When you transfer the #trademark, don’t forget to transfer the #domains :DomainGang

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Business 101 : When a company acquires intellectual property rights from its former partners, they’d better not forget to include the related domains in the exchange!

In the case of Corioliss Europe S.L., Spain, they paid the sum of $750,000 dollars to acquire global rights to the CORIOLISS brand and mark, but they left out the domains Corioliss.com and CoriolissEurope.com.

The former officers of the company in whose names these domains were registered, kept selling the products legitimately. When the company realized what had happened, they filed a UDRP to get these domains.

Unfortunately for the Complainant, the Respondent pointed out that nowhere was there a mention of handing over the domains, as part of the intellectual property sale.

The sole panelist at the WIPO agreed, and ordered the domains to remain with the Respondent. Full details follow:

Corioliss Europe S.L. v. Jmastm LLC , Adi Schimko, UK.Corioliss, Jerome Migliori
Case No. D2019-2735

1. The Parties

The Complainant is Corioliss Europe S.L., Spain, represented by J.A Muñoz-Zafrilla, Spain.

The Respondents are Jmastm LLC, Adi Schimko, UK.Corioliss, and Jerome Migliori, United States of America (“United States”), represented by Peretz Chesal & Herrmann, PL, United States.

2. The Domain Names and Registrars

The disputed domain names <corioliss.com> and <coriolisseurope.com> are registered with GoDaddy.com, LLC and Tucows Inc. (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on November 7, 2019. On November 8, 2019, the Center transmitted by email to the each of the Registrars a request for registrar verification in connection with the disputed domain names. On November 8, 2019, the Registrars transmitted by email to the Center their verification responses disclosing registrant and contact information for the disputed domain names which differed from the named Respondent and contact information in the Complaint. The Center sent an email communication to the Complainant on November 15, 2019 providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. The Complainant filed an amended Complaint on November 19, 2019.

The Center verified that the Complaint together with the amended Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), 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”).

The Center sent an email communication to the parties on November 15, 2019 regarding the language of the proceeding, as the Complaint has been submitted in Spanish and the language of the registration agreement for the disputed domain name is English. The Complainant submitted a request for Spanish to be the language of the proceeding on November 18, 2019. The Respondents submitted a request for English to be the language of the proceeding on November 18, 2019. The Center requested the Complainant to submit a translated version of the Complaint on November 25, 2019. The Complainant submitted a translated version of the Complaint on December 5, 2019.

In accordance with the Rules, paragraphs 2 and 4, the Center formally notified the Respondents of the Complaint, and the proceedings commenced on December 9, 2019. In accordance with the Rules, paragraph 5, the due date for Response was December 29, 2019. The Respondent requested an extension of the deadline for Response, which was partially granted by the Center, establishing the due date for the Response to be January 6, 2020. The Response was filed with the Center on January 6, 2020.

The Center appointed Luca Barbero as the sole panelist in this matter on January 15, 2020. 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

CORIOLISS is a brand dedicated to the marketing and sale of hairdressing products such as irons, curling irons and hair dryers.

In 2003, the Respondents started their business selling CORIOLISS branded hair straightening irons and hair dryers in Europe under the CORIOLISS trademark.

On February 20, 2004, while the Respondents were principals of the entities owning the CORIOLISS trademarks, the disputed domain name <corioliss.com> was registered in the name of the Respondent Jerome Migliori.

In 2005, the Respondents began selling their products in the United States. Beginning in 2005, the Respondents, through various business entities, applied for and obtained trademark registrations for the CORIOLISS trademark in several countries throughout Europe, Asia, North America, and South America.

In 2011, the Respondents formed Jmastm, LLC, a Florida limited liability company (the third Respondent in this proceeding), which acquired title and all rights in and to the several trademark registrations for the CORIOLISS trademark.

On May 25, 2017, while the Respondent Jmastm, LLC was the owner of the CORIOLSS trademarks, the disputed domain name <coriolisseurope.com> was registered in the name of the Respondent Adi Schimko, UK.Corioliss.

On November 20, 2018, the Respondent Jmastm LLC transferred to the Complainant its trademark rights by means of a Trademark Assignment Deed.

The Complainant thus became the owner of several trademark registrations, which include, but are not limited to, the following:

– United States trademark registration No. 3649295 for CORIOLISS (figurative mark), filed on September 19, 2007 and registered on July 7, 2009, in International classes 9 and 11;

– United States trademark registration No. 3653082 for CORIOLISS (word mark), filed on September 19, 2007 and registered on July 14, 2009, in International classes 9 and 11;

– International trademark registration No. 974876 for CORIOLISS (word mark), registered on April 1, 2008, in classes 3 and 9, designating amongst others European Union;

– United Kingdom trademark Registration No. 2470103, for CORIOLISS (word mark), filed on October 8, 2007 and registered on April 25, 2008, in classes 8, 9 and 25;

– United Kingdom trademark Registration N. 2478674, for CORIOLISS (word mark), filed on February 1, 2008 and registered on August 1, 2008, in class 3.

