In the recent HoldOn.com decision, sole panelist Christopher Pibus found the domain owner guilty of bad faith for simply placing the domain on a parking page. Pibus made the bad faith finding despite there being no evidence that any of the ads on the parked page were infringing. When I visited the page at HoldOn.com, the ads were related to cars (screenshot below). Swedish company Amicus Trade AB, the Complainant, has a trademark on ‘holdon’ for clips.
Pibus found bad faith because that the seventeen year-old holdon.com domain was interfering with the Complainant’s business-
The Panel is further prepared to accept the Complainant’s uncontested assertions that the use of the disputed domain name in association with a click-through site has interfered and/or is interfering with the Complainant’s business, and that the disputed domain name is leading Internet customers seeking the Complainant’s website to the Respondent’s unauthorized website for purposes of monetary gain. In the absence of any evidence to the contrary, the Panel finds that the disputed domain name was registered and used in bad faith by the Respondent.
I fail to see how using, in a non-infringing way, a generic domain that long predates the existence of the Complainant is interfering with the Complainant’s business. If merely using the holdon.com is interfering with Amicus Trade’s business, then the domain began interfering with the Complainant’s business the moment that Amicus Trade starting making use of the ‘holdon’ brand fifteen years ago. Yet as the domain predates the business, it makes no sense to accuse the domain of interfering with the business. Why is the current use bad faith when the previous uses of the holdon.com domain were not? Are owners of generic domains not allowed to place ads on their websites that don’t infringe on any other trademarks? Is it bad faith to try to make money from your website when you aren’t infringing on anyone else’s trademark rights?
The domain owner failed to file a response. Even so, in order to succeed in a UDRP the Complainant must demonstrate that the registration and use is in bad faith.
Pibus’ position that placing non-infringing ads on a non-distinctive domain is bad faith use targeting the trademark holder is an overreach. It expands the rights of trademark holders far beyond any legal foundation. This approach also has the practical effect of putting every parked non-distinctive domain at risk, if the domain is at all similar to an existing trademark.
The HoldOn.com decision, and other similar decisions such as the MyArt.com decision and the Ovation.com decision, pervert the intention of the UDRP. In these cases the UDRP is not, as it is supposed to be, a procedure for protecting trademark holders from blatant cybersquatters. Instead, in these cases the UDRP is a tool whose purpose is to steal from their owners valuable non-distinctive domains that are coveted by the trademark holders but to which the trademark holders have no legal right.
HBO is the proud new owner of the piedpiper.com domain name. PiedPiper.com is now the home of the faux corporate website for Pied Piper, the fictional start-up company in HBO’s new comedy, “Silicon Valley”. Last night’s episode has the team brainstorming ridiculous names as they try to come up with an alternative to the Pied Piper name. One thing that rings true – all the team members recognize the critical importance of finding the perfect name for their company, even if it means overdosing on hallucinogenic mushrooms for inspiration. Even if you don’t have HBO, you can check out the first episode for free on YouTube.
HBO acquired the 1996 registered piedpiper.com domain from the original owner last year with the help of Markmonitor. The original owner lived in Hamelin, Germany, the source of the nearly thousand year-old tale of the Pied Piper of Hamelin, and had a website with information about the region around Hamelin at PiedPiper.com.
In a beasion zeused this noaning NAF baualist Sandra Franklin betamined that the pouin “Guaiky.com” is voanusimly ziamuar to “Quirky.com”.
Sorry… You didn’t have any trouble reading that did you?
In a decision released this morning NAF panelist Sandra Franklin determined that the domain “Guaiky.com” is confusingly similar to “Quirky.com.”
As you can see, no one reading “guaiky” would think of “quirky”. The first letter is different. The third letter doesn’t exist in the mark. And the consonant “r” that is in the mark is missing from the domain. The transformation of “guaiky” to “quirky” is similar to turning “right” into “wrong”, which Franklin also accomplished with her decision.
