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Hewitt Associates LLC v. Robin Cuff [2005] GENDND 59 (3 February 2005)

World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

SingTel Optus Pty v. Xnet

Case No. D2004-0734

1. The Parties

The Complainant is SingTel Optus Pty, North Sydney, New South Wales, of Australia, represented by Baker & McKenzie, Australia.

The Respondent is Xnet, Mornington, Victoria, of Australia, represented by ESQwire.com Law Firm, United States of America.

2. The Domain Name and Registrar

The disputed domain name <optus.com> is registered with TierraNet d/b/a DomainDiscover (the “Disputed Domain Name”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on September 10, 2004. On September 10, 2004, the Center transmitted by email to TierraNet d/b/a DomainDiscover a request for registrar verification in connection with the domain name at issue. On September 15, 2004, TierraNet d/b/a DomainDiscover 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. In response to a notification by the Center that the Complaint was administratively deficient, the Complainant filed an amendment to the Complaint on September 21, 2004. The Center verified that the Complaint together with the amendment to 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 September 21, 2004. In accordance with the Rules, paragraph 5(a), the due date for Response was October 15, 2004. The Response was filed with the Center on October 16, 2004.

The Center appointed Debrett G. Lyons as the sole panelist in this matter on October 29, 2004. Panelist Lyons then withdrew from the proceeding due to work-related issues. The Center then appointed Alistair Payne as the sole panelist in this matter on November 10, 2004. 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.

The Complainant requested leave to file a Reply Brief and was granted leave to file a Reply Brief on November 16, 2004. The Brief was filed by the Complainant on December 1, 2004. The Respondent was given leave to file a reply to Complainant’s Reply Brief by the Panel, and the Reply was filed on December 23, 2004.

4. Factual Background

The Complainant is the second largest provided of telecommunications services in Australia and serves more than six million customers each day. It commenced operations in Australia on November 6, 1991, under the registered company name Optus Communications Pty Limited. The Complainant has undergone changes in ownership since then and now trades as Singtel Optus Pty Limited. It is the owner of numerous Australian and New Zealand trade mark registrations for OPTUS and for phrases that incorporate OPTUS. In addition, the Complainant has been operating a web site from the <optus.com.au> domain name for a number of years. According to a Hitwise Australia report of May 29, 2004, this web site is ranked in the top five “Business and Finance – Telecommunications” sites in Australia.

The Respondent states that he is an entrepreneur and web developer and that he has operated a number of Internet web sites, including the Disputed Domain Name and <x.net.au>. On December 17, 2003, the Respondent registered an enterprise called “Optus Website Design” in South Africa and indicated on the Disputed Domain Name that it was a supplier of Optus Website Design services.

The Disputed Domain Name was registered by the Respondent some time in 1996. Soon after registration, he began using the Disputed Domain Name to promote “Optus Software” allegedly on behalf of an unrelated third party producer of the software known as Optus Solutions Inc (“OSI”). In particular, the Respondent maintained a link on its website that resolved to the website of OSI. The Respondent contends that this link remained in place until some time in 1999/2000.

It is not apparent from the evidence whether or not the Respondent ever offered or himself sold Optus Software products, or whether he simply acted as an intermediary for promotional purposes.

On August 16, 1996, the Complainant sent a fax to the Respondent requesting that he include a disclaimer on his website indicating that he does not have any relationship with the Complainant. The Respondent contends that he responded to this request by inserting a banner on the web site stating that “This site is brought to you by ZX.net”. This banner was maintained until February 2000.

On May 4, 2000, the Complainant wrote to the Respondent threatening to take proceedings against him under the Policy. It appears that no proceedings commenced after this letter was sent. In August 2003, the Complainant made contact with the Respondent with a view to negotiating the transfer of the Disputed Domain Name. Over the course of a number of meetings, terms of transfer were discussed but no agreement was reached. In particular, the Respondent declined an offer of AU$80,000.

5. Parties’ Contentions

A. Complainant

Whether the Disputed Domain Name is identical or confusingly similar to a name, trade mark or service mark in which the Complainant has rights.

The Complainant contends that it has established legal rights in the word OPTUS on the basis of its ownership of numerous registered trade marks. It further contends that it has common law rights in the word OPTUS on the basis of substantial trading activities in relation to that word, including the operation of a web site under the <optus.com.au> domain name for a number of years.

The Complainant contends that the Disputed Domain Name is identical or, alternatively, confusingly similar to OPTUS in which it has registered/common law rights.

