National Arbitration Forum

DECISION

U.S. Nutraceuticals, LLC v. Telepathy, Inc. c/o Development Services

Claim Number: FA0411000365884

PARTIES

Complainant is U.S. Nutraceuticals, LLC (“Complainant”), represented by David L. Sigalow, 255 South Orange Avenue, Suite 1401, Orlando, FL 32801.  Respondent is Telepathy, Inc. c/o Development Services (“Respondent”), represented by John Berryhill, of Dann, Dorfman, Herrell, and Skillman P.C.,1601 Market Street, Suite 2400, Philadelphia, PA, 19103 USA.

REGISTRAR AND DISPUTED DOMAIN NAME 

The domain name at issue is <naturedirect.com>, registered with Go Daddy Software, Inc.

PANEL

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

Anne M. Wallace, Q.C., Alan Limbury, and Paul M. DeCicco, Esq. as Panelists.

PROCEDURAL HISTORY

Complainant submitted a Complaint to the National Arbitration Forum electronically on November 16, 2004; the National Arbitration Forum received a hard copy of the Complaint on November 16, 2004.

On November 16, 2004, Go Daddy Software, Inc. confirmed by e-mail to the National Arbitration Forum that the domain name <naturedirect.com> is registered with Go Daddy Software, Inc. and that the Respondent is the current registrant of the name.  Go Daddy Software, Inc. has verified that Respondent is bound by the Go Daddy Software, 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 November 29, 2004, a Notification of Complaint and Commencement of Administrative Proceeding (the “Commencement Notification”), setting a deadline of December 20, 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@naturedirect.com by e-mail.

A timely Response was received and determined to be complete on December 20, 2004.

On January 3, 2005, pursuant to Complainant’s request to have the dispute decided by a three-member Panel, the National Arbitration Forum appointed Anne M. Wallace, Q.C. Alan Limbury, and Paul M. DeCicco as Panelists.

Preliminary Matters

The Response exceeds the ten-page limit set forth pursuant to ICANN Rule 5(b)(i).  Respondent’s Response is eleven pages long.  The Panel may either choose to accept or decline to accept Respondent’s Response in deciding this case.  In the instant case the Panel finds that ruling the Response inadmissible, under the circumstances would be not be consistent with the interests of justice and thus accepts the Response.  See Strum v. Nordic Net Exch. AB, FA 102843 (Nat. Arb. Forum Feb. 21, 2002).

Further, Complainant’s Additional Submission was submitted without the fee required by Supplemental Rule 7(b)(ii).  It is likewise within the Panel’s discretion whether to consider Complainant’s Additional Submission. See Am. Airlines Inc. v. WebWide Internet Communication GmbH, FA 112518 (Nat. Arb. Forum June 13, 2002).  Both parties having fully briefed the matter in their opening papers, the Panel chooses to not consider the Complainant’s additional submission and the Respondent’s response thereto.

RELIEF SOUGHT

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

PARTIES’ CONTENTIONS

A. Complainant

Complainant contends as follows:

Complainant, U.S. Nutraceuticals, LLC, has used the NATURE DIRECT trademark in connection with vitamins and nutritional supplements since at least as early as January 2001.  On May 1, 2001, Complainant filed an application to register the NATURE DIRECT trademark with the U.S. Patent and Trademark Office.  On July 15, 2003, Trademark Application Serial No. 78/061365 was granted registration by the USPTO.  The registration, U.S. Trademark Reg. No. 2,738,940, is directed to the NATURE DIRECT mark as applied to “nutritional supplements” in International Class 5.  The registration also attests to use of the subject mark by Complainant in connection with the subject goods since at least as early as January 2003.  This registration is currently active; as a result, Complainant’s rights in the mark within the United States are presumed valid.

Complainant’s products are prominently featured and offered for sale through Complainant’s own website (<usnutra.com>) and through the websites operated by its clients, i.e. <naturedirect.co.nz> and <beautydirect.co.nz>.  Complainant also advertises its products on other websites in Australia, Canada, and the United Kingdom linked to this domain name as well.  Complainant, through its clients, spends approximately $3,500 per year in promoting its NATURE DIRECT vitamins and nutritional supplement products.  As a result of such promotion and due to the high quality of Complainant’s NATURE DIRECT products, Complainant has achieved a high degree of customer recognition in the marketplace, both on the Internet and elsewhere, for its NATURE DIRECT mark. 

