ADMINISTRATIVE PANEL DECISION
Under the ICANN Uniform Domain Name Dispute Resolution
1. Parties and Contested Domain Name
1.1 The Complainant is Qtrade Canada Inc. based in Vancouver, British Columbia. The Complainant represents that it is a full service internet based securities broker dealer located in Vancouver, British Columbia, Canada. The Complainant holds itself out to the public through "QTRADE Investor Inc.", which is a wholly owned subsidiary of Qtrade Canada Inc.
1.2 The Respondent is the Bank of Hydro ("Bank") based in Hydro, Oklahoma. On January 23, 1999, the Bank registered the domain name qtrade.com with Network Solutions, Inc. Mr. Grubb states that he mistakenly registerd the domain name in the name of the Bank due to a technical error which he subsequently tried to rectify. He states further that if the Bank succeeds in this arbitration, it will transfer the domain name to himself. As for the other "Q" commerce names, Mr. Grubb asserts that he registered these as well. It is not clear from the record whether he did so in his personal capacity or as a representative of the Bank. This confusion seems somewhat contrived, however, on balance, as explained below, I am prepared to give Mr. Grubb the benefit of the doubt as to the intentions of Virtual Surety with respect to the domain name in question and the other "Q" commerce names. That said, as explained below, this confusion could have some bearing in considering whether the complaint was made in bad faith.
1.3 Mr. Shawn Grubb is Senior Vice President of the Bank, which he represents is owned by the Grubb family. Mr. Grubb states that he intended to market and use QTRADE.COM in association with the development of an Internet company, which eventually became incorporated as Virtual Surety, Inc. ("Virtual Surety"). Mr. Grubb is President and CEO of Virtual Surety. The Respondent states that that Virtual Surety intends to utilize a package of related "Q" domain names to market its goods and services. Accordingly, in addition to QTRADE.COM, Mr. Grubb registered several other "Q" domain names, including QTRUST, QTELLER, QTITLE, QESCROW, QSURETY, QSENTRY, QAUCTION, QDRAFT, QVAULT, QBANKER, AND QCREW. The Respondent states that it has always been, and is Mr. Grubb's intention to use these names in association with his Internet company.
2. Procedural History
2.1 The electronic version of the Complaint form was filed on-line through eResolution's Website on March 28, 2000. The hardcopy of the Complaint Form was received on the same date. Upon receiving all the required information, after completing the appropriate inquiry, the Clerk of eResolution concluded that: the Registrar is Network Solutions Inc, the Whois database contains all the required contact information but the billing contact, the contested Domain Name resolves to an inactive Web page and the Complaint is administratively compliant. An email was sent to the Registrar by eResolution Clerk's Office to confirm the name of the billing contact and to obtain a copy of the Registration Agreement on April 17, 2000. The requested information was received on the same date.
2.2 The Clerk fulfilled all its responsibilities under paragraph 2 (a) of the ICANN's Rules for Uniform Domain Name Dispute Resolution Policy ("Rules") in connection with forwarding the Complaint to the Respondent on April 13, 2000. That date is the commencement date of the administrative proceeding. On April 13, 2000, the Clerk's office notified the Complainant, the Respondent, the concerned Registrar, and ICANN of the date of commencement of the administrative proceeding. On May 3, 2000, the Respondent submitted, via eResolution internet site, its response. The signed version of the response was received on May 4, 2000. On May 30, 2000, the Clerk's Office contacted me, and requested that I act as panelist in this case. On June 2nd, 2000, I accepted to act as panelist in this case and filed the necessary Declaration of Independence and Impartiality. On June 2nd, 2000, the parties were notified that I had been appointed and that a decision was to be, save exceptional circumstances, handed down on 15, 2000.
2.3 On June 16, 2000, I informed the Clerk's Office that in accordance with paragraph 10(c) of the Rules and 3(a) of the Supplemental Rules of the Disputes.org/eResolution Consortium (the "Supplemental Rules"), I had exercised my own discretion to extend my time limit for rendering a decision as I considered such an extension necessary for me to be able to fulfil my duties adequately.
