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Martha Stewart Living Omnimedia. Inc. v. Josh Gorton [2005] GENDND 2115 (13 December 2005)

World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Martha Stewart Living Omnimedia. Inc. v. Josh Gorton

Case No. D2005-1109

1. The Parties

The Complainant is Martha Stewart Living Omnimedia. Inc., City of New York, New York, United States of America, represented by Hogan & Hartson, LLP, United States of America.

The Respondent is Josh Gorton, Minneapolis, Minnesota, United States of America.

2. The Domain Names and Registrar

The disputed domain names <marthastewartfoundation.com> and <marthastewartfoundation.org> are registered with Go Daddy Software.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on October 20, 2005. On October 21, 2005, the Center transmitted by email to Go Daddy Software a request for registrar verification in connection with the domain names at issue. On October 24, 2005, Go Daddy Software 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 October 27, 2005. In accordance with the Rules, paragraph 5(a), the due date for Response was November 16, 2005. The Respondent submitted an electronic Response on November 16, 2005.

The Center appointed William R. Towns as the sole panelist in this matter on November 28, 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 diversified, publicly traded company in the United States founded by Martha Stewart. The Complainant owns a number of trademarks incorporating the MARTHA STEWART name (hereinafter referred to as the MARTHA STEWART marks)¹ used in connection with a variety of goods and services. The Complainant also is the parent company of the Martha Stewart Living Omnimedia Foundation, created to enhance the lives of women, nurture and protect children, and foster good nutrition and promote respect for nature.

The Respondent registered the disputed domain names <marthastewartfoundation.com> and <marthstewartfoundation.org> on September 29, 2005. On the same day he registered these domain names, the Respondent contacted the Complainant, advising that he “no longer wanted these domain names” was “in the process of selling them.” The Respondent offered the Complainant a chance to buy the domain names before they were put up for public auction.² On October 3, 2005, the Complainant sent a cease and desist notice to the Respondent, to which the Respondent replied, disclaiming any intent to profit from the domain name, and indicating that his intention was to create a fan-style site focusing on the Complainant’s charitable work.

The parties on October 5 and 6, 2005, exchanged views regarding the transfer of the domain names, but no agreement was reached, and the Respondent ultimately declined to transfer the domain names to the Complainant, citing the amount of time he had invested in the websites as the reason. At that point, the websites corresponding to the domain names were parked, but the Respondent has since posted content on a website to which both domain names resolve, consisting of a list of political contributions made by the Complainant, derived from publicly available data. The Respondent’s website presently disclaims any affiliation with the Complainant.

5. Parties’ Contentions

A. Complainant

The Complainant alleges that is it a leading integrated company offering products and services in a variety of fields from furniture to flowers under the MARTHA STEWART brand. According to the Complainant, the MARTHA STEWART brand is well-known and famous, and has become synonymous to consumers and the general public as associated with products and service of the highest standard of quality. The Complainant owns trademark registrations for MARTHA STEWART trademarks in the United States, the European Union, and eleven other countries, and claims exclusive rights to the MARTHA STEWART marks, which have continuously been used in commerce since 1989.

The Complainant contends that the disputed domain names are confusingly similar to its MARTHA STEWART marks, and that the addition of the generic word “foundation” does not dispel such confusion, particularly as the Complainant is also the parent company of the MARTHA STEWART LIVING OMNIMEDIA FOUNDATION. Further, the Complainant states that it has not authorized the Respondent to use the MARTHA STEWART mark in any domain name, and that the Respondent has made no use of the domain names that would establish rights or legitimate interests therein.

Finally, the Complainant alleges that the Respondent registered and is using the domain names in bad faith. The Complainant contends that the Respondent’s bad faith is clearly evidenced by his solicitation for sale of the domain names to the Complainant on the same day that the Respondent registered the domain names, and by the Respondent’s refusal to voluntarily transfer the domain names after being placed on notice of the Complainant’s rights in the mark. The Respondent further asserts that the Respondent’s registration of the domain names with knowledge of the proprietary and famous nature of the MARTHA STEWART marks establishes his bad faith.

