1. The Parties and Contested Domain Name

The complainant Breakthrough Software, Inc. (Breakthrough) of San Jose, California, USA brought the present complaint against the respondent Gordon-Huigen Enterprises (Huigen) of Burbank, California, USA. The domain name at issue is shopzone.com register ed by Huigen. The complaint was brought pursuant to the Uniform Domain Name Dispute Resolution Policy (ICANN policy), adopted by the Internet Corporation for Assigned Names and Numbers on October 24, 1999.

2. Procedural history

The electronic version of the complaint form was filed on-line through eResolution's website on February 10, 2000. The hardcopy of the complaint form was received on February 15, 2000. Payment was received on February 23, 2000.

Upon receiving all the required information, eResolution's Clerk proceeded to the required administrative inquiry. The inquiry lead the Clerk of eResolution to the following conclusions: the Registrar is Networks Solutions, the Whois database contains al l the required contact information. The contested domain name resolves to an inactive Web page and the complaint is administratively compliant.

The Clerk then proceeded to send a copy of the complaint form and the required cover sheet in accordance with paragraph 2(a) of the ICANN's Rules for Uniform Domain Name Dispute Resolution Policy.

The Clerk forwarded the complaint to the respondent on February 23, 2000. That date is the commencement date of the administrative proceeding.

On February 25, 2000, the Clerk's office notified the complainant, the respondent, the concerned Registrar, and ICANN of the date of commencement of the administrative proceeding.

On March 5, 2000, the respondent asked for an extension until March 19, 2000 to submit his response.

On March 9, 2000, the Clerk's Office granted the delay.

On March 17, 2000, the Respondent submitted, via eResolution website, his response. The signed version of the response was received on March 21, 2000.

On March 29, 2000, the Clerk's Office contacted Mr. Jean-François Buffoni, and requested for him to act as panelist in this case.

On March 30, 2000, Mr. Jean-François Buffoni accepted to act as panelist in this case and filed the necessary Declaration of Independence and Impartiality.

On March 31, 2000, the Clerk's Office forwarded a user name and a password to Mr. Jean-François Buffoni allowing him to access the complaint form and the evidence through eResolution's Automated Docket Management System.

On March 31, 2000, the parties were notified that Mr. Jean-François Buffoni had been appointed and that a decision was to be, save exceptional circumstances, handed down on April 14, 2000.

3. Factual Background

On June 26, 1996, Huigen and his wife Elise Gordon registered with the Recorder's Office of Los Angeles County, California, a "Fictitious Business Name Statement" for various business names including "The Shopzone."

On June 30, 1996, Huigen registered the domain name shopzone.com with Network Solutions.

On April 14, 1998, Breakthrough filed a trademark application with the United States Patent and Trademark Office (USPTO) for the registration on its Principal Register of the trademark SHOPZONE for computer software enabling the user to create a website w ith an on-line store, which will be a site on the Internet, for the purchase of goods or services featuring catalog lookups, a simulated shopping cart, discussion groups, electronic forms, and database connectivity, in International Class 9. This applica tion resulted in registration number 2,301,588 on December 21, 1999. This registration indicates July 14, 1998 as the date of first use of the SHOPZONE trademark.

In 1999, Mr. Joshua Weisberg (Weisberg), vice-president of Marketing and Business Development for Breakthough contacted Huigen to see if Breakthrough could purchase the domain name from him. According to Breakthrough, Weisberg asked Huigen how much he w anted for the name, Huigen replied he was thinking of $50,000, Weisberg then stated that Breakthrough was willing to pay $10,000 and Huigen said it was not enough. According to Huigen, Weisberg offered $5,000 rather than $10,000. Huigen denies having ev er mentioned $50,000 or stating that the amount offered was not enough, adding that he is not and never was interested in selling the domain name. Be it as it may, the parties did not come to an agreement.

On January 7, 2000, Breakthrough's attorney, Daniel R. Richardson of San Francisco, California, USA, sent to Huigen a cease and desist letter claiming violation of Breakthrough's trademark SHOPZONE, requesting that Huigen cease use of the shopzone.com dom ain name and immediately surrender and assign all rights and interests in this name and its registration to Breakthrough. This letter has remained unanswered.

