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Kate Spade LLC v. IQ Management Corporation [2005] GENDND 404 (9 May 2005)

World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Kate Spade LLC v. IQ Management Corporation

Case No. D2005-0109

1. The Parties

The Complainant is Kate Spade LLC, New York, New York, United States of America, represented by Keats McFarland & Wilson LLP, Beverly Hills, California, United States of America.

The Respondent is IQ Management Corporation, Belize City, Belize.

2. The Domain Name and Registrar

The disputed domain name <kate-spade.com> is registered with Tucows.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 1, 2005. On February 1, 2005, the Center transmitted by email to Tucows a request for registrar verification in connection with the domain name at issue. On February 2, 2005, Tucows 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 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 February 25, 2005. In accordance with the Rules, paragraph 5(a), the due date for Response was March 17, 2005. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on April 1, 2005.

The Center appointed Kiyoshi I. Tsuru as the sole panelist in this matter on April 13, 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

Complainant has provided evidence of ownership of 17 trademark registrations in the United States in connection with high fashion articles, a considerable number of which were filed and/or granted before Respondent registered the disputed domain name.

The disputed domain name <kate-spade.com> was registered on October 15, 2003.

Complainant spends approximately US$1,000,000 annually on the advertising and sale of its products in the United States of America.

Complainant also sells and distributes products bearing the KATE SPADE Trademarks from its Web site located at “www.katespade.com.”

5. Parties’ Contentions

A. Complainant

A.1. Identity or Confusing Similarity

Complainant asserted the following:

The disputed domain name is confusingly similar to Complainant’s marks KATE SPADE. Other panels constituted under the Policy have found domain names confusingly similar in virtually identical factual situations to those presented in Complainant’s Complaint (and cites the following cases to state that the addition of the generic top-level domain “.com” to a mark is irrelevant in determining whether a domain name is confusingly similar to a complainant’s mark: Pomellato S.p.A. v. Richard Tonetti, WIPO Case No. D2000-0493; Rollerblade, Inc. v. Chris McCrady, WIPO Case No. D2000-0429; Sony Kabushiki Kaisha (also trading as Sony Corporation) v. Inja, Kil, WIPO Case No. D2000-1409)).

Panels appointed in accordance with the Policy have found domain names confusingly similar based upon the addition of a hyphen to a trademark (citing Teleplace, Inc. v. Oliveira, National Arbitration Forum (NAF) Case No. FA 95835, and InfoSpace.com Inc. v. Tenenbaum Ofer, WIPO Case No. D2000-0075).

A.2. Respondent’s lack of rights or legitimate interests in respect of the domain name

Complainant asserted the following:

Respondent has never been known by the name “Kate-Spade”, or the domain name in dispute. Complainant has never given a license nor in any way authorized Respondent to make use of Complainant’s KATE SPADE Trademark.

Panels acting under the Policy have held that registration of a domain name incorporating another’s famous mark does not confer any rights or legitimate interests in the domain name to Respondent, but rather constitutes bad faith under paragraph 4(c) of the Policy (citing Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003; Medisite S.A.R.L. v. Intellisolve Limited, WIPO Case No. D2000-0179 and V&S Vin & Sprit Aktiebolag v. Kownacki, NAF Case No.95079). According to Complainant, its case is similar to V&S Vin & Sprit Aktiebolag v. Kownacki in that the KATE SPADE Trademarks are famous, and therefore Respondent knew or should have known of Complainant’s marks when it registered its domain name.

A.3 Bad faith registration and use

Complainant submitted the following arguments, and cited the following cases:

Respondent’s own conduct proves that it has registered the disputed Domain Name in bad faith for its own financial gain. For example, Respondent has offered to sell numerous domain names that incorporate the names of famous fashion and apparel designers such as <coach-handbag.com>, <coach-purse.com>, <fossil-watch.com>, <gucci-handbags.com>, <gucci-watch.com>, <kenneth-cole.com>, and <tommy-bahama.com>. In addition, Respondent has offered to sell numerous domain names that incorporate the names of famous brand names such as <ford-tractor.com>, and <nikon-d1.com>, and <samsung-phone.com>.

