Congratulations to David Lin from Lewis & Lin winning another case

Congratulations to David Lin from Lewis & Lin winning another case

I must actually apologise to David, He sent me this story on Friday and I haven’t had a chance to blog over the weekend, Lewis & Lin LLC has successfully won the case for Palace.com in case number D2013-0559.

Another excellent victory for law practice and hopefully this case shall also shows companies that think they can just swoop in and take generic domain name away from rightful holders without buying the domain name from the current owner.

Here is the full case below.

ARBITRATION
AND
MEDIATION CENTER

ADMINISTRATIVE PANEL DECISION

Palace Sports & Entertainment LLC v. Palace Enterprises, NV

Case No. D2013-0559

 1. The Parties

Complainant is Palace Sports & Entertainment LLC of Auburn Hills, Michigan, United States of America (“U.S.”), represented by Hand Baldachin & Amburgey, LLP, U.S.

 

Respondent is Palace Enterprises, NV of New York, New York, U.S., represented by Lewis & Lin, LLC, U.S.

 

2. The Domain Name and Registrar

The domain name at issue, <palace.com > (“Domain Name”), is registered with GoDaddy.com, LLC (“Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (“Center”) on March 22, 2013.  On March 22, 2013, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Name.  On March 22, the Registrar transmitted by email to the Center its verification response, confirming that Respondent is listed as the registrant and providing contact information and other details pertaining to the registration.

 

The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (“Policy” or “UDRP”), the Rules for Uniform Domain Name Dispute Resolution Policy (“Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (“Supplemental Rules”).

 

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified Respondent of the Complaint, and the proceedings commenced March 28, 2013.  In accordance with the Rules, paragraph 5(a), the due date for Response was April 17, 2013.  The Response was filed with the Center on April 17, 2013.

 

The Center appointed Debra J. Stanek, Jonathan Hudis and W. Scott Blackmer as panelists in this matter on June 6, 2013.  The Panel finds that it was properly constituted.  Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

 

4. Factual Background

Complainant owns a U.S. federal trademark registration for a design mark that includes the words “the palace of Auburn Hills.”  THE PALACE OF AUBURN HILLS and design mark was registered in December 1990.  Complainant also claims rights in the unregistered mark, PALACE.  According to the publicly available WhoIs database, the <palace.com> Domain Name was created on July 16, 1993;  it does not currently lead to an active website.

5. Parties’ Contentions

A. Complainant

1. Identical or Confusingly Similar

Complainant owns common law rights in the mark PALACE for its renowned sporting and entertainment facility located in the Detroit metropolitan area in the U.S.  The facility is well-known.  The Domain Name is identical to Complainant’s PALACE mark.

 

Complainant owns a U.S. federal trademark registration, which issued in December 1990, for the mark THE PALACE OF AUBURN HILLS and design for entertainment services.  The Domain Name is confusingly similar to Complainant’s registered mark THE PALACE OF AUBURN HILLS because the “prominent component” of the mark is the word “palace,” which is identical to <palace.com>, while the remainder of the mark simply refers to a geographic location.

 

2. Rights or Legitimate Interests

Complainant has not authorized Respondent to use <palace.com> and does not have a business relationship with Respondent.

 

Complainant has been using the mark PALACE since 1988.

 

Respondent is not using the Domain Name;  a website testing service was unable to connect to it.

 

An Internet search did not disclose information on Respondent, apart from records of the Domain Name registration.  Respondent does not own any U.S. federal trademark applications or registrations containing the word “palace”, or any other term.  Therefore Respondent “does not have any legitimate company or trademark containing the word ‘Palace’ and Respondent is not known under the name ‘Palace.’”

 

3. Registered and Used in Bad Faith

Respondent is not operating a website at the <palace.com> Domain Name and is not using in commerce a trademark that contains the word “palace.”

