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Rand Refinery Limited v. Patrick Reinhardt [2001] GENDND 1010 (23 May 2001)

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

The Complainant is Rand Refinery Limited, a South African corporation of Germiston, South Africa. The Complainant is represented by Mr. John Giles, attorney, of Sandton, South Africa.

The Respondent is Mr. P.T. Reinhardt of Arrau, Switzerland. The Respondent is represented by Mr. John B. Berryhill, attorney, of Philadelphia, PA, United States of America.

The domain name at issue is <krugerrand.com>. The domain name is registered with Tucows.com, Inc. of Toronto, Canada ("the Registrar"). The name was registered on March 16, 1998.

This is an administrative proceeding pursuant to the Uniform Domain Name Dispute Resolution Policy ("the Policy") adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) on August 26, 1999, in accordance with the Rules for the Policy, approved by ICANN on October 24, 1999 ("the Rules") and the Supplemental Rules for the Policy ("the Supplemental Rules") of the WIPO Arbitration and Mediation Center ("the Center").

The Complaint was received by the Center on February 13, 2001, (electronically) and February 16, 2001, (hard copy). An amendment to the Complaint was filed on March 2, 2001 (email) and March 6, 2001 (hard copy).

On March 7, 2001, the Center sought registration details from the Registrar. On March 12, 2001, the Registrar advised that the registrant of the disputed domain name and the Administrative, Technical, Zone and Billing Contact is the Respondent at the above address. The Registrar’s Service Agreement incorporates the Policy and requires the registrant to submit to a properly initiated complaint under the Policy; that the status of the disputed domain name is "on hold." and that a copy of the Complainant had not received.

On March 14, 2001, the Center satisfied itself that the Complainant had complied with all formal requirements, including payment of the prescribed fee. It formally notified the Respondent by post/courier, facsimile and email of the Complaint and the amended Complaint and of the commencement of this administrative proceeding and sent copies to the Complainant, the Registrar and ICANN.

The formal date of the commencement of the proceeding was accordingly March 14, 2001. A Response was filed by the Respondent on April 3, 2001 (electronic) and April 4, 2001 (hard copy).

A three-member Panel was requested by the Respondent. Both parties have paid the requisite fees.

On May 7, 2001, the Center notified the parties of the appointment of the Panel, all three members having submitted a Statement of Acceptance and Declaration of Impartiality. The Panel is required to give its decision by May 21, 2001. Because of the delay in obtaining further material from the parties, the decision will be delivered on or before June 1, 2001.

The language of the proceeding is English, as being the language of the domain name Registration Agreement, pursuant to paragraph 11(a) of the Rules.

The Panel received a request from Complainant to file a Reply. By procedural order dated May 9, 2001, it allowed a Reply to be filed, plus submissions from the Respondent on the Reply. The Panel has considered these additional materials before giving its decision.

The Panel is satisfied that the Complaint was filed in accordance with the requirements of the Rules; payment was properly made; the Panel agrees with the Center’s assessment concerning the Complaint’s compliance with paragraph 2(a) of the Rules; and that the three member administrative panel was properly constituted.

The Complainant originally claimed in its Complaint that the Complainant held or had held trademark registrations for ‘Krugerrand’ in Taiwan and the U.S.A.

A krugerrand is a unit of currency in South Africa, being a gold coin established by the legislature of the Republic of South Africa in 1967 with its name, weight and dimensions all prescribed by statute. The Complainant is authorised by the Reserve Bank of South Africa to manufacture gold blanks that are minted into krugerrand coins by the South African Mint, an organ of the Reserve Bank.

In its Response, the Respondent produced evidence that showed that the Complainant had abandoned a U.S. trademark registration application in 1989. In its Reply to the Response, the Complainant’s excuse for referring to a U.S. trademark when it never owned one was that it had referred to "past and/or present registration in Taiwan and the United States". It rather limply stated that it did not intend to mislead the Panel.

Complainant asserted initially trademark registrations in Benelux, Singapore, Spain, Switzerland, Portugal and Austria. It did not submit documentation to support all these claims. In its procedural ruling, the Panel required the Complainant to give full particulars of the marks and their status. It required hard copies to be forwarded to WIPO Center and to the Respondent for checking. These have now been supplied. It appears that the Complainant’s claims to trademark registration for "Krugerrand" in at least some of the countries mentioned is established.