The registration of famous trademarks as domain names is evidence of bad faith cybersquatting under the Policy (and cites Encyclopedia Britannica, Inc. v. John Zuccarini and The Cupcake Patrol a/ka Country Walk a/k/a Cupcake Party, WIPO Case No. D2000-0330; Inter-IKEA Systems B.V v. Technology Education Center, WIPO Case No. D2000-0522).

Respondent has a history of systematically registering in bad faith domain names that incorporate famous trademarks in the entertainment and fashion industries. As a consequence of Respondent’s bad faith registration, panels constituted under the Policy have handed down numerous decisions against Respondent under factual situations that are virtually identical to those presented in this Complaint (and cites Lifetime Products, Inc. v. IQ Management Corporation, WIPO Case No. D2004-0719 (finding <lifetimeproducts.com> to be confusingly similar to complainant’s LIFETIME PRODUCTS trademarks); Six Continents Hotels, Inc. v. IQ Management Corporation, WIPO Case No. D2004-0272 (finding <holiday-inn.com> and <holiday-in.com> to be confusingly similar to complainant’s HOLIDAY INN trademark); Mattel, Inc. v. IQ Management Corporation, NAF Case No. FA244128 (finding <barbiecollectiblestore.com>, <barbienutcracker.com>, <barbie-collectibles.com>, <barbie-collectables.com>, and <hotwheelsaddict.com> to be confusingly similar to complainant’s BARBIE and HOT WHEELS trademarks); DJR Holdings, LLC v. Paul Gordon a/k/a IQ Management Corporation, NAF Case No. FA0141813 (finding <defjamsouth.com> to be confusingly similar to complainant’s DEF JAM trademark); V&S Vin & Sprit Aktiebolag v. IQ Management Corporation, NAF Case No. FA098440 (finding <absolutbeach.com> to be confusingly similar to Complainant’s ABSOLUT trademark.); Ecostyle BV v. IQ Management Corporation, WIPO Case No. D2001-0375 (finding Respondent’s use of the name <ecostyle.com> to be in bad faith and ordering the domain name returned to the complainant); Fatbrain.com, Inc. v IQ Management Corporation, NAF Case No. FA96374 (finding <clbooks.com> to be confusingly similar to complainant’s CLBOOKS.COM trademark).

Respondent’s widespread and systematic policy of registering domain names in bad faith for profit and Respondent’s lack of any rights in and to the KATE SPADE Trademarks prove that Respondent has no legitimate rights in the domain name at issue, but rather has simply attempted to trade upon the goodwill and rights of others for its own commercial gain (and cites Lifetime Products, Inc. v. IQ Management Corporation, WIPO Case No. D2004-0719, citing Collections ETC., Inc. v. Cupcake Patrol, WIPO Case No. D2001-0305 (“conduct that reveals a scheme or plan, a course of operations, is not irrelevant. Its probative value may be one of weight, but it is a matter, which can be taken into account in assessing the implications of all of the information that an administrative panel has at hand.”)).

Respondent has used and is using the disputed Domain Name to create a business that competes unfairly with Complainant’s sale of its goods.

Other panels have found initial interest confusion in the presence of a respondent who sells products similar to complainants’ merchandise, or a respondent who sells products through a Web site associated to a domain name confusingly similar to complainant’s trademark (and cites Institut Straumann AG v. Core-Vent Corporation, WIPO Case No. D2000-0404; and United States Olympic Committee (USOC) v. Tri B-U-N Eco. Project, WIPO Case No. D2000-0435).

B. Respondent

The Respondent did not reply to the Complainant’s contentions.

6. Discussion and Findings

In accordance with the Policy, paragraph 4(a), the Complainant must prove that:

“(i) the domain name in question 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 in respect of the domain name, and

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

In the administrative proceeding, the Complainant must prove that each three of these elements are present.

