526
Nominet UK Dispute Resolution Service
DRS 00526
PDG Graphics Ltd -v- PDGraphics Ltd
Decision of Independent Expert
Parties:Complainant: PDG Graphics Ltd
Great BritainDomain Name:
pdggraphics.co.uk ("the Domain Name")
Procedural Background:The Complaint was submitted to Nominet on 30 July 2002, was received by Nominet on 2 August 2002, and was sent to the Respondent by post on 6 August 2002 by Nominet, informing the Respondent that he had 15 working days, i.e. until 28 August 2002, in which to respond to the Complaint.
On 27 August 2002, Nominet received a Response from the Respondent. On the same date, Nominet sent a copy of the Response to the Complainant, PDG Graphics Ltd. Nominet informed the Respondent that the Complainant had five working days, i.e. until 3 September 2002, in which to file a Reply. On 2 September 2002, Nominet received a Reply from the Complainant and sent a copy to the Respondent on 4 September 2002. Both parties were informed by Nominet that the next stage in the Dispute Resolution Service was Informal Mediation. On 25 September 2002, Nominet informed the Complainant that the next step in the Dispute would be to refer the matter for an Expert Decision if the Complainant paid a fee of £750 plus VAT within ten working days of receipt of that letter.
The Complainant duly paid the fee within the relevant time limit and the matter was duly referred to Nick Rose, the undersigned, ("the Expert") for an Expert Decision following confirmation to Nominet that the Expert knew of no reason why he could not properly accept the invitation to act in this case and of no matters which ought to be drawn to the attention of the parties, which might appear to call into question his independence and/or impartiality.
Outstanding Formal/Procedural Issues (if any)I am satisfied that all outstanding procedural issues have been dealt with satisfactorily.
The FactsBoth PDG Graphics Limited, the Complainant, and PDGraphics Limited, the Respondent, are companies based in Beeston, Nottingham. The Complainant provides graphic design services in internet and other media. The Respondent provides online shopping services through its website www.yellowcatshop.co.uk. The Domain Name, pdggraphics.co.uk, was registered on 29 May 2002 for PDGraphics Limited. As at the date of this Decision, the Domain Name address displays the Respondent's website, www.yellowcatshop.co.uk, advertising the online shopping service provided by the Respondent.
The Complainant already owns the domain name www.pdggraphics.com. This displays the Complainant's website which advertises its graphic design business.
In addition to owning the Domain Name, the Respondent also owns the domain name www.pdgraphics.co.uk. The Expert notes that there is currently no website displayed at this domain name, nor is there any indication that a website is under construction at this address.
The Parties contentionsThe Complainant contends that the Domain Name is identical or similar to a name or mark in which it has Rights. It does not say what those Rights are but submits that the Domain Name "is our name and not theirs" (i.e. belonging to the Complainant rather than the Respondent). No documentary evidence has been filed in support of the Complaint. The Complainant also states "PD Graphics has the domain name www.pdgraphics.co.uk which is fair".
The Complainant does not say that the Complainant, or anybody else, owns any registered trade mark rights in "PDG Graphics". However the Expert has conducted a trade mark search and the Expert notes that no trade mark rights have been registered under this name or any similar name in the relevant class.
The Complainant asserts that the Domain Name in the hands of the Respondent is an Abusive Registration. The Complainant submits that the Respondent trades "within the same sector" and its "office is geographically very close to ours (approx. one mile). Both companies have NG9 2 postcodes. This leads to the extreme likelihood of confusion for any customer or enquirer looking for us... this registration enables PD Graphics to benefit from our reputation, PR and advertising through mistaken identity."
RespondentThe Respondent sent its Response on 27 August 2002 to Nominet. The Respondent contends that the "PDG Graphics department under PDG Limited" has been trading since 1993.