For the transfer of such trademark rights, the Respondents received a sum of EUR 750,000.00.

On November 20, 2018 – the same date of the Trademark Assignment Deed – the Complainant and the Respondents entered into an International Sales Commission Agreement, through which the Respondent Jmastm, LLC became the exclusive seller of CORIOLISS products in Italy, France, and United Kingdom.

The disputed domain names <corioliss.com> and <coriolisseurope.com>, registered by the Respondents, respectively, on February 20, 2004 and May 25, 2017, are still being used to date by the Respondents to sell CORIOLISS branded products.

5. Parties’ Contentions
A. Complainant

The Complainant contends that the disputed domain names are confusingly similar to the trademark CORIOLISS in which the Complainant has rights since November 20, 2018, as they both reproduce the trademark in its entirety with the mere addition of the geographical indicator “Europe” in one of the two cases and of the generic Top-Level domain (“gTLD) “.com” in both cases.

Moreover, the Complainant states that the disputed domain names are still being exploited by the Respondents, which, in accordance with the third and fourth provisions of the Trademark Assignment Deed, should have changed the ownership to comply with the Agreement, but failed to do so and, to date, are still using both disputed domain names to promote the sale of CORIOLISS branded products.

The Complainant further highlights that such conduct only serves to create confusion as to the ownership of the CORIOLISS trademark, as both disputed domain names now belong exclusively to the Complainant.

With reference to rights or legitimate interests in respect of the disputed domain names, the Complainant states that the Respondents have breached the first and third clauses of the Trademark Assignment Deed, as they failed to comply and would thus have no rights or legitimate interests in relation to the CORIOLISS trademark and the rest of the elements and accessories that are part of it.

As a circumstance evidencing bad faith in the use of the disputed domain names, the Complainant highlights that, despite the Trademark Assignment Deed was signed months before and all trademarks were consequently assigned to the Complainant, the Respondents did not change the ownership of the disputed domain names in the corresponding WhoIs records, but has instead continued making use of the disputed domain names, preventing the Complainant from using them for the commercialization of its products, thus disrupting the Complainant’s commercial activity.

Moreover, the Complainant underlines that, in making use of the disputed domain names to market CORIOLISS branded products, the Respondents are not only disrupting the Complainant’s commercial activity, but are also favoring the existence of confusion with the brand, in terms of source, sponsorship, affiliation and promotion, allowing the Respondents to obtain illicit economic benefit at the expense of the Complainant.

In addition, the Complainant emphasizes that the Respondents have been requested on numerous occasions to proceed with the change of ownership of the disputed domain names in accordance with the provisions of the Trademark Assignment Deed, but have failed in all occasions to reply to this requirement and, in doing so, have proved to be acting in bad faith.

B. Respondents

The Respondents do not deny the confusing similarity between the disputed domain names and the Complainant’s trademark, but state that the Complainant is unable to meet its burden of establishing the other elements of its claim.

With reference to rights or legitimate interests in respect of the disputed domain names, the Respondents submit that the Complainant has failed to establish the second element for the following reasons:

– the Respondents began doing business with a bona fide offering of goods under the disputed domain names <corioliss.com> and <coriolisseurope.com> long before the present dispute commenced and there is no question that the Respondents initially had rights and legitimate interests with respect to the disputed domain names, as they adopted the CORIOLISS trademark and began selling products under such trademark in 2003;

– the Respondents began selling CORIOLISS branded products through the disputed domain name <corioliss.com> – when it was registered – in 2005 and under the disputed domain name <coriolisseurope.com> – when it was registered – in 2017; therefore, the Respondents used the disputed domain names in connection with a bona fide offering of goods, to sell such products, long before receiving notice of the present proceeding;

– contrary to the Complainant’s assertions, the Respondents did not sell to the Complainant, nor did the Complainant acquire, the disputed domain names when the Respondents assigned its trademark registrations for the trademark CORIOLISS to the Complainant in November 2018;

– the Complainant declares, without any evidence to show for it, that the Respondents were required to transfer the disputed domain names pursuant to the Trademark Assignment Deed;

– the Complainant relies on two provisions of the Trademark Assignment Deed, that in no way refer to the sale or transfer of the disputed domain names;

– even after the Trademark Assignment Deed was signed, appointing the Respondents as exclusive sellers of CORIOLISS branded products in Italy, France, and United Kingdom, the Respondents still continued to have the right to sell genuine CORIOLISS brand products in the United States and used the disputed domain names to do so;

– the Complainant verbally agreed to purchase the Respondent’s remaining inventory of CORIOLISS branded products in the United States, but ultimately decided not to purchase the inventory and did not execute a written agreement. Consequently, the Complainant knew and agreed that the Respondent would continue selling off the remaining inventory using the disputed domain names in the United States where the Complainant does not even do business;

– The Respondents are making a legitimate fair use of the disputed domain names, since they still have the right to sell CORIOLISS branded products pursuant to the International Sales Commission Agreement and to resell inventory in the United States, where the Complainant does not offer goods for sale.

