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Fatbrain.com, Inc. v IQ Management Corporation [2001] GENDND 414 (28 February 2001)


National Arbitration Forum

DECISION

Fatbrain.com, Inc. v IQ Management Corporation

Claim Number: FA0101000096374

PARTIES

The Complainant is Fatbrain.com, Inc., Santa Clara, CA, USA ("Complainant") represented by David M. Kelly, of Finnegan, Henderson, Farabow, Garrett. The Respondent is Paul Gordon IQ Management Corporation, Belize City, Belize ("Respondent").

REGISTRAR AND DISPUTED DOMAIN NAME

The domain name at issue is "CLBOOKS.COM", registered with Tucows.com, Inc.

PANEL

Each of the undersigned certifies that he has acted independently and impartially and to the best of his knowledge, has no known conflict in serving as a panelist in this proceeding.

Paul Michael DeCicco, David P. Miranda and James A. Carmody (Chairman), as Panelists.

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum ("the Forum") electronically on January 9, 2001; the Forum received a hard copy of the Complaint on January 9, 2001.

On January 18, 2001, Tucows.com, Inc. confirmed by e-mail to the Forum that the domain name "CLBOOKS.COM" is registered with Tucows.com, Inc. and that the Respondent is the current registrant of the name. Tucows.com, Inc. has verified that Respondent is bound by the Tucows.com, Inc. registration agreement and has thereby agreed to resolve domain name disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the "Policy").

On January 19, 2001, a Notification of Complaint and Commencement of Administrative Proceeding (the "Commencement Notification"), setting a deadline of February 8, 2001
by which Respondent could file a Response to the Complaint, was transmitted to Respondent via e-mail, post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts, and to postmaster@CLBOOKS.COM by e-mail.

A timely response was received and determined to be complete on February 9, 2001.

On February 19, 2001, pursuant to Complainant’s request to have the dispute decided by a Three-Member Panel, the Forum appointed Paul Michael DeCicco, David P. Miranda and James A. Carmody as Panelists. The Panel has taken into consideration the Complaint, the Response and the supplemental replies of each of the parties in making this Decision.

RELIEF SOUGHT

The Complainant requests that the domain name be transferred from the Respondent to the Complainant.

PARTIES’ CONTENTIONS

A. Complainant

Complainant alleges that:
    1. The domain name at issue fully incorporates Complainant’s registered trademark CLBOOKS.COM, and therefore, is identical to and is confusingly similar to Complainant's CLBOOKS.COM mark. Respondent’s domain name, CLBOOKS.COM, is also confusingly similar to Complainant’s CL mark.
    2. Respondent does not have any rights or a legitimate interest in the domain name at issue by virtue of the fact that it contains and trades on the goodwill of Complainant’s CLBOOKS.COM mark, and Respondent’s use of that mark is unauthorized.
    3. Respondent does not have any rights or a legitimate interest in the domain name at issue by virtue of the fact that it trades on the goodwill of Complainant’s CL-formative marks, and Respondent’s use of those marks is unauthorized.
    4. Respondent’s registration and use of the domain name at issue meet the bad faith requirement described in Paragraph 4(a) of the UDRP.

B. Respondent

Respondent alleges that:
    1. It does not deny that the domain name at issue is identical or confusingly similar to Complainant’s registered trademark. However, it claims that the "CL" mark is not distinctive due to its common use to describe the chemical element chlorine.
    2. Respondent claims that it has rights and legitimate interests in respect of the domain name at issue in that it was registered by Respondent "…with the express intention of operating an e-commerce website relevant to one of the domain names generic meanings." Presumably, this means a site devoted in part to books on the subject of chlorine and its effects on the environment.
    3. Respondent further states that it was legally entitled to register the domain name at issue as it was shown to be available in listings at a number of warehousing websites, and Complainant’s failure to renew suggested abandonment and availability of the domain name at issue.
    4. Respondent claims that it did not act in bad faith because it did not know of Complainant’s use of the "CLBOOKS.COM" mark or its registration. Non-U.S. domain name registrants should not be held to know of the use and registration of marks in the U.S. claims Respondent.
    5. Finally, Respondent claims that it is not in competition with Complainant and does not seek to divert web surfers looking for Complainant to Respondent’s CLBOOKS.COM site or to one of Respondent’s transfer sites.

