Generic Top Level Domain Name (gTLD) Decisions

Vertical Circuits, Inc.
COMPLAINANT,

vs.

Brian Connelly
RESPONDENT.

DECISION
Forum File No.:  FA 0005000094836

FINDINGS OF FACT AND CONCLUSIONS

The above entitled matter came on for an Administrative Hearing this date before the undersigned on the Complaint of Vertical Circuits, Inc., a Delaware Corporation (“Complainant”) against Brian Connelly (“Respondent”).  Mr. Connelly’s address is given as 4805 Rancho Viejo Drive, Del Mar, California 92014.  Mr. Connelly’s telephone number is given as 858-481-8247; e-mail address is Bpc0511@yahoo.com.  Complainant’s contact individual is Williams Kuncz, CFO, whose address is 27 Janis Way, Scotts Valley, California  95066; telephone number is 831-438-1887, x 203; fax number is 831-438-1890, and whose e-mail address is kuncz@vcincorp.com.

This matter has been brought under the Uniform Domain Name Dispute Resolution rules and policy adopted by the Internet Corporation for assigned names and numbers (“ICANN”) and the rules for Uniform Name Dispute Resolution policy adopted by ICANN on October 24, 1999. 

The record reflects that the Complaint herein satisfies the requirements of the policy, rules and supplemental rules^[1] and in accord therewith Respondent was sent a copy of the Complaint, along with a notice that the administrative proceeding had commenced, following which Respondent filed a timely response.  In compliance with Rule 4(d), the National Arbitration Forum (“Forum) notified Network Solutions, Inc., the domain name registrar, whose address is 505 Huntmar Park Drive, Herndon, Virginia 20170, of the commencement of these proceedings.  

The facts as reflected by the record disclose the following:  The domain names in issue are verticalcircuits.com and verticalcircuits.net.  The record reflects that Vertical Circuits, Inc., is a lawfully organized and existing corporation under the laws of the State of Delaware as of October 27, 1999.  Respondent registered the domain names in issue on November 6, 1999.

Complainant’s company is the consequence of a merger between ERD Components International, Inc., a Virginia corporation, and Inter-Quebic Memory, Inc. under the name of Vertical Circuits, Inc. , as reflected by a Certificate of Merger issued by the Office of the Secretary of State of Delaware, said Certificate of Merger having been filed in that office on the 27^th day of October 1999.

Complainant, contending that Respondent has no legitimate interest in the domain names in issue, premised on Complainant’s contention that Respondent registered the names in issue “after reading a press release announcing the formation of the company” seeks transfer of the domain names to Vertical Circuits, Inc.   Respondent denies Complainant’s contention and asserts that his utilization of the domain names in issue came about as:

Just putting two words together to make a phrase, I got the words from looking at my open computer.  There are circuits inside and they are installed vertically and horizontally.  However, horizontal circuits didn’t sound right so I played around with the name until I found a combination that sounded good. 

Regrettably, the record does not reflect the text of or the date of the press release referred to by the Complainant.  Regardless of the circumstances leading to Respondent’s claim of ownership of the domain names in issue, its use by the Respondent has been both inappropriate and violative of paragraph 4(b)(i) of the Uniform Domain Name Dispute Resolution Policy (infra).  Paragraph 4(a)(i), (ii), (iii) imposes upon the Complainant to satisfy the undersigned, as it has, that the preponderance of the evidence is as follows:  (i) the domain name is identical or confusingly similar to a trademark or service mark to which it has rights; (ii) Respondent has no rights or legitimate interest in respect of the domain names; and (iii) finally, Respondent’s domain name has been registered and is being used in bad faith.

Paragraph 4(b)(i) states in essence that for the purposes of Paragraph 4(a)(iii) aforementioned, 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:

(i) circumstances indicating that a Respondent has registered or has 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 a Respondent’s documented out-of-pocket costs directly related to the domain name.

For the reasons stated in these findings, I find that the domain names in issue have been registered and are being used in bad faith.

