Superior Play Systems, Inc. v. Marchex Sales / Brendhan Hight
Claim Number: FA1103001379684
Complainant is Superior Play Systems, Inc. (“Complainant”), represented by Adam G. Garson of Lipton Weinberger & Husick, Pennsylvania, USA. Respondent is Marchex Sales, Inc. / Brendhan Hight
(“Respondent”), represented by John Berryhill, Pennsylvania, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <superiorplaysystems.com>, registered with Enom, Inc.
The undersigned certifies that he or she has acted independently and impartially and to the best of his or her knowledge has no known conflict in serving as Panelist in this proceeding.
Honorable Karl V. Fink (Ret.), Honorable Daniel B. Banks Jr., and Paul M. DeCicco, as Panelists.
Complainant submitted a Complaint to the National Arbitration Forum electronically on March 23, 2011; the National Arbitration Forum received payment on March 23, 2011.
On March 23, 2011, Enom, Inc. confirmed by e-mail to the National Arbitration Forum that the <superiorplaysystems.com> domain name is registered with Enom, Inc. and that Respondent is the current registrant of the name. Enom, Inc. has verified that Respondent is bound by the Enom, Inc. registration agreement and has thereby agreed to resolve domain disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”).
On March 29, 2011, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of April 18, 2011 by which Respondent could file a Response to the Complaint, via e-mail to all entities and persons listed on Respondent’s registration as technical, administrative, and billing contacts, and to postmaster@superiorplaysystems.com. Also on March 29, 2011, the Written Notice of the Complaint, notifying Respondent of the email addresses served and the deadline for a Response, was transmitted to Respondent via post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts.
A timely Response was received and determined to be complete on April 19, 2011.
The Complainant’s Additional Submission was received on April 25, 2011. The Respondent’s Additional Submission was received on May 2, 2011. Each submission was timely. All submissions were considered by the Panel.
On May 5, 2011, pursuant to Respondent’s request to have the dispute decided by a three-member Panel, the National Arbitration Forum appointed Honorable Karl V. Fink (Ret.), Honorable Daniel B. Banks Jr., and Paul M. DeCicco (Chair) as Panelists.
Complainant requests that the domain name be transferred from Respondent to Complainant.
A. Complainant
Complainant contends as follows:
Complainant manufactures, designs, and distributes children’s play and athletic equipment under the SUPERIOR PLAY SYSTEMS brand and has been doing so since 1993. Over the past fifteen years, Superior Play Systems has registered its SUPERIOR PLAY SYSTEMS mark with the USPTO several times. Although, the initial registrations were abandoned or cancelled for technical reasons, Superior Play Systems has used its mark continuously without interruption since 1993. Most recently, the USPTO issued a registration for the SUPERIOR PLAY SYSTEMS word mark (Registration No. 3922404) and a second mark, consisting of SUPERIOR PLAY SYSTEMS combined with a design (Ser. No. 85171557) is in review.
Respondent, Marchex Sales, Inc. (“Marchex Sales” or “Respondent”), is the registrant of the disputed domain name, and Brendhan Hight is the registrant’s authorized representative. Marchex Sales is a subsidiary of Marchex, Inc. (“Marchex”). Marchex was incorporated in the state of Delaware on January 17, 2003 and is a “call advertising and small business marketing company,” which derives its principal revenue from small and medium-sized business marketing products, which consist primarily of performance-based advertising services, including pay-for-call services, pay-per-click services, cost-per-action services and feed management and related services.
The at-issue domain name was registered on June 8, 2003. Over the past seven years, <superiorplaysystems.com> has been hosted on 14 unique name servers, the most recent being that of Marchex, Inc. The <superiorplaysystems.com> web site owned by Respondent consists of a single page site exhibiting 10 “sponsored listings” or links to Superior Play Systems competitors and links to “related searches.” At the footer of the page, Respondent states, “This domain may be for sale. Click here for more information.” Clicking on the link, invokes a page from MDNH, Inc.’s web site containing a form in which to make an offer to purchase the domain name. MDNH, Inc. appears to be the former name of Marchex Sales, Inc. Superior Play Systems has made two offers to purchase the <superiorplaysystems.com> domain. It has received no response from either offer.
It is Superior Play Systems’ good faith belief that Respondent’s primary purpose in obtaining the disputed domain name and promoting a web site of the same name is to use the good will developed by Superior Play Systems’ name and trademark over 18 years of continuous use, for its own benefit. On June 8, 2003, at the time Respondent registered <superplaysystems.com>, it was on notice that Superior Play Systems owned a valid in-force registration of the Mark (Registration No. 2106291).
Superior Play Systems has established rights in the SUPERIOR PLAY SYSTEMS mark through prolonged and continuous use of the Mark and through its registrations with the United States Patent and Trademark Office.
Complainant introduced the SUPERIOR PLAY SYSTEMS brand. During the last 18 years, Complainant has expanded its operations to several states, experienced considerable growth, and has established SUPERIOR PLAY SYSTEMS as the preeminent brand for playground equipment and servicing in the Northeastern and Southern United States.
In 1995, eight years before Respondent purchased the <superiorplaysystems.com> domain, Complainant, representing itself, filed registration applications with the PTO for two marks: SUPERIOR PLAY SYSTEMS and design (serial no. 75029420) and SUPERIOR PLAY SYSTEMS (serial no. 75029421). The SUPERIOR PLAY SYSTEMS and design mark achieved registered status in October 1997 (Registration No. 2106291), six years before Respondent purchased the <superiorplaysystems.com> domain. Although the registration of the mark was cancelled in July 2004 – after Respondent purchased the <superiorplaysystems.com> domain – Superior Play Systems has never abandoned or discontinued use of its trademarks during the entire time period and until the present. That fact was affirmed by the PTO in February 2011, which issued Complainant, a registration for SUPERIOR PLAY SYSTEMS based upon the mark’s acquiring of distinctiveness over the last 18 years.