The Respondent has no rights or legitimate interests in respect of the Disputed Domain Name.

The Complainant contends that the Respondent has no rights or legitimate interests in the Disputed Domain Name. The Complainant maintains that there is no evidence that the Respondent has made a bona fide offering of goods or services in relation to the Disputed Domain Name. With respect to the Respondent’s relationship with OSI, the Complainant maintains that at most the evidence indicates that the Disputed Domain Name resolved to the <facsys.com> domain name operated by that company. The Complainant contends that this does not establish that the Respondent was offering bona fide goods or services himself in the connection with the Disputed Domain Name.

The Complainant contends that the proposed business - Optus Website Design - which was registered in South Africa on December 17, 2003, should be discounted in deciding whether the Respondent has rights or legitimate interests in the Disputed Domain Name since it was proposed after the Respondent was on notice of the Complainant’s objection to its use of the Disputed Domain Name.

The Complainant contends that there is no evidence to suggest that the Respondent uses the Disputed Domain Name as an email address and that in fact the Respondent uses [name]@x.net.au as his email address.

The Disputed Domain Name was registered or is subsequently being used in bad faith.

The Complainant contends that the Respondent registered the Disputed Domain Name in bad faith. As evidence of bad faith, the Complainant refers to a statement – “You could register anything you wanted back then” – which the Complainant contends was made by the Respondent in discussions with a Representative of the Complainant in 2003. The Complainant contends that the willingness of the Respondent to negotiate commercial terms for the transfer of the Disputed Domain Name is also evidence of registration in bad faith.

As evidence of use in bad faith, the Complainant refers to the presence of advertisements on the Disputed Domain Name that are permitted by the Respondent, and for which the Complainant maintains the Respondent receives payment. In addition, the Complainant contends that, on dates between 2002 and 2003, the Disputed Domain Name resolved automatically to “www.x.net.au”.

The Complainant urges the Panel to consider all the circumstances of the case in assessing whether or not the Disputed Domain Name has been registered and used in bad faith.

B. Respondent

The Disputed Domain Name is identical or confusingly similar to the trade mark or service mark in which the Complainant has rights.

The Respondent concedes that the Disputed Domain Name is identical or confusingly similar to the Complainant’s trade mark.

The Respondent has no rights or legitimate interests in respect of the Disputed Domain Name.

The Respondent contends that the word OPTUS is commonplace and used by several third parties. Accordingly, it argues that the Complainant cannot have a monopoly on this common term.

The Respondent argues that its relationship with OSI commencing in 1996, establishes that it has a right or legitimate interest in the Disputed Domain Name. Furthermore, the Respondent contends that the Complainant acknowledged its right or legitimate interest in the fax of August 26, 1996. The Respondent also contends that it has used the Disputed Domain Name in connection with the promotion of its own web services since 1996.

The Respondent contends that the use of the Disputed Domain Name for email purposes also supports a finding that the Respondent has a legitimate interest in the Disputed Domain Name.

The Disputed Domain Name was registered and is being used in bad faith.

The Respondent contends that the Complainant has failed to show that the Respondent registered and used the Disputed Domain Name in bad faith. The Respondent contends that the fact that he declined an offer of AU$80,000 made by the Complainant indicates that the registration and use was not in bad faith.

The Respondent contends that there is no evidence to suggest that he registered the Disputed Domain Name for the “purpose” of selling, renting or transferring it to the trade mark owner or a competitor. The Respondent maintains that the Complainant must establish “intent” on the part of the Respondent to commit a wrongdoing and not the mere registration of a domain name with the knowledge of an existing trade mark. The Respondent contends that the fact that it has also registered other generic or common words does not in any way indicate a pattern of opportunistic registrations.

The Respondent disagrees that his 2003 conversation with a representative of the Complainant is a basis for implying that the Disputed Domain Name was registered in bad faith. The Respondent maintains that what is relevant is that he refused the financial offer and made no counter offer.

Finally, the Respondent contends that the advertisements that appear on its website are automatically generated by Google and that it has no control over the content of these advertisements (although he acknowledges that he received click-through revenue from them).

6. Discussion and Findings

In accordance with paragraph 4(a) of the Policy, in order to succeed in this Administrative Proceeding and obtain the requested remedy (in this case the transfer of the Domain Name to the Complainant) Complainant must prove each of the pre elements referred to in paragraph 4(a) of the Policy.