 

Respondent offered the Domain Name for auction through the Registrar’s auction service.  Complainant bid USD 10,000 to purchase the Domain Name.  Subsequently, Complainant was advised that the Domain Name had been withdrawn from the auction and that Respondent instituted an auction at a “third-party trafficking” site.  Respondent’s sole interest in the Domain Name is to obtain an even higher price from Complainant, which would be well above the costs of maintaining the Domain Name.

 

B. Respondent

1. Identical or Confusingly Similar

Complainant has not established common law rights in the mark PALACE.  Complainant has not submitted any evidence of common law rights, such as evidence of the mark’s “secondary meaning,” including in respect of the length and amount of sales under the trademark, the nature and extent of advertising, consumer surveys and media recognition.  Information regarding the distinctiveness or secondary meaning of the mark would be within Complainant’s knowledge.  Complainant’s assertion that it began using PALACE as a trademark in 1988 is not evidence of such use and does not create a presumption of such use.

 

Because the dictionary defines the word “palace” as “a large and usually ornate place for entertainment, exhibitions, etc.”, the term is generic for Complainant’s sporting and entertainment arena facility and is not entitled to any trademark protection.  This is further evidenced by the numerous other sporting and entertainment arenas that have the word “palace” in their names, including:  Alhambra Palace, Buck Owens Crystal Palace, Cadillac Palace, Caesars Palace, Ice Palace, Imperial Palace, Lorain Palace, Louisville Palace, San Antonio Rose Palace, Tachi Palace, Vallarta Palace, and Victoria Palace.

 

Complainant’s registered mark, moreover, consists of an intricate drawing along with the phrase “the palace of Auburn Hills.”  The graphic elements of the mark dominate and Complainant did not separately register THE PALACE OF AUBURN HILLS as a word mark.

 

Even assuming that Complainant has trademark rights in THE PALACE OF AUBURN HILLS, the Domain Name <palace.com> is not identical or confusingly similar.  The mark consists of five words, including “palace” and the geographic identifier “Auburn Hills.”  Complainant has combined two generic elements to make a distinctive combination;  without both, the mark has no distinctiveness.

 

Common, dictionary word domain names are available for registration on a first-come, first-served basis, for their generic value, where such names are not associated exclusively with any one company.

 

2. Rights or Legitimate Interests

The declaration of Respondent’s president states he acquired the Domain Name in December 2008 – several years prior to its receipt of the Complaint – through another entity with the intention of using it in connection with an online casino.

 

Shortly thereafter, Respondent’s president engaged in preliminary activities including:  designing a logo and creating an initial home page to which the Domain Name resolved.  The initial page stated:

 

“The very best in online gaming is coming to Palace.com. We have all your favorite new and classic “table games, and slots for free or cash.  Sign up today for membership information!”

 

He also planned a search engine optimization strategy, took steps to implement use of Google Analytics for the site, and later posted a different “Coming Soon” message on the site.  In June 2009, the Domain Name was transferred to Respondent, a corporation organized in Curacao, one of the oldest and most politically stable providers of regulated e-gaming licenses.

 

Respondent subsequently entered into an agreement for development of computer software for the site, opened a corporate bank account with an e-commerce payment company, and entered into an agreement for co-location and bandwidth.  Sometime in August 2011, Respondent decided to delay launch of its site upon learning that the U.S. might legalize online gambling;  Respondent is currently awaiting developments.

 

Respondent had the right to register the Domain Name because it is comprised of a dictionary word, capable of multiple uses, and was not, to its knowledge, associated with any one company.

 

The Domain Name is identical to Respondent’s corporate name.

 

3. Registered and Used in Bad Faith

Complainant has not established that Respondent registered and uses the Domain Name in bad faith.

 

Respondent did not register the Domain Name to sell it to Complainant and has never offered to sell the Domain Name to Complainant or to anyone.

 

Respondent was unaware of Complainant at the time it registered the Domain Name.

