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Telefonaktiebolaget L.M Ericsson v. iNuntius Inc. [2005] GENDND 1760 (25 October 2005)

World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Telefonaktiebolaget L.M Ericsson v. iNuntius Inc.

Case No. D2005-0732

1. The Parties

The Complainant is Telefonaktiebolaget L.M Ericsson, Stockholm, Sweden, represented by White, Redway & Brown, LLP, Alexandria, Virginia, United States of America.

The Respondent is iNuntius Inc., Compton, California, United States of America, represented by Rutter Hobbs & Davidoff Incorporated, Los Angeles, California, United States of America.

2. The Domain Name and Registrar

The disputed domain name <tems.com> is registered with Network Solutions, LLC.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on July 12, 2005. On July 12, 2005, the Center transmitted by email to Network Solutions, LLC a request for registrar verification in connection with the domain name at issue. On July 13, 2005, Network Solutions, LLC transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details for the administrative, billing, and technical contact. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on July 26, 2005. In accordance with the Rules, paragraph 5(a), the due date for Response was August 15, 2005. At the request of the Respondent, the deadline to file the Response was extended by the Center until August 25, 2005. The Response was received by the Center on August 26, 2005.

On August 29, 2005, the Complainant requested leave to file a reply to the Response and to submit newly acquired evidence in support of the Complaint. On August 30, 2005, the Respondent objected to the said request and the Center advised that it would be up to the Panel to decide on the Complainant’s request. The Complainant filed a reply to the response on September 2, 2005. The same day, the Respondent requested to file a sur-reply to address the new evidence and new arguments presented by the Complainant. By email of September 5, 2005, the Complainant submitted that there was no need for such a sur-reply. On September 7, 2005, the Center indicated to the parties that it would be at the sole discretion of the Panel to determine whether to admit any supplemental filings. A sur-reply was filed by the Respondent on September 12, 2005. The Center acknowledged receipt of the said supplemental filing by email of September 19, 2005.

The Center appointed Theda König Horowicz as the sole panelist in this matter on September 26, 2005. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

4. Factual Background

The Complainant is a well-known supplier of mobile telephone systems worldwide.

The Complainant applied for the United States trademark TEMS on October 15, 1997, in international class 9 for the goods “testing and planning equipment, namely, computer software and mobile units comprising mobile telephones installed with such software, for design and improvement of digital mobile telephone networks”. A registration No. 2,356,486 was issued by the United States Patent and Trademark Office (USPTO) on June 13, 2000.

On May 22, 1996, the domain name <tems.com> was registered by the United States company Tornado, Inc., which became, in 1997, Tornado Development, Inc. The denomination “TEMS” was chosen by Tornado with reference to the first letter of the words ‘Tornado Electronic Messaging Systems’ and was used for a system called the Tems system which gives service providers the ability to deploy and market a variety of enhanced messaging services under any brand. The domain name <tems.com> was used until 2002, by Tornado for a website promoting such services. The word “TEMS” was used in the said site.

On July 28, 1997, Tornado applied for the United States trademark TEMS in international class 38 for the services “providing electronic mail, facsimile transmission, voice mail and paging services via a website over the global computer information network”. An opposition against this application was filed by the Complainant in 1999. On May 10, 2005, the USPTO Trademark Trial and Appeal Board refused the registration.

On November 25, 2002, the Respondent acquired the assets and all of Tornado’s intellectual property rights, including the domain name <tems.com>, as well as the United States trademark application for TEMS in international class 38. Since April 2003, the domain name <tems.com> has been linked by the Respondent to “www.xmsg.com”, a website promoting its own software services named “Xmsg” corresponding to a system - similar to the Tems system - which enables its users to receive anywhere and anytime from one inbox emails, faxes, pages and voicemail.

On February 14, 2005, the Complainant wrote to the Respondent to ask for the transfer of <tems.com>. No response was given by the Respondent at that time. On August 4, 2005, after having received the Complaint, the Respondent informed the Complainant that it will agree to transfer the domain name in exchange for the payment by the Complainant of US$100,000.

5. Parties’ Contentions

A. Complainant

The Complainant alleges that it has rights in the TEMS trademark because of its having used it since 1994 and its United States registration No. 2,356, 486 of June 13, 2000. Furthermore, <tems.com> is confusingly similar to the Complainant’s mark.