A. Identical or Confusingly Similar

The Complainant has provided ample evidence that it has registered trade mark and common law rights in the OPTUS mark. The Respondent concedes this aspect of the Complaint.

The Panel also finds that the Disputed Domain Name is confusingly similar to the OPTUS mark.

B. Rights or Legitimate Interests

The burden of proof rests with the Complainant to establish that the Respondent has no rights or legitimate interests in the Disputed Domain Name. Paragraph 4(c) of the Policy lists three non-exhaustive factors by which the Respondent may show that it has rights or legitimate interests in the Disputed Domain Name.

The Respondent asserts that the name “Optus” is in common (as opposed to “exclusive”) use and that in these circumstances and consistent with Energy Source Inc. v. Your Energy Source, Case No. 96364 (NAF February 19, 2001) that the first to register such a domain name will have rights or legitimate interests. The Panel does not accept that the Energy Source decision necessarily stands for this approach and considers in any event that this would be inconsistent with the purpose and literal meaning of the Policy. The Policy does not operate upon the basis of an assessment of exclusive or non-exclusive rights, but rather upon a consideration of whether the Respondent at issue has any “right or legitimate interest” in the domain name. The three non-exhaustive factors in Paragraph 4(c) are expressly set out to demonstrate the possible nature of such rights or legitimate interests.

The main arguments for the Respondent turn on the question of whether its use of the Disputed Domain Name amounts to use “in connection with a bona fide offering of goods or services” under paragraph 4 (c)(i) of the Policy. Four factors are relevant to this inquiry.

First, the Respondent alleges that for some period of time commencing in 1996 (and prior to initiation of this dispute) the Respondent maintained a link on its website to <facsys.com> - a website operated by Optus Solutions, Inc. (“OSI”) through which it sold software. Despite ample opportunity to do so during these proceedings, the Respondent has not presented any evidence to suggest that it ever actually sold goods or provided services on behalf of OSI. Accordingly, the Panel concludes that even if the link existed, the Respondent never actually sold goods or services on behalf of OSI. Does maintenance of a link alone constitute use “in connection with a bona fide offering of goods or services” for the purposes of the Policy?

In the Panel’s view it does not. If the Panel was to find otherwise, it would mean, as correctly pointed out by the Complainant, that rights or legitimate interests could be acquired merely by creating a link for a Disputed Domain Name to a third party who does offer bona fide goods or services. The Respondent cites The Landmark Group v. Digimedia L.P. no. 285459 (NAF August 6, 2004) as supporting such use. However this case is limited on its facts to the use of dictionary words as domain names in circumstances where such words have not been registered because of their intrinsic value as trade marks. For the reasons set out under Part C below this is not at all the case here.

Second, the Respondent contends that it has offered web design and related services via the Disputed Domain Name since 1996. Again the Respondent has failed to provide evidence of any actual business activities in relation to its use of the Disputed Domain Name. The evidence presented shows that the Respondent has operated a very basic website including only a short description of its services, its e-mail address and links to a number of third parties. Had the Respondent been operating a real and substantive business from the website it should have been able to provide much more detail concerning its activities than it has done - it certainly had more than enough opportunity to do so. As a result the Panel finds that there is no evidence of the respondent’s own activity such as to support a finding that it has established rights or legitimate interests in the Disputed Domain Name.

Third, the Respondent has provided evidence that it proposes to offer website design services under the trading name Optus Website Design services. The Complainant correctly points out and the Panel accepts that this business was only registered in December 2003, after the Respondent was made aware of possible proceedings under the Policy.

Fourth, the Respondent has argued that its use of the Disputed Domain Name as an email address establishes its rights or legitimate interests in the Disputed Domain Name and has cited a number of decisions in support of its contention, including, Bosco Products v. Bosco Email Service (C-94828 (NAF June 29, 2000)) and Buhl Optical Co. v. Mailbank.com (WIPO Case No. D2000-1277 (March 1, 2001)). Those cases, as acknowledged by Respondent’s counsel, concern real commercial entities offering email addresses to third parties in the course of undertaking actual business activities. As noted above there is insufficient evidence to support a finding that the Respondent has undertaken commercial activity such as to qualify as a bona fide offering of goods or services. Personal e-mail use alone will not suffice to establish a bona fide offering of goods or services for the purposes of sub-paragraph 4(c)(i), nor to establish that an organization was commonly known by the domain name under sub-paragraph 4(c)(ii).