To establish the Mark’s acquired distinctiveness, Complainant presented the following facts to the PTO. Superior Play Systems has maintained a widespread multi-faceted advertising campaign utilizing direct mail, local and regional newspapers, television, and radio. Since 2005, it has spent on the average approximately $554,400 per year on advertising and marketing. To demonstrate that the SUPERIOR PLAY SYSTEMS mark has acquired distinctiveness among the consuming public, Complainant/applicant presented the PTO with exemplar copies of advertising purchased by it between 1995 and 2010. That information together with Applicant’s marketing and sales efforts over the past seven years was a sufficient basis for the PTO to conclude that SUPERIOR PLAY SYSTEMS had acquired distinctiveness and qualified it for registration on the Principal Register of trademarks. The Complainant’s rights to the mark are thus unassailable.
Finally, there can be no doubt that the domain name <superiorplaysystems.com> is identical or confusingly similar to the mark registered and used by Superior Play Systems. SUPERIOR PLAY SYSTEMS is identical to Respondent’s domain name, <superiorplaysystems.com>. The “.com” Top Level Domain suffix is irrelevant to a determination of similarity.
Respondent has no legitimate interest in the <superiorplaysystems.com> domain name. Respondent’s WHOIS information identifies Respondent as “Marchex Sales, Inc. Brendhan Hight,” a name with no apparent relationship to the disputed domain name, the Complainant, or Complainant’s line of business. Complainant has never authorized or licensed Respondent to register or use a domain name incorporating its SUPERIOR PLAY SYSTEMS mark.
Respondent’s <superiorplaysystems.com> domain name resolves to a minimally developed web site containing search links to various third-party web sites, including Superior Play System’s competitors. The web site diverts customers and potential customers of Superior Play Systems and generally creates confusion over whether Complainant is associated with Respondent’s web site.
Respondent has parked and is using the disputed domain name to operate a website featuring advertisements and links to third-party websites that directly compete with Complainant’s business. Respondent is taking advantage of the likelihood of confusion between its domain name and Complainant’s SUPERIOR PLAY SYSTEMS mark, and is benefiting from the goodwill associated with the mark by attracting Internet users to a website featuring such advertisements. Internet users directed to Respondent’s website while trying to find Complainant’s business instead may follow the available third-party links and do business with a competitor of Complainant. Such use disrupts
Complainant’s business and is evidence of bad faith registration and use pursuant to Policy ¶4(b)(iii).
Respondents offering to sell domain names and then failing to respond to offers once made also demonstrate bad faith. Respondent’s web site at <www.superiorplaysystems.com> states, “This domain may be for sale. Click here for more information.” Complainant made two attempts to purchase the <superiorplaysystems.com> domain to which Respondent did not respond.
Registration of the <superiorplaysystems.com> domain name at the same time that Complainant owned a registered U.S. trademark constitutes bad faith. Superior Play Systems owned the SUPERIOR PLAY SYSTEMS and design mark from 1997 through 2004. Respondent could have avoided this dispute had it performed a simple search of the PTO public database for “superior play systems” in 2003, when it purchased the domain name.
B. Respondent
Respondent contends as follows:
This Proceeding involves a laudatory term pre-pended to a generic phrase which, in combination, the Complainant has expressly disclaimed, and had expressly abandoned claims therein, prior to the Respondent’s acquisition of the domain name in dispute. While the Complainant has, a few weeks prior to commencement of this proceeding, obtained US federal trademark registration as of February 11, 2011, the Complainant deliberately omits relevant facts concerning its trademark claims in relation to the relevant time at which the Respondent acquired the domain name. The Respondent is entitled to rely upon the public notice function provided by the US Principal Register of trademarks, and has continuously used the domain name in connection with its descriptive purpose for more than six years preceding this dispute.
Complainant lacks chronologically relevant trade or servicemark rights in relation to the term “SUPERIOR PLAY SYSTEMS”, and the Complainant has omitted other documentary evidence in which the Complainant expressly disavowed such a claim. The testamentary evidence of the Complainant, presented for the purpose of this proceeding, is an ineffective attempt to recapture rights which the Complainant admittedly did not possess at the relevant time.
Regarding US TM Reg. No. 2,106,291, Complainant refers in passing to this registration, issued in 1997 on an application filed in 1995 for a logo. Complainant disclaims: “NO CLAIM IS MADE TO THE EXCLUSIVE RIGHT TO USE ‘SUPERIOR PLAY SYSTEMS’ APART FROM THE MARK AS SHOWN”
As correctly noted by Complainant, this registration was cancelled in January 2004. Respondent acquired the disputed domain name in January 2005. As of the Respondent’s acquisition of the domain name, this trademark registration provided public notice that the Complainant had disclaimed exclusive rights the phrase “SUPERIOR PLAY SYSTEMS” through 2004. The Complainant’s attempt, at this late date, to provide testamentary evidence of a common law claim is inconsistent with the apparent fact that the Complainant had been unable to do so at the relevant time that the Complainant had pursued and maintained this registration, and the disclaimer therein. The Complainant’s narrative and supporting declarations presented here at this time cannot change the facts as they existed through 2004. While the United States Patent and Trademark Office is competent to evaluate, and reject, claims of acquired distinctiveness in descriptive terms, as was apparently the case here, the effect of express disclaimers is one of the few bright line rules which has found universal application under the UDRP.
Furthermore, with respect to the compound graphical presentation of the mark formerly used by the Complainant, in order to arrive at the disputed domain name, one must ignore the graphical presentation along with additional stylized textual matter. Without the stylized component of the Trademark, Complainant lacks rights in the words standing alone, which is precisely the situation we have here. Further, in many instances, it has been said that when one “peels away the graphic element, all that remains is a descriptive or generic word”.
Peeling away the graphic elements and stylization of the Complainant’s mark, such as it had been until 2004, one is left with the laudatory term “SUPERIOR” and the term “PLAY SYSTEMS” which the Complainant to this day disclaims in its more recently acquired registration in 2001, under a Lanham Act 2(f) claim. Accordingly, the Respondent submits that the proffered US TM Reg. No. 2,106,291 demonstrates a decided lack of trade or service mark rights at the relevant time at which the Respondent acquired the domain name.