4. The Parties' Contentions

Breakthrough asserts that the domain name shopzone.com is identical or confusingly similar to the trademark SHOPZONE, that Huigen has no rights or legitimate interest in respect of the domain name shopzone.com and that this domain name has been registered and is being used in bad faith. Huigen denies that there is any copy or similarity or that there would be any confusion in the marketplace. He further contends that he had and still has rights and legitimate interests in the domain name shopzone.com. Finally, Huigen rejects all claims of bad faith.

5. Discussion and Findings

Under the ICANN Policy paragraph 4(a), a complainant has the obligation to prove each of the following: i) that the domain name at issue is identical or confusingly similar to the complainant's trademark; ii) that the respondent has no rights or legitimat e interests in the domain name; and iii) that the domain name has been registered and is being used in bad faith. The ICANN Policy in paragraph 4(b) provides four examples of circumstances which, for the purposes of paragraph 4(a)(iii), supra, are clear evidence of the registration and use of a domain name in bad faith. The ICANN Policy at paragraph 4(c) sets out three examples of defences which, if proved by respondent, shall demonstrate respondent's rights or legitimate interests to the domain name fo r purposes of paragraph 4(a)(ii), supra. If the complainant successfully proves all three elements of paragraph 4(a), then this panel has the authority under paragraph 4(i) to require the cancellation of the respondent's domain name registration, or to order that it be transferred to the complainant. According to paragraph 15(e), the panel also may consider whether the complaint was brought in an attempt at "reverse domain name hijacking" or otherwise in bad faith.

1. Identity or Confusing Similarity

Paragraph 4(a)(i) of the ICANN policy requires that the domain name be identical or confusingly similar to the complainant's trademark.

Breakthrough asserts that Huigen's domain name shopzone.com is identical to its own SHOPZONE trademark, that the marks are the same in spelling, sound and connotation and would create a likelihood of confusion in the marketplace, and that Huigen does not presently have a website on the Internet using this domain name.

Huigen does not respond to the allegation that the domain name shopzone.com is the same as the trademark SHOPZONE in spelling, sound and connotation. He acknowledges however that the domain name shopzone.com is not currently in operation. But he asserts that the business model for shopzone.com is a marketplace for facilitating the transfer of goods and services which is different from Breakthough's software which is contemplated by the SHOPZONE trademark registration. Huigen puts forward a number of ad ditional arguments in support of his view that the shopzone.com website, when in operation, will not cause confusion in the marketplace with Breakthrough's products or services.

As pointed out above, there is no dispute that the domain name shopzone.com is identical to the trademark SHOPZONE. Of course, the presence of the top-level domain ".com" in the domain name is of no consequence in the instant case. The same applies to t he fact that the domain name is displayed in lowercase letters as opposed to the trademark which is displayed in upper-case letters in the USPTO Registration. The panel therefore finds that the identity test of paragraph 4(a)(i) of the ICANN policy has b een satisfied. Since the complainant must, under paragraph 4(a)(i), prove only that the domain name and trademark are identical or confusingly similar, the panel need not address the issue of alleged confusing similarity.

2. Rights or Legitimate Interests

Paragraph 4(a)(ii) of the ICANN policy raises the issue whether the respondent has any rights or legitimate interests in respect of the domain name. Paragraph 4(c) sets out three examples of circumstances which demonstrate the existence of such rights or legitimate interests of the respondent in the domain's name. These examples are not exhaustive.

Breakthrough contends that when it contacted Huigen to see how the domain name was being used, the latter could not identify any trademark or other use of the name. Breakthrough adds that Huigen is not using the name for any trade purposes, that is it is not being used for the sale of goods or services.

Huigen replies in essence that the adoption in June 1996 of the domain name shopzone.com and the registration of the corresponding fictitious business name The Shopzone predate by almost two years the filing of Breakthough's trademark application in Apri l 1998. By that time, the Whois Database had been displaying the shopzone.com domain name registration for over 21 months. Huigen further points out that the Whois database also shows a registration of September 1998 for another domain name, shopzone.ne t belonging to a third party. Huigen draws the conclusion that Breakthrough had no intention of branding its SHOPZONE software through the use of a top level domain containing the SHOPZONE trademark.

As seen above, paragraph 4(c) sets out three non-exhaustive examples of situations which, if proven, shall demonstrate the respondent's rights or legitimate interests to the domain name for the purposes of paragraph 4(a)(ii).

The first example, which can be found at paragraph 4(c)(i), appears to be the closest to the present case. It contemplates the fact that the respondent, before any notice to him of the dispute, has used or made demonstrable preparations to use, the domai n name or a name corresponding to the domain name in connection with a bona fide offering of goods or services.