The “confusingly similar” test has long been a playground for Panelists’ more creative impulses. “MADDHATTEntertainment” was found confusingly similar to “MADD”. “Uniprotein” was found confusingly similar to “Universal”. And most notoriously, “Bodacious-tatas” was found confusingly similar to “tata”.
Franklin relies on the 13-year old belken.com decision that found “Belken” confusingly similar to “Belkin” as support for her finding that “Guaiky.com” is confusingly similar to “Quirky.com”. If a case that found that swapping one vowel in the fifth position for another vowel justifies a finding of consuming similarity that involves three transformations to a seven-letter word then nearly any fanciful mark could be used to go after thousands of dictionary word domains. Similar reasoning would find Disney confusingly similar to “Kidney.com” or would allow Verizon to go after “Derision.com”. Since consumers are so easily confused by swapping three-letters, much less one letter, what a nightmare it is to live in a world where ABC, BBC, and NBC are all television channels.
Franklin is also the author of the “horrible” UDRP decision awarding the valuable, non-distinctive domain NiceCar.com owned by 13-years by a Korean to an American company with a trademark that post-dates the domain registration date by several years.
Franklin ordered the transfer of HealthySolutions.com despite a lack of evidence that when the domain owner registered the domain 13 years earlier that he was targeting the trademark holder. Franklin also ordered the transfer of the non-distinctive domain MedicalPark.com.
Franklin’s approach to the UDRP – finding “guaiky.com” confusingly similar to “quirky.com”, ignoring a domain owner’s legitimate interest in owning valuable non-distinctive domains such as eHelper.com, NiceCar.com, HealthySolutions.com or MedicalPark.com, finding that the reason a Korean individual registered and held for 13-years a domain, NiceCar.com, based on a commonly used generic phrase was in a bad faith effort to target a small American company’s unregistered usage of that phrase – makes a mockery of the UDRP policy. Her apparent goal is to find a way to transfer these domains regardless of the facts and she’ll twist the UDRP policy into unrecognizable shapes to achieve that goal.
Franklin has decided hundreds of cases as a sole panelist in the last few years, mostly for NAF but some as well at WIPO. A review of these cases show that if you appear before her with a complaint that isn’t formally deficient, with evidence that you had some trademark use, registered or unregistered, for your mark that predates the registration date of the domain, and the issue isn’t a pre-existing business or legal dispute, that you will win 100% of the time.
Put another way, in hundreds of cases over the last couple of years, when a Complainant can show some trademark use that predates the domain registration, Franklin has never found that the Respondent had a legitimate interest in its domain name. She has also never found, under this circumstance, that the domain owner’s registration or use was in good faith.
The integrity of the UDRP depends upon the integrity of the Panelists in honoring the policy as written. Franklin, and panelists who take a similar approach, are turning the UDRP into a tool for domain theft.
Updated Feb 9
[This post was originally published on January 15, 2010 on DirectNavigation.com. Thanks to Larry Fischer for allowing me to repost it here. Now that I am publishing my own blog, I am consolidating at DomainArts.com some posts that were first published elsewhere. -Nat]
Nat Cohen is a long time domainer who specializes in generic domains. This post, which Nat prepared, is one that is important to all domain owners.
About Nat – He has built up many of his Properties including OceanCity.com and Maryland.com. He lives with his wife and family in Washington DC. Nat is a longtime friend.
A Problem at the Core of the Internet
Those who care about the development of the Internet should pay attention to a problem festering at its core. Domain names, the building blocks of the Internet, are governed by such a flimsy, easily-abused set of rules that ownership rights in domain names are not secure. This problem affects both those within and outside the domain industry.
Domains are the only asset class where owners are required to subject their ownership rights to cancellation by an arbitration panel. The poorly paid, loosely accredited arbiters who decide these cases are guided by a vague set of rules, the Uniform Dispute Resolution Policy or “UDRP”. There is no procedure for reviewing the decisions of the arbiters to ensure that the decisions comply with the guidelines. Arbiters enjoy free rein in interpreting the rules as they see fit and can act with impunity.