The Complainant also states that the Respondent has no rights or legitimate interests in the domain name at issue in view of its inaction in the opposition proceedings relating to the United States trademark TEMS, which was applied for in 1997, by Tornado and later assigned to the Respondent. Furthermore, the Respondent uses <tems.com> only to divert traffic to its website. In addition, the Respondent registered the domain name at issue after the use of the name “TEMS” by the Complainant and the Respondent does not use the name “TEMS”.

The Complainant indicates that the Respondent makes a bad faith use of the domain name as it does not use <tems.com> to identify an active website, but rather to divert the web user to a website advertising its services which are complimentary to the Complainant’s goods. The Respondent has therefore the intention to attract, for commercial gain, Internet users to its website by creating confusion or a likelihood of confusion with the Complainant’s trademark. Furthermore, the Respondent has a lack of interest in the name “TEMS” as it has failed to respond in the opposition relating to the United States TEMS trademark application. In addition, its continued registration of the domain name with the full knowledge of the Complainant’s rights indicates that the Respondent has the intention of disrupting the Complainant’s business. Finally, the offer made by the Respondent to settle the matter for US$100,000 is far in excess of any out of pocket expenses and shows that the domain name has been acquired with the purpose of being sold to the Complainant.

B. Respondent

The Respondent alleges that the Complainant has no rights in the trademark TEMS, which antedates the date when the domain name at issue was registered. Furthermore, the TEMS System software is distinct and different from the mobile system the Complainant sells.

The Respondent also states that since 2002, it has been using the domain name <tems.com> and “@tems.com” email addresses for its customers to be able to connect to its website to purchase its messaging services and on facsimile correspondence to its customers. In any event, the Complainant is not known by the name “TEMS” and the Respondent is making a fair use of the domain name since customers have gone to the “www.tems.com” website since as far back as 1996 to purchase the specific messaging systems offered. Furthermore, Tornado did not register <tems.com> with the intention of redirecting Internet users searching for the Complainant’s goods, but rather for its own messaging systems. In addition, the Respondent continues to service the “tems” customers who use the “@tems.com” email address.

The Respondent indicates that it acts in good faith because of its continued use of the domain name at issue. Furthermore, the TEMS trademark of the Complainant did not exist at the time the disputed domain name was registered and the Complainant is not known as “Tems”. The Respondent has not tried to create any confusion but uses the domain name to promote its own unique services. The domain name at issue was not registered by its first owner Tornado with the intent to tarnish or disparage the Complainant’s mark and the Respondent established a link from <tems.com> to its website to make sure it did not lose its customers acquired from Tornado. In addition, the offer of US$100,000 has been made within the framework of settlement discussions. This offer was only in response to an inquiry from the Complainant and this does not constitute bad faith, particularly as the sum is justified for a legitimate asset.

Finally, the Respondent invokes reverse domain name hijacking by the Complainant who is attempting to deprive the Respondent of a domain name that has been used for nearly a decade. Furthermore, the Complaint has been brought in bad faith because the trademark postdates the disputed domain name.

6. Discussion and Findings

A. Procedural Aspects

Late filing of the Response

The Panel notes that the Response was transmitted on August 26, 2005, that is one day after the deadline of August 25, 2005 given by the Center.

The Panel holds the view that the lateness of the Response is de minimis and has not prejudiced the Complainant nor has it delayed the decision in this proceeding. (See Kate Spade, LLC v. Darmstadter Designs, WIPO Case No. D2001-1384 and Arthur Guinness Son & Co. (Dublin) Limited v. Feeney O’Donnell and John O’Donnell, WIPO Case No. D2000-1710 - <guinnessdraught.com>).

The Panel, therefore, has admitted and considered the submissions set out in the Response.

Supplemental filings

Both the Complainant and the Respondent have transmitted supplemental filings.

Given its aim of an expeditious settlement of disputes, the Policy does not provide the parties with any right to reply, unless the panel requests, at its sole discretion, further statements or documents from either of the parties pursuant to paragraph 12 of the Rules.

Opinions differ as to whether and under what conditions the panel can take into account unrequested additional submissions. The majority of panels refer to the general requirement of procedural fairnes and assume that unrequested submissions by the complainant can be taken into account, depending on the circumstances, for example, if the additional submission concerns questions that were not known before the filing of the complaint (See Toyota Sidosha Kabushiki Kaisha d/b/a Toyota Motor Corporation v. S&S Enterprises Ltd., WIPO Case No. D2000-0802 – <itoyota.com>) or if objections have been raised by the Respondent that were not foreseeable when the complaint was filed.