The <naturedirect.com> domain name is identical to the word component of Complainant’s registered NATURE DIRECT trademark.  Those who access the <naturedirect.com> domain name searching for the products of Complainant are instead directed to a page which will, in turn, direct them to other products and services and away from the vitamins and nutritional supplements they are seeking.  Thus, Complainant’s potential customers will be directed to these other service providers.

Respondent should be considered to have no rights or legitimate interests in the domain name in view of the following: Respondent is not making a legitimate non-commercial or fair use of the domain name because Respondent is using the domain name with the intent to gain commercially.  Complainant has, for over three (3) years, become well known within the industry as the provider of vitamins and nutritional supplements and has continuously offered such products in connection with the NATURE DIRECT trademark within the United States from 2001 to the present.  Such activities commenced well before the registration of the domain name by the Respondent in November 2001. Complainant has invested considerable sums of money and effort in establishing goodwill associated with its NATURE DIRECT mark, and spends approximately $3,500 per year in promoting the NATURE DIRECT products.  This goodwill is being eroded by Respondent’s ownership of the domain name and in the purposeful use of the domain name to direct commercial traffic away from Complainant.  This will dilute the goodwill which Complainant has developed over the past three (3) years in its use of the NATURE DIRECT mark in the minds of the consuming public and will interfere with and infringe Complainant’s statutory and common law rights.

The domain name should be considered as having been registered and used in bad faith in view of the following: Complainant has been using the NATURE DIRECT mark since at least as early as January 2001 in connection with its vitamins and nutritional supplements.  Complainant’s application to register the subject mark with the U.S. Patent and Trademark Office was filed with the USPTO on May 1, 2001.  This mark was then placed in a searchable database at the USPTO.  Thus, the existence of Complainant’s application, and its assertion of rights for the <naturedirect.com> domain name, would have been readily ascertainable by Respondent if it had performed a trademark search within the United States prior to its registration of the domain name.  Moreover, as Complainant’s registration itself was issued within mere days following the registration of the domain name by Respondent, Complainant’s trademark registration was ascertainable prior to the use of the domain name to promote the products of Complainant’s competitors.  If Respondent had performed a trademark search within the United States prior to its registration of the domain name, it would have uncovered Complainant’s trademark application; moreover, it would have known at that time that Complainant had in fact attested to use of the subject mark in connection with nutritional supplements.  Therefore, by registering the domain name at that time, Respondent knew or should have known of the existence of the United States trademark registration for the NATURE DIRECT mark.

In September 2004, Complainant placed several telephone calls to the Respondent in an attempt to negotiate the acquisition of the domain name.  In addition, on July 15, 2004, Complainant dispatched a letter to Respondent.  Complainant asserted its trademark rights in the <naturedirect.com> domain name and requested that Respondent cease using it.  Complainant offered to reimburse Respondent in the sum of U.S. $1,000 for Respondent’s costs and expenses in registering the domain name.  Respondent replied that it was using the name to promote goods and services related to nature and the environment.  However, a subsequent check of the website on October 25, 2004, indicated that this use has never been fulfilled. 

At some point the site contained a link that states it is available for transfer.  Respondent either wished to exploit its sale of the website, or obstruct Complainant’s legitimate use of the domain name.

B. Respondent

Respondent alleges as follows:

The alleged mark is not an inherently distinctive, fanciful mark, but consists of two common words.  The existence of this US trademark registration does not confer an exclusive right to these two words for any and all uses.  The alleged mark is not famous. Complainant has presented no evidence of common law rights prior to registration, and Complainant’s registration does not allege use prior to January 2003.  The domain name was registered in November 2001 - more than a year prior to Complainant’s allegation of first use.

Complainant has presented evidence of present rights in the “NATURE DIRECT” mark as a brand of nutritional supplements.  Complainant’s registration is based on an intent-to use application that was amended to an allegation of first use in January 2003.

Respondent has been using the domain name, and had been using the domain name prior to any contact with Complainant, to provide a shared advertising directory of goods and services relevant to the term “nature” - i.e. as a set of “direct” links to “nature”-relevant material.