Most arbiters are sincere, fair-minded, hard-working, distinguished legal professionals who make a genuine effort to carefully and faithfully apply the UDRP rules. Yet their good work is undermined by weak procedural safeguards that allow a minority of arbiters to mishandle the power entrusted to them to order the cancellation of a registrant’s rights to a domain name and the transfer of that domain name to a new owner for the flimsiest of reasons.
Individuals and small businesses are losing their long-held domains in arbitration to covetous newcomers who are not entitled to them. Last year a Korean dentist lost opendental.com to a company that did not exist at the time he initially registered the domain. A technology enthusiast recently lost parvi.org to the City of Paris in spite of the arbiter finding that there was no evidence that he registered the domain in bad faith and despite of his clear legitimate use of the domain to promote new software he was developing.
‘Fox Guarding the Henhouse’
Arbiters are selected by providers of arbitration services, primarily WIPO and NAF, and the arbitration venue is in turn selected by the Complainant. WIPO and NAF are competing in the marketplace to offer services to their customers. The customers they are catering to are people or businesses who want domains transferred to them.
The previous owner of Liberty.com confirmed that he sold the domain last year for a “seven figures” sum. The sale is covered by an NDA so he couldn’t disclose the actual price.
The new owner is Liberty Global, the $35 billion market cap international cable company. Liberty.com changed hands in April 2013.
In 2011, Liberty.com was listed for sale by the former owner for $10,000,000. At that time, the sales page stated that the owner had already turned down two offers for Liberty.com of a million dollars each. While the sales price can’t be independently verified, it seems reasonable for such a premium domain. Liberty Global is a publicly traded company, so perhaps the sales price will be revealed in its company filings.
Liberty.com was the subject of a UDRP dispute in 2000. The Complainant was a London retail store. Fortunately the domain owner prevailed.
“Liberty” related domains seem to attract UDRP disputes from companies who take the liberty of filing baseless complaints attempting to liberate the domains from their current owners. My own Libertad.com domain – “Libertad” means “Liberty” in Spanish – was hit with a UDRP Complaint in 2011. Thanks to the response prepared by Ari Goldberger and Jason Schaeffer of Esqwire.com, the complaint was unsuccessful.
Surge in misuse of UDRP for attempted domain theft leads to record year for Reverse Domain Name Hijacking decisions
UDRP decisions finding Reverse Domain Name Hijacking hit a new record this year indicating a surge in attempts by companies to abuse the UDRP process to steal domains that they are not entitled to. So far this year 24 complainants have been found guilty of Reverse Domain Name Hijacking (RDNH) compared to only 14 last year. The prior record of 23 (or only 19 if .biz STOP disputes are excluded) was set over a decade ago in 2002 in the early days of the UDRP.
What has led to the surge of RDNH decisions this year?
A radical new approach to the UDRP by a few panelists is encouraging companies to file abusive complaints. These are complaints that fail to meet the UDRP requirement that complainants demonstrate that the disputed domain was registered in bad faith. Filing a complaint without any evidence of bad faith registration is an abuse of the UDRP process and grounds for a finding of Reverse Domain Name Hijacking. When Panelists who reject the radical reinterpretation of the UDRP are assigned to decide disputes where complainants have failed to provide evidence of bad faith registration, they are frequently finding the complainants guilty of Reverse Domain Name Hijacking.
The radical new approach some panelists are now taking is to replace the “REGISTRATION in bad faith” standard with a “RENEWED in bad faith” standard. This approach is illegitimate for the many reasons discussed in the ”Push to Adopt ‘Renewed in Bad Faith’ standard puts Investment Domains at Risk” post. The primary flaw with the “renewed in bad faith” approach is that it is based on language from a part of the policy that has no bearing on how domain disputes are to be decided. The relevant section of the policy where the dispute procedures are specified clearly states that “registration in bad faith” is one of the criteria that must be demonstrated for a complaint to be successful.
Those panelists who are championing the “renewed in bad faith” standard are ordering the transfer of domain names that everyone agrees were registered in good faith, including domains that were registered years before the complainant even existed. Encouraged by the prospect of being able to use this new weaker standard to seize domains that they have long coveted, companies are now filing complaints targeting domains that were registered in good faith and where there is no evidence of bad faith registration.