In the present case, the panel finds that, long before any notice of the dispute to Huigen, he had demonstrably prepared to use the domain name shopzone.com as well as the business name The Shopzone in connection with a bona fide offering of goods or serv ices.

One could argue that, from June 1996 until notice of the dispute in early 2000, the preparation time to actually use the domain name and the corresponding business name is rather long. However, that fact in itself is not sufficient to defeat Huigen's rig hts or legitimate interests in the domain name. Firstly, the issue of rights to and legitimate interests in the domain name must be assessed as it existed before any notice to the respondent of the dispute. That time frame includes more particularly the time at which the respondent registered the domain name and the corresponding business name, that is June 1996, close to two years before the complainant filed its SHOPZONE trademark application. The complainant has adduced no evidence to contradict thi s very straightforward fact. Secondly, even if respondent were not to fall squarely within the four corners of the first example in question, it must not be forgotten that the three examples outlined in paragraph 4(c) are just examples and are expressly said not to be exhaustive. Thirdly, although paragraph 4(c) of the ICANN rules provides the respondent with instances demonstrating his rights to and legitimate interests in the domain name in issue, and therefore provides examples of conclusive defences to the complaint, the burden of proof still rests on the complainant's shoulders to prove that the respondent has no rights or legitimate interests.

Having found that Huigen, long before any notice of the dispute to him, had demonstrably prepared to use the domain name shopzone.com as well as the business name The Shopzone in connection with a bona fide offering of goods or services, the panel therefo re concludes that the respondent has demonstrated his rights to and legitimate interests in the contested domain name and the complainant has failed to discharge its burden to prove the second essential element of the complaint.

3. Bad Faith Registration and Use

Strictly speaking, since the complainant has failed to prove the second essential element of the complaint, the panel need not address the issue of bad faith registration and use. Nevertheless, the panel finds it expedient to summarily dispose of that is sue as well.

Paragraph 4(a)(iii) raises the issue whether the domain name has been registered and is being used in bad faith. Paragraph 4(b) supplies a non-exhaustive list of four examples of situations which, if any of them is found by the panel to be present, shall be evidence of the registration and use of a domain name in bad faith.

Breakthrough contends that Huigen's bad faith is demonstrated by:

It appears to the panel that none of the facts alleged under paragraph a, c and d above would fall within any of the four examples supplied by paragraph 4(b) of the ICANN Rules and, in any event, none of these three facts in any way constitutes evidence o f bad faith. As for the reference to ACTPA, irrespective of the question whether that act in general or the cited factor in particular are applicable to the present administrative proceeding, the panel finds that Breakthrough has not proven its essential elements. Without limitation, it has not proven that Huigen has in fact offered its domain name to Breakthrough or that Huigen's prior conduct indicated a pattern of the reprehensible conduct in question. Therefore, the panel finds that the complainant has also failed to prove the third essential element set forth in paragraph 4(a) of the ICANN policy.

4. Reverse Domain Name Highjacking

In light of the panel's conclusion that Breakthrough has not proven two of the three elements set forth in the applicable rule, it seems appropriate to consider whether Breakthrough brought the complaint in bad faith. Paragraph 15(e) of the ICANN Rules p rovides, "If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in it s decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding." "Reverse Domain Name Hijacking" is defined in paragraph 1 of the ICANN Rules as "using the Policy in bad faith to attempt to deprive a regi stered domain-name holder of a domain name."

This panel finds no elements of bad faith on Breakthrough's part. Firstly, Breakthrough's trademark registration for the trademark SHOPZONE coupled with Huigen's alleged lack of actual use of its domain name shopzone.com and tradename The Shopzone might have led Breakthrough to a bona fide conclusion that its legal position under the ICANN Rules was better than it was in reality. Secondly, the ICANN Rules having been adopted quite recently, that is only a few months before Breakthrough filed the present complaint, it would be appropriate, in this very particular instance, to give Breakthrough the benefit of the doubt.

6. Conclusions

For the reasons set forth above, the panel concludes that Breakthrough has proved only one of the three elements set forth in paragraph 4(a) of the ICANN policy, and therefore decides that the relief sought by Breakthrough should not be granted.

MONTREAL (Quebec), Canada, April 13, 1999.

(s) Jean-François Buffoni

Lead Panelist