3. Factual Background
3.1 On January 23, 1999, the Respondent registered the domain name qtrade.com with Network Solutions, Inc.
3.2 The Complainant filed an application for the trademark "QTRADE" with the Canadian Intellectual Property Office on February 14, 2000. The application was "formalized" (i.e., made available for public inspection) on March 9, 2000. The services covered by the Trade-Mark application include "provision of securities brokerage services and all other services reasonably related thereto". The Complainant filed an application for the Trademark "QTRADE" with the United States Patent and Trademark Office on February 7, 2000. The services covered by the Trademark application include "Internet-based provider of retail securities brokerage services".
3.3 The Complainant initiated attempts to purchase the domain name in question from the Respondent on April 8 1999. The factual record here is mixed. When an agent of the Complainant, Mr. Chris Jackson, approached the Respondent inquiring whether the Respondent was using the domain name, and whether it was willing to sell it, the Respondent replied that it was not using the domain name, and that it was willing to sell it, and invited the Complainant to suggest a price. The parties danced around the issue of price with neither one wanting to make the first move. In this context, the Respondent informed the Complainant that he was unsure what price to ask for given that he had every intention of using the domain name when it was registered. After that, the Complainant named a price, $400.00-$500.00, but the Respondent did not reply further to repeated correspondence from Mr. Jackson before June 17, 1999.
3.4 Sometime thereafter on August 11, 1999, the Respondent received another unsolicited request to sell the domain name from a Mr. John Jacobsen. Mr. Jacobsen indicated that he had noticed that the domain name was not being used. He indicated further that he had made an offer on another domain name, and that being indifferent between the two he would purchase from the first person to agree to sell for $2000.00. The Respondent replied that it would probably sell the domain name but only as a package with the other "Q" commerce names. At that Mr. Jackson claimed to be planning to use the domain name for a not for profit site for a religious order, and asked the Respondent for how much it would sell solely the domain name. The Respondent did not reply. On March 23, 2000, Mr. Michael J. Labrie, an attorney acting for the Respondent indicated to Mr. Meehan that he believed that an agent of the Complainant had been trying to acquire the domain name by posing as a not for profit religious order. Mr. Labrie denied any knowledge of such an agent, however, as the Respondent points out, correspondence between Messrs. Grubb and Jacobsen is included in Schedule "C" of the Complaint.
3.5 On December 22, 1999, Mr. Jackson again initiated contact with the Respondent requesting a sale of the domain name. On February 4, 2000, Mr. Jackson again offered to purchase the domain name this time for a price of $2500.00. The Respondent replied that he had already turned down a price of $8000.00 from another source. On February 8, 2000, Mr. Jackson indicated that $8000.00 was too high. On March 3, 2000, Mr. Jackson again initiated contact with the Respondent inviting it to sell at a "reasonable price". Again the Respondent did not reply. Thereafter on March 21, 2000, the Complainant sent the Respondent a Cease and desist letter, accusing the Respondent of acting in bad faith, and threatening to initiate these arbitral proceedings. (Letter dated March 21, 2000 from Mr. Joseph E. Meehan, Vice President and General Counsel of Qtrade Canada Inc. to Mr. Greg Campbell, President of the Bank, ("Cease and Desist Letter") (Schedule C of the Complaint))
4. Parties' Contentions
4.1 The Complainant has registered and is using the domain "www.qtrade.ca". The Complainant submits that the Respondent's "registration of "www.qtrade.com" is identical to the Complainant's registered and pending Trademarks over the word `QTRADE' in Canada and the United States." (Paragraph 4(1)(c)(i) of the Complaint) [Emphasis added.]. Similarly, in the Cease and Desist Letter, the Complainant also asserted that "Qtrade Canada is the registered owner of the 'QTRADE` trademark in Canada . . . ."
