1748
Nominet UK Dispute Resolution Service
DRS Number 1748
Design-A-Rock and Packtex Limited
Decision of Independent Expert
1. Parties:
Complainant: Design-A-Rock
Country: GB
Respondent: Packtex Limited
Country: GB
2. Domain Name:
designarock.co.uk
3. Procedural Background:
10/05/2004 Dispute entered into system
11/05/2004 Hardcopies received in full on: 11/05/2004
14/05/2004 Complaint validated
14/05/2004 Complaint documents generated
24/05/2004 Electronic Response entered into system
24/05/2004 Electronic Response matched
25/05/2004 Forward response to complainant documents generated
02/06/2004 Reply entered into system
02/06/2004 Electronic Reply matched
02/06/2004 Electronic Reply entered into system.
07/06/2004 Reply due date amended by 1 working days because reply processed late as waiting for hard copy annexes
07/06/2004 Reply due date amended by 2 working days because reply processed late as hard copy not forwarded to legal dept until 4th
07/06/2004 Reply hardcopies received on: 03/06/2004
07/06/2004 Reply received and Initiate mediation documents generated
01/07/2004 Mediation documents generated
16/07/2004 Fees due date amended by 1 working days because rec'd within deadline
16/07/2004 Fees received from complainant on 15/07/2004
20/07/2004 Mr Chris Tulley selected as expert
4. Outstanding Formal/Procedural Issues (if any):
None
5. The Facts:
· The Complainant's business, Design-A-Rock, was set up in September 2003 by Mr Mark Pollard and Ms Julie Gamble, who were both previously employed by the Respondent, Packtex Limited.
· The Complainant and Respondent are competitors, both being involved in the sale of motifs and transfers.
· The Domain Name was registered by the Respondent on 26 November 2003 and was pointed to its own website, or a mirror image of its website, at www.packtex.com.
· The Respondent also registered the domain name designarock.com on 26 November 2003.
· The Respondent had never before traded as, or used, the Design A Rock name.
6. The Parties’ Contentions:
Complainant:
In summary the Complainant says that:
· The Design-A-Rock business was set up in September 2003. It opened a business bank account with Lloyds TSB in this name and also had stationary printed using the Design-A-Rock business name. Since then they have attended a number of trade and retail fairs promoting their products and their business name. As a result of this use of the trade mark DESIGN-A-ROCK they have built up goodwill in the name.
· In November 2003, when the Respondent found out about the Complainant's business, it immediately registered the Domain Name and the designarock.com domain name.
· As both businesses sell the same product, an individual or a business searching for the Complainant's company or product may be directed to the Respondent thinking that it is the Complainant.
· The Respondent has no product or brand or company registered as Design A Rock and has only registered the Domain Name maliciously and in full knowledge of the Complainant's rights to mislead prospective clients of the Complainant.
· The Respondent's actions amount to passing off and its sole purpose in registering the Domain Name is to disrupt the Complainant's business.
· The Complainant denies the allegations made by the Respondent that they took the Respondent's customer database or contacted the Respondent's customers, although they acknowledge that six of the Respondent's customers did contact Ms Gamble after she had left the Respondent's employment.
Respondent:
In summary, the Respondent says that:
· Both Mr Pollard and Ms Gamble were previously employees of the Respondent and Mr Pollard had all details of it's business.
· Mr Pollard had stolen the Respondent's database of customers acquired at the 2002 Printwear & Promotion exhibition, which has not been returned.
· Mr Pollard and Ms Gamble have contacted all of the Respondent's customer base.
· Having sought legal advice the Respondent believes it is entitled to keep the registration of the Domain Name.
· The Complainant can either take the dispute to a Nominet independent expert at a cost of £750.00 + VAT or alternatively to bring an end to the matter the Complainant can buy the Domain Name and the designarock.com domain name from the Respondent for £1,000.00 + VAT each.
7. Discussion and Findings:
General
In order to succeed the Complainant must prove, on the balance of probabilities, two matters, i.e. that:
1. The Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name; and
2. The Domain Name, in the hands of the Respondent, is an Abusive Registration.
These terms are defined in the Nominet UK DRS Policy as follows:
· Rights includes, but is not limited to, rights enforceable under English law. However, a Complainant will be unable to rely on rights in a name or term which is wholly descriptive of the Complainant's business.
· Abusive Registration means a Domain Name which either:
i. was registered or otherwise acquired in a manner which, at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant's Rights; or
ii. has been used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
Complainant’s Rights
The Complainant has traded under the name Design-A-Rock since September 2003 and has provided various forms of evidence of its use of the name from that time, such as letterheads, the opening of its bank account and VAT registration, a purchase invoice, a delivery note and a sales invoice.