FINDINGS

    1. Complainant traces its roots back to 1983 with the formation of its predecessor-in-interest, Computer Literacy Bookshops, Inc., a retail store. The first COMPUTER LITERACY bookstore was opened in Sunnyvale, California, and a second COMPUTER LITERACY bookstore was opened in San Jose, California. Both stores are still operated today under the mark and name COMPUTER LITERACY. Complainant has continuously operated COMPUTER LITERACY retail bookstores from 1983 to the present. Complainant has continuously used for many years the mark CL to promote its COMPUTER LITERACY bookstores.
    2. Complainant registered the domain name CLBOOKS.COM on August 25, 1991, and began using that domain name to sell books online under the marks and names CLBOOKS.COM and COMPUTER LITERACY. From 1991 until approximately March 1999, Complainant used the domain name CLBOOKS.COM for email and to identify its website for book selling operations. From March 1999 until November 2000, at which time the domain name CLBOOKS.COM was inadvertently deleted for nonpayment, Complainant continued to use the domain name CLBOOKS.COM for email and also to direct Internet users to its FATBRAIN.COM website.
    3. While Complainant’s retail stores still operate under the mark COMPUTER LITERACY, Complainant’s online book selling and other online services have been promoted since early 1999 under the mark and name FATBRAIN.COM. Complainant’s online services are featured at its website, FATBRAIN.COM.
    4. Respondent is not and has never been a licensee of Complainant. Respondent is not and has never been otherwise authorized by Complainant to use its CLBOOKS.COM, CL, COMPUTER LITERACY, or COMPUTER LITERACY BOOK SHOP and Design marks.
    5. Complainant is the owner of the following trademark registrations and applications:
    1. United States Trademark Registration No. 1,907,949 for the mark CLBOOKS.COM, first used November 1991, filed January 18, 1994, issued July 25, 1995, covering retail store and mail order stores in the fields of books and technical information in International Class 42.
    2. United States Trademark Application No. 75/431,265 for the mark CL, filed February 9, 1998, published for opposition September 7, 1999, covering retail store services, and computerized on-line store services, featuring wholesale and retail books, manuals, multimedia products, computer software, audiocassettes, and videocassettes in International Class 42.
    3. United States Trademark Registration No. 1,594,680 for the mark COMPUTER LITERACY, first used June 1983, filed June 15, 1989, issued May 1, 1990, covering retail store services and mail order services in the field of computer supplies, computer programs, and technical books and periodical in International Class 42.
    4. United States Trademark Registration No. 1,432,433 for the mark COMPUTER LITERACY BOOK SHOP and Design, in which the letters CL are emphasized in larger, bolder type, first used March 1983, filed October 11, 1985, issued March 10, 1987, covering retail store and mail order services for books and periodicals for use in technical fields.
    1. On August 25, 1991, Complainant registered the subject domain name, CLBOOKS.COM, and used it continuously for more than nine years from that date until sometime in the fall of 2000 when it was inadvertently deleted, without Complainant’s knowledge, for nonpayment of the renewal fee. At the time the subject domain name was inadvertently deleted for nonpayment, Complainant used it for email and also to point to Complainant’s website, as Complainant had done throughout the nine years that Complainant owned the domain name.
    2. Respondent uses the subject domain name to redirect Internet users to a website at SEARCH.VU, which offers electronic books on CD-ROM, such as atlases, encyclopedias, and foreign language reference books, in direct competition with Complainant.
    3. Respondent uses the subject domain name to directly compete with Complainant by diverting Internet users to its SEARCH.VU website which offers electronic books that are closely related to the publications offered by Complainant. Internet users attempting to locate Complainant’s services might instead choose to use the services offered at the SEARCH.VU website once they arrived at it inadvertently by typing in the subject domain name when looking for a site associated with Complainant’s registered mark. This type of initial interest confusion involving the same or closely related goods or services is actionable as trademark infringement. Brookfield Communications, Inc. v. West Coast Entertainment Corp.[1999] USCA9 225; , 174 F.3d 1036 (9th Cir. 1999). Respondent registered Complainant’s CLBOOKS.COM mark to deprive Complainant of the Internet traffic rightly intended for Complainant, thereby disrupting Complainant’s business and causing Complainant to lose revenue.

DISCUSSION

Paragraph 15(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") instructs this Panel to "decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable."

Paragraph 4(a) of the Policy requires that the Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:

(1) the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

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

(3) the domain name has been registered and is being used in bad faith.

Identical and/or Confusingly Similar

It is not seriously disputed that the domain name at issue is identical or confusingly similar to a trademark in which the Complainant has rights. The Panel finds that such is the case.