In this case, the Complainant has filed a reply to the Response, notably on the issue of domain name reverse hijacking alleged by the Respondent. The Complainant also filed further evidence some antedating, some postdating the filing of the Complaint.

The Panel notes that the Complainant must have - as a matter of fairness - the right to take a position on the argument of reverse domain name hijacking brought by the Respondent. However, all further developments made by the Complainant relating to the fulfillment of the Policy and Rules have not been taken into account, as the Complainant already had the ability to take a position on them in its Complaint.

The additional evidence filed by the Complainant with the reply to the Response, which postdates the filing of the Complaint, has also been taken into consideration. All other documents antedating the filing of the Complaint have not been considered by the Panel as the Complainant should have initially filed them with its Complaint.

The Respondent has filed a sur-reply with respect to the evidence newly brought into the proceedings by the Complainant. In light of the general principles of fairness and equitable treatment embodied in the Policy, the Panel has taken into consideration the position taken by the Respondent regarding the new evidence filed by the Complainant. All other developments and allegations made by the Respondent have not been taken into account as they are merely a second reply to the arguments already contained in the Complaint.

B. Substantive Issues

According to paragraph 4(a) of the Policy, the Complainant must prove that:

(i) the domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and

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

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

1. Identical or Confusingly Similar Domain Name

The Complainant is the owner of a United States trademark registration for the trademark TEMS which is identical to the domain name <tems.com>.

Contrary to the allegations made by the Respondent, the time of the registration of the trademark on which a complainant bases its rights is not relevant under paragraph 4(a)(i) of the Policy. Indeed, a majority of panels have found that the registration of a domain name before a complainant acquires trademark rights in a name does not prevent a finding of identity or confusing similarity (See Madrid 2012, S.A. v. Scott Martin-MadridMan Websites, WIPO Case No. D2003-0598, <madrid2012.com>).

The Respondent also relies on the fact that its software services would be different than the mobile system sold by the Complainant. However, in the context of paragraph 4(a)(i) of the Policy, it is appropriate to assess whether the domain name is confusingly similar to the Complainant’s mark on the basis of a comparison between the name and mark, without considering whether the domain name is or could be used in a way which avoids or might avoid confusion (See Banconsumer Service, Inc. v. Mary Langthorne, Financial Advisor, WIPO Case No. D2001-1367, <banco.com> and Deutsche Telekom AG v. Oded Zucker, WIPO Case No. D2004-0749, <t-shops.net> and <tshops.net>).

As indicated above, the domain name in dispute is identical to the Complainant's mark and the Panel thus concludes that the first element of paragraph 4(a) of the Policy is fulfilled.

2. Respondent’s Rights or Legitimate Interests in the Domain Name

The Complainant has made a prima facie case showing that the Respondent has no rights to or legitimate interests in the domain names. In particular, the Complainant has established that the Respondent has not been known by the name “Tems”, has not been using the said name for more than two years and has not shown any interest in obtaining rights on a United States trademark application for TEMS.

The burden of proof on this factor therefore shifts to the Respondent to rebut the showing by providing concrete evidence that it has rights to, or legitimate interests in the domain name (See Croatia Airlines d.d. v. Modern Empire Internet Ltd., WIPO Case No. D2003-0455, <croatiaairlines.com>; Belupo d.d. v. WACHEM d.o.o. WIPO Case No. D2004-0110, <belupo.com>).

The Respondent has failed to meet that burden considering that it solely relies on the use of the domain name which was made from 1999 until 2002, by Tornado, the previous owner of <tems.com>. Indeed, the relevant period to determine if the Respondent has a legitimate interest in the domain name is the time after November 25, 2002, when the Respondent acquired the intellectual property rights of Tornado, in particular the domain name <tems.com>.

The facts of this case show that <tems.com> was linked to an active website promoting the Tems system and services of Tornado until 2002. In 2003, shortly after the Respondent acquired the intellectual property rights of Tornado, the website no longer existed and <tems.com> was, from that point on, only linked to a website promoting “Xmsg” services with no reference whatsoever to “TEMS”, “Tems services” or “Tems system”.