The Complainant also has its own website at www.design-a-rock.com and has attended a number of trade and retail fairs promoting its products and business name. However, it is not clear how many of the trade and retail fairs took place before the date of registration of the Domain Name by the Respondent on 26 November 2003.
Whilst the Complainant does not claim to have any registered trade marks relating to its Design-A-Rock name that does not mean it does not have Rights as defined in the Nominet UK DRS Policy. Rights include, but are not limited to, any rights enforceable under English law and therefore unregistered passing off rights and any other rights in relation to the name are just as relevant.
The name "Design-A-Rock" is not in any way descriptive of the Complainant's business of designers and sellers of motifs and transfers. From the evidence provided by the Complainant of its use of the Design-A-Rock name I am satisfied on the balance of probabilities that it will now have acquired passing off rights enforceable under English law in relation to use of the Design-A-Rock name by others in the same or similar areas of business.
I am therefore satisfied on the balance of probabilities that the Complainant does have Rights in the name Design-A-Rock, which is identical or similar to the Domain Name.
The Complainant has therefore proved, on the balance of probabilities, the first of the two elements that it needs to prove in order to succeed in its complaint.
Abusive Registration
The second element that the Complainant must prove is that the Domain Name, in the hands of the Respondent, is an Abusive Registration as defined in the DRS Policy.
Paragraph 3 of the DRS Policy gives some examples of circumstances that may tend to show that a registration is an Abusive Registration. Paragraph 4 of the DRS Policy gives examples of how the Respondent may demonstrate that the Domain Name is not an Abusive Registration.
Factors which may be evidence that the Domain Name is an Abusive Registration
From the matters relied on by the Complainant and Respondent in their submissions the following parts of paragraph 3 are potentially relevant:
Paragraph 3 a) i) - "Circumstances indicating that the Respondent has registered or otherwise acquired the Domain Name:
A) primarily for the purposes of selling, renting or otherwise transferring the Domain Name to the Complainant or to a competitor of the Complainant, for valuable consideration in excess of the Respondent's documented out-of-pocket costs directly associated with acquiring or using the Domain Name;
B) as a blocking registration against a name or mark in which the Complainant has Rights; or
C) primarily for the purpose of unfairly disrupting the business of the Complainant;"
In response to the complaint, the Respondent has offered to sell the Domain Name to the Complainant for £1000 plus VAT i.e. a sum likely to be well in excess of the Respondent's out-of-pocket costs directly associated with acquiring or using the Domain Name.
It is important to bear in mind that registering a domain name just for the purpose of selling it is not of itself objectionable. The legitimate buying and selling of domain names is a common business. However, it is often a different story if a domain name is registered or otherwise acquired primarily for the purpose of selling it to a particular company or one of their competitors for an inflated price in excess of its acquisition costs.
However, the problem the Complainant has to overcome is that they have to show, on the balance of probabilities, that the Respondent's primary purpose in registering the Domain Name was to sell it to the Complainant or to a competitor of the Complainant at an inflated price. On the evidence before me, there is nothing to indicate any previous or other attempts by the Respondent to sell the Domain Name, either to the Complainant or any of its competitors whether or not at an inflated price. The offer to sell was not made until after the complaint was made some six months after its registration. The evidence does not show, on the balance of probabilities, that the Respondent had registered the Domain Name for this primary purpose.
In the circumstances, I am not satisfied that the Complainant can seek to rely on Paragraph 3 a) i) A) of the DRS Policy as evidence that the Domain Name is an Abusive Registration.
However, the Respondent puts forward no reason for the decision to register the Domain Name. The Respondent says that having sought legal advice the Respondent believes it is entitled to keep the registration of the Domain Name, but no further details and no reasons for this apparent belief are given.
On the evidence before me it seems to be very clear that when registering the Domain Name the Respondent was motivated by a sense of injustice arising out of the belief that Mr Pollard and Ms Gamble of the Complainant, who are both ex-employees, had stolen and misused the Respondent's customer database in order to help them set up in competition. The allegations made by the Respondent are denied by Mr Pollard and Ms Gamble but in any event it is irrelevant whether or not these allegations are true for the purposes of the DRS Policy.
The registration of the Domain Name, and its subsequent use in association with a website advertising the Respondent's business, appears to be nothing more than the Respondent's attempt to get its own back by preventing the Complainant from registering the Domain Name and unfairly disrupting the Complainant's competing business. Two wrongs do not make a right.
In the circumstances, I am satisfied that the Complainant can seek to rely on Paragraphs 3 a) i) B) and 3 a) i) C) of the DRS Policy as evidence that the Domain Name is an Abusive Registration.
