ADMINISTRATIVE PANEL DECISION
Under the ICANN Uniform Domain Name Dispute Resolution
1. Parties and Contested Domain Name
Complainant, Everything for a Dollar Store (Canada) Inc., is a company established in Markham, ON, Canada.
Respondent, Mrs. Sheri Bown, is a natural person residing in Greensboro, NC, U.S.A..
The contested domain name is "efads.com", registered with Network Solutions.
2. Procedural History
The electronic version of the Complaint form was filed on-line through eResolution's Website on May 16, 2000. The hardcopy of the Complaint Form was received on July 6, 2000. Payment was received on May 31, 2000.
Upon receiving all the required information, eResolution's clerk proceeded to:
- Confirm the identity of the Registrar for the contested Domain Name;
- Verify the Registrar's Whois Database and confirm all the required contact information for Respondent;
- Verify if the contested Domain Name resolved to an active Web page;
- Verify if the Complaint was administratively compliant.
The inquiry leads the Clerk's Office of eResolution to the following conclusions: the Registrar is Network Solutions Inc., the Whois database contains all the required contact information, the contested Domain Name resolves to an active 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 May 16, 2000. The requested information was received on May 18, 2000.
The Clerk's Office then proceeded to send a copy of the Complaint Form and the required Cover Sheet in accordance with paragraph 2 (a) of the ICANN's Rules for Uniform Domain Name Dispute Resolution Policy.
The Clerk's Office fulfilled all its responsibilities in connection with forwarding the Complaint to the Respondent on July 6, 2000. That date is the commencement date of the administrative proceeding.
On July 6, 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 July 24, 2000, the Respondent submitted, via eResolution internet site, her response. The signed version of the response was received on July 26, 2000.
On August 2, 2000, the Clerk's Office contacted Mr. Gabriel Francisco Leonardos, and requested that he acts as panelist in this case.
On August 3, 2000, Mr. Gabriel Francisco Leonardos, accepted to act as panelist in this case and filed the necessary Declaration of Independence and Impartiality.
On August 3, 2000, the Clerk's Office forwarded a user name and a password to Mr. Gabriel Francisco Leonardos, allowing him to access the Complaint Form, the Response Form, and the evidence through eResolution's Automated Docket Management System.
On August 3, 2000, the parties were notified that Mr.Gabriel Francisco Leonardos, had been appointed and that a decision was to be, save exceptional circumstances, handed down on August 16, 2000.
3. Factual Background
Complainant has been in business in Canada since 1985 where it has 54 stores. Complainant owns Canadian registrations for trademarks "Everything for a Dollar Store" since the early 1990's and "efads.com" since the past 5 years. Complainant argues that it has been promoting the trademark "efads.com" for many years. These facts have not been contested by Respondent.
Complainant also mentions that it was the holder of the domain name "efads.com" and lost the registration due to the lack of renewal caused by poor services rendered by its Internet Services Provider (ISP), and when it contacted the Respondent, Respondent offered to sell the domain name for an amount which was mispelled as US$ 5,0000.00, but which Respondent itself acknowledged to be US$ 5,000.00 (five thousand U.S. dollars).
Respondent argues that she was unaware of the previous history of the domain name and that it had no prior knowledge of the Complainant's business and that she has a small inventory of domain names of a generic nature in order to develop future web sites. She says she does not register domain names with the intent of selling, and the only reason she volunteered to sell the domain "efads.com" to Complainant is because she was contacted by an officer of Complainant, initially on a no-name basis, and she believed it would be convenient to sell the domain for US$ 5,000.00 (five thousand U.S. dollars). The reason for choosing "efads.com" fell upon the generic meaning of the word "Fad" and Respondent believed that this would be a suitable name for a web site in which electronic "fads" would be on sale, such as electronic games and software.
4. Parties' Contentions
Complainant contends that the domain name "efads.com" is vital for its business strategy and implied that Respondent is responsible for a company called URLsNow.com, which has as sole business to re-possess and re-sell URLs that have for one reason or another, "fallen through the cracks" and, concluding, Complainant seeks the transfer of the domain name.
Respondent contends that it was a simple coincidence that she registered the disputed domain, as she had no prior knowledge of Complainant's activities, and she did not have the initiative of contacting Complainant in order to offer to sell the domain. She does not "repossess names", but she simply "purchase names that are on the open market, available to the public", without knowing the history of such names. She gave a list of other domain names of a generic nature which she also registered for future development, such as "fatgrams.com", "epetroleums.com" and others, which the Arbitrator has verified to indeed be registered in Respondent's name.
