Borderfree Ltd.
v. Atlantic Management and Developments ltd. c/o Heidi Radford-Legg
Claim
Number: FA0311000211961
Complainant is Borderfree
Ltd., Toronto, ON, Canada (“Complainant”)
represented by Steven L. Graff, of Aird & Berlis LLP, 181 Bay Street,
Suite 1800, Toronto, ON, Canada M5J 2T9.
Respondent is Atlantic Management
and Developments ltd c/o Heidi
Radford-Legg (“Respondent”), 59 River Street, Boston, MA 02108.
The domain name at issue is <borderfree.com>, registered with Register.Com.
The undersigned certifies that they have acted independently
and impartially and to the best of their knowledge have no known conflict in
serving as Panelists in this proceeding.
David A. Einhorn (Panel Chair), Anne M. Wallace and Robert
A. Fashler as Panelists.
Complainant submitted a Complaint to the National
Arbitration Forum (the “Forum”) electronically on November 17, 2003; the Forum
received a hard copy of the Complaint on November 18, 2003.
On November 17, 2003, Register.Com confirmed by e-mail to
the Forum that the domain name <borderfree.com>
is registered with Register.Com and that the Respondent is the current
registrant of the name. Register.Com
has verified that Respondent is bound by the Register.Com registration
agreement and has thereby agreed to resolve domain-name disputes brought by
third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution
Policy (the “Policy”).
On November 21, 2003, a Notification of Complaint and
Commencement of Administrative Proceeding (the “Commencement Notification”),
setting a deadline of December 11, 2003 by which Respondent could file a
Response to the Complaint, was transmitted to Respondent via e-mail, post and
fax, to all entities and persons listed on Respondent’s registration as
technical, administrative and billing contacts, and to postmaster@borderfree.com
by e-mail.
A timely Response was received and determined to be complete
on December 9, 2003.
Complainant submitted an untimely Additional Submission on
December 23, 2003. The untimeliness of
this submission is rendered as a moot issue in light of this Panel’s decision
set forth herein below to dismiss the Complaint on procedural grounds.
On December 29, 2003, pursuant to
Complainant’s request to have the dispute decided by a three-member Panel, the Forum appointed David A. Einhorn (Panel Chair), Anne M.
Wallace and Robert A. Fashler as Panelists.
Complainant requests that the domain name be transferred
from Respondent to Complainant.
A. Complainant:
[a.] Complainant
was developed by a group of venture capitalists led by Mosaic Venture Partners
and Brightspark Ventures, L.P. It was formerly known as “The Etail Factory
Ltd.” and “Project Purple.”
[b.] Beginning
in August 1999, Complainant retained Cyberplex Interactive Media (“Cyberplex”),
where Heidi Radford-Legg (“Radford-Legg”) was employed as an account director
from July 14, 1998 to May 31, 2000, to assist in the development of an online
interface and a new company name. Radford-Legg was one of the Cyberplex
employees who worked on performing services for Complainant.
[c.] The
name “Borderfree” was suggested by Radford-Legg to replace Complainant’s former
names.
[d.] Radford-Legg
was instructed to register the domain name at issue, <borderfree.com>, in the name and on behalf of the
Complainant.
[e.] Despite
these instructions, Radford-Legg registered <borderfree.com> in her own name on November 9, 1999.
[f.] Under
the terms of Radford-Legg’s employment contract with Cyberplex, she was not
entitled to ownership of intellectual property created during her employment
with Cyberplex and relating to the business of Cyberplex. [We note that
Complainant has also attached a copy of the Severance Agreement between
Cyberplex and Radford-Legg that contains a mutual release and discharge
clause.]
[g.] Cyberplex
acknowledges that all intellectual property developed during its engagement by
the Complainant belongs to the latter. There was an express and/or implied
understanding among the parties that Complainant would retain ownership of all
concepts and ideas developed by Cyberplex or Radford-Legg while Cyberplex was
engaged by the Complainant. Complainant has attached a copy of Radford-Legg’s
employment agreement and a memo from Cyberplex in evidence of such implied
understanding.
[h.] The
registration of <borderfree.com>
was either in error or an attempt by Radford-Legg to obtain rights to which she
is not entitled.
[i.] Complainant
has paid for the renewal of registration of the domain name and has used the
website <borderfree.com> to promote its services and conduct its
business.
[j.] Radford-Legg
has made no efforts to use the impugned domain name.
[k.] The
facts that Radford-Legg has registered the domain name in her own name despite
instructions to register it in the name of Complainant and that she has no
independent use for the domain name, suggest that Radford-Legg intends to sell
the domain name for a profit to Complainant.
[l.] Radford-Legg’s
intention to sell the domain name to Complainant is further confirmed by the
fact that Radford-Legg wrote e-mails to Lorne Taylor, Director of Operations
for the Complainant, in which she states that she is awaiting Complainant’s
offer.
[m.] Radford-Legg
has changed the administrative contact for the impugned domain name to
Respondent, which suggests that she may attempt to use the domain name.
[n.] Complainant
filed applications for registration of the marks BORDERFREE.COM and BORDERFREE
with the Canadian Intellectual Property Office on January 5, 2000 and March 22,
2000 respectively. These marks were registered on October 11, 2001 and April 4,
2002 respectively.
