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Wal-Mart Stores, Inc. v. Texas Internet [2005] GENDND 540 (29 July 2005)

World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Wal-Mart Stores, Inc. v. Texas Internet

Case No. D2005-0610

1. The Parties

The Complainant is Wal-Mart Stores, Inc., C/O Debra Hughes, Senior Counsel, Bentonville Arkansas, United States of America, represented by David Schramm, Kirkpatrick & Lockhart Nicholson Graham LLP, Pittsburg Pennsylvania, United States of America.

The Respondent is Texas Internet, Dallas, Texas, United States of America.

2. The Domain Name and Registrar

The disputed domain name <samsclubs.com> is registered with Intercosmos Media Group d/b/a directNIC.com.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on June 11, 2005. On June 13, 2005, the Center transmitted by email to Intercosmos Media Group d/b/a directNIC.com a request for registrar verification in connection with the domain name at issue. On June 13, 2005, Intercosmos Media Group d/b/a directNIC.com 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 June 16, 2005. In accordance with the Rules, paragraph 5(a), the due date for Response was July 6, 2005. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on July 7, 2005.

The Center appointed William R. Towns as the Sole Panelist in this matter on July 19, 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 large and well known retailer. In addition to operating Wal-Mart Stores and Supercenters, the Complainant operates members-only Sam’s Club stores in the United States of America and elsewhere. The Complainant has registered the mark SAM’S CLUB and makes extensive use of the mark, which is well known. The Complainant also operates a website at “www.samsclub.com”, which provides information about Sam’s Club and allows members to shop online.

The Respondent is the registrant of the disputed domain name <samsclubs.com>. The domain name differs from the Complainant’s SAM’S CLUB mark only by an additional “s” following “club”. The Respondent has on more than one occasion registered domain names that differ only slightly from well known brand names. The disputed domain name resolves to a website displaying an advertisement and link to “www.adultfriendfinder.com”, a website featuring adult-oriented and sexually explicit material.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the disputed domain name is identical or confusingly similar to registered SAM’S CLUB marks in which the Complainant has rights.¹ According to the Complainant, the Respondent is using the domain name to redirect internet users to “www.adultfriendfinder.com”, which contains adult-oriented, pornographic and sexually explicit material. The Complainant asserts that the Respondent has no rights or legitimate interests in the disputed domain name, and has engaged in a pattern of registering domain names consisting of slightly changed famous names for similar purposes. The Complainant characterizes the Respondent’s conduct as “a classic case of typosquatting”, establishing bad faith registration and use, and requests the transfer of the disputed domain name.

B. Respondent

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

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 concludes that the disputed domain name <samsclubs.com> is confusingly similar to Complainant’s SAM’S CLUB marks for purposes of paragraph 4(a)(i) of the Policy. The Complainant beyond question has established rights in the SAM’S CLUB marks through registration and use. At a bare minimum, that marks are entitled to a presumption of validity by virtue of registration with the United States Patent and Trademark Office. See EAuto, L.L.C. v. Triple S. Auto Parts d/b/a Kung Fu Yea Enterprises, Inc., WIPO Case No. D2000-0047.

The disputed domain name <samsclubs.com>, incorporates the Complainant’s SAM’S CLUB mark in its entirety, and is distinguishable from the mark only by a addition of a single letter – the “s” following “club”. Given the overall circumstances of this case, the Respondent’s minor misspelling of the Complainant’s mark appears to be deliberate – a practice commonly referred to as “typosquatting”.² The Panel finds that the domain name registered by the Respondent is confusingly similar to the Complainant’s SAM’S CLUB marks for purposes of paragraph 4(a)(i).