Rights or Legitimate Interests

The panel finds that the Respondent has no rights or legitimate interests in respect of the domain name at issue under the circumstances of this case. Under the undisputed facts alleged, Complainant would have superior common law or registered trademark rights vis-à-vis Respondent with respect to use of the domain name at issue. This would be so even if Complainant had not been the registered owner of the domain name at issue from August 25, 1991 to March of 1999. While Respondent would have us find that Complainant abandoned the domain name at issue, such would require the voluntary relinquishment of a known right on the part of Complainant. "Abandonment has been defined as the voluntary relinquishment of all right, title, claim and possession of property with the intention of not reclaiming it. It includes both the intent to abandon and an act or acts by which the intention is carried into effect." U.S. v. Sherpinski, [1995] USCA4 2807; 70 F.3d 112 (9th Cir. 1995). We find no evidence of abandonment so defined.

Respondent has no rights or legitimate interests in the domain name in question because Respondent is not commonly known by the domain name, nor has Respondent used the domain name in connection with a legitimate noncommercial or fair use without intent for commercial gain. See Hartford Fire Ins. Co. v. Webdeal.com, Inc., FA 95162 (Nat. Arb. Forum Aug. 29, 2000) (finding that respondent has no rights or legitimate interests in domain names because it is not commonly known by complainant’s marks and respondent has not used the domain names in connection with a bona fide offering of goods and services or for a legitimate noncommercial or fair use).

Registration and Use in Bad Faith

Respondent’s registration of the domain name at issue and the development of the related website to refer web surfers to a site competitive with Complainant is evidence of bad faith. This type of initial interest confusion involving the same or closely related goods or services is also actionable as trademark infringement. Brookfield Communications, Inc. v. West Coast Entertainment Corp., [1999] USCA9 225; 174 F.3d 1036 (9th Cir. 1999). Respondent registered Complainant’s CLBOOKS.COM mark to deprive Complainant of the Internet traffic rightly intended for Complainant, thereby disrupting Complainant’s business and causing Complainant to lose revenue.

Respondent has demonstrated a pattern of conduct, by registering domain names comprised of infringing marks, which prevents trademark owners from reflecting their marks in corresponding domain names. See General Electric Co. v. Forddirect.com, Inc., D2000-0394 (WIPO June 22, 2000) (finding that the Respondent engaged in a pattern of conduct, by registering over fifty domain names such as <amazondirect.com> and <lycosdirect.com>, and intended to prevent holders from using their marks in corresponding domain names); see also Gamesville.com, Inc. v. John Zuccarini, FA 95294 (Nat. Arb. Forum Aug. 30, 200) (finding that Respondent has engaged in a pattern of conduct of registering domain names to prevent the owner of the trademark from reflecting the mark in a corresponding domain name, which is evidence of registration and use in bad faith).

Also, Respondent acquired the domain name at issue due to Complainant’s inadvertent failure to renew its registration. See InTest Corp. v. Servicepoint, FA 95291 (Nat. Arb. Forum Aug. 30, 2000) (finding that where the domain name has been previously used by the Complainant, subsequent registration of the domain name by anyone else indicates bad faith, absent evidence to the contrary); see also BAA plc v. Spektrum Media Inc., D2000-1179 (WIPO Oct. 17, 2000) (finding bad faith where Respondent took advantage of the Complainant’s failure to renew a domain name).

Furthermore, although Respondent has a disclaimer on its web site, it is not immediately apparent; therefore, the disclaimer does not prevent initial interest confusion. See Thomas & Betts Int’l v. Power Cabling Corp., Inc., AF 0274 (eResolution Oct. 23, 2000) (finding bad faith based upon initial interest confusion despite disclaimer and link to Complainant’s web site on Respondent’s web site).

Finally, Respondent registered the domain name at issue to intentionally attract, for commercial gain, Internet users to its web site, or other online location, by creating a likelihood of confusion with Complainant’s well-established mark as to the source, sponsorship, affiliation and endorsement of Respondent’s web site. See Luck's Music Library v. Stellar Artist Mgmt., FA 95650 (Nat. Arb. Forum Oct. 30, 2000) (finding that the Respondent had engaged in bad faith use and registration by linking the domain name to a web site that offers services similar to Complainant’s services, intentionally attempting to attract, for commercial gain, Internet users to its web site by creating a likelihood of confusion with the Complainant’s marks); see also Perot Sys. Corp. v. Perot.net, FA 95312 (Nat. Arb. Forum Aug. 29, 2000) (finding bad faith where the domain name in question is obviously connected with the Complainant’s well known marks, thus creating a likelihood of confusion strictly for commercial gain).

DECISION

The Complainant having established all three elements required under the ICANN Policy, the Panel unanimously concludes that the requested relief shall be and hereby is granted.

Accordingly, it is Ordered that the domain name "CLBOOKS.COM" be transferred from Respondent to Complainant.

Paul Michael DeCicco, Panelist

David P. Miranda, Panelist

Honorable James A. Carmody

Dated: February 28, 2001

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