The selection and placement of links on such shared advertising pages is determined by a bidding arrangement between the advertising consolidator and the advertiser.  The links are thus dynamic, and depend on the current bids submitted by advertisers.  Respondent has utilized several different keyword-advertising programs in order to maximize its monetization of the domain name, including one program, which appeared to key on the substring “EDI” within “naturedirect” to provide links relevant to electronic data interchange systems.  However, at no time has Respondent infringed Complainant’s alleged trademark.

It is not established that Respondent knew of Complainant’s trademark at the time it registered the disputed domain name and there is no evidence that Respondent registered the disputed domain name with the intention to profit from Complainant’s trademark.

Respondent is not infringing upon Complainant’s alleged trademark, but is and has been using the words “nature” and “direct” in accordance with their primary and ordinary meaning, to provide paid advertising links to topics of relevant interest.  Respondent has every right to utilize these words in any manner that does not violate Complainant’s alleged rights, even if such rights had been acquired earlier.

The domain name at issue here was one of many domain names that had been abandoned by prior registrants and expired shortly before it was registered by Respondent.  Respondent registered the domain name because it contained the desirable words “nature” and “direct”.  Respondent has registered other domain names such as <outdoordirect.com>, <sportdirect.com>, <weatherdirect.com> and <stardirect.com>.

Complainant willfully and deliberately misrepresents the facts to this Panel.  Specifically, Complainant states at page 6, “by registering the domain name, at that time Respondent knew or should have known of the existence of the United States Trademark Registration for the mark NATURE DIRECT.” At the time the domain name was registered, there was no such United States Trademark Registration, and Complainant is fully aware of that fact. Complainant’s deliberately false statement in its certified Complaint is reason enough to deny the requested relief.

In November 2001, there was no trademark right to infringe or abuse.

Complainant is correct that a template utilized by Respondent at some point in the past had indeed placed a link indicating that the domain “may” be available for sale along with the paid advertising links.  That notation was an artifact of the template utilized by Respondent.  It is clear that in its registration and use of the domain name for several years, the Respondent has not sought to sell the domain name to any party, and upon being approached to potentially sell the domain name, Respondent politely indicated the domain name was not for sale.  Respondent’s registration and use of the <naturedirect.com> domain name has been consistent with its use of the other generic “direct” formative domain names, and has not been motivated by an intent arising from Complainant’s trademark, or from any desire to sell these “direct” formative domain names for any reason relating to the trademarks of any party.

Complainant has failed to show that the domain name was registered and used in bad faith.  By Complainant’s own admission, the domain name has not been used for infringing purposes, and Complainant has made deliberate false statements before this Panel in order to obscure the actual facts and chronology of the matter.  At the time the domain name was registered, there was nothing Respondent knew or should have known that would have demonstrated that Respondent could not register and use the domain name for the purpose which Respondent has been using the domain name.  Respondent’s good faith intent in such registration and use is reflected in the evidence of record showing use of the domain name in connection with environmental and natural topics of advertisement, and in Respondent’s voluntary offer to provide a link to Complainant in order to address Complainant’s concerns.

C. Additional Submissions

For the reasons stated above, additional submissions were not considered.

FINDINGS

Complainant filed an application to register the NATURE DIRECT trademark with the U.S. Patent and Trademark Office on May 15, 2001.  On July 15, 2003, Trademark Application Serial No. 78/061365 was granted registration by the USPTO.  Complainant has trademark rights in the NATURE DIRECT mark for nutritional supplements.  The mark is not a “famous mark.”  The mark was first used in commerce in May 2003.

Respondent registered the <naturedirect.com> domain name in November 2001.  At the time, it has not been shown that Respondent was aware of Complainant or Complainant’s pending trademark application.  The domain name is used in connection with a website referring Internet users to advertising based on the keywords “nature” and “direct.”

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 rights in the NATURE DIRECT mark.  The mark was registered with the United States Patent and Trademark Office (“USPTO”) (Reg. No. 2,738,940 issued July 15, 2003, filed May 1, 2001).  United States trademark law gives registered marks a presumption that they are inherently distinctive and have acquired secondary meaning.  See Men’s Wearhouse, Inc. v. Wick, FA 117861 (Nat. Arb. Forum Sept. 16, 2002).  The United States trademark registration thus confers a presumptive exclusive right to use the NATURE DIRECT mark in connection with a brand of nutritional supplements.