The Panel has also considered whether, as submitted by the Respondent, the facsimile of August 26, 1996, effectively “authorizes” the Respondent’s use, or acknowledges the Respondent’s interest. The facsimile addressed to Xnet Computers contains a “without prejudice” offer of compromise. In it the Complainant proposes that it will not pursue any rights it may have if a disclaimer is added to the site to dispel any possible public confusion that the Complainant was connected with the site or with Optus Software. The fax was sent exactly three years prior to the commencement of the Policy and at that time probably represented a pragmatic commercial compromise in circumstances where the law concerning domain names was relatively undeveloped. Although containing an authorization of use on limited terms (i.e. with a disclaimer), the fax does not appear to the Panel to amount to an acknowledgement by the Complainant of any other rights. Rather it amounts to a pragmatic acceptance that the Respondent had secured the domain name registration and at that point in time the Complainant considered that it had a better chance of securing the Respondent’s agreement to insert a disclaimer on the site, than of successfully obtaining its transfer.

This view is supported by the letter sent by the Complainant’s solicitors in early 2000, clearly asserting the Complainant’s rights in the OPTUS mark, although it is apparent that the Complainant did not initiate proceedings under the Policy at that time. Had the Respondent after this date used the Disputed Domain Name in connection with a bona fide offering of goods or services and without links to unconnected third parties than the Complainant’s delay in bringing these proceedings may have seriously affected its chances of obtaining relief under the Policy.

Finally, in PROM Software Inc v. Reflex Publishing (WIPO Case No. D2001-1154 (March 2, 2002)) cited by the Respondent in support, the Complainant sought to acquire a domain name containing the common dictionary word “Prom” in circumstances in which it had no better rights than the Respondent and where the Respondent would have had no knowledge of the Complainant’s interest at the time of registration. These were not the circumstances in this case – as set out below the Panel infers that the Respondent knew of the Complainant’s mark at the time of registration.

The Panel finds that there are no other factors supporting the Respondent’s case under this limb of the Policy and accordingly that the Complainant has established that the Respondent has no rights or legitimate interests in the Disputed Domain Name.

C. Registered and Used in Bad Faith

For the reasons set out below the Panel is satisfied that the Disputed Domain Name has been both registered and used in bad faith by the Respondent.

The Panel accepts that the Complainant’s OPTUS trade mark is one of that category of trade marks which can truly be said to be famous within Australia. The Panel is of the view that at the time of establishing its website, the Respondent must have been well aware of the Complainant’s OPTUS trade mark.

The Respondent is correct in contending that mere knowledge of a prior trade mark right does not in itself support a finding of bad faith registration and use. Instead, the Panel needs to determine whether the evidence indicates that the Respondent registered and used the Dispute Domain Name primarily with a view to taking advantage for its own gain of the Complainant’s registered trade mark rights and reputation (paragraphs 4(b)(i)-(iv)).

In all the circumstances it seems highly probable that the Respondent chose the Disputed Domain Name because of its similarity to the Complainant’s trade mark. The Respondent has provided no credible explanation or evidence of (a) its business arrangements with OSI, or (b) its own bona fide offering of goods or services, which led it to register the Disputed Domain Name, or to maintain that registration through to the date of this dispute. The fact that the Respondent maintained a link to OSI’s website and has subsequently maintained links to third parties (presumably for financial gain as referred to below) permits an inference that the real purpose of registration was more likely to be for the purpose of diverting traffic from the Complainant to OSI and subsequently to various third parties.

The Panel is also satisfied that the evidence as outlined above supports a finding of use in bad faith by the Respondent. The evidence presented by the Complainant indicates that a large proportion of the traffic visiting the Disputed Domain Name is inadvertent. The fact that inadvertent visitors to the Respondent’s website will in most cases quickly realize their mistake does not aid the Respondent’s case. As explained by the Panel in Telstra Corporation Limited v. India Yellow Pages (WIPO Case No. D2002-0651), in such circumstances the “Respondent will be deriving a potential business opportunity from those visiting the site expecting to find the Complainant’s site who might not otherwise have visited the site”. The Panel infers that the Respondent is well aware of this inadvertent traffic and attempts to profit from it by generating referral income through the Google advertisements and other means (paragraph 4(b)(iv) of the Policy).

For these reasons, the Panel finds that the Respondent both registered and used the Disputed Domain Name in bad faith contrary to paragraph 4(a)(iii) of the Policy.

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 be transferred to the Complainant.

Alistair Payne
Sole Panelist

Dated: January 18, 2005