The above scenario demonstrates that it is lax practice for a complainant to assert trademark registrations without tendering prima facie evidence such as copies of official registration documents. The Panel is at a loss to understand why it was given such obviously incorrect information about a U.S. trademark. What follows is the Panel’s summary of the relevant information, including that eventually supplied by the Complainant.

- The trademark on which the Complaint is based is "Krugerrand". Gold coins are the goods in connection with which the Complainant uses the trademark. It has trademark registrations in some European countries, including Switzerland where the Respondent is domiciled. Even so, the evidence produced by the Complainant is not entirely satisfactory. Some of the marks are in the name of International Gold Corporation Limited and are said to have been transferred to the Complainant. However, its ownership of a Swiss mark appears proved.

- The Respondent has not developed a website for the domain name. He wishes to develop the name in connection with investment activities, but is open to offers to sell.

- Relevant parts of a communication from the Respondent to the Complainant dated June 8, 1999 read –

- A letter of demand was sent to the Respondent in February, 2001 offering to pay the Respondent’s out-of-pocket costs directly related to the domain name in return for the transfer of the domain name: the Complainant has received no response.

(a) domain name is identical to the Complainant’s registered mark.

(b) Respondent has no rights or legitimate interests in respect of the domain name that is the subject of the Complaint for the following reasons –

- Respondent has not used or made preparation to use the domain name in connection with a bona fide offering of goods or services, and

- Respondent is not commonly known by the domain name, and

- Respondent is not making a legitimate non-commercial or fair use of the domain name.

The web page that appears at the domain name provides proof of the existence of the above factual grounds. The Respondent has offered the domain name for sale.

(c) The name was registered and is being used in bad faith, as can be seen from the correspondence between the parties. The Complainant’s enquiry about sale in 1999 was made without legal advice.

(a) The krugerrand is a unit of currency of the Republic of South Africa. It is a one troy-ounce gold coin established by an Act of the legislature of South Africa in 1967. The name of the coin is derived from Paul Kruger, the President of South Africa from 1883 to 1900, conjoined with the fundamental currency unit of South Africa, the rand. The name of the krugerrand, its weight, its composition, and its size, are all established in Schedule 2 of the South African Reserve Bank Act. Section 16 of the Act states:

"The Bank may make or cause to be made coins of the denominations and with the mass set out in Schedule 2, and which are made of gold […]"

Section 2 of the Act, specifies various weights of "krugerrand" and the composition thereof. Section 17(2) of the Act defines as legal tender of the Republic:

"coin which is lawfully in circulation in the Republic and of current mass, […] and the value of each gold coin so tendered shall be equal to the net amount at which the bank is prepared to purchase that gold coin on the day of such tender thereof."

While the South African Reserve Bank Act is clear in the establishment of the krugerrand as a coin, and in the physical specifications for the coin, there is no mention of the Complainant to be found in the Act. Krugerrands are not a product of the Complainant. As the name of a unit of currency, the term "krugerrand" is not the intellectual property of any person at all. The coin was named by the legislature of South Africa, and the Complainant has no claim to a trademark as the result of an Act of the legislature of its home country.

(b) For any party to claim a trademark right in the term "krugerrand" would be the equivalent of a trademark claim to "Swiss Franc", "Deutsche Mark", or "U.S. Dollar". The krugerrand is traded as a commodity item on world markets as a "krugerrand".

(c) The Complainant exercises no control over the name, design or physical features of this coin, and thus does not legally exercise control over the product as would be required for goods subject to trademark. It does not manufacture the krugerrand. The Complainant does not determine the number of krugerrands to be produced in a given year. Indeed, the specifications of the coin are conditions for the production of krugerrands, set by the legislature of South Africa. The sine qua non of trademark ownership is the ability to control the quality of the goods produced under the alleged trademark.

(d) In the absence of any valid trademark claim, the Respondent was entitled to register the domain name <krugerrand.com> on a "first-come, first-served" basis, when the domain name was available for registration. Despite the presumption of validity of a registered mark, this is one of those rare cases where the Panel should find that there is no valid mark.

(e) The Respondent’s interest in krugerrands arises from the Respondent’s professional involvement in investments. The Respondent has a Swiss commercial diploma in economic studies, and is professionally employed as an investment advisor with the Aarauische Kantonalbank. It has been the Respondent’s plan to develop the domain name in connection with investment activities, as the krugerrand is an investment vehicle. Pending the development of an active website in connection with the domain name, the Respondent is open to offers that others desiring to develop the domain name may have. The Complainant initially approached the Respondent’s brother, stating that it was "interested to know if you would sale …".

