AF Gloenco, Inc. v. CT PACKAGING SYSTEMS, INC.
Claim Number: FA1805001785831
Complainant is AF Gloenco, Inc. (“Complainant”)t”), represented by Andrea
Shannon of Norton Rose Fulbright US LLP, Texas, USA. Respondent is CT PACKAGING SYSTEMS, INC. (“Respondent”), Connecticut, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is <shrinkfast.com>, registered with Network Solutions, LLC.
The undersigned certifies that he has acted independently and impartially and to the best of his knowledge has no known conflict in serving as Panelist in this proceeding.
Dennis A. Foster as Panelist.
Complainant submitted a Complaint to the Forum electronically on May 9, 2018; the Forum received payment on May 9, 2018.
On May 10, 2018, Network Solutions, LLC confirmed by e-mail to the Forum that the <shrinkfast.com> domain name is registered with Network Solutions, LLC and that Respondent is the current registrant of the name. Network Solutions, LLC has verified that Respondent is bound by the Network Solutions, LLC 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 May 15, 2018, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of June 8, 2018 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@shrinkfast.com. Also on May 15, 2018, the Written Notice of the Complaint, notifying Respondent of the e-mail 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 June 7, 2018.
A timely Additional Submission from Complainant was received and determined to be complete on June 12, 2018.
On June 14, 2018, pursuant to Complainant's request to have the dispute decided by a single-member Panel, the Forum appointed Dennis A. Foster as Panelist.
Having reviewed the communications records, the Administrative Panel (the "Panel") finds that the Forum has discharged its responsibility under Paragraph 2(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") "to employ reasonably available means calculated to achieve actual notice to Respondent" through submission of Electronic and Written Notices, as defined in Rule 1 and Rule 2.
Complainant requests that the domain name be transferred from Respondent to Complainant.
A. Complainant
- Complainant presently offers a variety of heat tools under the SHRINKFAST trademark that provide the power to heat shrink film around military equipment, buildings, pallets, boats, bridges, and any odd-shaped applications for shipping, storage and protective purposes.
- Complainant has done business under its trademark since 1975, and its products are sold in more than forty countries worldwide. The mark is registered with the United States Patent and Trademark Office ("USPTO"). Complainant has created substantial goodwill associated with its trademark due to its continuous operations under, and extensive promotion of, the mark.
- Complainant also operates online through its domain name, <shrinkfast-998.com>, which Complainant registered in 2001.
- The disputed domain name, <shrinkfast.com>, is identical or confusingly similar to Complainant's SHRINKFAST trademark. The addition of the gTLD, ".com," is irrelevant in assessing the similarity between the name and mark.
- Respondent has no rights or legitimate interests in the disputed domain name. Despite having served as a distributor of Complainant's products, along with competing products, Respondent has never been authorized or licensed by Complainant to use the SHRINKFAST trademark or the disputed domain name. Moreover, Respondent has never been known as SHRINKFAST or the disputed domain name.
- Respondent is not using the disputed domain name for a bona fide offering of goods or services or in a noncommercial or fair use manner. Instead, Respondent is passing itself off illegitimately as Complainant to sell not only Complainant's products but those of Complainant's competitors.
- Respondent registered and is using the disputed domain name in bad faith. Respondent is using the disputed domain name for commercial gain based upon the false impression that the website connected with the name is authorized and associated with Complainant and its mark. Moreover, Respondent demanded $195,000, clearly in excess of its documented out-of-pocket costs associated with the disputed domain name, when approached by Complainant with respect to its proposed acquisition of the name. Finally, Respondent's bad faith is evidenced by its failure to respond to Complainant's two cease-and-desist letters.
B. Respondent
- Respondent has been a distributor of Complainant's products since 1980. Indeed, the very first product ever sold by Respondent was Complainant's "Shrinkfast Model 975." Now, the only heat-shrink guns sold by Respondent are those made by Complainant.
- Respondent registered the disputed domain name in 2000 to help market and promote its sales of Complainant's heat-shrink guns, as it had in other ways for some twenty years. That registration pre-dated Complainant's USPTO trademark registration for its SHRINKFAST mark by about twelve years. The delay that Complainant faced in registering its trademark resulted from the lack of distinctiveness of the mark, which suggests that Complainant has no rights in that mark worthy of enforcement in these proceedings.
- Complainant depends upon an independent distributor network to sell its products. Those distributors set their own marketing and pricing strategies, with no oversight whatsoever from Complainant. Distributors have been allowed by Complainant to use its trademark in connection with online marketing and sales without Complainant's objections for years. Moreover, the SHRINKFAST mark has been incorporated into domain names used by independent distributors other than Respondent.
- Respondent has rights and legitimate interests in the disputed domain name. Respondent has been using the name since its registration to sell Complainant's heat-shrink guns as a bona fide offering of goods. Complainant, who is a manufacturer/wholesaler not a retailer, did not object to this use until 2017. Respondent had been an authorized distributor of Complainant's products for thirty-seven years.