 

Respondent’s <naturedirect.com> domain name is identical to Complainant’s NATURE DIRECT mark, but for the addition of the generic top-level domain “.com” and the omission of the space between the words “nature” and “direct” in Complainant’s mark.  Such slight differences do not negate the fact that Respondent’s domain name is identical to Complainant’s mark pursuant to Policy ¶ 4(a)(i).  See Pomellato S.p.A v. Tonetti, D2000-0493 (WIPO July 7, 2000).

Therefore, the domain name is identical to Complainant’s NATURE DIRECT trademark for the purposes of paragraph 4(a)(1) of the Policy.

Rights or Legitimate Interests

Respondent registered the domain name in November 2001.  While this date precedes the filing of Complainant’s application for trademark registration, the registration record shows both the “first use” and the “first use in commerce” by the Complainant to be January 1, 2003. www.uspto.gov (January 12, 2005).  Thus at the time of filing, Complainant did not have trademark rights in Complainant’s mark.  Respondent’s registration of the domain name thus pre-dates Complainant’s establishment of rights in the mark.  Therefore, Respondent had rights and legitimate interests in the domain name pursuant to Policy ¶ 4(a)(ii) at the time of registration.  See Warm Things, Inc., Inc. v. Weiss, D2002-0085 (WIPO April 18, 2002); see also Parachute, Inc. v. Jones, FA 94947 (Nat. Arb. Forum July 12, 2000). 

Even if, as Complainant urges, Complainant’s trademark rights relate back to date of the application filing, such rights would not exclude the universe of uses for the domain name which are non-infringing.  In the instant case, Respondent appears to be using the words “nature” and “direct” consistent with the ordinary meaning of the two words.  The Respondent had the right to utilize these words in any manner that does not violate Complainant’s rights, even if such rights had been acquired earlier.  Respondent’s business model is to sell advertising linking nature related topics.  Such use does not tread on Complainant’s trademark rights relating to the classes of goods covered by the NATURE DIRECT registration.

Registration and Use in Bad Faith

Respondent was unaware of Complainant and Complainant’s mark at the time the domain name was registered.  Respondent uses the domain name in a manner unrelated to, and not competing with, Complainant.  Respondent appears to have believed that it had a legitimate right to register the domain name.  Moreover such a belief is reasonable under the circumstances.  See MatchMaker Int'l Dev. Corp. v. Kaiser Dev. Corp., FA 146933 (Nat. Arb. Forum May 9, 2003) (Panelist David Sorkin, dissenting); see also The Way International, Inc. v. Diamond Peters, D2003-0264 (WIPO May 29, 2003).  Without knowledge of Complainant or its claim of right in the mark, it is difficult to see how Respondent could have the specific intent required for it to act in bad faith against the rights of Complainant.

Since Complainant applied for trademark registration prior to the domain name’s registration, Respondent might be said to have had  “constructive knowledge” of the Complainant’s application.  See Meredith Corp. v. CityHome, Inc., D2000-0223 (WIPO May 18, 2000).  “Constructive knowledge” of Complainant’s trademark application might support a finding of bad faith registration.  See Digi Int’l v. DDI Sys. FA 124506 (Nat. Arb. Forum Oct. 24, 2002); see also Samsonite Corp. v. Colony Holding, FA 94313 (Nat. Arb. Forum Apr. 17, 2000).  But as mentioned above the Respondent’s intended use of the domain name doesn’t infringe Complainant’s mark.  Importantly, there is no evidence in the record showing that the Respondent has made it a practice of registering pending trademark registrations.

Complainant urges that Respondent’s offer to sell the domain name indicates bad faith pursuant to the Policy.  However, Complainant initiated the offer to purchase the disputed domain name, therefore Respondent did not register or use the domain name in bad faith pursuant to Policy ¶ 4(b)(i).  See Coca-Cola Co. v. Svensson, FA 103933 (Nat. Arb. Forum Feb. 27, 2002); see also Sumner v. Urvan, WIPO D2000-0596 (WIPO July 24, 2000).

 

Given the foregoing, Complainant has failed to show that Respondent registered and used the domain name in bad faith.

DECISION

Having failed to establish all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.

Paul M. DeCicco, Presiding Panelist

Anne M. Wallace & Alan Limbury, Panelists
Dated: January 17, 2005

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