(f) A speculative interest in a domain name that one has legitimately acquired to the detriment of no trademark right, is a legitimate interest. Here, the domain name is the generic name of a unit of currency, and is not a trademark. In John Fairfax Publications Pty Ltd v. Domain Names 4U and Fred Gray, (WIPO Case No. D2000-1403), the domain name at issue was <financialreview.com>.

(g) <krugerrand.com> was registered by the Respondent on March 16, 1998. The Complainant’s domain name, <krugerrand.org>, was registered on June 10, 1999, at a time when the Complainant was surely on notice of the prior registration of <krugerrand.com> by the Respondent. The Policy is akin to an action in equity, giving rise to the equitable defense of laches. Even if the Complainant had a claim of right to the term "krugerrand", (which is not conceded), the Respondent would still be entitled to a legitimate reliance in the undisturbed registration of the domain name in view of the Complainant’s several years of inaction followed by the Complainant’s new-found interest in acquiring the domain name.

(h) The Respondent has not engaged in a pattern of registering domain names corresponding to any trademark of the Complainant. Moreover, the Respondent has not prevented the Complainant from using the term "krugerrand" in a domain name – even though the term is not a trademark of the Complainant. The Complainant has registered and uses the domain name <krugerrand.org>, and the Complainant admits at the corresponding website that they are coins issued by South Africa for the manufacture of which the Complainant supplies the blanks.

(i) The Respondent, having a professional interest in investments, registered the domain name <krugerrand.com> because it is a term of relevance to his occupation. The Respondent has maintained contact data sufficient to provide actual notice of the dispute, and has updated the data at various times to reflect parties with whom the Respondent was engaged in potential developments for the domain name. Had the Respondent registered the domain name primarily for the purpose of selling it to the Complainant, then the Respondent would have approached the Complainant at some point during the Respondent’s undisturbed years of registration.

(j) It is unlikely that any relevant consumer associates the term "krugerrand" with the Rand Refinery, which does not manufacture or sell krugerrands. Rather, it is clear that the investment world recognizes the term "krugerrand" as a one-ounce gold coin which provides a practical method of owning a calibrated weight of gold for investors in countries which allow coin ownership but which do not allow private ownership of bullion per se. Just as the coin is legitimately held for speculation, so too is it a legitimate activity to speculate in the generic name of the coin. The Complainant has presented no evidence of any secondary meaning or distinct consumer association of the term "krugerrand" with any commercial activity of the Complainant.

(k) There is no bad faith evident in the Respondent’s willingness to sell the domain name.

To qualify for cancellation or transfer, a complainant must prove each element of paragraph 4(a) of the Policy, namely:

(i) the disputed domain names are identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

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

(iii) the disputed domain names have been registered and are being used in bad faith.

Although the Panel has misgivings about the validity of the trademark registration of "krugerrand" which is a unit of currency not controlled by the Complainant, the Panel does not find it necessary to investigate the Respondent’s concerns. Such an investigation is best made by a Court of competent jurisdiction in a proceeding to test the validity of the mark. Because there are valid trademark registrations of "krugerrand" owned by the Complainant, the Panel is prepared to hold that the domain name is identical to the registered mark. Thus the first criterion is proved.

However, the Panel considers that the Complaint must fail because it is not satisfied that the Respondent registered <krugerrand.com> in bad faith in June, 1998. Although there may have been a Swiss trademark registration, a reasonable person in the finance industry such as the Respondent, could not be assumed to know that a trademark registration existed for a unit of currency with worldwide recognition which is authorized by the legislature of the country that produces and distributes it. Respondent would normally be entitled to use "krugerrand" as a generic term. Maybe the Respondent did register the name in bad faith. But that fact cannot be decided on the papers – only a Court would be able properly on evidence to so decide.

It is therefore unnecessary to consider the second criterion under the Policy, in view of the clear view of the Panel that the third criterion has not been met by the Complainant.

For the above reasons, the Panel declines to order the transfer or removal of the domain name.

The Complaint is denied.

Hon. Sir Ian Barker QC
Presiding Panelist

Archibald Findlay, S.C.
Panelist

Tony Willoughby
Panelist

Dated: May 23, 2001