The “renewed in bad faith” standard eliminates the heart of the UDRP – the requirement that the Complainant must demonstrate that the domain owner has registered and used the domain in bad faith. What the “renewed in bad faith” standard boils down to is that a Complainant no longer needs to meet three rigorous tests to seize a domain through a UDRP. Instead, for some panelists, under the “renewed in bad faith” standard, the Complainant merely needs to demonstrate some current bad faith use.
Last month panelist Eduardo Machado ordered the transfer of Ovation.com in one of the most poorly reasoned UDRP decisions ever issued. Stephen Gilfus, the owner of the ovation.com domain, has filed in Federal Court in Florida to prevent the transfer by seeking a declaration under the Anti-Cybersquatting Protection Act that his use of the domain is legal. He is also seeking a declaration that Ovation Hair, the Complainant in the UDRP, is guilty of Reverse Domain Name Hijacking under the ACPA.
Alex Lerman, a long-time investor in generic domain names, was until recently the registered owner of XC.com. Alex confirmed on a phone call that he no longer owned the domain.
Alex does not wish to publicly disclose the sales price. He is known for not offering his domains for sale, so it likely took a substantial offer to persuade him to part with it.
The new owner appears to be giant Chinese travel company Ctrip. Ctrip’s Pinyin name is Xié chéng, thus its interest in xc.com.
Ctrip is publicly traded on NASDAQ with a market capitalization of nearly 6 billion dollars. Its market value has more than doubled in the past year.
This sale again demonstrates the tremendous impact that the Chinese have had on the domain market. Domains that were out of favor, such as number domains and acronyms that include ‘x’, ‘q’, ‘j’, and ‘z’, are now in high demand thanks to interest from Chinese buyers.
Chinese buyers with an interest in two-letter dot-com domains have been good for Alex as last year he sold jd.com to another Chinese company for an amount that most speculation has in the millions of dollars.
Hat tip to the Chinese domainer who passed on the news
The sloppy cut-and-paste decision in the Calibers.com UDRP demonstrates once again the National Arbitration Forum’s (NAF) shoddy practices and some panelists’ lack of respect for the Reverse Domain Name Hijacking (RDNH) finding. The decision also highlights the poor implementation and oversight of the UDRP policy, the policy that controls how a domain owner loses the rights to his or her domain name.
In the Calibers.com dispute, the Complainant tried to use the UDRP to steal the calibers.com domain name, despite the fact that the domain was registered a decade prior to the Complainant’s trademark registration date and despite the domain owner’s 13 years of use of the domain in its descriptive sense. The panelist rightly denied the complaint.
But why didn’t the panelist find Reverse Domain Name Hijacking? This case seems like an obvious example of RDNH. RDNH has been found in dozens of similar situations where the domain predated the trademark rights, where there was clear legitimate use and where there was no evidence of bad faith. Why wasn’t RDNH found in this case?
Many domains held for investment are at risk of loss due to a radical new approach to the UDRP championed by some UDRP panelists at WIPO’s Advanced Workshop on UDRP Practice and Precedent held in Geneva last week.
Respected WIPO Panelist and the Workshop co-leader, David Bernstein, is a leading advocate for this new approach that changes the criteria that the Complainant must prove to win a transfer of a disputed domain. The standard since the UDRP was introduced in 1999 has been that “Registration in Bad Faith” must be proven before a domain can be transferred. Bernstein, and other panelists who share his views, are using a “Renewed in Bad Faith” standard instead.
The “Renewed in Bad Faith” standard is an open invitation to covetous companies to employ the UDRP to try to steal your domains. As was made clear at the WIPO workshop, under the “renewed in bad faith” standard every renewal provides a panel the opportunity to look at the then current use for evidence of bad faith. Putting a domain to virtually any use other than running an established business on that domain can be viewed as bad faith. The following were all held out as examples of bad faith use at the workshop, and have been cited as bad faith use in many UDRP decisions-