As far as circumstances evidencing bad faith in the use of the disputed domain names is concerned, the Respondents assert as follows:

– the Complainant has failed to establish this requirement, since there is no evidence that the Respondents registered the disputed domain names for the purpose of selling, renting or otherwise transferring the disputed domain names to the Complainant or to one of its competitors;

– the Respondents registered the disputed domain names in 2005 and 2017, while they were operating the CORIOLISS business under that name, at which time, the Complainant had no rights at all on the CORIOLISS trademark until it acquired the trademark registrations in November 2018;

– the Respondents in no way attempted to sell the disputed domain names to the Complainant, which did not even own a federal trademark registration at the time the disputed domain names were registered;

– since the Complainant had no rights to the CORIOLISS trademark at the time of registration of the disputed domain names, there is likewise no evidence that the Respondent registered the disputed domain names in order to prevent the Complainant from reflecting the trademark in a corresponding domain name, and there is certainly no evidence that Respondents engaged in a pattern of such conduct;

– with regards to whether or not the Respondents registered the disputed domain names primarily for the purpose of disrupting the business of a competitor, the matter clearly has no application to the present case as the Respondents and Complainant are simply not competitors and certainly were not competitors when the disputed domain names were registered.

– With regards to the use of the domain names in bad faith to intentionally attempt to attract, for commercial gain, Internet users to the Respondents’ web site or other on-line location, by creating a likelihood of confusion with the Complainant’s trademark as to the source, sponsorship, affiliation, or endorsement of the Respondents’ website or location or of a product or service on the Respondents’ website or location, the Respondents assert that there is no evidence to support such statement, since the Respondents have the right to sell-off its remaining inventory of CORIOLISS branded products in the United States and also have a contractual right, pursuant to the International Sales Commission Agreement executed with the Complainant, to sell CORIOLISS branded products in Italy, France and United Kingdom. Thus, there is simply no evidence that the Respondents have used the disputed domain names to intentionally create a likelihood of confusion.

In view of the above, the Respondents conclude that the Complainant has failed to establish the three elements necessary to obtain the relief sought, i.e. the transfer of the disputed domain names.

6. Discussion and Findings

According to paragraph 15(a) of the Rules: “A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.” Paragraph 4(a) of the Policy directs that the Complainant must prove each of the following:

(i) that the disputed domain names registered by the Respondents are identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

(ii) that the Respondents have no rights or legitimate interests in respect of the disputed domain names; and

(iii) that the disputed domain names have been registered and are being used in bad faith.

A. Identical or Confusingly Similar

The Panel finds that the Complainant has established rights over the trademark CORIOLISS based on the trademark registrations cited under section 4 above and the Trademark Assignment Deed signed with the Respondents on November 20, 2018, copy of which is submitted as Annex 2 to the Complaint.

The Panel also notes that the trademark CORIOLISS is entirely reproduced in the disputed domain names, with the mere addition of the gTLD “.com”, and, for one of the disputed domain names, of the geographical indicator “Europe”, which is not sufficient to avoid confusing similarity (sections 1.8 and 1.11 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”)).

Therefore, the Panel finds that the Complainant has proven that the disputed domain name <corioliss.com> is identical to the trademark CORIOLISS and that the disputed domain name <coriolisseurope.com> is confusingly similar to the trademark CORIOLISS, according to paragraph 4(a)(i) of the Policy.

B. Rights or Legitimate Interests

In light of the Panel’s findings under the next section, it is not necessary to address the issue of whether the Respondent has rights or legitimate interests in respect of the disputed domain names.

C. Registered and Used in Bad Faith

Paragraph 4(a)(iii) of the Policy requires that the Complainant prove that the disputed domain names were registered and are being used by the Respondents in bad faith.

As stated in section 3.8 of WIPO Overview 3.0, where a respondent registers a domain name before the complainant’s trademark rights accrue, panels will not normally find bad faith on the part of the respondent.

In the case at hand, the Panel notes that, when the disputed domain names were registered by the Respondents, the Complainant was not yet the owner of the CORIOLISS trademark rights, since the trademarks were at that time owned and used by the Respondents in connection with the promotion and sale of CORIOLISS branded products.

In fact, the Complainant became the owner of the trademark CORIOLISS and of other trademarks originally belonging to the Respondents, only after signing with the Respondents the Trademark Assignment Deed on November 20, 2018.

Furthermore, the Panel notes that this contractual dispute between the parties may exceed the scope of the UDRP, and would be more appropriately addressed by a court of competent jurisdiction, notable the interpretation of the Trademark Assignment Deed.

In view of the above, the Panel finds that the Complainant has failed to demonstrate that the Respondent registered the disputed domain names in bad faith.

7. Decision

For the foregoing reasons, the Complaint is denied.

Luca Barbero
Sole Panelist
Date: February 3, 2020

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