred to Marketing Cohorts in May 2017 without consent from K-BOX who continued to pay for and receive service until five months later in October 2017”.

“The Respondent will gladly release ownership of the domain, k-boxmobilestorage.com, in accordance with our termination agreement when the Complainant pays his bill as a completion of our contract.”

Respondent contends that it has a legitimate interest in maintaining ownership of the disputed domain name until Complainant has paid its contract in full.

Respondent argues that it will not use the disputed domain name in a manner that creates competition or tarnishes the reputation of Complainant, and it has not been used to infringe upon the rights of Complainant. Respondent contends that Complainant continues to do business under the domain name <kboxmobile.com>, which Complainant registered immediately prior to terminating its contract with Respondent in an attempt to defraud Respondent.

Respondent contends that the disputed domain name was inadvertently diverted to another client website with similar offerings, but that this was not done intentionally in bad faith, nor did it benefit Respondent’s client.

Respondent states that it will continue to hold the disputed domain name until Complainant has completed payment and provides a letter of apology “for the torment the owners of the company have brought upon the Respondent”.

Respondent states that it is willing to reach an agreement with Complainant, and that it will also upon satisfactory agreement transfer a number of other domain names that incorporate the trademark of Complainant which it registered in Respondent’s name at the request of Complainant.

6. Discussion and Findings

It is essential to Policy proceedings that fundamental due process requirements be met. Such requirements include that a respondent have notice of proceeding that may substantially affect its rights. The Policy and the Rules establish procedures intended to ensure that respondents are given adequate notice of proceedings commenced against them and a reasonable opportunity to respond (see, e.g., Rules, paragraph 2(a)).

The Center formally notified the Complaint to Respondent at the email and physical addresses provided in its record of registration. Respondent filed a timely Response. The Center took those steps prescribed by the Policy and the Rules to provide notice to Respondent, and those steps are presumed to satisfy notice requirements.

Paragraph 4(a) of the Policy sets forth three elements that must be established by a complainant to merit a finding that a respondent has engaged in abusive domain name registration and use and to obtain relief. These elements are that:

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

(ii) 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.

Each of the aforesaid three elements must be proved by a complainant to warrant relief.

A. Identical or Confusingly Similar

Complainant has provided evidence of rights in the service mark K-BOX MOBILE STORAGE including by registration at the USPTO, and by use in commerce. The aforesaid service mark registration post-dates Respondent’s registration through transfer of the disputed domain name.

The date of acquisition of service mark rights is not relevant to the question whether Complainant has rights in the service mark, though it is a factor that may be relevant to a finding of bad faith registration and use. In the present proceeding, there is substantial evidence that Complainant was using the K-BOX MOBILE STORAGE service mark as early as March 2016, and Complainant established unregistered service mark rights prior to formal issuance of trademark registration by the USPTO. The Panel will revert to the timeline under the heading of bad faith.

The Panel determines that Complainant owns rights in the service mark K-BOX MOBILE STORAGE.

Complainant also has provided evidence of registration on May 3, 2017 with Oklahoma state authorities for the trademark K-BOX. The Panel does not consider it necessary to assess the significance of this registration, or to determine whether Complainant has independent trademark rights in K-BOX.

The disputed domain name incorporates the K-BOX MOBILE STORAGE service mark of Complainant, eliminating the hyphen. The disputed domain name is nearly identical, and confusingly similar, to the service mark in which Complainant has rights.

The Panel determines that Complainant has established rights in the K-BOX MOBILE STORAGE service mark and that the disputed domain name is confusingly similar to that service mark.

B. Rights or Legitimate Interests

The second element of a claim of abusive domain name registration and use is that Respondent has no rights or legitimate interests in respect of the disputed domain name (Policy, paragraph 4(a)(ii)). The Policy enumerates several ways in which a respondent may demonstrate rights or legitimate interests:

“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”. (Policy, paragraph 4(c)).

Complainant’s allegations to support Respondent’s lack of rights or legitimate interests in the disputed domain name are outlined above in section 5A, and the Panel finds that Complainant has made a prima facie showing that Respondent lacks rights or legitimate interests in the disputed domain name.

Respondent contends that it has rights or legitimate interests in the disputed domain name because it acted pursuant to the terms of a contract with Complainant further to which Complainant instructed Respondent to transfer the disputed domain name to itself. Respondent has not established the existence of a contractual relationship pursuant to which it was authorized to register the disputed domain name for its own account. The evidence submitted by Respondent is an invoice dated April 14, 2017 that purports to establish contractual terms under the heading “Basic Legal Stuff” and providing:

However, a copy of the April 14, 2017 invoice in Complainant’s possession and submitted in this proceeding does not include the aforesaid language, although it does state Respondent’s requirement to receive passwords from Complainant. In addition, prior correspondence including email and proposals from Respondent to Complainant do not include reference to Respondent’s taking of the disputed domain name as a form of security for contract payment. The Panel is not persuaded that Complainant agreed to the contract and security terms asserted by Respondent. In that regard, Respondent has not rebutted Complainant’s prima facie showing.