 

Respondent never knowingly authorized any other party to offer the Domain Name for sale.  In March 2013, when Respondent received notices from the Registrar indicating that another customer had expressed an interest in purchasing the Domain Name, Respondent did not respond as it was not interested in selling the Domain Name.

 

Respondent argues that Complainant has engaged in an attempt at Reverse Domain Name Hijacking, pointing to the fact that the Domain Name consists of a generic term and that a review of the Internet Archive would have shown that “Respondent had been using the Domain Name in connection with a legitimate business.”

 

6. Discussion and Findings

In order to prevail, a complainant has the burden of showing, as to a disputed domain name, that:

 

(i)      It is identical or confusingly similar to a mark in which the complainant has rights.

 

(ii)     The respondent has no rights or legitimate interests in respect to it.

 

(iii)     It has been registered and is being used in bad faith.

 

Policy paragraph 4(a).  The Policy sets out examples of circumstances that may evidence a respondent’s rights or legitimate interests in a domain name, see paragraph 4(c) of the Policy, as well as circumstances that may evidence a respondent’s bad faith registration and use, see paragraph 4(b) of the Policy.

 

A. Identical or Confusingly Similar

Complainant does not claim any registration for the mark PALACE and must therefore establish common law rights in the unregistered mark.  Here, Complainant has not provided any evidence of the type that establishes rights in a mark that has not been registered.  See WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”), paragraph 1.7 (a complainant asserting rights in a mark that is not registered must show mark has become a distinctive identifier for party or its goods and services, such as by evidence of length of use, amount of sales, nature and extent of advertising, consumer surveys, and media recognition of mark).

 

The Complaint asserts in a conclusory fashion that Complainant’s facility has been commonly known to the public for over 20 years and the mark is “renowned” in the Detroit area.[1]  Apart from a copy of unidentified “promotional material” (apparently a screen shot from a web page) that depicts the term “Palace” in larger type above the phrase “sports & entertainment,” Complainant has not provided any evidence regarding length of use, sales, nature and extent of advertising, consumer surveys, media recognition or other information that would establish rights in a mark that is not registered.

 

The Panel concludes that Complainant in the present proceedings has not established rights in the unregistered mark PALACE.

 

 

The Panel finds that Complainant has rights in the mark THE PALACE OF AUBURN HILLS and design by virtue of its U.S. federal trademark registration.  The question then becomes whether the Domain Name is in effect (disregarding “.com”, etc.) identical or confusingly similar to that mark.  Complainant’s registered mark and the Domain Name are not identical.

 

For purposes of confusing similarity, Complainant must establish that the Domain Name is confusingly similar to Complainant’s mark, determined with reference to the degree of resemblance between the domain name and mark at issue as to appearance, sound, and meaning.  See, e.g., WIPO Overview 2.0, paragraph 1.2 (generally, test for confusing similarity involves straightforward comparison of trademark and alphanumeric string making up the domain name).

As a general matter, a domain name is likely to be deemed to be confusingly similar to a mark if it incorporates the mark or a variation or dominant portion of the mark;  however, such a finding is not automatic.  Here, the Domain Name does not incorporate the mark in its entirety, but only the single term “palace.”  Complainant argues that “palace” is the dominant feature of its mark. The Panel finds, however, that the additional words in Complainant’s mark – “the” and “of Auburn Hills” – serve to differentiate it from the Domain Name in appearance, pronunciation, and connotation, and is therefore not convinced of the likelihood of Internet user confusion in this case.

 

The Panel therefore finds that the Domain Name is not identical to or confusingly similar to a mark in which Complainant has been shown to have rights under paragraph 4(a) of the Policy.

 

B. Rights or Legitimate Interests

In light of the conclusion that Complainant failed to establish the first element, it is not necessary to address the issue of Respondent’s rights or legitimate interests in, or bad faith in registering and using, the Domain Name.  However, in the interests of completeness, and because Respondent argues that Complainant has engaged in Reverse Domain Name Hijacking, the Panel finds it appropriate to include a discussion of its findings on the second and third elements in the decision.

