DECISION

Public Company Accounting Oversight Board v. Karl Nagel

Claim Number: FA0406000290974

PARTIES

Complainant is Public Company Accounting Oversight Board (“Complainant”), represented by Laurence R. Hefter, of Finnegan Henderson Farabow Garrett & Dunner L.L.P., 1300 I Street NW, Washington, DC 20005.  Respondent is Karl Nagel  (“Respondent”), POB 7752, Huntington Beach, CA 92615.

REGISTRAR AND DISPUTED DOMAIN NAMES 

The domain names at issue are <pcaob.com >, < pcaob.org >, < pcaobonline.com > and

<pcaob-online.com>, registered with Tucows Inc.

PANEL

The undersigned certify that they have acted independently and impartially and to the best of their knowledge have no known conflict in serving as the Panel in this proceeding.

Honorable Paul A. Dorf (Ret.), Professor David Sorkin, Honorable Nelson A. Diaz (Ret.) as Panelists.

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum (the “Forum”) electronically on June 30, 2004; the Forum received a hard copy of the Complaint on July 1, 2004.

On July 2, 2004, Tucows confirmed by e-mail to the Forum that the domain names <pcaob.com>, <pcaob.org>, <pcaobonline.com> and <pcaob-online.com> are registered with Tucows and that the Respondent is the current registrant of the name.  Tucows has verified that Respondent is bound by the Tucows 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 July 2, 2004, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of July 22, 2004 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@pcaob.com, postmaster@pcaob.org, postmaster@pcaobonline.com, and postmaster@pcaob-online.com by e-mail.

A timely Response was received and determined to be complete on July 21, 2004.

Both parties filed timely supplemental submissions pursuant to the Forum’s Supplemental Rule #7.  Complainant’s Submission was received by the Forum on July 26, 2004.  Respondent’s additional submission was received by the Forum on August 2, 2004.

On August 3, 2004, pursuant to Respondent’s request to have the dispute decided by a three-member Panel, the Forum appointed Honorable Paul A. Dorf (Ret.), Professor David Sorkin, and Honorable Nelson A. Diaz (Ret.) as Panelists.

RELIEF SOUGHT

Complainant requests that the domain names be transferred from Respondent to Complainant.

PARTIES’ CONTENTIONS

A. Complainant

1. Public Company Accounting Oversight Board oversees the auditors of public companies to protect investors and further the public interest in the preparation of informative, fair, and independent audit reports of public companies.  Congress established the Public Company Accounting Oversight Board with the passage of the Sarbanes-Oxley Act of 2002.  That Act became law on July 30, 2002.  Title I of the Sarbanes-Oxley Act established the Public Company Accounting Oversight Board and specified its powers and responsibilities.  The establishment of the Public Company Accounting Oversight Board has been described, by the Securities and Exchange Commission and others, as the “centerpiece” of the Act.

2. Public Company Accounting Oversight Board provides information about its services and online registration for public accounting firms at its website, PCAOBUS.ORG.

3. Because Congress established Public Company Accounting Oversight Board to address the loss of investor trust in public companies and their auditors in the wake of the Enron and WorldCom bankruptcies, Congress’s actions drew intense public attention. Numerous Congressional publications and hearings, financial industry analyst reports, and press articles reported on Congress’s formation of Public Company Accounting Oversight Board.

4. From at least July 8, 2002 through July 16, 2002, when Respondent registered the first of the Domain Names, and continuously thereafter, publications frequently referred to the Public Company Accounting Oversight Board as PCAOB.   

5. In addition, before Respondent’s registration of the Domain Names, the possible creation of a entity known as the Public Company Accounting Oversight Board received wide coverage in the national, international, and regional press.  For example, the creation of the Public Company Accounting Oversight Board was discussed in “Today’s Debate” on the editorial page of USA Today on July 10, 2002.  Other similar articles, which reached many millions of people, appeared in and/or were carried by publications such as The Wall Street Journal, Los Angeles Times, Newsday, San Bernardino Sun, San Diego Union Tribune, National Journal’s Congress Daily, Congressional Quarterly Weekly, CPA Letter, The Observer, Financial Times, The Daily Deal, Legal Week, Dallas Morning News, Chicago Tribune, Star Tribune, Chicago Sun-Times, Pittsburgh Post-Gazette, Miami Herald, Kansas City Star, Milwaukee Journal Sentinel, Times Union, Detroit Free Press, the Associated Press, Orlando Sentinel, Cox News Service, and The Atlanta Journal and Constitution.   