Regarding US TM Appl. No. 75/029,421, Complaint is silent on the subject of the Complainant’s second federal trademark registration application. Indeed, in a Complaint which the Complainant has certified to be “complete”, it appears that the Complainant, while capable of producing a wealth of self-serving testamentary evidence, managed to omit mention altogether of an objective public record that is chronologically relevant to the time the Respondent acquired the domain name. As noted therein, this application was filed for the text mark “SUPERIOR PLAY SYSTEMS” apart from the stylized presentation which the Complainant abandoned in 2004. While the full record of this application does not appear to be available from the USPTO, the Panel will note, that in relation to the text which the Complainant here asserts to have been its mark for the purpose of obtaining the domain name at issue, the final transaction record notes: Current Status: Abandoned after publication because applicant filed an express abandonment. …Date of Status: 2004-01-13.
Only the Complainant is in unique possession of critical information regarding the file history, which the Complainant has chosen to deliberately omit from this Proceeding, of how or why it came to pass that the Complainant would have expressly abandoned this claim as of January 2004.
Complainant proffers US TM Reg. No. 3,922,404. This registration came into enforceable effect as of its issue date of February 11, 2011, years after acquisition of the domain name by the Respondent, and perforce years after the Complainant had expressly disclaimed and expressly abandoned, in separate public records, a claim in the words “SUPERIOR PLAY SYSTEMS” per se apart from any graphical or stylized presentation thereof. This registration was further issued under Section 2(f) of the Lanham Act, as noted in the record thereof. Here, we know that as of January 2004, the phrase at issue was not distinctive, having been disclaimed and, if that were not enough, expressly abandoned by the Complainant as of January 2004. Having expressly abandoned this claim as of January 2004, the Complainant is not in a position in this proceeding to recapture that which it had intentionally repudiated at that time.
Upon initial examination of the underlying application, it was refused as descriptive. In response, the Complainant made its 2(f) claim of distinctiveness on September 23, 2010, a mere few months before this Proceeding was brought.
Consistent with the original disclaimer of “SUPERIOR PLAY SYSTEMS” in its earlier registration and the unexplained express abandonment of a claim to that text mark in January2004, the Complainant’s 2(f) submission to the USPTO was careful not to rely on periods of time reaching back in time beyond that January 2004 express abandonment. Again, while only the Complainant knows the peculiar reasons why its claim had been subject to an impediment not apparent from the public record, the record of the proffered US TM Reg. No. 3,922,404 does not establish distinctiveness in “SUPERIOR PLAY SYSTEMS” as of the January 2005 acquisition of the domain name by the Respondent, and the Respondent’s continuing use of the domain name since that time.
Complainant’s 2(f) submissions rely upon a span of time culminating upon submission of the 2(f) declaration as of September 2010. This type of situation relative to 2(f) registrations has arisen in prior disputes under the Policy. Complainant has demonstrated that, after a history of disclaiming and expressly abandoning claims to the phrase here at issue during the relevant time period involved in this dispute, the Complainant’s recent acquisition of a US trademark registration under 2(f) of the Lanham Act – in February 2011 – is not effective in relation to acts undertaken by the Respondent in late 2004 leading to acquisition of the domain name in January 2005. At that time, the Complainant had lacked relevant rights as shown in its prior US registration, its expressly abandoned application, and the materials submitted in support of the 2(f) claim required to obtain the US registration of extremely recent vintage. The Complainant’s testamentary evidence in this proceeding appears to be inconsistent with the record established before the USPTO, when the Complainant was motivated by factors independent of prevailing in a domain name dispute.
The Policy expressly states that bona fide use of the domain name prior to notification of a dispute constitutes a legitimate interest. The term here at issue is directly descriptive, as noted in the requirement that the Complainant demonstrate acquired distinctiveness as of September 2010 in its most recent proceeding before the USPTO. It consists of a laudatory term “SUPERIOR” preceding the generic term “PLAY SYSTEMS”, which remains disclaimed from the Complainant’s February 2011 trademark registration. The Respondent, Marchex Sales Inc. is the successor, through a corporate name change and reorganization of MDNH Inc., the domain holding company which remains a wholly owned subsidiary of the publically-traded Marchex Inc. (NASDAQ: MCHX). Brendan Hight is a technical administrator and employee of Marchex Inc.
The history of Marchex Inc.’s 2005 asset purchase of Ultimate Search Inc. is documented in numerous proceedings under the Policy. The following are the relevant events: 1. The disputed domain was name first registered in 2000. 2. MDNH Inc. established in late 2004. 3. Disputed domain name transferred to MDNH Inc. by Ultimate Search Inc. in February 2005 (pursuant to a deal done in late 2004). 4. The Complainant commenced business and established its Simply Business website some time in 2005. 5. The Complainant filed for its first relevant trademark registration on November 2005. 6. Recently, MDNH Inc. changed its name to Marchex Sales, Inc. The Respondent’s business in relation to its portfolio of domain names consisting of descriptive phrases and generic terms is equally as well known, and is documented in several UDRP cases.
What Respondent has been doing since prior to notification of a dispute, and indeed senior to the Complainant’s very recent claim of acquired distinctiveness, has been, as described in the Complaint to use a descriptive term since acquisition of the domain name in 2005 in association with advertising material relating to play systems. The Complainant’s recent US trademark registration under Section 2(f) of the Lanham Act does not change the circumstances which have existed in connection with the Respondent’s acquisition of the domain name in early 2005 and the Respondent’s continuous use of the domain name, and a registration issued in February 2011 cannot retroactively render the Respondent’s continued bona fide use of this descriptive term as an index for relevant advertising material for the past six years to be illegitimate (nor indeed the Respondent’s predecessor in interest since 2003).