 

The Panel, consistent with the well-established UDRP jurisprudence, finds that a complainant may establish that a respondent has no rights or legitimate interests in respect of a domain name by making a prima facie showing that a respondent lacks rights or legitimate interests.  See WIPO Overview 2.0, paragraph 2.1 (after a complainant makes a prima facie case, the burden of production to show rights or legitimate interests in the domain name shifts to the respondent).

 

Paragraph 4(c) of the Policy sets out the following examples:

 

“(i)     before any notice to you of the dispute, your use of, or 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; or

 

(ii)     you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

 

(iii)     you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.”

 

The Panel concludes that, under the circumstances presented here, Complainant failed to make a prima facie showing under this element for the following reasons:

 

First, Complainant asserted that the Domain Name was first registered twenty years ago – in 1993 – supporting its claim that “Respondent is not using the domain name in commerce” with a single 2013 website test showing an inability to connect to a “www.palace.com” website.  It appears, in fact, as Respondent’s evidence shows, that Respondent not did not acquire the Domain Name until December 2008.  Whether Respondent acquired the Domain Name in 1993 (as Complainant apparently believed) or in 2008, the Panel finds that the use of a single contemporaneous website test is not sufficient in the present proceedings to establish a prima facie case.  This is particularly true, where, as here, archived copies of web pages from the “www.palace.com” website are freely and readily available through the Internet Archive’s Wayback Machine.  In addition to archived pages dating back to 1996, a search of the archive discloses Respondent’s initial “coming soon” page and subsequent similar announcements.

 

Second, Complainant knew that the WhoIs record identified the registrant of the Domain Name as “Palace Enterprises, NV.”  Apparently in an effort to address this, it asserted that:

 

“A search on the internet for Respondent’s entity name yields no results aside from domain registration records.  See Annex 8.  Respondent owns no U.S. federal trademark application or registration containing the word “palace.”  Indeed, no U.S. federal trademark records were found that are associated with the Respondent.  Therefore, the Respondent does not have any legitimate company or trademark containing the word ‘Palace’ and the Respondent is not known under the name ‘Palace.’”

 

Complainant’s Annex 8 (the results of a Google search for “Palace Enterprises, NV”), however, contradicts the first assertion quoted above.  The document does contain more than references to domain name registration records.  Complainant’s search results include two similar results, each of which contains a reference to “Palace Enterprises N.V.” and associates it with the Domain Name <palace.com> on a table that also lists a license number and status.  Each result gives the same address in Curacao, Netherlands Antilles.  While the abbreviation “N.V.” may not be as widely understood in the U.S. as in other countries, it is not obscure.  One can readily learn, and one would expect a party represented by counsel would learn, that it can be an abbreviation for the Dutch words, “Naamloze Vennootschap,” signifying a particular corporate form.

 

The fact that an entity does not own any U.S. federal trademark applications or registrations may be somewhat relevant.  Without more, however, it is not sufficient to establish a prima facie case, much less that Respondent could not be a “legitimate company” or be known under the name “Palace.”  This is particularly true here where it is evident that the entity in question is not a U.S. corporation.

 

In any case, the Panel concludes that Respondent has established, through the declaration of its president and other documentary evidence, that it acquired the Domain Name several years before learning of Complainant.  That evidence also shows the demonstrable preparations that Respondent has undertaken to use the Domain Name with a bona fide offering of goods or services as well as Respondent’s use of “Palace” in its corporate name.

 

Accordingly, based on the case record the Panel finds that Complainant has not established that Respondent lacks rights or legitimate interests in respect of the Domain Name under paragraph 4(a) of the Policy.  Further, the Panel finds that Respondent has established its rights and legitimate interests in the Domain Name under paragraph 4(a)(ii) of the Policy.