B. Respondent

The Respondent claims that he is a student and that he registered the domain names for use in a web design course, in which he was assigned to create and maintain a fan-type site. He alleges that he had a student partner in this project, and that this person used the Respondent’s email (without his knowledge) to contact the Complainant. According to the Respondent, it was his teacher who suggested that, since Martha Stewart is a political figure who donates money to political organizations, that Respondent should use his website to track these contributions.

The Respondent asserts that he has neither made nor attempted to make any commercial use of the websites, and that while the Complainant made a demand for the transfer of the websites, the Complainant never offered to pay for his out-of-pocket expenses in relation to the domain names, but merely the transfer fee. He feels he was bullied and manipulated by the Complainant, whom he alleges attempted to trap him into asking for a large sum of money, which he did not want to do. The Respondent concludes that he has a right to use the Martha Stewart name since she is a public figure, and that he did not register and is not using the domain names in bad faith.

6. Discussion and Findings

A. Scope of the Policy

The Policy is addressed to resolving disputes concerning allegations of abusive domain name registration and use. Milwaukee Electric Tool Corporation v. Bay Verte Machinery, Inc. d/b/a The Power Tool Store, WIPO Case No. D2002-0774. Accordingly, the jurisdiction of this Panel is limited to providing a remedy in cases of “the abusive registration of domain names”, also known as “cybersquatting”. Weber-Stephen Products Co. v. Armitage Hardware, WIPO Case No. D2000-0187. See Report of the WIPO Internet Domain Name Process, paragraphs 169 & 170. Paragraph 15(a) of the Rules provides that the Panel shall decide a complaint on the basis of statements and documents submitted and in accordance with the Policy, the Rules and any other rules or principles of law that the Panel deems applicable.

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

(i) the domain name registered by the Respondent 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 interests with respect to the domain name; and

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

Cancellation or transfer of the domain name are the sole remedies provided to the Complainant under the Policy, as set forth in paragraph 4(i).

Paragraph 4(b) sets forth four situations under which the registration and use of a domain name is deemed to be in bad faith, but does not limit a finding of bad faith to only these situations.

Paragraph 4(c) in turn identifies three means through which a respondent may establish rights or legitimate interests in the domain name. Although the complainant bears the ultimate burden of establishing all three elements of paragraph 4(a), a number of panels have concluded that paragraph 4(c) shifts the burden to the respondent to come forward with evidence of a right or legitimate interest in the domain name, once the complainant has made a prima facie showing. See, e.g., Document Technologies, Inc. v. International Electronic Communications Inc., WIPO Case No. D2000-0270.

B. Identical or Confusingly Similar

The Panel finds that the disputed domain names are confusingly similar to the MARTHA STEWART marks, in which the Complainant clearly has established rights through registration and use. See Lockheed Martin Corporation. v. Dan Parisi, WIPO Case No. D2000-1015; The Salvation Army v. Info-Bahn, Inc., WIPO Case No. D2001-0463. The critical inquiry under the first element of paragraph 4(a) is simply whether the mark and domain names, when directly compared, have confusing similarity. See Wal-Mart Stores, Inc. v. Richard MacLeod d/b/a For Sale, WIPO Case No. D2000-0662 (domain name incorporating mark in its entirety is confusingly similar). The Panel finds that to be the case here. Accordingly, the Complainant has met its burden under paragraph 4(a)(i).

C. Rights or Legitimate Interests

The Complainant clearly has not authorized or consented to the Respondent’s use of the MARTHA STEWART marks. Nothing in the record reflects that the Respondent has ever been commonly known by the disputed domain names, and the Respondent has not denied that he was familiar with the Complainant, its services and the MARTHA STEWART marks before he registered the disputed domain names. The Respondent’s unsolicited offer to sell the disputed domain names to the Complainant on the day of their registration, and his subsequent claim to have registered the domain names to create a “fan site” regarding the Complainant’s charitable activities, strongly indicate that the Respondent was well aware of the Complainant and the MARTHA STEWART marks when he registered the disputed domain names.

While the Respondent never demanded payment of a specific amount from the Complainant for the domain names in the course of his dealings with the Complainant, he clearly indicated that he would offer the domain names for public sale to the highest bidder, should the Complainant not agree to acquire them. The Respondent further suggested that he should be paid somewhere between $300 to $500 for each domain name, although the Respondent never submitted to the Complainant any documentation to establish what his out-of-pocket expenses were in relation to the domain names.