- More than seventeen years after registration of the disputed domain name, Complainant offered to buy it from Respondent for $5,000. Respondent, who was reluctant to sell the name, finally countered with a sale offer of $195,000, after calculating potential lost sales regarding Complainant's and related products.
- Due to its long use of the disputed domain name and its distribution of Complainant's SHRINKFAST guns, Respondent is commonly known by the disputed domain name. Moreover, Respondent does not sell products that compete with those produced by Complainant, but products that are complementary to those of Complainant.
- The disputed domain name was neither registered nor is being used in bad faith. Respondent registered and is using the disputed domain name in connection with its long-time authorized distribution of Complainant's products. Respondent did not demand $195,000 for the name, but merely countered Complainant's purchase offer in good faith. Respondent's failure to respond to Complainant's 2018 cease-and-desist letters did not indicate bad faith, but evidence only disagreement over Respondent's legitimate rights in the disputed domain name.
C. Complainant's Additional Submission
- Even if Complainant's SHRINKFAST trademark was initially descriptive, it became distinctive and related solely with Complainant due to long continuous use and promotion by Complainant. Thus, by at least 2000, Complainant had gained common law rights in that trademark.
- Respondent does not use the disputed domain name to sell only Complainant's products. For example, the name is used to market heat-shrink guns manufactured by Complainant's largest competitor. Moreover, the website located at the disputed domain name fails to disclose the relationship between Complainant and Respondent.
Complainant is a well-established
company that has manufactured heat-shrink products since 1975. Complainant has
conducted its operations under the "Shrinkfast" brand name and
obtained a trademark registration with the USPTO for the SHRINKFAST mark (e.g.., Reg. No. 4,260,908, registered Dec. 18, 2012).
Complainant established a general online presence with its registration of the
domain name, <shrinkfast-998.com)>, on April 20, 2001.
Respondent is the owner of the disputed domain name <shrinkfast.com>, which was registered on February 3, 2000. Respondent has sold at least some of Complainant's goods since 1980, as a distributor of those goods and related third-party products. The disputed domain name has been used to facilitate Respondent's distribution activities. Respondent offered to sell the name to Complainant for $195,000, after Complainant offered to buy the name from Respondent for $5,000.
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.
Respondent does not contest that the
disputed domain name, <shrinkfast.com>, is identical to Complainant's SHRINKFAST trademark.
The Panel agrees with that conclusion, since the additional gTLD,
".com," is inconsequential in a comparison of the name and mark, both
of which otherwise contain the same letters in the same order. See, See F.R. Burger &
Associates, Inc. v. shanshan lin, FA 1623319 (Forum July 9, 2015) (holding, “Respondent’s <frburger.com>
domain name is identical to Complainant’s FRBURGER mark because it differs only
by the domain name’s addition of the top-level domain name '.com'”); see also Grouplink Corp.
v. Meng Zhang, FA 1396425 (Forum Aug. 11, 2011) (finding
<grouplink.com> to be identical to the GROUPLINK mark).
Complainant has provided sufficient evidence to the Panel that Complainant has put its SHRINKFAST trademark to continuous, robust and advertised use since 1975. Even though the trademark is composed of two common English language words, Complainant's evidence leads the Panel to believe that Complainant had established a secondary meaning and thus common law rights in that mark prior to registration of the disputed domain name in 2000. Moreover, Complainant has provided the Panel with clear evidence (Comp. Ex. C) of its USPTO registration for the SHRINKFAST mark. Therefore, the Panel disagrees with Respondent's contention that Complainant has no enforceable rights in the mark and finds that Complainant possesses exactly those rights. See Goodwin Procter LLP v. Amritpal Singh, FA 1736062 (Forum July 18, 2017) (holding that the complainant demonstrated its common law rights in the GOODWIN mark through evidence of “long time continuous use of the mark, significant related advertising expenditures, as well as other evidence of the mark’s having acquired secondary meaning.”); see also Lilly ICOS LLC v. Andrew Riegel, D2006-1088 (Wipo Oct. 19, 2006) ("...Complainant’s registration with the USPTO sufficiently establishes the Complainant’s rights in the CIALIS mark.").
As a consequence, the Panel determines that Complainant has satisfied the first element required under the Policy.
The consensus of UDRP decisions is that, if a complainant can make a prima facie case that a respondent has no rights or interests in a disputed domain name, the respondent must come forward with concrete evidence that it does possess those rights or legitimate interests. See Neal & Massey Holdings Limited v. Gregory Ricks, FA 1549327 (Forum Apr. 12, 2014) (“Under Policy ¶ 4(a)(ii), Complainant must first make out a prima facie case showing that Respondent lacks rights and legitimate interests in respect of an at-issue domain name and then the burden, in effect, shifts to Respondent to come forward with evidence of its rights or legitimate interests”); see also Adv. Intern'l Marketing Corp. v. AA-1 Corp, FA 780200 (Forum Nov. 2, 2011).