 

C. Registered and Used in Bad Faith

A complainant must establish that the domain name was registered and is being used in bad faith.  The Policy sets out four non-exclusive circumstances, evidence of which may establish bad faith (see Policy, paragraph 4(b)(i)-(iv)):

 

(1)     Registering the domain name primarily to sell it for more than documented out-of-pocket costs (see Policy, paragraph 4(b)(i)).

 

(2)     Registering the domain name to prevent the owner of the trademark from reflecting the mark in a domain name, where there is a pattern of such conduct (see Policy, paragraph 4(b)(ii)).

 

(3)     Registering the domain name primarily to disrupt the business of a competitor (see Policy, paragraph 4(b)(iii)).

 

(4)     Using the domain name to intentionally attempt to attract, for commercial gain, Internet users to [respondent’s] website or other on-line location, by creating a likelihood of confusion with complainant’s mark as to the source, sponsorship, affiliation, or endorsement of [respondent’s] website or location or a product or service on [the respondent’s] website or location, (see Policy, paragraph 4(b)(iv)).

 

Complainant’s sole argument on this element is that Respondent is “trafficking” in the domain name, seeking to get more money from Complainant than the USD 10,000.00 that Complainant previously bid when Respondent learned the Domain Name was being offered at auction.  Complainant provides little evidence on this point,[2] but asserts that “GoDaddy reported that Respondent had decided to institute an auction at the third-party domain trafficking site sedo.com …. Annex 10.”  Complainant’s Annex 10 (an email message from […]@godaddy.com), however, does not support this characterization. Instead, the email message states only that that the auction listing was canceled via a third-party listing agent.

 

The fact that Respondent rejected Complainant’s bid for USD 10,000.00 does not establish that Respondent’s purpose in registering the Domain Name was to sell it to Complainant.

 

Accordingly, the Panel finds that Complainant has not established that Respondent registered or is using the Domain Name in bad faith under paragraph 4(a) of the Policy.

 

D. Reverse Domain Name Hijacking

As noted above, Respondent has argued that Complainant has attempted to engage in Reverse Domain Name Hijacking (defined in the Rules, paragraph 1, as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name”).  The Rules, paragraph 15(e), provide:

 

“If after considering the submissions the Panel finds 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, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.”

 

As discussed above, the Panel has concluded that Complainant failed to establish the required elements.  Complainant did not provide support for its claim of common law rights in the ordinary English word “palace” and did not persuade the Panel that its design mark that contained the word “palace” was confusingly similar to the Domain Name.  The Panel noted that the Complaint contained some assertions that appeared to be contradicted by Complainant’s own exhibits and that, under the circumstances, some readily and publicly-available Internet research would have been appropriate.

 

Nonetheless, Complainant did establish ownership of a U.S. federal trademark registration containing a term used in the Domain Name and presented an argument that the Domain Name was confusingly similar to that mark.  Further, it does not appear that Complainant had access to the details of Respondent’s company registration or Respondent’s preparations to use the Domain Name before filing the Complaint.

 

Therefore, the Panel does not conclude that the Complaint was brought in bad faith or brought primarily to harass Respondent and declines, on this record, to find that Complainant attempted to engage in Reverse Domain Name Hijacking.

 

7. Decision

For the foregoing reasons, the Complaint is denied.

 

 

 

 

Debra J. Stanek

Presiding Panelist

 

 

 

 

Jonathan Hudis

Panelist

 

 

 

 

W. Scott Blackmer

Panelist

Date:  June 19, 2013



[1] The Complaint is signed only by Complainant’s counsel;  no information is included that suggests that these assertions are or would be based on his personal knowledge.

[2] As previously noted, the assertions of the Complaint are certified only by Complainant’s counsel.

About the Author

Robbie
Robbie Ferguson is an Internet Entrepreneur, Domain Investor, Domain Broker, Blogger and founder of various websites and eCommerce businesses such as ScreenProtectors.co.uk

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