Paragraph 3 a) ii) - "Circumstances indicating that the Respondent is using the Domain Name in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant;"
The Complainant points out that the Respondent has no product or brand or company called Design A Rock and says that as both businesses sell the same product an individual or a business searching for the Complainant's company or product may be directed to the Respondent thinking that it was the Complainant. The Complainant alleges that this is a deliberate and malicious attempt by the Respondent to mislead prospective clients of the Complainant in full knowledge of the Complainant's rights.
The Respondent does not challenge these points.
There is no evidence of actual confusion having occurred, but it is notoriously difficult to obtain such evidence. However, it seems clear that the Respondent's use of the Domain Name in association with a website advertising the Respondent's competing business is almost bound to confuse people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant.
In the circumstances, I am satisfied that the Complainant can seek to rely on Paragraphs 3 a) ii) of the DRS Policy as evidence that the Domain Name is an Abusive Registration.
Paragraph 3 a) iii) - "In combination with other circumstances indicating that the Domain Name in dispute is an Abusive Registration, the Complainant can demonstrate that the Respondent is engaged in a pattern of making Abusive Registrations".
The Complainant points out that the Respondent has also registered the designarock.com domain name, although there is no direct allegation by the Complainant that this amounts to a pattern of making Abusive Registration.
In any event I am not satisfied that the evidence indicates that the Respondent is engaged in a pattern of making Abusive Registrations. I do not believe that making two domain name registrations is sufficient to amount to a pattern of behaviour.
In the circumstances, I am not satisfied that the Complainant can seek to rely on Paragraph 3 a) iii) the DRS Policy as evidence that the Domain name is an Abusive Registration, if that is what the Complainant was seeking to do.
Factors which may be evidence that the Domain Name is not an Abusive Registration
Only one of the examples in paragraph 4 of the DRS Policy appear to be potentially relevant.
Paragraph 4 a) i) A) - "Before being informed of the Complainant's dispute, the Respondent has used or made demonstrable preparations to use the Domain Name or a domain name which is similar to the Domain Name in connection with a genuine offering of goods or services.
The Domain Name was pointed to the Respondent's website, or a mirror image of its website, at www.packtex.com which offers its goods and services for sale. However, there is nothing in the evidence submitted to indicate whether this first happened before or after the Respondent was informed of the Complainant's dispute. In addition, the evidence clearly suggests that the Respondent's use of the Domain Name was motivated by a desire unfairly to disrupt the Complainant's competing business by confusing people into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant. As such, I cannot see how the Respondent's use of the Domain Name to offer its goods and services could be said to be a genuine offering if the offering of those goods and services amounts to passing off.
In the circumstances, I am not satisfied that the Respondent can seek to rely on Paragraph 4 a) i) A) of the DRS Policy as evidence that the Domain Name is not an Abusive Registration.
However, as the factors set out in paragraph 4 of the DRS Policy are non-exhaustive examples, it was still open to the Respondent to rely on other factors to demonstrate that the Domain Name is not an Abusive Registration, but the Respondent has not put forward any other factors.
8. Decision:
As a result of the use of the Design-A-Rock name since September 2003 I am satisfied on the balance of probabilities that the Complainant does now have Rights in the name. However, the precise extent, and enforceability under English law, of the Complainant's rights in respect of the name as at the date of registration of the Domain Name by the Respondent on 26 November 2003 is not entirely clear, given that the Complainant only commenced its business under the Design-A-Rock name some two months previously. Having said that, even just two months of active trading under the name is likely to have given the Complainant some element of rights in respect of the name.
It also seems clear from the evidence that the Respondent's motivation for registering the Domain Name was to prevent the Complainant from doing so, and unfairly to disrupt the business of the Complainant.
I am therefore satisfied on the evidence before me on the balance of probabilities that at the time when the registration of the Domain Name took place on 26 November 2003 it was registered in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
In addition, the Respondent has subsequently used the Domain Name in relation to its website offering the Respondent's goods and services for sale. This is likely to confuse people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant.
In the circumstances, I am satisfied on the evidence before me on the balance of probabilities that the Domain name has been used in a manner which takes unfair advantage of or is unfairly detrimental to the Complainant's Rights.
For the reasons outlined above I find that the Complainant has proved on the balance of probabilities that it has Rights in respect of the name "Design-A-Rock", being a name or mark which is identical or similar to the Domain Name, and that the Domain Name, in the hands of the Respondent, is an Abusive Registration.
In the circumstances I order that the Domain Name be transferred to the Complainant.
Chris Tulley
Date: 28 July 2004