The Respondent alleges to still be using “TEMS” on its facsimile cover pages and to have kept “@tems.com” email addresses of former Tornado customers. The Panel, however, finds that the evidence given in this respect by the Respondent is largely insufficient.

In addition, the Complainant has shown that the Respondent did not participate in the opposition proceedings relating to the United States trademark TEMS which had been applied for by Tornado in 1997. Due to its default, the USPTO rendered a judgment this year refusing the registration of the said mark.

In the Panel’s view, it is quite clear that the Respondent was interested in acquiring the Tems system developed and patented by Tornado, but was obviously not interested in keeping and using the name “TEMS” given to the said system.

The Panel, therefore, finds that the Respondent has no rights or legitimate interests in respect of the domain name <tems.com> and considers that the second condition of paragraph 4(a) of the Policy is fulfilled.

3. Domain Name Registered and Used in Bad Faith

The most difficult question to resolve in this case is to determine whether the domain name at issue has been registered and used in bad faith. In this regard, the Panel is not limited to the application of the circumstances of paragraph 4(b) of the Policy, which does provide a non-exhaustive list of factors evidencing bad faith.

Contrary to the allegations made by the Respondent, the Panel notes that the relevant period of time to determine if the domain name at issue has been registered in bad faith is not 1996 (year of the initial domain name registration by Tornado), but 2002, which is the year when <tems.com> was acquired by the Respondent.

The Complainant showed that is has used the name “TEMS” in the United States since about 1994, “TEMS” meaning “TEst Mobile System”. Furthermore, The Complainant obtained the registration of a United States trademark for TEMS on June 13, 2000. In addition, the Complainant evidenced that it had opposed, in 1999, Tornado’s United States TEMS trademark applied for in 1997 and that the Respondent was joined by the USPTO to the said proceeding once it acquired the intellectual property rights of Tornado.

Consequently, the Respondent knew when it acquired the domain name at issue in 2002, that the Complainant had a TEMS trademark for goods similar to its software services and that the Complainant had a strong interest in the said name.

Despite this fact, the Respondent acquired <tems.com> and directed this domain name, soon after its acquisition, to “www.xmsg.com”, a website promoting “Xmsg” software services and not services bearing the name “TEMS”.

According to the Respondent, this link was made in order to avoid losing the customers acquired from Tornado. No relevant evidence has, however, been given by the Respondent in this regard.

The Panel finds that the repeated lack of interest shown by the Respondent for the name “TEMS”, combined with its knowledge of the Complainant’s mark indicates that the Respondent acquired the domain name at issue with the idea of taking advantage of <tems.com>, notably by directing the said domain name to a website promoting services bearing a different name and which are similar to the goods commercialized by the Complainant (See Telstra Corporation Limited v. Nuclear Marshmallows - WIPO Case No. D2000-0003, <telstra.org> and Wild West Domains, Inc. v. Neo Jung, WIPO Case No D2004-0243, <wildwestdomain.com>).

This point of view is confirmed by the fact that the Respondent contacted the Complainant after the filing of the Complaint and offered to transfer the domain name at issue in return for payment by the Complainant of US$100,000.

According to the evidence filed in this case, the said offer was not made by the Respondent during settlement discussions, but spontaneously, after the filing of the Complaint.

The Respondent alleges that the sum is justified for a legitimate asset.

In this regard, the Panel notes that the said offer was made more than two years after the acquisition of the domain name by the Respondent.

During this period, the Respondent neither used the domain name <tems.com> nor the name “TEMS”.

As indicated above, the domain name in dispute was simply linked to “www.xmsg.com”, a website promoting the Respondent’s own software services.

The Panel, therefore, rejects the Respondent’s arguments and considers that the offer it made tends much more to indicate that the Respondent bore in mind when acquiring <tems.com> the possibility of selling it to the Complainant, a well-known company, for a sum far in excess of the usual out-of-pocket expenses related to a domain name.

Considering the above, the Panel considers that the domain name at issue was registered and used in bad faith.

The third condition of paragraph 4(a) is therefore also fulfilled.

4. Reverse Domain Name Hijacking

For the reasons above, the Panel rejects the Respondent’s claim of reverse domain name hijacking.

7. Decision

For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name <tems.com> be transferred to the Complainant.

Theda König Horowicz
Sole Panelist

Dated: October 25, 2005