DECISION

Franzus Company LLC v. James R. Cotner, Jr.

Claim Number: FA0209000125365

PARTIES

Complainant is Franzus Company LLC, Beacon Falls, CT (“Complainant”) represented by Melvin I. Stoltz.  Respondent is James R. Cotner, Northport, AL (“Respondent”) represented by Jeffrey H. Greger, of Mason Mason & Albright.

REGISTRAR AND DISPUTED DOMAIN NAME 

The domain name at issue is <travelsmart.com>, registered with Network Solutions.

PANEL

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

The Honorable Charles K. McCotter, Jr. (Ret.) as Panelist.

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum (the “Forum”) electronically on September 18, 2002; the Forum received a hard copy of the Complaint on September 20, 2002.

On September 20, 2002, Network Solutions confirmed by e-mail to the Forum that the domain name <travelsmart.com> is registered with Network Solutions and that the Respondent is the current registrant of the name.  Network Solutions has verified that Respondent is bound by the Network Solutions 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 September 23, 2002, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of October 14, 2002 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@travelsmart.com by e-mail.

A timely Response was received and determined to be complete on October 14, 2002.

Complainant filed a timely Additional Submission on October 18, 2002.  Respondent submitted a Supplemental Response on October 23, 2002.

On October 28, 2002, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the Forum appointed the Honorable Charles K. McCotter, Jr. (Ret.) as Panelist.

RELIEF SOUGHT

Complainant requests that the domain name be transferred from Respondent to Complainant.  Respondent requests a finding that Complainant has engaged in reverse domain name hijacking.

PARTIES’ CONTENTIONS

A. Complainant

Respondent’s <travelsmart.com > domain name is identical to Complainant’s registered TRAVELSMART mark.  Respondent does not have any rights or legitimate interests in the domain name.  Respondent registered and used the domain name in bad faith.

B. Respondent

Respondent alleges a legitimate interest based on developing the domain name in the future for use in the field of travel.  Respondent also made limited preparations to use the website corresponding to the domain name in connection with a bona fide offering of services in the past but these never came to fruition.  Respondent contends that he has legitimate rights and interests in respect of the domain name due to the highly descriptive nature of the terms in the domain name.  Respondent contends that he has the right to commercialize a highly descriptive domain name.

C. Additional Submissions

Complainant contends that passive holding of domain names without demonstrable plans to use the domain is evidence of bad faith and a lack of legitimate interest.  Respondent contends he made significant preparations to use the highly descriptive domain name long before notification of the dispute and that he never initiated contact nor offered the domain name registration for sale to anyone.

FINDINGS

Complainant, Franzus Company, LLC (“Franzus” or “Complainant”), is a worldwide and well-known marketing and distributing company of travel and travel-related products including luggage, travel appliances, electrical conversion products, travel convenience accessories, travel security products, travel healthcare products, and automobile accessories.

Franzus, through its predecessor company, Franzus, Inc., adopted the trademark TRAVEL SMART by using this trademark on travel-related products.  Shortly after this first use, Franzus sought and obtained six (6) U.S. Trademark Registrations on the Principal Register for the mark TRAVEL SMART in International Classes 8, 9, 12, and 19.  The earliest U.S. TRAVEL SMART Registration was issued on February 20, 1990 with use through its predecessor in title at least as early as April 1988.  Franzus is also the owner of thirty-six (36) Foreign Registrations for the trademark TRAVEL SMART

In addition to holding the above-identified U.S. and Foreign Trademark Registrations, Franzus has acquired common law rights to this name and has made a substantial investment in advertising, public relations, and promoting its TRAVEL SMART trademarks.  Franzus maintains a web page on the Internet wherein the TRAVEL SMART Trademark is prominently displayed.

Complainant has invested over $80,000 in obtaining its trademark rights to TRAVEL SMART.  Substantially greater sums of money have also been expended in promoting Complainant’s products under the TRAVEL SMART trademark.  Through Complainant’s widespread, worldwide use, its TRAVELSMART mark has become well known and associated with Complainant and its products.