The Expert does not know if this last sentence is correct. The Expert has been provided with a limited amount of information from company searches on the Complainant and the Respondent within the bundle of papers supplied by Nominet. The Expert notes that Mr David Wilson and his wife Mrs Leza Wilson are the directors of the Complainant and, between them, hold all the voting shares of the Complainant. The Expert has conducted full company searches on the Complainant and the Respondent and also on PDG Limited ("PDG"). The Expert notes that Mr David Wilson was a director of PDG from its incorporation in 1993 and that he also held 10% of the company's shares. Mr David Wilson resigned as a director of PDG on 18 November 1999 and, on the same date, PDG bought back all Mr Wilson's shares in that company.
The Expert notes that the abbreviated financial statements of PDG for the year ended 31 March 1999 state at paragraph 4 (under the heading "Transactions with Directors") "After seeking Inland Revenue clearances the company agreed with a director, D. Wilson, that the trading division for which he was previously responsible be allowed to separate from this company into a new company PDG Graphics Ltd. As a result in this accounting period an amount of £38,313 is included in debtors due to the company from PDG Graphics Ltd, which is paid after the balance sheet date". These accounts do not state what the trading division was for which Mr David Wilson was responsible. However the Expert notes that the annual returns of PDG from PDG's incorporation until 1999, the last year in which Mr David Wilson was a director of PDG, describe Mr David Wilson's occupation as "DESIGN". The Expert notes that on the Form 288a by which Mr David Wilson was appointed to the position of director for the Respondent, Mr David Wilson lists as his other directorships "DESIGN DIRECTOR, PDG LIMITED". Mr John Foster is described on most annual returns as "MANAGING DIRECTOR", although the Expert notes that he is described on PDG's first annual return dated 9 February 1994 as "DESIGN CONSULTANT".
The Expert notes that PDG entered into various transactions with PDG Graphics Limited over the course of the financial year ended 31 March 2000. PDG's abbreviated financial statements for the year ended 31 March 2000 state at paragraph 4 (under the heading "Transactions with Directors") "The company had various transactions during the year with PDG Graphics Ltd, in which the former director of PDG Ltd, D. Wilson, is a director and shareholder." It then lists sales of £35,000 and sale of motor vehicle and equipment of £14,500. The Expert considers that this shows that PDG and Mr David Wilson of the Complainant not only reached agreement as to the business of PDG being split but that the parties clearly cooperated with each other for a time after the split occurred.
The Respondent goes on to say that PDG Limited is "my father's company" and that "my father has allowed me to carry on the role of promoting PDG Graphics in my own limited company". No documentary evidence has been filed in support of this statement. The Expert notes from the Respondent company search provided by Nominet that Mr Adrian Foster, listed as contact for the Domain Name, is the sole director of the Respondent. The Expert notes, from the company search of PDG, that PDG appears to be a family business owned by various members of the Foster family and that the Managing Director and majority shareholder is Mr John Foster.
The Respondent contends "PDG Graphics department under PDG Limited... has been known by all PDG graphic's clients as PDG Graphics". No documentary evidence has been filed in support of this statement. The Respondent then goes on to say that, because the Respondent has used the same name as his father's graphics department used and made it a limited company, the Complaint "should in fact be reversed, we are the injured party".
Complainant's ReplyOn 2 September 2002 Nominet received from the Complainant a Reply to the Respondent's Response. The Complainant said that in 1993 Mr John Foster and Mr David Wilson formed PDG. The Expert is satisfied that this is correct, although it is not the whole truth. The company search on PDG shows that Mr David Wilson was one of three directors. The other two directors were Mr John Foster and Ms Mary Foster, and PDG's company secretary was Ms Julie Foster. As the Expert has already noted above, when Mr David Wilson was a director of PDG, 90% of PDG's shares were held by the Foster family and Mr David Wilson held only the remaining 10%.
The Complainant says that "Mr. Foster Snr" (whom the Complainant subsequently refers to as "Mr John Foster") was "MD" and Mr Wilson was Design Director. The Complainant said that Mr Foster ran the engineering side of the business and Mr Wilson ran the design side which covered both product and graphic design.