As Respondent has failed to submit a response to the Complaint, the Panel may choose to accept as true all of the allegations of the Complaint. Encyclopaedia Britannica, Inc. v. null John Zuccarini, Country Walk, WIPO Case No. D2002-0487; Talk City, Inc. v. Michael Robertson, WIPO Case No. D2000-0009.

A. Identical or Confusingly Similar

Complainant has submitted evidence to prove that it holds exclusive rights to the trademark KATE SPADE, by providing evidence of the existence of numerous trademark registrations. Complainant’s exclusive rights to the trademark KATE SPADE have not been contested by Respondent.

Respondent’s domain name <kate-spade.com> is confusingly similar to Complainant’s trademark KATE SPADE. The disputed domain name entirely incorporates Complainantīs trademark, but for the addition of a hyphen (“-”) and the incorporation of the relevant gTLD .com.

To carry into effect the similarity analysis, we must not take into account the generic top-level domain (gTLD) “.com,” because such gTLD has no legal significance. See, Ahmanson Land Company v. Vince Curtis, WIPO Case No. D2000-0859, (citing in turn Monty and Pat Roberts, Inc. v. J. Bartell, WIPO Case No. D2000-0300; J.P. Morgan & Co., Incorporated and Morgan Guaranty Trust Company of New York v. Resource Marketing, WIPO Case No. D2000-0035; See also Pomellato S.p.A. v. Richard Tonetti, WIPO Case No. D2000-0493; Rollerblade, Inc. v. Chris McCrady, WIPO Case No. D2000-0429; Sony Kabushiki Kaisha (also trading as Sony Corporation) v. Inja, Kil, WIPO Case No. D2000-1409).

The simple addition of a hyphen to Complainant’s mark in the disputed domain name does not render said domain name sufficiently different from Complainant’s trademark, and it certainly does not make it inherently distinctive as opposed to Complainant’s highly publicized mark. This Panel agrees with previous panels in that the mere addition of a hyphen to a trademark renders the relevant domain name confusingly similar to such mark. See, e.g. Teleplace, Inc. v. Oliveira, NAF Case No. FA 95835, and InfoSpace.com, Inc. v. Tenenbaum Ofer, WIPO Case No. D2000-0075).

In light of the above, the Panel finds that the domain name <kate-spade.com> is confusingly similar to the trademark KATE SPADE in which Complainant has rights. The first requirement of the Policy has been met.

B. Rights or Legitimate Interests

The following are examples of circumstances where Respondent may have rights or legitimate interests over a contested domain name:

“(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.” (Policy, paragraph 4(c)).

Respondent has not submitted any evidence showing any rights or legitimate interests in the disputed domain name. Complainant has denied having granted any license nor in any way authorized Respondent to make use of Complainant’s KATE SPADE Trademarks.

This Panel agrees with previous panels in that registration of a domain name incorporating another’s famous mark does not confer any rights or legitimate interests in the domain name to Respondent, but rather constitutes bad faith under paragraph 4(c) of the Policy. See, Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003, Medisite S.A.R.L. v. Intellisolve Limited, WIPO Case No. D2000-0179, and V&S Vin & Sprit Aktiebolag v. Tyler Kownacki, NAF Case No. 95079.

Respondent has not set forth any evidence showing that before this dispute arose, it had used or made demonstrable preparations to use the disputed name <kate-spade.com> in connection with a bona fide offering of goods or services. This Panel notes that Respondent’s past behavior regarding the registration of domain names incorporating registered trademarks that are considerably publicized, makes it difficult to presume a bona fide activity regarding the domain name at hand.

Respondent has not submitted any evidence showing that it has been commonly known by the domain name <kate-spade.com>.

Respondent has not provided any evidence showing that it is making a legitimate noncommercial use of the disputed name, without intent for commercial gain to misleadingly divert consumers. In fact, the evidence presented by Complainant and Respondent’s past behavior leads the Panel to infer that Respondent was engaged in the opposite conduct.

The Panel thus finds that Respondent has no rights or legitimate interests in the disputed domain name. The second requirement set forth in the Policy has therefore been fulfilled.