B. Respondent:
[a.] Complainant
has been using the domain name <borderfree.com>
with the written consent of Radford-Legg.
[b.] Radford-Legg
conceived the idea of cross-border shopping, which forms the essence of <borderfree.com>, with her father
and brother, outside the course of her employment. She discussed how to develop
this business idea with Mosaic Venture Partners (“Mosaic”) and Brightspark.
[Mosaic is also the venture capitalist behind Cyberplex, Radford-Legg’s
employer.]
[c.] Although
her salary came from Cyberplex, Radford-Legg was employed by Etail Factory and
was listed in all formal ways as an employee and founder of Etail Factory.
[d.] Radford-Legg
was promised and assured that she would receive adequate compensation in her
capacity of initiator of the concept and founder of the company borderfree.com.
This compensation, in the form of shares and share options, was not forthcoming
and has not been given to date.
[e.] Radford-Legg
has paid for the renewal of the impugned domain name.
[f.] Complainant
was aware, at all times, of Radford-Legg’s ownership of <borderfree.com> and was silent since the time it was
registered about four years ago.
C. Complainant’s
Additional Contentions:
[a.] Complainant
did not obtain written consent from Radford-Legg for use of the domain name.
Radford-Legg gave access and password information to Complainant. Complainant
learned of ownership of the domain name only during a due diligence enquiry by
Canada Post Corporation.
[b.] The
decision to use the name “Borderfree” as a business tagline was made by those
working on the development of the Etail Factory business, including
Radford-Legg.
[c.] Complainant
owns several other ccTLD’s with the term “Borderfree”.
[d.] Radford-Legg
is retaining control over the domain name as a means of exacting compensation
by way of shares or share options from Complainant.
Paragraph 15(a) of the Rules for
Uniform Domain Name Dispute Resolution Policy (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 the 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 the
Respondent is identical or confusingly similar to a trademark or service mark
in which the Complainant has rights;
(2) the 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.
In this case, the Panel has decided not to consider the case
on its merits, so we will not be considering these three elements. We have outlined the evidence and
submissions of the parties to demonstrate the complexity of the issues in this
case. Because of the number and
complexity of the issues and the reasons which will follow, the Panel is of the
view that this is not a dispute we should be deciding on its merits and that
our decision should leave the domain name registration status quo.
Four distinct sets of alleged legal relationships are
central to this dispute. The first is
the relationship of the former employee as assignor of the trademark and Respondent. The second is an employer/employee
relationship between the employee and Cyberplex, the employer. The third is a
contractual relationship between Cyberplex, as supplier, and Complainant, as
customer. The fourth is an alleged contractual relationship between the former
employee and others with respect to the development of a business concept.
Complainant says that as a consequence of the interplay of
those legal relationships, Respondent has no rights or legitimate interests in
the domain name and is acting in bad faith. Respondent claims that a different
legal relationship governs rights in the domain name. Employee says that she originated a business plan and idea for an
Internet business and related domain name outside the course of her employment
agreement with Complainant.
Employee further claims that when the business plan was
presented to Complainant, it was misappropriated from her without compensation.
Complainant says that it is entitled to the domain name as a consequence of the
legal obligations owed, first, by employee (and by Respondent as her successor)
to Cyberplex and, second, by Cyberplex to Complainant. Specifically,
Complainant argues that there was an implied understanding between it and
Cyberplex that Complainant would retain ownership of all intellectual property
which Cyberplex and its employee developed during employee's term of employment
with Cyberplex, and that employee's selection of the domain name was
accomplished in the course of her employment by Cyberplex. It is also noted
that the record includes a severance agreement dated July 14, 2000, in which
Cyberplex releases employee from "all claims related to or in any manner
incidental to" her "employment with Cyberplex". This raises the
additional issue of whether said Release bars the filing of an action in any
form. It would be impossible for this Panel, with the sparse and conflicting
statements before us, to resolve these issues without considerable
inappropriate speculation. There are numerous evidentiary issues that could
only be resolved by testing of evidence through full disclosure and
cross-examination.
The narrow grounds on which a Panel is permitted to rule
under the UDRP, in this case, would require the examination of several complex
factual and legal issues. Such
predicate issues (for example, the interpretation of a contract, implied
contract, and breach of fiduciary duty) may be best determined by a forum of
broader jurisdiction. Under Section 5
of the Policy, disputes outside of the narrow framework set out in Section 4 of
the Policy “… shall be resolved through any court … available.” We are not prepared to resolve these
contractual or fiduciary duty issues since they are outside the framework of
the UDRP. See Latent Tech. Group, Inc. v. Fritchie, FA
95285 (Nat. Arb. Forum Sept. 1, 2000) (dispute concerning employee’s
registration of domain name in its own name and subsequent refusal to transfer
it to employer raises issues of breach of contract and breach of fiduciary duty
which are more appropriately decided in courts rather than before a UDRP
panel).
The Complaint
of Borderfree Ltd. with respect to the domain name <borderfree.com> is hereby dismissed.
David A.
Einhorn, Panel Chair
Anne M. Wallace, Panelist
Robert A. Fashler, Panelist
Dated: January 12, 2004
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