Again, there are few species of chronologically defective claims which Respondent has not encountered. The situation circa early 2005 was quite clear, and the Complainant had freshly expressly abandoned and had disclaimed rights in the term “SUPERIOR PLAY SYSTEMS”. Only during the Complainant’s recent return to the USPTO since that time, did the Complainant claim acquired distinctiveness based on advertising and other activities “Since 2005” or in and unsworn argument stating “over the past seven years” culminating in its claim to have acquired distinctiveness as of its submission under 2(f) in September 2010. Accordingly the Respondent has a legitimate reliance interest in continued use of a descriptive term senior to Complainant’s recent claim of acquired distinctiveness. The issuance of Complainant’s US registration as of February 2011 is not effective to recapture rights it had disclaimed and repudiated as of 2004, and the Complainant cannot claim to have within the span of a year between January 2004 and January 2005 to have acquired such distinctiveness.
Complainant believes the Respondent to have registered the domain name in 2003. As noted above, the domain name was originally acquired by Ultimate Search in 2003, and the Respondent concluded a $164 million asset purchase of the Ultimate Search Inc. holdings in late 2004 and early 2005. The difference is of no consequence, but the Respondent seeks a consistent record with the well-documented chronology noted in prior decisions. In particular, the bad faith element is directed to an inquiry into why the Respondent registered the domain name. Did the Respondent register the domain name with intent to target or usurp the goodwill of the Complainant, or was the Respondent motivated by an independent intent, unrelated to the Complainant? First, there is the basic issue of chronology. While US trademark registrations serve a function of constructive notice, one must consider the relevant circumstances as of the early 2005 acquisition date of the domain name by the Respondent. Had the Respondent, in early 2005, conducted a search of USPTO records, the Respondent would surely have obtained actual notice of two important facts – (a) the Complainant had recently abandoned its registration in which the operative phrase was disclaimed, and (b) the Complainant had expressly repudiated a claim to the phrase itself, under circumstances known only to the Complainant. Remarkably, the Complainant claims: “Respondent could have avoided this dispute had it performed a simple search of the PTO public database for ‘superior play systems’ in 2003, when it purchased the domain name.” The result, however, would have been that the Respondent would have found the Complainant’s express disclaimer and express abandonment, leading to the conclusion that the Complainant was doing all in its power in the records of the USPTO to convince the world of its lack of relevant trade or service mark rights.
While “constructive notice” is a thin reed in the determination of specific bad faith intent, here the Complainant apparently believes the Respondent is chargeable with constructive notice of the Complainant’s express and apparent lack of rights, as of the time the domain name was acquired. In specific relation to acquisition of distinctiveness under Section 2(f) of the Lanham Act, it has been repeatedly held that registration of a descriptive term such as a domain name prior to demonstration of such acquired distinctiveness cannot be understood to have been undertaken in bad faith:
C. Additional Submissions
Complainant contends in its Additional Submission as follows:
Respondent arguments that since Complainant expressly disclaimed “the exclusive right to use ‘SUPERIOR PLAY SYSTEMS’ apart from the mark as shown” Complainant’s disclaimer barred its acquisition of common law trademark rights to the Mark at the time the domain name was registered and as such there can be no finding against Respondent. Respondent goes on to contend that, because the USPTO ultimately registered SUPERIOR PLAY SYSTEMS based upon secondary meaning, Respondent admits, as it must, that the Mark later acquired distinctiveness but only, according to Respondent, in 2005 or later. Respondent was therefore purportedly free to register the <superiorplaysystems.com> domain in 2005 because it contained generic, non-distinctive elements unaffected by Complainant’s continuous use of its trademark since1993, the 1995 trademark registration, or the USPTO’s allowing a registration in 2011. However, Respondent misstates the law, ignores the considerable evidence of the Complainant’s use of the Mark accompanying its Complaint, and misrepresents the evidence submitted to the USPTO in support of registration of the SUPERIOR PLAY SYSTEMS mark in 2011.
Respondent’s mischaracterization of the controlling legal principles, United States trademark law is abundantly clear that disclaimer of an unregistrable component of a trademark does not curtail the common law trademark rights arising out of the disclaimed matter pursuant to Section 6 of the Lanham Act.
The only legal effect of a disclaimer is that no claim can be implied from the fact of registration as to the exclusive right to use the disclaimed words.
Complainant has provided abundant evidence of common law usage beginning
in 1993 continuing until the present.
A complainant may prevail if it demonstrates common law trademark usage separate from its trademark registration. The disclaimed component of a trademark registration does not nullify a trademark registrant’s ability to acquire common law trademark rights.
So long as a complainant can demonstrate trademark usage and acquired distinctiveness, it may claim common law trademark rights irrespective of the presence of a disclaimer in its federal trademark registration.
In the instant matter, Complainant has provided substantial evidence of continuous use and acquired distinctiveness of its SUPERIOR PLAY SYSTEMS mark from 1993 – 12 years before Respondent acquired the rights to the <superiorplaysystems.com> domain – to the present. Respondent has not proffered its own evidence to counter the claims made by Complainant in its evidence in support of common law rights.
Respondent’s contention that Complainant by expressly abandoning a trademark application, it expressly abandoned its trademark rights and has intentionally ignored, indeed, suppressed the surrounding facts and circumstances, is unfounded. Whatever the facts and circumstances were, the abandonment – express or otherwise – of the 75029421 trademark application was an abandonment of the application, not the Complainant’s trademark rights. It is fundamental that trademark rights under U.S. trademark law can exist independent of a trademark registration.
To determine whether Complainant has trademark rights in the SUPERIOR PLAY SYSTEMS mark, the panel must look to the evidence of use and acquired distinctiveness, not to unsupported inferences made from an abandoned trademark application.