4.2 Furthermore, the Complainant alleges that the Respondent has no rights or legitimate interests in the domain on the grounds that the Respondent has not used the domain name and registered the domain name solely for the purpose of reselling it along with the other "Q" commerce names.
4.3 Finally the Complainant alleges that the Respondent has acted in bad faith by: attempting to sell the domain name only when bundled with the other "Q" commerce names; not using the domain name; and by failing to respond to the cease and desist letter.
4.4 The Respondent states that while there is a similarity between its registered domain name QTRADE.COM and the Complainant's corporate name, Qtrade Canada, Inc., there is no likelihood of confusion between the two. Furthermore, the Respondent claims that the Complainant has no right to either "QTRADE" or "QTRADE.COM", particularly because at the time of the registration of the domain name, the Complainant had not filed trademark applications for "QTRADE" in Canada or the United States, and that as of the date of this arbitration, no such trademark had been granted in either country. The Respondent further states that at the time of registering the domain name, the Respondent was totally unaware of the Complainant or its Canadian business.
4.5 The Respondent points out that Paragraph 4(c) of the ICANN Policy (the "Policy") provides examples of what are considered legitimate rights and interests. Specifically, the Policy provides that: "Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, shall demonstrate . . . legitimate interests to the domain name . . . (1) Before any notice . . . of the dispute, . . . use of, or demonstrable preparation to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services . . . ." The Respondent states that it registered for the domain name for a legitimate business purpose and has made significant preparation for the use of QTRADE.COM. Therefore, the Respondent states that the Respondent has a legitimate interest in the domain name and Complainant is not entitled to transfer of the name.
4.6 The Respondent states further that it registered the domain name QTRADE.COM to market and use the domain name in association with the development of an Internet company, which eventually became incorporated as Virtual Surety. In addition to QTRADE.COM, Mr. Grubb has registered various other "Q" domain names to utilize with his "Q" marketing concept. Under the "Q" marketing concept, Virtual Surety will utilize QTRADE.COM and the other "Q" domain names to market its related goods and services on the Internet. The Respondent admits that Virtual Surety is still in its beginning stages, and he has not begun utilizing QTRADE.COM. However, the Respondent states that it has taken significant steps towards implementing his Internet company, Virtual Surety, which will utilize the "Q" domain names.
4.7 The Respondent states further that in July of 1999, Mr. Grubb began to develop "Qtrust, Inc." (corresponding to his domain name QTRUST.COM) as the corporate entity under which he would develop and market his "Q" services concept, and instructed his attorney to file the necessary papers to incorporate in the name Qtrust, Inc. On July 27, 1999, Mr. Grubb hired a company to develop a logo for Qtrust, Inc. On July 30, Qtrust, Inc. entered a contract with Intermedia Communications. On August 4, 1999, Qtrust, Inc. received an irrevocable standby letter of credit from a bank. Also, he applied for and was granted a United States tax identification number for Qtrust, Inc. Further, he applied for and was granted an identification number by Dunn & Bradstreet. Ultimately, however, the Oklahoma Secretary of State rejected the application for incorporation of Qtrust, Inc. based on state law prohibition of the word "trust" in a corporate name. Therefore, Mr. Grubb chose Virtual Surety as the alternate name for the company under which the "Q" concept and domain names would be developed. Virtual Surety has established a web site and is currently seeking investors for the new corporation.
4.8 In its support, the Respondent cites a recent eResolution Administration Panel Decision, Shirmax Retail Ltd. v. CES Marketing Group, Inc., Case No. AF-0104 (March 20, 2000). In Shirmax, the respondent operated a business that registered domain names and sold the acquired domain names on the Internet. The respondent had registered approximately 50 domain names, including the disputed domain name THYME.COM. The complainant had a registered trademark for "THYME," and filed a complaint seeking to acquire the domain name THYME.COM. The complainant alleged that the respondent did not have a legitimate interest in the domain name because respondent had not used the name in commerce. The respondent argued that it had made preparation to use to domain name in commerce and that the mere idea for a business application for the domain name was sufficient. The panel held in favor of the respondent. First, the panel found that the domain name in question was generic. "Where the domain name . . . in question [is] generic - and in particular where they comprise no more than a single, short, common word - the rights/interests inquiry is more likely to favor the domain name owner." Against this background, the panel expressly stated that "admittedly perfunctory preparations . . . made by [respondent] for use of the domain name . . . in bona fide commerce are sufficient to demonstrate the rights or legitimate interests required by paragraph 4(a)(ii)." Accordingly, claimant's allegations were reject.