Even if the Panel were to accept Respondent’s contention that Complainant had authorized Respondent to transfer the disputed domain name to itself as a form of security, Respondent’s redirection of the disputed domain name to a parking page, and subsequently to the website of a direct third-party competitor of Complainant, does not provide Respondent with any rights or legitimate interests under the Policy. Moreover, though not a finding necessary for its determination in this dispute, the Panel doubts under the circumstances this would constitute a legitimate means of addressing Complainant’s alleged non-payment of contract fees. Such action would manifestly cause injury to Complainant’s business and does not appear to constitute a legitimate form of self-help, particularly under circumstances in which Complainant made repeated offers to address Respondent’s demands for payment.

Respondent has not rebutted Complainant’s prima facie showing that it lacks rights or legitimate interests in the disputed domain name. Complainant has established that Respondent lacks rights or legitimate interests of the disputed domain name.

C. Registered and Used in Bad Faith

In order to prevail under the Policy, Complainant must demonstrate that the disputed domain name “has been registered and is being used in bad faith” (Policy, paragraph 4(a)(iii)). Paragraph 4(b) of the Policy states that “for the purposes of Paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith”. These include that: “(ii) [the respondent has] 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 [the respondent has] engaged in a pattern of such conduct; or (iii) [the respondent has] registered the domain name primarily for the purpose of disrupting the business of a competitor; or (iv) by using the domain name, [the respondent has] intentionally attempted to attract, for commercial gain, Internet users to [the respondent’s] 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 [the respondent’s] website or location or of a product or service on [the respondent’s] website or location”.

Respondent has argued that Complainant did not complete registration of its service mark prior to being advised by Respondent that the application process was not complete. This suggests an argument by Respondent that it registered the disputed domain name prior to Complainant establishing rights in the service mark. Generally, a registrant does not act in bad faith when registering a domain name prior to the establishment of rights in the trademark by a third-party. However, that is not the situation in the present proceeding. Complainant was using the K-BOX MOBILE STORAGE service mark well before Respondent undertook to transfer the disputed domain name to itself in May 2017, and Respondent was well aware of the fact of that service mark usage. When Respondent undertook to provide services to Complainant, Complainant already had an operational website associated with the disputed domain name using the aforesaid service mark. Formal registration of a service mark is not a condition of the establishment of service mark rights, which as a matter of United States trademark law are established through use in commerce. The Panel determines that Complainant had established rights in its service mark before Respondent transferred the disputed domain name to itself.

Respondent has used the disputed domain name to direct Internet users to the website of a third-party competitor of Respondent that is also a customer of Respondent. Such direction would be likely to substantially disrupt Complainant’s business by suggesting to customers and/or prospective customers of Complainant that its business was now associated with another enterprise. Respondent holds itself out as a sophisticated manager of websites and related services, and the Panel is not inclined to accept its claim that such usage of the disputed domain name and Complainant’s service mark was accidental. This conclusion is reinforced by Respondent’s initial redirection of Complainant’s customers and prospective customers to a parking page. Respondent’s actions appear to have been intended to place commercial pressure on Complainant.

Respondent by its own account registered (i.e. transferred) the disputed domain name for purposes of contract security. Its action in subsequently attempting to enforce its security by redirecting Complainant’s customers and prospective customers appears to have been within the contemplation of Respondent at the time it registered (i.e. transferred) the disputed domain name to itself. Respondent registered the disputed domain name in bad faith within the meaning of the Policy by: (a) transferring the disputed domain name to itself without authorization of Complainant and; (b) thereafter directing Complainant’s customers and prospective customers in a manner designed to injure Complainant’s business.

In its Response, Respondent indicates that it has registered a number of additional domain names that incorporate Complainant’s service mark, and that it will release those domain names only upon Complainant’s payment of its fees. Such action constitutes a pattern of registering domain names for purposes of preventing a service mark owner from reflecting its service mark in corresponding domain names within the meaning of paragraph 4(b)(ii) of the Policy.

The Policy is directed toward addressing abusive domain name registration and use. It is neither intended nor designed to resolve contractual disputes. Inevitably, some disputes require assessment of facts surrounding contracting relationships, and this is such a dispute. Respondent has alleged a specific contractual relationship involving the disputed domain name. Having considered Respondent’s evidence, the Panel has determined that Respondent failed to establish a specific term of that relationship. Complainant has provided evidence that appears to contradict Respondent’s claims with regard to the terms of their alleged agreement, and the Panel has assessed the evidence provided by the parties.

Complainant and Respondent established a business relationship the terms of which were not set out in a formal written contract acknowledged by both parties. Respondent may elect to file a legal action seeking to block transfer of the disputed domain name, at which point it will have further opportunity to present its evidence in civil court. Court proceedings would provide an opportunity for a thorough consideration of the testimony of the parties involved in this proceeding, other witnesses, the submission of additional documentation, and so forth.

The Panel determines that Respondent registered and is using the disputed domain name in bad faith within the meaning of the Policy.

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 <kboxmobilestorage.com> be transferred to Complainant.

Frederick M. Abbott
Sole Panelist
Date: October 21, 2018

¹ Complainant has provided evidence in the form of an ICANN WHOIS database printout showing a transfer of the disputed domain name to a privacy service, the same as that used by Respondent, as an update of May 11, 2017.