Respondent concedes that Trademark registration no. 3,922,404 (SUPERIOR PLAY SYSTEMS) was issued on the basis that the mark, although generic, had acquired distinctiveness through many years of use substantiated by declarations and documents similar to those submitted by Complainant here. Aware of the problem that this registration poses to its ownership of the disputed domain name, Respondent attempts to narrow the temporal scope of the registration by pointing to the chronological evidence presented to the USPTO that post-dates its acquisition of the disputed domain name, while ignoring both the considerable documentary evidence submitted to the USPTO dating from 1995, and the declaration of Complainant that the company began using the mark in 1993. For the most part, the evidence – consisting of images of advertising and advertising invoices dating from 1995 until the present – is the same documentary evidence submitted here, which demonstrates that Complainant was continuously using SUPERIOR PLAY SYSTEMS as a trademark twelve years before the Respondent purchased the <superiorplaysystems.com> domain name.
Although not necessary to conclude that Complainant had rights at the time the domain name was registered Complainant has nevertheless updated its marketing expenditures data to include the period from 1993 until the present.
Complainant has no reason to dispute either the history of Respondent’s domain name acquisition or the fact that it has been a party to several UDRP cases. This history, however, has no bearing on whether it should retain its rights in the disputed domain name. Complainant’s continuous use of its trademark documented since 1993 should serve as ample proof of its common law trademark rights and acquired distinctiveness, which predate the Respondent’s purchase of the domain name by at least 12 years. The trademark applications filed in 1995 and 2011 do not temporally limit Complainant’s rights but, rather, serve as evidence that Complainant has attempted to add statutory trademark rights to those at common law, which it already possessed.
Had Complainant performed a search, it would have had actual knowledge that Complainant had a U.S. trademark registration and that it still may retain common law trademark rights, notwithstanding abandonment of the federal registration. Having ignored this information, Respondent by parking <superiorplaysystems.com> on the Internet and posting advertisements or links to Complainant’s competitors has demonstrated bad faith registration of the domain name.
Respondent contends in its Additional Submission as follows:
Whether the Complainant could have hypothetically established rights in 2005 is irrelevant to what the public record demonstrated at that time, and more to the point is irrelevant to the bad faith element of the Policy, which is an element of intent. Notably, when confronted in 2010 with a registration application for “SUPERIOR PLAY SYSTEMS” in 2010, a competent Examining Attorney of the USPTO did not believe such a phrase to be more than merely descriptive.
None of the materials submitted in supporting common law rights, consisting largely of testimonial evidence of the Complainant’s principals could have been known to the Respondent upon acquisition of the domain name in 2005. If these materials, which demonstrate the curiously spotty record keeping of the Complainant in the “early years” as noted in the Complainant’s 2(f) submission to the USPTO, are deemed to have established a common law right as of 2005, then the Complainant would have demonstrated the first of three independent prongs of the Policy. It is neither a misstatement of law nor of fact to observe that the Complainant has provided no basis why the Respondent should have concluded, in 2005, in any manner differently from the initial observation of the USPTO in 2010 that the phrase around which this dispute revolves is facially descriptive. Certainly, the Respondent, in 2005 was not in possession and could not have been in possession of the testimonial and other evidence submitted either in this Proceeding in 2011 or submitted to the USPTO in 2010.
While the Complainant expends considerable effort to argue that it may have had common law rights as of some point in time, jurisdiction and geographical scope the Complainant declines to identify with any specificity whatsoever, such determinations under “application of principles of law” must still be made in the course of arriving at conclusions under the respective elements of the Policy. In regard to the three elements of the Policy, the Complainant’s supplement appears to argue that if the first prong is established, then the other two follow when in fact they do not.
What “application of principles of law” provides, relative to bad faith, is not a correct belief of lawfulness, but one which was believed and for which there were reasonable grounds to believe that use of the domain name was lawful. Respondent believes that the domain name was among a large number of similarly descriptive and generic terms acquired from Ultimate Search. There a reasonable grounds for such a belief at the time.
By asserting that it may have had “common law rights” at some time other than that sworn to in its recent submissions to the USPTO, the Complainant does not establish a prima facie case that it did have such rights at the relevant time, nor that the Respondent did or should have known of them in the face of a public record to the contrary. Common law claims may prevail under the Policy where they are unambiguously established, and there is likewise reason to believe the Respondent acted with a predatory intention arising from them, neither of which circumstances are demonstrated here.
Respondent submits that the production of yet further records of the Complainant that were equally unknown and unavailable to the Respondent in 2005, and apparently to the Complainant when it prepared and filed the Complaint, sheds more heat than light on the relevant inquiry into what were the Respondent’s intentions, beliefs, and available evidence at the time the Respondent acquired the domain name, and what reasonable conclusions the Respondent should have drawn from what was knowable at the relevant time.
Complaint has rights in the mark SUPERIOR PLAY SYSTEMS; such rights existed at or before the time when the at-issue domain name was registered and acquired by the Respondent. Complainant did not abandon its rights in the at-issue mark.
Respondent MDNH Inc. is a company that has been involved in numerous proceedings under the UDRP. MDNH Inc. is in the business of domain name trading with a portfolio of a large number of domain names. It seeks to generate revenue from its portfolio of domain names by the use of pay per click advertising and perhaps otherwise.
Respondent made no effort to determine whether or not its use of the at-issue domain name might violate the rights of another.
Respondent does not assert that it was unaware of Complainant’s claim of rights in its SUPERIOR PLAY SYSTEMS mark at the time Respondent acquired the domain names.
Respondent refused to acknowledge Complainant’s offers to purchase the domain name.
The large number of facially generic domain names acquired in mass by Respondent put Respondent on notice that at least some of those domain names had with relative certainty acquired distinctiveness and were thus the protectable trademarks.
Respondent made no effort to determine the trademark status of the at issue domain name.
Paragraph 15(a) of the Rules instructs this Panel to "decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable."
Paragraph 4(a) of the Policy requires that Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:
(1) the domain name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
(2) Respondent has no rights or legitimate interests in respect of the domain name; and
(3) the domain name has been registered and is being used in bad faith.
Complainant has proven this element. Complainant has rights in a mark which is identical to the at-issue domain name.