C. Registered and Used in Bad Faith

According to paragraph 4(b) of the Policy, the following circumstances shall be evidence of registration and use in bad faith:

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

(ii) you have 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 you have engaged in a pattern of such conduct; or

(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your 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 your website or location or of a product or service on your website or location.”

As stated in point 6B (supra), this Panel finds it difficult to find good faith on the side of a Respondent who has a history of registering domain names that entirely incorporate highly publicized trademarks, introducing slight variations thereto. It is not possible for this Panel to decide that Respondent’s conduct constitutes good faith acts, in light of numerous decisions issued by previous panels who have been presented with similar cases to the case at hand. Previous panels have ruled that registering domain names like <lifetimeproducts.com>, <holiday-inn.com>, <holiday-in.com>, <barbiecollectiblestore.com>, <barbienutcracker.com>, <barbie-collectibles.com>, <barbie-collectables.com> and <hotwheelsaddict.com>, inter alia, does not constitute good faith registration. This Panel agrees, and decides that registering <kate-spade.com> in light of Complainant’s considerable advertising campaigns, presence in the market and recognition among consumers does not constitute bad faith registration, especially taking into account the past conduct of Respondent.

Moreover, Complainant has stated that Respondent has offered to sell the following domain names: <coach-handbag.com>, <coach-purse.com>, <fossil-watch.com>, <gucci-handbags.com>, <gucci-watch.com>, <kenneth-cole.com>, <tommy-bahama.com>, <ford-tractor.com>, <nikon-d1.com>, and <samsung-phone.com>. Considering that Respondent has not contested this statement, said affirmation weighs against Respondent.

Respondent’s past history leads this Panel to believe that at the time of registration, Respondent knew what it was doing: registering another domain name that incorporated entirely in itself a highly publicized trademark belonging to a third party. This pattern of conduct falls under the category of bad faith.

Respondent’s modus operandi suggests that it intends to benefit from Complainant’s goodwill for commercial gain. Complainant’s citation of ETC., Inc. v. Cupcake Patrol, supra, is interesting as it is applicable to the present case: “conduct that reveals a scheme or plan, a course of operations, is not irrelevant. Its probative value may be one of weight, but it is a matter, which can be taken into account in assessing the implications of all of the information that an administrative panel has at hand.” The Respondent in ETC also presented a pattern of systematically registering domain names incorporating trademarks of third parties. Given the evidence submitted by Complainant and not refuted by Respondent, Respondent’s conduct inclines the balance towards the side of bad faith.

Complainant has asserted that this is a case of initial interest confusion. Complainant’s citation of Institut Straumann AG v. Core-Vent Corporation, supra, and United States Olympic Committee (USOC) v. Tri B-U-N Eco. Project, supra, is interesting. Respondent has not rebutted this affirmation. According to the first case, Respondent’s use of the disputed domain name in conjunction with a Web site selling a product similar to Complainant’s product showed an intention to create initial interest confusion among prospective consumers, therefore constituting bad faith. In the second case, the panel found that selling Olympic memorabilia and related products on a Web site to which domain names confusingly similar to Complainant’s trademark resolved posed a risk of creating a likelihood of confusion as to the source and endorsement of the products. Both cases refer to the concern that a domain name confusingly similar to a trademark may create a risk of confusion among users and potential customers as to the source and endorsement of a given Web site which is factually unrelated to the Complainants and their marks. Complainant asserts its case presents the same concern.

In view of the factual and procedural circumstances of the case, this Panel finds that Respondent has intentionally attempted to attract, for commercial gain, Internet users to its Web site, by creating a likelihood of confusion with the Complainant’s mark (even if said confusion is initial, at the moment of selecting which site to visit, and/or whether or not Respondent’s site should be visited at all) as to the source of Respondent’s Web site.

Complainant has thus established that the disputed domain name <kate-spade.com> has been registered and is being used in bad faith. The third requirement of the Policy has therefore been fulfilled.

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 <kate-spade.com> be transferred to the Complainant.

Kiyoshi I. Tsuru
Sole Panelist

Dated: May 9, 2005