Respondent obtained the domain name <travelsmart.com> in 1997 due to a connection with a then small start-up multilevel-marketing company called Travel Smart Network Services Inc.  Respondent was recruited as agent for the new company.  Respondent found the then current owner of the <travelsmart.com> domain name and acquired the domain name for considerably more than the cost of a new, un-acquired domain name.  Subsequently, Respondent engaged in developing an interactive website which was reduced to a beta version on computer disk.  However, the initial version was never launched due to a dispute with the principals that started the Travel Smart Network Services Company.  Shortly after Respondent acquired the domain name, the Travel Smart Network Services Company ceased doing business

On several occasions, Complainant has monitored the <travelsmart.com> website.  In attempting to open this website, the only information provided is that “This Page cannot be Opened”.

Recently, a representative of Complainant contacted Respondent in an attempt to purchase the domain name.  Although Respondent has not developed this website for a period of over five years, Respondent indicated that a “six-figure amount” was needed for the purchase of this domain name.

Respondent has not used the domain name <travelsmart.com> or developed an operating website under this designation, regardless of Respondent’s claim that the domain name would be used in the future.  Respondent says that since acquiring the domain name in 1997, his intentions have been to commercialize the domain name in connection with travel-related services. 

Complainant does not have exclusive rights to the descriptive domain name <travelsmart.com>.  There are other Federal registrations for the identical mark TRAVEL SMART owned by entities other than Complainant.  Respondent’s search of the Google™ database for "travel smart" revealed about 17,900 results.  Further, others have registered domain names using the term TRAVEL SMART.  Numerous other TRAVEL SMART formative domain names remain unused in the available pool of domain names.

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

Complainant has established that it has rights in the TRAVELSMART mark through registration and continuous use.  Respondent’s domain name <travelsmart.com> is identical to Complainant’s TRAVELSMART trademarks.

Accordingly, the Panel finds that Policy ¶ 4(a)(i) has been satisfied.

Rights or Legitimate Interests

Respondent admits that he has not used, or made any preparation to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services since 1997; is not commonly known by the domain name; and is not making any legitimate non-commercial or fair use of the domain name. 

Respondent asserts the intent to use the domain name at some unspecified time in the future.  However, a Respondent’s “unsupported, self-serving allegations alone are insufficient to establish that [the] Respondent has rights or legitimate interests in respect to the domain name at issue.”  Twentieth Century Fox Film Corp. v. Benstein, FA 102962 (Nat. Arb. Forum Feb. 27, 2002) (finding the Respondent’s assertion that she registered the domain name <foxstudios.biz> in order to get a website address for her planned dance studios, without evidentiary support, was insufficient to establish that she had rights or interests in respect to the domain name at issue); see also Travel in A Moment, Inc. v. F.S. Janco, FA 96821 (Nat. Arb. Forum April 9, 2000) (Respondent failed to show rights or legitimate interests in <momentsnoticetravel.com> where Respondent’s contended that domain name was registered for future use in connection with an “undisclosed business venture”); Camper, S.L. v. DPR USA a/k/a Global DNS Services, FA 118188 (Nat. Arb. Forum Oct. 22, 2002) (Respondent failed to establish legitimate interests in the domain name <camper.us> through mere statement of intent to market campers).

“Respondent may fairly use descriptive or generic terms as a commercial domain name.”  Eastbay Corp. v. VerandaGlobal.com, Inc., FA 105983 (Nat. Arb. Forum May 20, 2002); see also Energy Source Inc. v. Your Energy Source, FA 96364 (Nat. Arb Forum Feb. 19, 2001) (Respondent has rights and legitimate interests in the domain name where “Respondent has persuasively shown that the domain name is comprised of generic and/or descriptive terms, and, in any event, is not exclusively associated with Complainant’s business”).  The mark TRAVELSMART is a “common generic expression in which the Complainant cannot have exclusive rights.” See Do The Hustle, LLC v. Tropic Web, D2000-0624 (WIPO Aug. 21,2000).  However, Respondent is not using the domain name <travelsmart.com> but has been passively holding the domain for over five years for the only purpose of selling the domain name for an amount in excess of its out-of-pocket costs of registration.  See HomeFinishers, Inc. v. Tom Schutz, FA 123928 (Nat. Arb. Forum Oct. 10, 2002) (The passive holding of the domain name <homefinishers.com> for over two years without providing any demonstrable plans or preparations to use the domain name fails to show rights or legitimate interests). 