In view of prior panel decisions such as Auto-C, LLC v. MustNeed.com, WIPO Case No. D2004-0025, the Panel in this case is persuaded that a prima facie showing has been made for purposes of paragraph 4(a)(ii) that the Respondent lacks rights or legitimate interests in the disputed domain names. See also Compagnie de Saint Gobain v. Com-Union Corp., WIPO Case No. D2000-0020. Once a complainant makes a prima facie showing that a respondent lacks rights to the domain name at issue, the respondent must come forward with proof that it has some legitimate interest in the domain name to rebut this presumption. Document Technologies, Inc. v. International Electronic Communications Inc., WIPO Case No. D2000-0270.

Pursuant to paragraph 4(c) of the Policy, the Respondent may establish rights to or legitimate interests in the disputed domain names by demonstrating any of the following:

(i) before any notice to it of the dispute, the Respondent’s use of, or demonstrable preparations to use, the domain names or a name corresponding to the domain names in connection with a bona fide offering of goods or services; or

(ii) the Respondent has been commonly known by the domain names, even if he has acquired no trademark or service mark rights; or

(iii) the Respondent is making a legitimate noncommercial or fair use of the domain names, without intent for commercial gain, to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

The Panel concludes for the reasons set forth below that the Respondent has failed to make a sufficient showing under paragraph 4(c)(iii) of the Policy to rebut the Complainant’s prima facie case that the Respondent lacks rights or legitimate interests in the disputed domain names. The Respondent has not been commonly known by the disputed domain names, and the circumstances clearly reflect his awareness of the Complainant and its MARTHA STEWART marks prior to his registration of the domain names. Since the Respondent disclaims any intent to use the domain names in connection with an offering of goods or services, the Respondent’s sole claim to rights or legitimate interests under the Policy turns on whether he is making a legitimate noncommercial or fair use of the domain names under paragraph 4(c)(iii).

It is telling that the Respondent, on the same day he registered the domain names, solicited the Complainant to purchase the domain names or else see them put up for public auction – i.e., sold by the Respondent to the highest bidder. In these actions, the Respondent’s primary motive for registering the domain names clearly can be seen. The Respondent’s actions betray his claim to have registered the domain names for use with a “fan site”, a claim that the Panel notes the Respondent never made before receiving notice of this dispute from the Complainant.

The pretextual nature of the Respondent’s position is evident. The Respondent has presented no evidence of any demonstrable preparations to use the domain names in connection with a “fan site” prior to receiving the Complainant’s notice of this dispute. Further, the Respondent made no ostensible noncommercial use of the domain names until well after he was on notice of this dispute. A respondent cannot make a legitimate noncommercial or fair use of a domain name within the meaning of Paragraph 4(c)(iii) if such use is merely a pretext for cybersquatting, or if bad faith registration and use of the domain name otherwise is indicated from the circumstances of the case. See CBS Broadcasting Inc., f/k/a CBS Inc v. Nabil Z. aghloul, WIPO Case No. D2004-0988; Howard Jarvis Taxpayers Association v. Paul McCauley, WIPO Case No. D2004-0014; Wal-Mart Stores, Inc. v. Richard MacLeod d/b/a For Sale, WIPO Case No. D2000-0662. For the reasons discussed below, the Panel concludes that the Respondent’s purported use of the disputed domain names in connection with a “fan site”, undertaken only after the Respondent was on notice of this dispute, is merely a pretext for cybersquatting.

D. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy states that any of the following circumstances, in particular but without limitation, shall be considered evidence of the registration or use of a domain name in bad faith:

(i) circumstances indicating that the Respondent registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant (the owner of the trademark or service mark) or to a competitor of that Complainant, for valuable consideration in excess of documented out-of-pocket costs directly related to the domain name; or

(ii) circumstances indicating that the Respondent registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the Respondent has engaged in a pattern of such conduct; or

(iii) circumstances indicating that the Respondent registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) circumstances indicating that the Respondent intentionally is using the domain name in an attempt to attract, for commercial gain, internet users to its website or other on-line location, by creating a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the Respondent’s website or location or of a product or service on its website or location.

