Monday , June 27 2022

An interesting UDRP: victron.com

The majority of the panel applies an interesting interpretation to UDRP.

UDRP in red on a cream background

World Intellectual Property Organization (WIPO) has published (pdf) an interesting UDRP decision for victron.com.

The majority of the panel found in favor of Complainant Victron Energy B.V., which filed the case against domain investor Sarvix, Inc.

Sarvix undertook research before buying the domain for $7,000 in an expired domain auction in 2020. To summarize, Sarvix says it:

  • Checked the Wayback machine and found the domain was used by Victron Electronics of California since 1993, when the company went out of business and later let the domain expire
  • Searched USPTO and found existing and expired trademarks for victron
  • Checked Google translate and found that victron in Latin translated to conqueror

On this basis, Sarvix says it registered the domain with the understanding that it is a dictionary word (in Latin) used by many companies.

The majority of the WIPO panel called into question the Latin meaning of victron, noting that other Latin dictionaries don’t show this meaning. And even if it is Latin, the majority noted that it’s not a common Latin word.

So this led the panel to consider that if the word isn’t a dictionary term but is used by lots of companies, does that give the domain investor a right to register the domain if it’s not targeting just one of the companies? It said:

As discussed in detail in section 6.C below, the majority of the Panel believes that it is more likely than not that the Respondent has registered and used the disputed domain name in an attempt to extract profit from it based on the goodwill of the Complainant and the other entities that are holders of trademark registrations for VICTRON.

This leads to an interesting ramification. If multiple companies have a registered trademark for a term, it creates a “first to file a UDRP” incentive in which the first of those trademark holders to file a UDRP could conceivably win the domain to the detriment of other trademark holders.

Panelist Jeffrey Neuman dissented. He noted that Section 4(b) of the Policy states that for the purpose of satisfying that the domain name was registered and used in bad faith, the following shall be evidence of the registration and use of a domain name 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; (emphasis added)

Neuman wrote:

The Complainant’s evidence of bad faith targeting consists solely of (i) the Respondent knew the Complainant had rights in the VICTRON mark, (ii) it immediately put the domain name up for sale, and (iii) when the Complainant approached the Respondent, the Respondent asked for five figures. No further communication took place between the Complainant and the Respondent. Complainant filed this action. These facts alone are not enough to establish the requisite targeting required under paragraph 4(b)(i) of the Policy. Yet, the majority did find that there was such targeting, stating “it is more likely than not that the Respondent has registered and used the disputed domain name in an attempt to extract profit from it based on the goodwill of the Complainant or any of the other entities that are holders of trademark registrations for VICTRON.” In other words, even if the Respondent did not specifically have Complainant in mind but another rights holder when it registered the dropped domain name, nevertheless the registration must have been in bad faith. That is not consistent with the consensus view of the UDRP.

When domain investors buy domains, they often check trademark databases for instances of the term. If there are a lot of different trademark holders, they view this as evidence that the term is valuable. Of course, this assumes it is generic in nature.

It seems that a large part of this case hinges on whether victron is a Latin term or not. Neuman questions the panel’s independent research on this issue:

When evaluating the intent of the Respondent in registering the disputed domain name, the panel should not be substituting its own research for that which the Respondent did prior to purchasing the domain and for which it provides as evidence attached to its Response. Even if Google Translate is wrong, that doesn’t change the fact that the Respondent, when it registered the disputed domain name, believed Google translate was correct. The state of mind of the Respondent, when it can be shown, is a critical piece of evidence that cannot be ignored.

Neuman summarized why he thinks the majority got this case wrong:

In sum, the majority has found registration and use in bad faith based upon a new generalized targeting standard to conclude that Respondent must have acquired the disputed domain name to “extract profit” from the Complainant or another entity that holds a trademark. But the standard is not a generalized standard, but a very specific one where the Complainant must prove that the Respondent registered the disputed domain name specifically to sell that name to the Complainant. However, there is simply no evidence in the record establishing that.

One thing missing from the Respondent’s defense is if it searched Google for the term. The Complainant attached a Google search showing that the Complainant dominates all results. I see the same thing when I search.

There’s another issue in this UDRP. It seems that the Complainant tried to mislead the panel into thinking that the domain owner reached out to the Complainant, offering the domain for sale. But this was in response to the Complainant’s inquiry into buying the domain.

The majority of the panel had this to say about this:

According to the majority of the Panel, hanging a “for sale” sign out and then receiving a query can hardly be described as an unsolicited approach. In its words in the response to the Complainant’s query about the price, the Respondent was “looking for offers in the 5 figure range for this domain name.” In these circumstances, the Respondent cannot portray itself as innocently minding its own business until an unsolicited offer came in.

True, the domain owner had listed the domain for sale. But this is very different from contacting a Complainant about buying a domain, and it’s important that Complainants not mislead panels into thinking this happened.

So what does this mean for domain investors? Many words are trademarks for specific uses and can be used by a lot of companies. These can be OK to register. But if the word isn’t in the dictionary, or if one company holds a seemingly “dominant” ownership of the mark, you need to be cautious.

Assen Alexiev and Warick Rothnie made up the majority of the panel. Leopold Meijnen Oosterbaan represented the Complainant. Howard M. Neu represented the Respondent.

Post link: An interesting UDRP: victron.com

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