Complainant shows that it previously owned a trademark registration with the United States Patent and Trademark Office ("USPTO") for the SUPERIOR PLAY SYSTEMS and Design mark (Reg. No. 2,106,291 filed on December 7, 1995; issued October 21, 1997; cancelled July 24, 2004). In its application for the noted mark Complainant maintains a first use of the mark of February 6, 1993. Complainant also submits a currently held registration for the SUPERIOR PLAY SYSTEMS word mark with the USPTO (Reg. No. 3,922,404; filed April 26, 2010; issued February 22, 2011), which also alleges a first use date of February 6, 1993.
Respondent claims that Complainant has abandon all its rights in the mark by abandoning the registration and that Complainant’s filing postdates the 2000 registration and subsequent accusation of the domain name by Respondent. Complainant has current rights in its mark that at least date back to April 26, 2010, which is the filing date for its currently registered mark. See Expedia, Inc. v. Tan, FA 991075 (Nat. Arb. Forum June 29, 2007) (“As the [complainant’s] mark is registered with the USPTO, [the] complainant has met the requirements of Policy ¶ 4(a)(i).”); see also Hershey Co. v. Reaves, FA 967818 (Nat. Arb. Forum June 8, 2007) (finding that the complainant’s rights in the KISSES trademark through registration of the mark with the USPTO “date back to the filing date of the trademark application and predate [the] respondent’s registration”).
Although Respondent contends that the <superiorplaysystems.com> domain name is comprised of common and descriptive terms and as such cannot be found to be identical to Complainant’s mark, such a determination is not necessary under Policy ¶ 4(a)(i). This portion of the Policy considers only whether Complainant has rights in the mark and whether the disputed domain name is identical or confusingly similar to Complainant’s mark. See Precious Puppies of Plorida, Inc. v. kc, FA 1028247 (Nat. Arb. Forum Aug. 10, 2007) (examining Respondent’s generic terms arguments only under Policy ¶ 4(a)(ii) and Policy ¶ 4(a)(iii) and not under Policy ¶ 4(a)(i)); see also Vitello v. Castello, FA 159460 (Nat. Arb. Forum July 1, 2003) (finding that the respondent’s disputed domain name was identical to complainant’s mark under Policy ¶ 4(a)(i), but later determining the issue of whether the disputed domain name was comprised of generic terms under Policy ¶¶ 4(a)(ii) and 4(a)(iii)).
Furthermore the <superiorplaysystems.com> domain name is identical to Complainant’s SUPERIOR PLAY SYSTEMS mark. The domain name merely removes the spaces between the terms of the mark while adding the generic top-level domain (“gTLD”) “.com.” See Hannover Ruckversicherungs-AG v. Ryu, FA 102724 (Nat. Arb. Forum Jan. 7, 2001) (finding <hannoverre.com> to be identical to HANNOVER RE, “as spaces are impermissible in domain names and a generic top-level domain such as ‘.com’ or ‘.net’ is required in domain names”); see also Bond & Co. Jewelers, Inc. v. Tex. Int’l Prop. Assocs., FA 937650 (Nat. Arb. Forum Apr. 30, 2007) (finding that the elimination of spaces between terms and the addition of a gTLD do not establish distinctiveness from the complainant’s mark under Policy ¶ 4(a)(i).
Complainant has proven this element. Respondent fails to demonstrate rights or interest in respect of the at-issue domain name.
Complainant must first make out a prima facie case that Respondent lacks rights and legitimate interests in the disputed domain name under Policy ¶ 4(a)(ii) and then the burden, in effect, shifts to Respondent to show that she does have rights or legitimate interests. See Hanna-Barbera Prods., Inc. v. Entm’t Commentaries, FA 741828 (Nat. Arb. Forum Aug. 18, 2006). Complainant contends that Respondent is not commonly known by the <superiorplaysystems.com> domain name. WHOIS information identifies “Marchex Sales, Inc. Brendhan Hight,” as the registrant, which is dissimilar to the domain name. See Tercent Inc. v. Lee Yi, FA 139720 (Nat. Arb. Forum Feb. 10, 2003) (stating “nothing in Respondent’s WHOIS information implies that Respondent is ‘commonly known by’ the disputed domain name” as one factor in determining that Policy ¶ 4(c)(ii) does not apply); see also Braun Corp. v. Loney, FA 699652 (Nat. Arb. Forum July 7, 2006) (concluding that the respondent was not commonly known by the disputed domain names where the WHOIS information, as well as all other information in the record, gave no indication that the respondent was commonly known by the disputed domain names, and the complainant had not authorized the respondent to register a domain name containing its registered mark). Furthermore, Respondent is not authorized to register or use Complainant’s SUPERIOR PLAY SYSTEMS mark. See Braun Corp. v. Loney, FA 699652 (Nat. Arb. Forum July 7, 2006) (concluding that the respondent was not commonly known by the disputed domain names where the WHOIS information, as well as all other information in the record, gave no indication that the respondent was commonly known by the disputed domain names, and the complainant had not authorized the respondent to register a domain name containing its registered mark); see also M. Shanken Commc’ns v. WORLDTRAVELERSONLINE.COM, FA 740335 (Nat. Arb. Forum Aug. 3, 2006) (finding that the respondent was not commonly known by the <cigaraficionada.com> domain name under Policy ¶ 4(c)(ii) based on the WHOIS information and other evidence in the record). Therefore, Complainant satisfies its slight initial burden regarding Respondent’s lack of rights and interests in the disputed domain name.
Under paragraph 4(c) of the Policy, Respondent demonstrates its rights or interest in its domain name if the Panel finds any of the particular three situations enumerated thereunder are in play. Respondent contends that it is in the business of registering descriptive domain names and utilizing those domain names to host parked websites. Respondent asserts that it receives click-through fees each time an Internet user clicks on one of the hyperlinks. Respondent argues that such a use is a legitimate commercial use of the disputed domain name which leads to the conclusion that Respondent’s use of the disputed domain name is a bona fide offering of goods or services under Policy ¶4(c)(i). See INVESTools Inc v. KingWeb Inc., FA 598845 (Nat. Arb. Forum Jan. 9, 2006) (holding that the respondent’s use of the disputed domain name to operate a web directory with links to investment-related websites in competition with the complainant constituted a bona fide offering of goods or services within the meaning of Policy ¶ 4(c)(i)); see also Eastbay Corp. v. VerandaGlobal.com, Inc., FA 105983 (Nat. Arb. Forum May 20, 2002) (finding that the respondent’s use of the disputed domain name, which was comprised of generic terms, as a portal to a commercial website featuring various advertisements and links constituted a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i)).