The overriding objective of the Policy is to prevent abusive domain name registrations and use for the benefit of legitimate trademark owners, in circumstances where the registrant is seeking to profit from and exploit the trademark of another. See Match.com, LP v. Bill Zag and NWLAWS.ORG, WIPO Case No. D2004-0230. As noted in Research In Motion Limited v. Dustin Picov, WIPO Case No. D2001-0492, when a domain name is so obviously connected with a complainant and the complainant’s mark or products, its very use by a registrant with no connection to the complainant suggests “opportunistic bad faith”.

The Panel is persuaded from the circumstances in this case that the Respondent registered the disputed domain names primarily for the purpose of selling them to the Complainant for an amount greatly in excess of any documented out-of-pocket costs incurred by the Respondent and directly related to the domain names. The Respondent’s unsolicited offer to sell these domain names to the Complainant on the very day the Respondent registered the marks, with the thinly veiled threat that he otherwise would put them up for sale to the highest bidder, is compelling evidence of the Respondent’s bad faith under paragraph 4(b)(i) of the Policy.

The Respondent’s assertion, raised for the first time in this proceeding, that it was not he who communicated the unsolicited offer of sale to the Complainant, but rather an unidentified “student partner” using the Respondent’s email without his knowledge and permission, is simply not credible. Nor does this Panel find credible the Respondent’s assertion, also raised for the first time in this proceeding, that he was required as part of a school assignment to register the domain names and use them in connection with a fan site. The Respondent has submitted no documentation, statements or other evidence to substantiate any of these assertions, all of which appear in the circumstances of this case to be merely pretextual, and intended to obscure what is in reality cybersquatting.

There is no evidence in the record of any demonstrable preparations by the Respondent, prior to being placed on notice of this dispute, to use the domain names in connection with a “fan site”. The Respondent did not undertake any active use of the domain names until well after he was on notice of this dispute. While the Respondent argues that he is making a noncommercial or fair use of the domain names, there can be no legitimate noncommercial or fair use of a domain name within the meaning of Paragraph 4(c)(iii) where such use is merely a pretext for cybersquatting, or if bad faith registration and use of the domain name otherwise is indicated from the circumstances of the case. See CBS Broadcasting Inc., f/k/a CBS Inc v. Nabil Z. aghloul, WIPO Case No. D2004-0988; Howard Jarvis Taxpayers Association v. Paul McCauley, WIPO Case No. D2004-0014; Wal-Mart Stores, Inc. v. Richard MacLeod d/b/a For Sale, WIPO Case No. D2000-0662.

The Panel notes that the examples of bad faith registration and use set forth in Paragraph 4(b) are not meant to be exhaustive of all circumstances from which such bad faith may be found. See Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003. Under the circumstances of this case, the Respondent’s bad faith also can be inferred from the Respondent’s failure to actively use or make preparations to use the disputed domain name for noncommercial purposes until he was placed on notice of the dispute. See CBS Broadcasting Inc., f/k/a CBS Inc v. Nabil Z. aghloul, WIPO Case No. D2004-0988; Salomon Smith Barney, Inc. v. Salomon Internet Services, WIPO Case No. D2000-0668. Accordingly, the Panel finds that the Complainant has met its burden under paragraph 4(a)(iii) of the Policy to demonstrate that the disputed domain names have been registered and are being used in bad faith.

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 names <marthastewartfoundation.com> and <marthastewartfoundation.org> be transferred to the Complainant.

William R. Towns
Sole Panelist

Date: December 13, 2005

¹ The Complainant’s registered marks include MARTHA STEWART EVERYDAY, MARTHA STEWART LIVING, MARTHA STEWART SIGNATURE, MARTHASTEWART.COM, AT HOME WITH MARTHA STEWART, MARTHA STEWART HOME, and MARTHA STEWART WEDDINGS.

² This communication was in the form of an email from the email address listed in the administrative contact information in the domain name registrations. The sender identified himself in the email as “Joshua Gorton”. This is also the same email address by which the Respondent electronically submitted his Response to the Center.