The Complainant then says that in 1999 the two directors agreed to split the business as they had different aims and priorities. The Expert assumes that by "the two directors" the Complainant refers to Mr John Foster and Mr David Wilson, rather than the third director Ms Mary Foster. It appears that PDG, the company, agreed with Mr David Wilson that the business of PDG would be split.
The Complainant then says that Mr John Foster kept the product design and engineering side of the business continuing to trade as PDG and Mr Wilson took the graphics department and registered it as a separate trading company PDG Graphics Limited with Mrs Leza Wilson. On balance of probabilities, and in view of the fact that the Respondent has failed to comment on PDG's business being split when Mr David Wilson resigned from PDG, the Expert accepts this explanation.
The Complainant says that Mr Wilson retained no shares in PDG but that Mr John Foster was given a small non-voting share in the Complainant on which he receives a dividend. The Expert notes from a company search of the Complainant that Mr John Wilson owns 20% of the "B Ordinary Shares" of the Complainant, which are non-voting shares and upon which the directors, Mr and Mrs Wilson, will declare dividend rights as they see fit.
The Complainant says that as at February 1999 PDG did not have a graphics department and that "any claim that the former graphics department has a right to the name brings it squarely back to us as Mr Wilson was the original director of that department in 1993". The Expert assumes that by this the Complainant contends that the former graphics department at PDG does not have a right to the name "PDG Graphics" because PDG agreed to allow Mr David Wilson of the Complainant to separate the department from PDG into a new company, the Complainant.
The Complainant says that it has also in effect paid for the right to that name (again, the Expert assumes the name referred to is "PDG Graphics") by Mr Wilson's surrendering of his shares in PDG and by giving Mr John Foster "shares/dividend" in the Complainant company.
The Complainant says that the Respondent and Mr Adrian Foster of the Respondent have no relationship, other than accident of birth, with either PDG or the Complainant. The Expert notes that the Respondent's registered office address is the same as for PDG, but that neither Mr Adrian Foster nor the Respondent are or have ever been a director or shareholder of PDG or the Complainant company.
Discussion and FindingsTo succeed in this Complaint, the Complainant must, in accordance with paragraph 2 of the Policy, prove to the Expert on balance of probabilities that:
The Complainant has chosen not to file any documentary evidence in support of its Complaint. In paragraph 1 of the Policy "Rights" includes, but is not limited to, rights enforceable under English law which are not wholly descriptive of the Complainant's business. There are no registered Rights, therefore it will be necessary to ascertain what unregistered Rights the Complainant has.
The Complainant has asserted that it has rights in the title "PDG Graphics". The Complainant's company name is identical or similar to the Domain Name, discounting the first (.uk) and second (.co) levels of the Domain Name. However, the Complaint itself provides little information in support of the assertion that the Complainant owns Rights in the title "PDG Graphics". Furthermore the Respondent contends that the Complainant has no Rights in this title.
The Expert believes that the Complainant's Response dated 2 September 2002 has rectified some of the problems with the Complaint, as it sets out the history behind the Complaint and provides details about the Complainant and Respondent companies and the role of PDG. The Response therefore provides more information as to why the Complainant believes it has rights in the title "PDG Graphics", although the Expert does not consider that the Response addresses all of the problems with the Complaint. The Complainant has still failed to file any documentary evidence.
However the Expert is satisfied that the Complainant has Rights in the name "PDG Graphics", which is a name identical or similar to the Domain Name, for the following reasons:
Paragraph 1 of the Policy defines "Abusive Registration" as a Domain Name which either:
A non-exhaustive list of factors, which may be evidence that the Domain Name is an Abusive Registration, is set out in paragraph 3 of the Policy. The potentially relevant "factors" in this case, from those set out in paragraph 3 of the Policy are as follows:
The factor referred to in (i) requires identifying the Respondent's purpose in making the registration. The factor referred to in (ii) does not involve identifying the Respondent's purpose.
The Expert will now consider each of these factors in turn.