6. Given the Public Company Accounting Oversight Board’s long name and the well-established practice of the public and the press referring to regulatory organizations by initialisms, the use of PCAOB to refer to the Public Company Accounting Oversight Board was entirely predictable and expected.  Appendix A of the official handbook of the Federal Government, the U.S. Government Manual, lists commonly used abbreviations and initialisms for government agencies such as SEC, FDA, IRS, EPA, FBI, CIA, ATSDR, CFTC, CPSC, DARPA, FERC, and UNICEF.  In the context of corporate and securities regulation, other organizations, like PCAOB, that are overseen by the SEC, routinely use and are publicly known by initialisms, including NASD, FASB, SIPC, and MSRB.

7. Complainant contends it is the owner of the mark PCAOB.  Complainant is the owner of a federal trademark registration with the United States Patent and Trademark Office (“USPTO”), Reg. No. 76,499,544 for the PCAOB mark filed on March 21, 2003.

8. Complainant contends its trademark rights in the PCAOB mark predate Respondent’s registration of the Domain Names.  Respondent registered <pcaob.com> on July 16, 2002; <pcaob.org> on July 25, 2002; <pcaobonline.com> on July 31, 2002; and <pcaob-online.com> on August 1, 2002.

9. Complainant contends that Respondent’s domain names <pcaob.com>, <pcaob.org>, <pcaobonline.com> and <pcaob-online.com> are confusingly similar to Complainant’s PCAOB mark.

10. Specifically, the domain names <pcaob.com> and <pcaob.org> are identical to Complainant’s PCAOB mark because each domain name incorporates the mark in its entirety.  The domain names <pcaobonline.com> and <pcaob-online.com> are confusingly similar to Complainant’s PCAOB mark because each is comprised of Complainant’s mark in its entirety, with the addition of the generic and/or descriptive term “online.”  Combining Complainant’s mark with a generic and/or descriptive term is not sufficient to distinguish the domain names from Complainant’s mark.

11. Complainant contends that Respondent has no rights or legitimate interest in the disputed domain name. 

12. Specifically, Respondent’s registration and use of the Domain Names to offer closely-related and/or complementary services does not constitute a bona fide offering of goods or services pursuant to Section 4(c)(i) of the UDRP.

13. Respondent’s use of the trade name “PCAOB Online” does not demonstrate a legitimate interest in the Domain Names because use of a trade name does not justify misappropriation of a trademark in a domain name.  If such were the case, domain name holders could freely pirate the trademarks of others as domain names simply by using the disputed domain name as a trade name.

14. Likewise, Respondent’s filing of a trademark application for the mark PCAOB with the USPTO fails to establish his rights in the Domain Names.  Fundamentally, Respondent cannot rely on that application because it was filed after Respondent was formally put on notice of Complainant’s senior rights. 

15. Complainant also contends that Respondent is not making legitimate noncommercial or fair use of the Domain Names, without intending to mislead and divert the public or to tarnish Complainant’s PCAOB mark for commercial gain. 

16. Complainant further contends that Respondent registered and is using the Domain Names in bad faith.  Specifically, Respondent’s registration and use of the Domain Names meets the bad faith element set forth in Section 4(b)(iv) of the UDRP because Respondent uses the Domain Names to intentionally attract for commercial gain Internet users by creating a likelihood of confusion with Complainant’s PCAOB mark and name as to the source, sponsorship, affiliation, and/or endorsement of Respondent’s website and the services directly related to Complainant’s business offered on Respondent’s website

17. Respondent’s use of a disclaimer on his website does not avoid this likelihood of confusion.  Disclaimers are not always read or understood and, as a result, potential customers will not likely notice or appreciate the disclaimer, particularly a small disclaimer appearing at the bottom of the fifth page of Respondent’s home page.  In any event, because Internet users do not have an opportunity to see the disclaimer until after the website is accessed, the initial interest confusion caused by Respondent’s use of the Domain Names cannot be relieved by its disclaimer.