4.9 Paragraph 4(b) of the Policy sets forth four specific examples of in which the registration and use of a domain name may be found to be in bad faith. Paragraph 4(b) provides that: "the following circumstances . . . if found by the panel to be present, shall be evidence of the registration and use of a domain name in bad faith: (i) circumstances indicating that [respondent] registered or . . . acquired the domain name primarily for the purpose of selling, renting or otherwise transferring the domain name registration to the complainant who is the owner of the trademark . . . ; or (ii) [respondent has] registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided [respondent] . . . engaged in a pattern of such conduct; or (iii) [respondent] registered the domain name primarily for the purpose of disrupting the business of a competitor; or (iv) respondent intentionally attempted to attract, for commercial gain, Internet users to respondent's web site . . . by creating a likelihood of confusion with the complainant's mark. Paragraph 4(c)(i)-(iii) of the Policy. The Respondent states that in the present case, none of these circumstances (or any other circumstances evidencing bad faith) is present.
4.10 The Respondent states that it did not register the domain name to sell to Complainant, rather it registered for the domain name for future use in his Internet company. Moreover, the Respondent states that as it was totally unaware of Complainant and its Canadian business when he registered the domain name, it could not have registered the domain name QTRADE.COM to sell to a company that it did know was in existence when he registered the domain name.
4.11 Similarly, the Respondent states that it did not register the domain name to prevent the owner of the trademark from reflecting the mark in a corresponding domain name, because at the time of registration, Complainant had not even applied for a trademark for "QTRADE." Further, the Respondent states that the Complainant has submitted no evidence of a pattern or practice of the alleged conduct, which is also required to show bad faith under the Policy.
4.12 For these same reasons, the Respondent states that it could not have registered the domain name to disrupt Complainant's business or to attract Internet users away from Complainant's online sites. In addition, the Respondent states that it was Complainant who approached the Respondent about purchasing the domain name.
4.13 The Respondent further states that the requirement of bad faith registration and use in paragraph 4(a)(iii) of the Policy is stated in the conjunctive. Citing the panel decision in Shirmax, the Respondent states that registration in bad faith is insufficient if the respondent does not use the domain name in bad faith, and conversely, use in bad faith is insufficient if the respondent originally registered the domain name for a permissible purpose." Accordingly, the Respondent states that even if Mr. Grubb's subsequent discussions in response to Complainant's offers to purchase the domain name could be considered some type of improper use, the Respondent applied for the domain name without knowledge of Complainant and, therefore, could not have applied with an improper purpose respecting Complainant.
5. Discussion and Findings
5.1 Paragraph 4(a) of the Policy requires the Complainant to demonstrate that three elements of a case are present for either cancellation or transfer of the disputed domain name. These are that: the domain name in question is identical or confusingly similar to a trademark or service mark in which the complainant has rights; that the Respondent has no rights or legitimate interests in respect of the domain name, and the domain name was registered and is being used in bad faith. The question before this Panel, therefore, is whether the Complainant has satisfied the requirements of Paragraph 4(a) with respect to these three elements, all of which must be proved. I find that the Complainant has not satisfied this burden of proof.