There can be no doubt but that the domain names in issue are identical to that of the properly registered Complainant’s business name, and that the Respondent, especially in light of the purpose for which evidence discloses they were registered, has no rights or legitimate interest in them and he had made no prior use of the names or bona fide offering of goods or services.  Finally, Respondent having acquired and registered the names in issue, the circumstances indicate the registration was primarily for the purpose of selling or otherwise transferring the domain names registration to the Complainant, the rightful owner of the marks for valuable consideration in excess of Respondent’s out-of-pocket cost directly related to the domain names.

The uncontradicted evidence discloses that on October 27, 1999, Vertical Circuits, Inc., the Complainant herein, was a lawfully organized and existing corporation; Respondent’s registering of the domain names in issue with Network Solutions occurred subsequently thereto.

Other unrefuted facts are that literally within days of the announcement concerning the formation of the Complainant’s merged company, Respondent, via telephone and e-mail, advised Complainant that he had registered verticalcircuit.com, .net, and .org, and that he would sell the rights to those names for $750,000.  Having received rejection to his offer to sell the names for $750,000, the record reflects that on November 12, 1999, in an e-mail which obviously came from Respondent addressed to Williams Kuncz, Complainant’s CFO, Mr. Connelly advised as follows:

Comments and/or questions:  = verticalcircuits.com  verticalcircuits.net, verticalcircuits.org

            I have these names and you want them don’t you?

I have another client who going to use for a porno actions Japanese anami site but as I just spoke to someone there I guess you don’t mind.

The undersigned further finds that Respondent has never used the domain names and same  were registered in bad faith because the registration was made with the intent to profit from a domain name identical to Complainant’s registered corporate name.  Such registration, I find, was primarily for the purpose of selling the domain name registration to the Complainant.  Indeed, the record reflects that after receipt of the Complaint herein, a communication was sent by the Respondent commencing with the phrase:  “Hi, John . . .,” with a copy being sent to William Kuncz, Complainant’s CFO, stating in part as follows:

They are a company, a business.  I am just a guy who registered a domain name legally, I did not know of them until after I registered  there was never bad faith, how could there be bad faith when I didn’t even know about them when i registered the names.

In that same communication, in an obvious reference to the instant issue and in a particular reference to Complainant’s CFO, it was further stated:

Then he will know the power of the Internet in the hands of someone who knows how to use it, and who has friends all over the world, who has done the same thing I have done registered names . . . 

The further statement was made:

Thank God this is my only one left and the hardest one to get rid of.  Everyone else made a deal.   I started with a number and we ended up in the middle.  Simple.

The instant case is similar to the case of Panavision International LP v. Toeppen, 945 F. Supp. 1296 (C.D. Cal. 1996), wherein the defendant registered PANAVISION.COM as a domain name and demanded $13,000 from the owner of the Panavision mark for the right to use the domain name.  Based on the fact that the defendant in that case had registered other marks as domain names, the Court found that the defendant’s “business [was] to register trademarks as domain names and then to sell the domain names to the trademarks’ owners.”  Id. at 1303.  In the instant case, Respondent, by his own admission, had registered names and then apparently was successful in, as he expressed it, “making a deal” in all but the instant case.  The apparent lack of any legitimate business or other reason for registering the names leads one to the logical conclusion that Respondent’s “business” is to register names and then sell them back to their rightful owners for sums well in excess of any reasonable out-of-pocket costs directly related to the name.

For the reasons stated in these findings, I find that the Complainant has sustained its burden of proof in accord with paragraph 4(a)(i)(ii) and (iii) of the Uniform Domain Name Policy, supra.

For the reasons herein stated and pursuant to the authority vested in the undersigned, it is DIRECTED that the registration of the domain names verticalcircuits.com and verticalcircuits.net be forthwith transferred to the Complainant.

The undersigned certifies that he has acted independently and has no known conflict in serving as the arbitrator in this proceeding.

Date:  June 7, 2000                                Honorable Robert R. Merhige, Jr., Arbitrator