5. Discussion and Findings
Whilst Complainant argues that Respondent's registration of the domain name "efads.com" was made in bad faith, Respondent answers that altough she sympathizes with Complainant's situation, she did not act in bad faith. Respondent argues that Complainant has failed to prove that all three elements required by ICANN's Policy (namely, copy or similarity, illegitimacy, and bad faith) are present in this case.
It was odd in this case that while Complainant is a legal entity which has continuously referred to Respondent as Respondent being another legal entity (a company named URLsNow.com), Respondent is a natural person who has continuously referred to herself as a legal entity (she always refers to herself as "we") and referred to Complainant as being another natural person (Mr. Asif Choksi, an officer of Complainant, is mentioned by name several times by Respondent). The evidence thus shows that Complainant is a legal entity operating a business in 54 stores throughout Canada, and that Respondent is a natural person strongly connected with a company called URLsNow.com, as Respondent did not deny such Complainant's implied contention.
It is not unreasonable to find that Respondent is indeed in the business of selling domain names, even though she might not be doing it out of intentional and blunt trademark piracy, as it happens with several other notorious registrants. Respondent argues that it was only by chance that she registered a domain name which was of any interest to Complainant and the Arbitrator agrees that it is probably what happened in this case.
In the Arbitrator's opinion it is not relevant for the legal analysis of this case whether Complainant had been the owner of the disputed domain in the past or not. Complainant has no better or worse rights because of this fact, as Complainant has not produced evidence of actually using the domain name "efads.com" prior to it being suspended due to lack of payment of maintenance fees.
However, Complainant has produced sufficient uncontested evidence of ownership of the trademark "efads.com" in Canada and that a substantial goodwill has accrued over the "EFADS" name as an identifier of Complainant's business. It is also a natural thing to happen in view of Complainant's long name.
Thus, the problem here lies in identifying whether all three conditions established by ICANN's Policy are met: copy or similarity, illegitimacy, and bad faith. As to the first condition, it is clear that the disputed domain is identical to Complainant's registered trademark "efads.com". As to the second condition, the Arbitrator also agrees that Respondent has "no rights or legitimate interests in respect of the domain name", as Respondent never used the domain in question and was willing to sell it to the first person who paid US$ 5,000.00.
The third condition, bad faith, is also met in the Arbitrator's opinion, and this will be further explained. ICANN's policy gives examples of acts in bad faith, but the Policy makes clear that other circumstances might also lead to the conclusion that the registration was made in bad faith. In the Arbitrator's opinion, the number of domain names might be very large, but is finite. Unless a registrant has a clear business purpose, it is not reasonable to lock several domain names only for "future development", when such registrations signify a serious obstacle to the development of an actual, already existing business, for which the ownership of such domain name is crucial. Complainant offers job opportunities in 54 stores, presumably pay taxes, and is an element of circulation of wealth in the places where it operates. Respondent does nothing of the kind; she simply registers fancy names in order to auction them to the highest bidder. She can certainly do it, but only if third party's rights are not harmed by her activities. Registering domain names is an activity for the accredited registrars; people who wish to do it on a private basis, registering several domains for later resale, are not doing an illegitimate business, but are operating a very risky one, as they might be infringing other people's rights, even without knowing it. Therefore, those who register domain names for sale, as the Respondent, must bear the burden of loosing the registrations, as in this case, or else the transaction costs for companies which have already developed a goodwill upon a certain trademark (as the Complainant did) would sky-rocket, and this would be an extremely inefficient system for the economy as a whole. In other words, those who act as the Respondent simply have a higher likelihood of loosing their domain to complainants which have acquired trademark rights, rather than companies which register the domains for actual use in the Internet. Reality has shown that it is not essential to the successful operation of an e-commerce site to use a generic domain name. "Amazon.com" uses a domain name with no relation to the goods it sells, but is successful anyway. Therefore, the fact that "Fad" has a generic meaning, as indicated by Respondent, does not exempt Respondent from the risk of infringement of a third party's trademark rights. For all the above reasons, the Arbitrator finds that the careless registration of a domain name, with the clear risk of infringing third party's trademark rights, as done by the Respondent, is also an act of bad faith which falls in ICANN's Policy criteria and authorizes the transfer of the domain name registration in favor of the Complainant.
The domain name "efads.com" is to be transferred to Complainant.
Rio de Janeiro, Brazil, August 16, 2000
(s) Gabriel F. Leonardos