5.2 First, I find that while there may be a potential similarity between the Respondent's domain name "QTRADE.COM" and the Complainant's corporate name "Qtrade Canada, Inc.", these terms are not identical. I further find that I do not need to decide whether the terms are confusingly similar because the Complainant has not proven that it has a trademark right to "QTRADE" in either the United States or Canada. Despite what the Complainant represented in the Cease and Desist Letter, and in Paragraph 4(1)(c)(i) of the Complaint, it has not yet succeeded in registering a trademark to "QTRADE" in either Canada or the United States. Furthermore, the record shows that the Complainant only filed trademark applications in both countries after almost a year of attempting to purchase the domain name from the Respondent. See also Mpower Communications Corp. v. Park Lodge Hotel, Case WIPO-D2000-0078 (April 3, 2000) and Breakthrough Software, Inc. v. Hendrick Huigen Doing Business As Gordon-Huigen Enterprises, Case AF-0122 (April 13, 2000).
5.3 In view of my finding above, it is not necessary for me to make findings as to illegitimacy and bad faith. However, for completeness, I find that, based on the facts set forth above, and the legal standard set out in Shirmax, the Respondent has satisfied its burden of proving that before any notice of the dispute, it had made demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services. Therefore, I find that the Respondent has demonstrated a legitimate interest to the domain name QTRADE.COM.
5.4 I find further that the Complainant has not demonstrated that the Respondent registered and used its domain name in bad faith. In particular, on the basis of the facts set forth above, I find that the Complainant has not proven the existence of any of the four enumerated circumstances in paragraph 4(b) of the Policy.
5.5 Based on paragraph 15(e) of the Rules, the Respondent moved the panel to find that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, and therefore, requested that the Panel declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.
5.6 In Shirmax, the panel described the standard to be applied by a panel in making this determination: "[a]lthough the applicable policy and rules are quite vague on what constitutes bad faith in bringing a complaint, it seems logical that bad faith should be found if the complainant has an obvious interest in obtaining the respondent's domain name for its own use, yet lacks even a plausible argument on each of the elements set forth in paragraph 4(a) of the ICANN Policy." In that proceeding, the panel found that Shirmax clearly was interested in obtaining the domain name thyme.com from CES, but had made no creditable attempt to show that CES registered thyme.com in bad faith, as required by paragraph 4(a)(iii) of the policy."
5.7 In Loblaws, Inc. v Presidentchoice.Inc/Presidentchoice.com, Cases AF-0170a, 0170b and 0170c (June 7, 2000), the panel held that "[t]he fact that Loblaws filed the Complainant without any evidence of Respondent's bad faith registration or use of the domain name, and apparently without investigating whether Respondent had rights or legitimate interests in the domain name, is indicative of bad faith." Nonetheless, because the UDRP is new, and complainant was proceeding on an incorrect but common misapprehension as to its scope, the panel was reluctant to find that the complainant filed the complaint in bad faith.
5.8 In this case, I have found that the Complainant has acted in bad faith. I form this conclusion based on two factors. First, I am troubled by the fact that the Complainant initiated these proceedings after unsuccessfully initiating attempts, directly and/or indirectly, to encourage the Respondent to sell the domain name for almost one year. I am more troubled by the Complainant's over-statement of the status of its application for a trademark for "QTRADE" in Canada in the Cease and Desist Letter and in the Complaint itself. For these reasons, I am reluctantly inclined to agree with the Respondent that if this case does not rise to the level of bad faith and reverse domain name hijacking, it is difficult to imagine a set of facts and circumstances that would. I have made this decision despite having some reservations about the confusion over whether the Respondent or its administrative contact actually registered the domain name. Nonetheless, in view of the surrounding circumstances, I have given the Respondent the benefit of the doubt on this point.
6.1 For the reasons given above, the Complainant's request is rejected and, in accordance with Paragraph 15(e) of the Rules, the Panel finds that the complaint was brought in bad faith, in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, and therefore constitutes an abuse of these administrative proceedings.
This decision of the Administrative Panel in Case No. AF-0169 was rendered in Rio de Janeiro on the 19th of June, 2000.
(s) Mark A. A. Warner, Esq.