Complainant has established above that the disputed domain name is identical to Complainant's valid trademark, SHRINKFAST. However, that alone does not constitute a prima facie case regarding Respondent's lack of rights or legitimate interests in the name. Complainant contends that it has never authorized Respondent to use that trademark in a domain name. The Panel does not agree.
The Panel accepts that there has never been a formal authorization, as there is no contract for distribution of Complainant's products or otherwise between Complainant and Respondent. However, the Panel believes that over the course of years an implied authorization for Respondent to use Complainant's mark in the context of a domain name has arisen.
Respondent registered the disputed domain name <shrinkfast.com> in 2000. In 2001, Complainant registered the domain name, <shrinkfast-998.com>, to establish a general online presence -- beyond merely marketing its then current SHRINKFAST Model 998 heat-shrink gun. The Panel believes that in doing so, Complainant must have considered registration of the disputed domain name, since it is, as Complainant has proven above, identical to Complainant's trademark. Moreover, as the gTLD, ".com," is by far the most common gTLD employed by companies worldwide to represent their wares online, Complainant would have certainly examined registration of <shrinkfast.com> before registering <shrinkfast-998.com>.
Therefore, the Panel believes that,
when registering its own domain name, Complainant was well aware that
Respondent owned the disputed domain name. Furthermore, Complainant knew well
who Respondent was, as the two had been in business together -- as manufacturer
and distributor -- for approximately twenty years before registration of either
domain name. Respondent has also presented evidence (Resp. Ex. C) to the Panel
that Complainant even encouraged Respondent, along with other distributors, to
be involved in Complainant's marketing efforts. The Panel believes that
Respondent's use of the Complainant's mark in the disputed domain name, hosting a
website that would likely increase Complainant product sales, could be
reasonably construed as a legitimate furtherance of those marketing efforts.
There is no evidence in the record to suggest that Complainant made any attempt in 2001, or shortly thereafter, to acquire the disputed domain name directly from Respondent or through a UDRP filing. Instead, the Panel concludes that Complainant approved of, or at least acquiesced in, the ownership of the name by Respondent. Complainant does not sell its products directly to consumers, and the use of the disputed domain name by Respondent inured not only to its commercial benefit, but also to Complainant's -- as wholesale revenue from Respondent increased -- even if Respondent also sold goods from third-party competitors of Complainant via the disputed domain name.
The Panel is aware that UDRP panels have not generally applied the doctrine of laches under the Policy. See Mile, Inc. v. Michael Burg, D2010-2011 (Wipo Feb. 7, 2011) ("...UDRP panels have generally declined to apply the doctrine of laches."); However, prior panels have taken heed of undue delay in filing when considering a respondent's possible legitimate interests in a disputed domain name. See Mile, Inc., supra ("However, the Panel observes that lengthy delays in seeking legal or administrative remedies can often have the effect of eroding or undermining the complainant's arguments with respect to the respondent's rights or legitimate interests in the disputed domain name, or the respondent's alleged bad faith in registering and using the domain name.").
In this case, Complainant waited at least sixteen years from its knowledge of Respondent's registration and use of the disputed domain name before challenging Respondent's rights and interests in the name. The Panel believes that that delay has cemented Respondent's business reliance upon the disputed domain name to conduct crucial online operations and constitutes an implied authorization for that use of the name by Respondent.
Both parties have cited the prior Policy decision Oki Data Americas, Inc. v. ASD, Inc., Case No. D2001-0903 (Wipo Nov. 6, 2001), in support of their positions. However, the Panel notes that the filing of the complaint in that case occurred within one year of the at-issue domain name's registration. Moreover, the Panel is unaware of any following UDRP cases, citing that decision as precedent, in which the filing delay approached that of the present case. Also, it does not appear that any of those following cases dealt with a domain name that is so exactly identical to the corresponding mark as the disputed domain name is to Complainant's mark. For those reasons, the Panel will not apply the standards set forth in Oki Data, supra.
In rendering its decision, the Panel is not concluding that Complainant has no possible legal claims with respect to Respondent and the disputed domain name. The Panel is merely deciding that Respondent's actions fall very short of the cybersquatting activity that the Policy was designed to preclude. As the learned panelist in Oki Data, supra, noted:
It is important to keep in mind that the Policy was designed to prevent the extortionate behavior commonly known as cybersquatting. It cannot be used to litigate all disputes involving domain names.
Accordingly, the Panel determines that Complainant has failed to sustain a prima facie case that Respondent has no rights or legitimate interests in the disputed domain name and thus has failed to satisfy the second element required under the Policy.
Based upon the evidence submitted, it appears to the Panel that Respondent, a long-time authorized distributor of Complainant, has used, with Complainant's implied approval, the disputed domain name legitimately, and in good faith, to offer for sale Complainant's products for the commercial gain of both Respondent and Complainant.
As a result, the Panel determines that Complainant has failed to satisfy the third element required under the Policy.
Having not established all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.
Accordingly, it is Ordered that the <shrinkfast.com> domain name REMAIN WITH Respondent.
__________________________________________________________________
Dennis A. Foster, Panelist
Dated: June 28, 2018
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