As further discussed below the Panel finds that Complainant has adequately demonstrated that it more likely than not had common law trademark rights at the time of the at-issue domain name’s registration at that the times the at-issue domain name was registered and acquired. Complainant’s uncontested relevant evidence presented in support of Complainant’s having timely common law trademark rights in the at-issue mark are sufficient to demonstrate secondary meaning and overcome any presumption that the SUPERIOR PLAY SYSTEMS mark is generic notwithstanding that each of the component words may be generic when taken discretely.
The facts alleged by Respondent with regard to Complainant’s abandonment of its trademark registration and Complainant’s particular disclaimers made to the United States Patent and Trademark Office do not vitiate Complainant’s common law rights in the at-issue mark. Therefore, in conducting its business Respondent was and is using the trademark of another. Numerous Panels have held that the use of another’s trademark in one’s domain name defeats the required bona fide character of goods and services offered in connection with such domain name and thereby renders paragraph 4(c)I inapplicable where, as here, the Respondent is using the domain name to advertise competing products or services or profit via pay per click links. See Expedia, Inc. v. Compaid, FA 520654 (Nat. Arb. Forum Aug. 30, 2005) (finding that the respondent’s use of the <expediate.com> domain name to redirect Internet users to a website featuring links to travel services that competed with the complainant was not a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i) or a legitimate noncommercial or fair use pursuant to Policy ¶ 4(c)(iii)); see also Royal Bank of Scotland Grp plc et al. v. Demand Domains, FA 714952 (Nat. Arb. Forum Aug. 2, 2006) (finding that the operation of a commercial web directory displaying various links to third-party websites was not a use in connection with a bona fide offering of goods or services pursuant to Policy ¶ 4(c)(i) or a legitimate noncommercial or fair use pursuant to Policy ¶ 4(c)(iii), as the respondent presumably earned “click-through” fees for each consumer it redirected to other websites).
Respondent suggests that it acquired the at-issue domain name entirely because of its descriptive value. However its method of wholesale bulk acquisition of domains comprised of facially generic terms makes it no surprise that its portfolio will, with a high degree of certainty, contain trademarks. Respondent impliedly submits that one might register, or in its case, acquire any trademarked domain name so long as the registrant did not actually know that the particular registration was a trademark and so long as the trademark was facially generic or contained descriptive terms.
As in Traditional Medicinals Inc. v. Worldwide Media Inc. c/o Domain Administrator FA 1247728 (Nat. Arb Forum April 7, 2009) here too..:
Respondent apparently believes that it has found a “loophole” whereby it may … register trademarked domain names, traffic in such names, offer such names for sale to the trademark holder, or otherwise profit from the fact that the registered domain name has trademark value apart from, and in addition to, its descriptive value but [nevertheless] not have any exposure from a UDRP action. The Panel disagrees.
Respondent takes no steps to avoid holding or using trademarked domain names when it would be a simple matter to screen domain names prior to registration or acquisition to determine if they contain registered trademarks or marks in which there is likely a claim of rights such as the SUPERIOR PLAY SYSTEMS mark. With even less trouble the Respondent might, after finding out that a trademarked domain name such as Complainant’s was registered as a domain name, cancel the trademarked domain name or voluntarily transfer registration, rather than link it do the mark holder’s competition.
It thus seems disingenuous for Respondent to claim it acquires domains because of the target domain name’s descriptive value. And even if Respondent’s motivation is as stated, the fact that Respondent cares not that it also is acquiring trademarked names is troubling and further calls into question the bona fide nature of Respondent’s endeavors.
Importantly, the domain name is hardly one that one would register “out of the blue” or acquire simply as a combination of descriptive words. Of all possible three word descriptive phrase why was Superior Play Systems registered? It seems highly unlikely that Respondent or its predecessor in interest did not know of Complainant’s mark when it choose a three word domain name identical to Complainant’s three word trademark.
The Panel finds that Respondent is not using the <superiorplaysystems.com> domain name to make bona fide offerings of goods or services under Policy ¶ 4(c)(i), or to make legitimate noncommercial or fair uses under Policy ¶ 4(c)(iii) and further concludes that Respondent lacks rights or interests in respect of the at-issue domain name.
Complainant has proven this element. Respondent registered and used the <superiorplaysystems.com> domain name in bad faith.
As discussed above, Respondent argues that Complainant had no rights in the at-issue domain name at the time it was registered or at the time Respondent acquired the at-issue domain name as part of its 2004 bulk domain name purchase. Respondent reasons that Complainant had abandoned any rights it might have in the domain name when it abandoned its federal registration of the at-issue mark. If Complainant had no rights in the domain name at the time it was registered and acquired by Respondent, there can be no finding against Respondent regarding bad faith.
Indeed, there is a nearly unflappable rule in UDRP proceedings which reasons that if Complainant did not have rights at the time the domain name was registered then, without more, it logically follows that Respondent could not have registered the domain name in bad faith.
Normally speaking, when a domain name is registered before a trademark right is established, the registration of the domain name was not in bad faith because the registrant could not have contemplated the complainant’s non-existent right.
WIPO Overview of WIPO Panel Views on Selected UDRP Questions, http://www.wipo.int/amc/en/domains/search/overview/index.html#31 (May 18, 2011).
Although ultimately finding for Respondent on a split decision, the Panel in Xbridge Limited v. Marchex Sales, Inc. WIPO Case No. D2010 2069 (March 1, 2011) held that although the respondent Marchex used its <simplybusiness.com> domain name --a domain name that was identical to the Complainant’s trademark and in which it had no rights or interest-- in bad faith, because Complainant had no rights in its SIMPLY BUSINESS mark at the time the domain name was registered/transferred, the Complaint failed the requirement of paragraph 4(a)(iii).