C. Rights or Legitimate Interests

The Complainant clearly has not authorized the Respondent to use the SAM’S CLUB marks or to incorporate such marks in a domain name. The Respondent is using the disputed domain name, incorporating the Complainant’s distinctive mark, to direct Internet traffic to “adultfriendfinder.com”, which claims to be the “World’s Largest Sex & Swinger Personals site”. The Respondent has more than once registered and made similar use of domain names consisting of slight misspellings of distinctive brand names. See Ruth’s Chris Steak House, Inc. v. Texas Internet, WIPO Case No. D2005-0292; BellSouth Intellectual Property Corporation v. texas Internet, WIPO Case No. D2005-0559. This is a sufficient prima facie showing for purposes of paragraph 4(a)(ii) that the Respondent lacks rights or legitimate interests in the disputed domain name. See 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 name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

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

(iii) the Respondent is 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.

In this case, the Respondent has not submitted any response to the Complaint. Some panels have held that a respondent’s lack of response can be construed as an admission that the respondent has no rights or legitimate interests in a disputed domain name. See Do the Hustle, LLC v. Tropic Web, WIPO Case No. D2000-0624. Other panel decisions note that adverse inferences may be drawn from a respondent’s failure to reply. See Charles Jourdan Holding AG v. AAIM, WIPO Case No. D2000-0403.

Certainly, in the absence of any submission by the Respondent, this Panel may accept all reasonable inferences and allegations included in the Complaint as true. See Talk City, Inc. v. Robertson, WIPO Case No. D2000-0009.

There is nothing in the record remotely suggesting that the Respondent has been commonly known by the disputed domain name, or that the Respondent is making any legitimate noncommercial or fair use of the domain name. Instead the record reflects the Respondent’s use of the disputed domain name incorporating the Complainant’s distinctive mark in order to direct internet users to a sexually-oriented commercial website, which operates an affiliate program under which affiliates are paid for visitors directed by them to the website. Even assuming the Respondent were to argue it is using the domain name in connection with an offer of goods or services, there can be no bona fide offering of good or services for purposes of paragraph 4(c)(i) of the Policy when the Respondent has registered and is using the domain name in bad faith. See, e.g., First American Funds, Inc. v. Ult. Search, Inc, WIPO Case No. D2000-1840. The bad faith issue is discussed below.

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 registration and use for the benefit of legitimate trademark owners, and 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. In this case, the totality of circumstances demonstrates the Respondent’s bad faith registration and use of the disputed domain name within the meaning of paragraph 4(a)(iii). This is a classic case of typosquatting. The Panel finds that the Respondent intentionally registered the disputed domain name, a common misspelling of the Complainant’s distinctive mark, and is using the domain name in order to take advantage of typographical errors made by internet users seeking the complainant’s website to divert them to a “Sex & Swingers Personal” website. See, e.g., Red Bull GmbH v. Grey Design, WIPO Case No. D2001-1035; Playboy Enterprises International Inc. v. SAND WebNames – For Sale, WIPO Case No. D2001-0094; Telstra Corp. Ltd. v. Warren Bolton Consulting Pty. Ltd., WIPO Case No. D2000-1293. The evidence further reflects that the Respondent has engaged in a clear pattern of abusive domain name registration and use, leaving no doubt about the Respondent’s bad faith in this instance.

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 <samsclubs.com> be transferred to the Complainant.

William R. Towns
Sole Panelist

Dated: July 29, 2005

² “Typosquatting” involves the intentional registration and use of a domain name that is a common misspelling of a distinctive mark. See, e.g., Red Bull GmbH v. Grey Design, WIPO Case No. D2001-1035; Playboy Enterprises International Inc. v. SAND WebNames – For Sale, WIPO Case No. D2001-0094; Telstra Corp. Ltd. v. Warren Bolton Consulting Pty. Ltd., WIPO Case No. D2000-1293. In a typical “typosquatting” case, the respondent has registered and is using the domain name in order to take advantage of typographical errors made by internet users seeking the complainant’s commercial website and divert them to the respondent’s website. Red Bull GmbH v. Grey Design, WIPO Case No. D2001-1035.