Unfairly disrupting the Complainant's businessAlthough the Complainant has not asserted that the Domain Name was registered "primarily for the purpose of unfairly disrupting the business of the Complainant", the Complainant refers to the fact that the Domain Name address displays a website, www.yellowcatshop.co.uk, advertising an online shopping service owned by the Respondent.
The Complainant also refers to the fact that the Respondent also owns the domain name www.pdgraphics.co.uk. When the Expert tried to look at the website displayed by this domain name, no website was displayed, nor was there any indication that any such website was under construction.
The Respondent has claimed that it is legitimately entitled to promote "PDG Graphics" as part of the Respondent company's activities. The Expert has found that the Respondent is not so entitled. As both the Domain Name and the domain name www.pdgraphics.co.uk owned by the Respondent display no website promoting "PDG Graphics" it is unclear why the Domain Name was chosen other than to take unfair advantage of the goodwill that the Respondent knows attaches to the name "PDG Graphics" and direct it to the Respondent's website www.yellowcatshop.co.uk. It is difficult to think of any other reason why, if the Respondent wished to advertise its business, it could not have chosen some name which was not the well-known name of another well-known business. In the absence of any valid explanation from the Respondent the Expert draws the inference that the Domain Name was registered by the Respondent primarily for the purpose of unfairly disrupting the business of the Complainant.
ConfusionEvidence required under paragraph 3.a.ii is actual confusion. The difficulty for the Complainant is that although they are able to speculate upon the possibility of confusion arising they have failed to produce any evidence of actual confusion taking place. Paragraph 3.a.ii is clear, the Complainant must show evidence of actual confusion and the Complainant's submissions are therefore not sufficient in the Expert's opinion to found upon paragraph 3.a.ii.
Whether an Expert can rely upon the likelihood of confusion and the potential for disruption or detriment to a Complainant business arising out of the use of a Domain Name as being capable of amounting to an Abusive Registration, even though the criteria of paragraph 3 a ii do not in terms apply, has been previously considered in Jackson-Stops and Staff -v- Michael Jackson Stops Fanzine (17/12/2001). In that dispute the appointed Expert concluded that the use of the domain name was unfairly detrimental to the complainant's Rights, due to the content of the website being such that a person who was not familiar with the complainant's business would get an erroneous view of the nature of the complainant's business and may desist from any further attempt to find the complainant's website. In this case the Expert concludes the same. and agrees with the conclusion reached by the appointed Expert in that case. The likelihood of confusion and the potential for disruption or detriment to the Complainant's business arising out of the Respondent's use of the Domain Name is capable of amounting to an abusive registration notwithstanding that the Complainant has shown no actual confusion.
In addition to the above, the list of factors under paragraph 3 that may show that the Domain Name is an Abusive Registration is non-exhaustive. The Expert can therefore consider additional factors, such as whether there is anything else about the conduct of the Respondent or the facts of this case, which can justify the Expert coming to the conclusion that in the hands of the Respondent the Domain Name is an Abusive Registration. As the list is non-exhaustive, the Expert considers that one such additional factor is that, even though the Complainant does not show actual confusion, it is overwhelmingly likely that there will be confusion. In this case, the Expert considers that it is overwhelmingly likely that there will be confusion for the following reasons:
The Expert has also noted that the Respondent has provided no evidence that it has made any genuine attempt to provide goods or services using the Domain Name, other than merely using the domain name as a link to divert internet users to its website www.yellowcatshop.co.uk.
In light of the Expert's findings at paragraphs 28 to 43 above the Expert finds that the Domain Name is an Abusive Registration within the definition of that term in paragraph 1 of the Policy on the basis that it was registered in a manner which, at the time when the registration took place, took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
DecisionFor the reasons set out above, namely that the Complainant has Rights in respect of the name or mark which is similar or identical to the Domain Name, and that the Domain Name, in the hands of the Respondent, is an Abusive Registration, the Expert directs that the Domain Name be transferred to the Complainant.
Nick Rose
Date: 23 October 2002