The Xbridge majority found that Marchex, by engaging in the very same conduct as partakes of in the instant case (i.e. Marchex had received a colorably descriptive domain name as part of a bulk purchase in which the Complainant had trademark rights –apparently the same bulk purchase that contained the currently at-issue mark- and then proceeded to establish a website which linked to click ads and the Complainant’s competitors) lacked rights and interest in respect of the domain name and was using the domain name in bad faith. The point of contention which the Xbridge Panel labored over (and split on) was whether or not, having found that the Complaint lacked rights in the mark at the time the domain name was registered (transferred) there should nevertheless be a finding of bad faith registration; the majority holding that it should not. The decision hinged on the interpretation and implications Policy 4(b)(iii) and whether the Complainant need to show trademark rights at the time the domain was registered/transferred to Respondent.
The dissenting Xbridge opinion urges that since the circumstances set out in paragraph 4(b)(iv) were present, and since such “shall be evidence of the registration and use of a domain name in bad faith” there must be a finding of bad faith registration and use notwithstanding that the Complainant might not have had interest in the domain name at the time of registration. Policy 4(b) (emphasis added). Having found that in our case Complainant did have rights in the at-issue domain name at all relevant times, there is no need to delve further into the syntax and interpretation of the Policy on what is needed to find bad faith registration.
In our nearly parallel case the Panel has found that the Complaint had trademark rights in the disputed domain name at the time the domain name was registered. Respondent argues, like it apparently similarly argued in Xbridge, that since the <superiorplaysystems.com> domain name is common and descriptive it may use the domain name as it likes since Complainant does not have an exclusive monopoly on these terms on the Internet. See Kaleidoscope Imaging, Inc. v. V Entm’t, FA 203207 (Nat. Arb. Forum Jan. 5, 2004) (finding that the respondent was using the <kaleidoscope.com> domain name for a bona fide offering of goods or services because the term was “generic” and respondent was using the disputed domain name as a search tool for Internet users interested in kaleidoscopes).
However, Respondent fails to show that it made any effort whatsoever to ascertain if any of the domain names it acquired, including the at-issue domain name, were trademarks. Registrants of large numbers of domain names or those acquiring domain names in bulk must be particularly careful in respect of the rights of third parties.
[T]hose who register domain names, and particularly those who register domain names in large numbers using automated programs and processes, are not allowed to simply turn a blind eye to the possibility that the names they are registering will infringe or violate the rights of trademark owners. That responsibility derives from paragraph 2 of the Policy, and in particular the words: ‘It is your responsibility to determine whether your domain name registration infringes or violates someone else’s rights’
See Grundfos A/S v. Tex. Int’l Prop. Assocs., D2007-1448 (WIPO Dec. 14, 2007).
As noted above it is preposterous to believe that the value of a domain name called <superiorplaysystems.com> would have any value above any other domain name made up of a purely generic phrase unless it also had value as a trademark. Furthermore, Respondent must have been aware that at least some of the domain names in the lot it purchased were trademarked by other parties despite the fact that they may have also been combined generic terms. But Respondent did not bother to exercise even the most trivial inquiry as to the trademark status of the at-issue domain name before trading on it.
What it would have in fact concluded upon doing such a check seems irrelevant given that by not investigating it shows Respondent’s indifference to the rights of actual mark holder(s). This indifference is at Respondent’s peril and indicates bad faith where, as here, the domain name is the trademark of another and where, as here, the domain name is used to direct Internet users to a website which contains links to Complainant’s competitors and otherwise attempts to trade on the trademark value of Complainant’s mark for commercial gain. As interested Internet users may end up purchasing products from Complainant’s competitors instead of from Complainant due to this use, and for the other reasons discussed above, the Panel finds Respondent registered and uses the disputed domain name in bad faith pursuant to Policy ¶ 4(b)(iii). See Tesco Pers. Fin. Ltd. v. Domain Mgmt. Servs., FA 877982 (Nat. Arb. Forum Feb. 13, 2007) (concluding that the use of a confusingly similar domain name to attract Internet users to a directory website containing commercial links to the websites of a complainant’s competitors represents bad faith registration and use under Policy ¶ 4(b)(iii)); see also St. Lawrence Univ. v. Nextnet Tech, FA 881234 (Nat. Arb. Forum Feb. 21, 2007) (“This Panel concludes that by redirecting Internet users seeking information on Complainant’s educational institution to competing websites, Respondent has engaged in bad faith registration and use pursuant to Policy ¶ 4(b)(iii).”).
Additionally, Respondent’s general offer to sell the domain name is evidence that Respondent registered and uses the disputed domain name in bad faith under Policy ¶ 4(b)(i). See Bank of Am. Corp. v. Nw. Free Cmty. Access, FA 180704 (Nat. Arb. Forum Sept. 30, 2003) (“Respondent's general offer of the disputed domain name registration for sale establishes that the domain name was registered in bad faith under Policy ¶ 4(b)(i).”). The fact that Complainant’s overture to purchase the domain name from Respondent was ignored by Respondent also leads to the inference that Respondent was well aware of Complainant’s claim of rights in the mark prior to the instant proceeding and that it purposefully ignored Complainant so as not to open the door for an adverse inference regarding offering the domain name offer for sale to the trademark’s owner should a UDRP be filed against Respondent (as it was). If this were not the case we would expect Respondent’s snub to be explained by Respondent in its papers.
Having established all three elements required under the ICANN Policy, the Panel concludes that relief shall be GRANTED.
Accordingly, it is Ordered that the <superiorplaysystems.com> domain name be TRANSFERRED from Respondent to Complainant.
Honorable Karl V. Fink (Ret.), Honorable Daniel B. Banks Jr. and
Paul M. DeCicco, as Panelists.
Paul M. DeCicco, (Chair)
Dated: May 23, 2011
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