18. Respondent’s registration and use of the Domain Names meet the bad faith elements set forth in Section 4(b)(iii) of the UDRP.  Respondent registered and has used the Domain Names to disrupt Complainant’s business by diverting Internet traffic from Complainant to Respondent’s commercial website, which offers services related to PCAOB, and by interfering with Complainant’s business (i.e., its ability to carry out its statutory responsibilities by conveying information to the public under its PCAOB mark and name). 

19. Respondent registered the Domain Names in bad faith because he did so with knowledge of Complainant’s rights in the PCAOB mark. 

20. Respondent registered the Domain Names opportunistically in bad faith. 

21. Finally, Complainant contends that Respondent’s current “passive holding” or non-use of the domain names PCAOB.ORG and PCAOBONLINE.COM constitutes bad faith.

B. Respondent

22. Respondent is Karl Nagel, d/b/a PCAOB Online, a financial information services company established on July 16, 2002, and the registrant of the Domain Names.

23. Respondent does not deny that the domain names <pcaob.com>, <pcaob.org>, <pcaobonline.com> and <pcaob-online.com> are confusingly similar to Complainant’s alleged mark.  Rather, Respondent does, however, deny that Complainant has proven the existence of protectable rights in the PCAOB mark.  The Public Company Accounting Oversight Board’s own Web site at www.pcaobus.org states in its mission statement that it was created by the Sarbanes-Oxley Act of 2002, enacted on July 30, 2002.  By its own admission, the Board technically did not exist prior to July 30, 2002.  Since it did not exist prior to that date, it is impossible for it to have conducted any business prior to its creation on July 30, 2002, and it has not been shown, when, if ever, the Board began engaging in commerce using the mark PCAOB, subsequent to its creation on July 30, 2002.

24. Respondent denies that it has no rights or legitimate interest in the disputed domain name, asserting it has made legitimate use of the <pcaob.com> domain name.

25. Further, Respondent contends it has been using the mark PCAOB-Online and the domain name <pcaob.com> in a continuous commercial context since July 16, 2002.

26. Respondent denies that it has acted in bad faith in registering and using the <pcaob.com> domain name.  Respondent is actively engaged in a rapidly growing business, and did not register or acquire the <pcaob.com> domain name for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant.

27. Furthermore, Respondent contends, that, while it registered the <pcaob.org> domain name primarily for the purpose of transferring the domain name to Complainant, it implies that this fact obviates any contention of bad faith.

28. Finally, Respondent contends that this Complaint was brought in bad faith in an attempt at Reverse Domain Name Hijacking and to harass the domain name holder.

C. Additional Submissions

29. Both Complainant and Respondent submitted additional submissions, but did not include any contentions substantially different from those above.

FINDINGS

The Panel finds that Complainant has not met its burden of proving rights in the common law mark, PCAOB.  Because the issue of which party has superior rights in the common law mark cannot be resolved on the Submissions, the Panel is unable to determine whether Respondent registered the domain names in bad faith and is using the domain names in bad faith.  For the reasons explained below, the Panel orders that the Domain Names NOT be transferred to Complainant.

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.”  The Panel has read and considered all the submissions in reaching its decision.

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

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

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

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

Identical and/or Confusingly Similar

The primary issue in this dispute is whether Complainant’s rights in the PCAOB mark are superior to those of Respondent.[1]  In its trademark application filed with the U.S. Patent and Trademark Office (“USPTO”) and its Submissions here, Complainant alleges a date of first use in commerce of June 25, 2002.  In an opposition proceeding filed with the

USPTO, and in its Submissions here, Respondent alleges that Complainant could not have used the mark prior to its creation by legislative act on July 30, 2002.  This issue presents a legitimate trademark dispute that is not resolvable on the present record and is more properly resolvable in a court. 