Respondent has produced some evidence that he acquired the domain name in 1997 for use in a business venture.   Respondent began developing an interactive website which was reduced to a beta version on computer disk, but was never activated on

the <travelsmart.com> site or any other website.  In view of the failure to develop the website, the subsequent passive use, and the offers to sell its rights for more than the registration costs, Respondent’s evidence fails to show demonstrable preparations to use the domain name in connection with a bona fide offering of goods and services. See Flor-Jon Films v. Larson, FA 94974 (Nat. Arb. Forum July 25, 2000) (finding that Respondent’s failure to develop the site demonstrates a lack of legitimate interest in the domain name).  Respondent has failed to show rights or a legitimate interest in the domain name.

Accordingly, the Panel finds that Policy ¶ 4(a)(ii) has been satisfied.  

Registration and Use in Bad Faith

During the last five years, Respondent has passively held the disputed domain name with the only activity being entertaining offers to purchase the domain name registration .  Respondent was and continues to be willing to sell this domain name registration for a “six-figure offer”. Bad faith exists where Respondent registered the domain name for the purpose of selling its rights in the domain name to Complainant for an amount in excess of out of pocket costs associated with the registration of the domain name and Respondent has made no other use of the domain name.  See Educ. Testing Serv. v. TOEFL, D2000-0044 (WIPO Mar. 16, 2000) (finding that a general offer of sale combined with no legitimate use of the domain name constitutes registration and use in bad faith); see also Am. Anti-Vivisection Society v. “Infa dot Net” Web Serv., FA 95685 (Nat. Arb. Forum Nov. 6, 2000) (finding that “general offers to sell the domain name, even if no certain price is demanded, are evidence of bad faith”); see also Grundfos A/S v. Lokale, D2000-1347 (WIPO Nov. 27, 2000) (finding that a failure to use the domain name in any context other than to offer it for sale to Complainant amounts to a use of the domain name in bad faith).

Respondent has made no use of the domain name other than to offer its rights for sale at a price that is likely to substantially exceed its costs of registration.  See Educ. Testing Serv. v. TOEFL, D2000-0044 (WIPO March 16, 2000).  Registration of a domain name primarily for sale, rent, or transfer is evidence of bad faith use and registration pursuant to Policy ¶ 4(b)(i).  See Matmut v. Tweed, D2000-1183 (WIPO Nov. 27, 2000) (finding bad faith under Policy ¶ 4(b)(i) where Respondent stated in communication with Complainant, “if you are interested in buying this domain name, we would be ready to sell it for $10,000”).  Moreover, the passive holding of the domain name for over five years is bad faith use.  See DCI S.A. v. Link Commercial Corp., D2000-1232 (WIPO Dec. 7, 2000) (concluding that Respondent’s passive holding of the domain name satisfies the requirement of ¶ 4(a)(iii) of the Policy).

However, Complainant must also show bad faith registration.  Under Paragraph 4(b) of the Policy, Complainant must show both registration and use in bad faith.  Respondent has produced some evidence that he acquired the domain name in 1997 for use in a legitimate business venture, which ultimately did not materialize.  However, Respondent’s passive holding of the domain name creates an inference of bad faith registration and use, which Respondent’s limited showing fails to overcome.  See also Caravan Club v. Mrgsale, FA 95314 (Nat. Arb. Forum Aug. 30, 2000) (finding that Respondent made no use of the domain name or website that connects with the domain name, and that passive holding of a domain name permits an inference of registration and use in bad faith); see also Cruzeiro Licenciamentos Ltda v. Sallen, D2000-0715 (WIPO Sept. 6, 2000) (finding that mere passive holding of a domain name can qualify as bad faith if the domain name owner’s conduct creates the impression that the name is for sale).

The Panel finds that Policy ¶ 4(a)(iii) has been satisfied. 

Reverse Domain Name Hijacking

Complainant has not engaged in reverse domain name hijacking.

DECISION

Having established all three elements under ICANN Policy, the Panel concludes that relief shall be hereby GRANTED.

Accordingly, it is Ordered that the <travelsmart.com> domain name be TRANSFERRED from Respondent to Complainant.

The Honorable Charles K. McCotter, Jr. (Ret.), Panelist
Dated: November 7, 2002

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