First, Complainant’s trademark application does not, in itself, establish rights in the PCAOB mark pursuant to Policy ¶ 4(a)(i).  See Computer Nerds Int’l, Inc. v. Ultimate Search, FA 155179 (Nat. Arb. Forum June 23, 2003) (finding that Complainant did not establish rights in a mark where it had only applied for a registered trademark and there was evidence that Respondent was actively opposing Complainant’s application); see also Amsec Ent. v. McCall, D2001-0083 (WIPO Apr. 3, 2001) (finding that Complainant’s pending trademark applications do not establish any enforceable rights to the mark until a trademark registration is issued); see also Razorbox, Inc. v. Skjodt, FA 150795 (Nat. Arb. Forum May 9, 2003) (finding that Complainant did not establish the requisite trademark or common law rights to grant Complainant the necessary standing for the Panel to find in its favor as Complainant’s pending trademark application did not, in and of itself, demonstrate trademark rights in the mark applied for).

Second, Complainant’s assertion of trademark rights ultimately rests on the preposition that, prior to signing of the Sarbanes-Oxley Act on July 30, 2002, the media and others in the securities industry published numerous articles in which the Public Company Accounting Oversight Board was referred to by the initialism, PCAOB.  See Complaint at ¶19. Complainant asserts that such third party use of PCAOB constitutes use “analogous to trademark use” and establishes rights in the alleged mark which predate Respondent’s registration of the domain names in question.  While the Panel recognizes that many governmental institutions are commonly known by their abbreviations (e.g., SEC, FBI, NASD), Complainant has cited no case law which would suggest that such a practice is sufficient to create common law trademark rights.  Certainly, the evidence of record does not prove that these third party uses of PCAOB have caused the alleged mark to become exclusively associated with Complainant.

Rights or Legitimate Interests

Complainant bears the burden of proving that Respondent has no rights or legitimate interests in respect to the disputed domain names.  Respondent claims that he has trademark rights in the PCAOB mark, based upon the commercial use of that mark since July 16, 2002, by Respondent’s financial information services company and that his rights in and use of that mark give rise to rights or legitimate interests.  The Panel finds that the question of whether Respondent’s activities qualify as a “bona fide offering of goods or services” under Paragraph 4(c)(i) of the Policy cannot be answered without first determining whether Complainant owns a common-law mark in PCAOB. 

In summary, this proceeding relates to a legitimate trademark dispute between the parties and is not susceptible to adjudication under the Policy.  The Policy covers only cyber squatting and cyber piracy, that is, instances “where the domain name registrant’s business activities (to the extent that they exist at all) are merely a pretext designed to camouflage the registrant’s intent to exploit the trademark value of a domain name.”  Palace Holding SA v. Priston Entmt. Ltd., Case No. D2003-0705 (WIPO Dec. 5, 2003).  Only cases within “the relatively narrow class of cases of ‘abusive registrations’” are susceptible to adjudication under the Policy’s streamlined dispute-resolution procedure.  ICANN, Second Staff Report on Implementation Documents for the Uniform Dispute Resolution Policy (Oct. 24, 1999), <http://www.icann.org/udrp/udrp-second-staff-report-24oct99.htm>, Paragraph 4.1(c).

[T]he fact that the policy’s administrative dispute-resolution procedure does not extend to cases where a registered domain name is subject to a legitimate dispute (and may ultimately be found to violate the challenger’s trademark) is a feature of the policy, not a flaw.  The policy relegates all “legitimate” disputes—such as those where both disputants had longstanding trademark rights in the name when it was registered as a domain name—to the courts; only cases of abusive registrations are intended to be subject to the streamlined administrative dispute-resolution procedure.  Id.

In conclusion, Complainant may have legitimate trademark rights.  However, Complainant has failed to sustain its burden of proof as to both its own rights in the alleged mark and Respondent’s lack of rights or legitimate interests in the domain names.  Likewise, Respondent’s assertion that Complainant has engaged in reverse domain name hijacking is not supported by record.

DECISION

Accordingly, it is Ordered that Complainant’s request for relief is DENIED.

Honorable Paul A. Dorf, (Ret.), Professor David Sorkin, Honorable Nelson A. Diaz, (Ret.), Panelists
Dated: August 17, 2004

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