The
Impact of "Reverse Domain Name Hijacking"
By
Jay Hollander
Jay Hollander, Esq. is the principal of Hollander and Company LLC, www.hollanderco.com, a New York City law firm concentrating its efforts in the protection and development of property interests relating to real property, intellectual property and commercial interests, as well as related litigation.
The content of this article is intended to provide general information relating to its subject matter. Providing it does not establish any attorney-client relationship and does not constitute legal advice. Personal advice in the context of a mutually agreed attorney-client relationship should be sought about your specific circumstances. Summary: "Reverse
domain name hijacking" is a tactic used by a complainant
in bad faith to attempt to deprive a registered domain-name
holder of a domain name. A number of disputes under the
Uniform Domain Name Dispute Resolution Policy have shown
that this "bad faith" can arise under many circumstances,
including when confusion is unlikely, when the complainant
fails to disclose certain facts and when a domain name
registrant has not used a domain name. This article explains
these cases and how reverse domain name hijacking affects
domain disputes.
Introduction
to Domain Name Dispute Procedures
By
now, everyone who follows legal issues relating to the
Internet is intimately familiar with the concept of "cybersquatting," the
practice of registering and using a well-known trademark
in a domain name in bad faith either to keep it away from
its rightful owner or to exact a profit from the owner
in exchange for the return of the name.
Laws,
such as the AntiCybersquatting
Consumer Protection Act, allow trademark owners to
use the courts for relief against cybersquatters, but court
battles often prove long and expensive.
As
a result, the Internet
Corporation for Assigned Names and Number (ICANN),
the quasi-governmental body assigned to establish rules
of the road for the Internet, created a limited administrative
remedy that allows trademark owners and others having rights
in a disputed domain name to get their name back.
That
remedy is contained in a procedure known as the Uniform
Domain Name Dispute Resolution Policy (UDRP), a policy
originally intended to be used as a cost-effective weapon
against those who register domain names in violation of
the rights of trademark holders or others having rights
in a disputed domain name.
Under
the policy, complainants must prove, among other things,
that the current domain name registrant both registered
and used the disputed domain name in "bad faith," and that
the current registrant has no legitimate interest in the
name.
Since
its creation, the majority of the cases brought under the
UDRP have resulted in victories for trademark holders and
other complainants, sometimes even against the so-called "little
guy" and sometimes against registrants who did not even
make commercial use of the name.
But
an increasing number of recent cases have relied on an
underreported provision of the UDRP to highlight a growing
trend that should make causal complainants less sanguine
about their ability to win a UDRP proceeding just by showing
up and claiming bad faith simply because they own a trademark.
That trend, known as "reverse domain name hijacking," describes
a practice in which trademark holders engage in a bad-faith
attempt to use the UDRP to wrongfully strip the legitimate
registrant and user of a desired domain name simply because
the complainant holds a trademark in that name or one similar
to it.
Understanding
the concept of reverse domain name hijacking will be helpful
if you see yourself as "David" against "Goliath" in a domain
name dispute. However, without question, it's the complainant
who especially needs to understand this concept, to avoid
crossing the line that has been drawn and ruining its chances
for relief under the UDRP and, possibly, other forums as
well.
What
Is Reverse Domain Name Hijacking?
According
to UDRP
Rule 1, the term "Reverse Domain Name Hijacking" means "using
the Policy [the UDRP] in bad faith to attempt to deprive
a registered domain-name holder of a domain name."
According
to Rule 15(e), panels finding such bad faith are not only
empowered to deny the complaint, but they are directed
to affirmatively find the presence of bad faith. In relevant
part, the rule states:
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
you can see, these rules don't really flesh out what qualifies
as a "bad faith" complaint. So, to answer the question
of what makes for a bad faith UDRP complaint and what facts
justify a finding of reverse domain name hijacking, we
need to look at some illustrations.
According
to the recent rulings, reverse domain name hijacking occurs
when a complaint is brought despite knowledge that the
domain name holder has a right or legitimate interest in
the domain name or that the name was registered in good
faith, with or without the aggravating circumstance of
harassment or proven bad intent by the complainant seeking
to gain the name.
Here's
how reverse domain name hijacking was defined in the ruling
in Goldline
International, Inc. v. Gold Line:
To
prevail on such a claim [of reverse domain name hijacking],
Respondent must show that Complainant knew of Respondent's
unassailable right or legitimate interest in the disputed
domain name or the clear lack of bad faith registration and
use, and nevertheless brought the Complaint in bad faith.
In
that case, the complainant, Goldline International, was
a business dealing in goods and services relating to coins
and precious metals. The respondent, Gold Line Internet,
was the business name for an individual who ran a consulting
business specializing in intellectual property, including
intellectual property arising from the use of vanity domain
names and 800 telephone numbers.
The
required "bad faith" registration and use of the domain
name "goldline.com" was claimed by the complainant primarily
because of a claimed likelihood of confusion with the complainant's
name, even though the two businesses had nothing to do
with each other and were unlikely to be confused with each
other in actuality. Moreover, the panel found that the
respondent had brought this, and other facts undermining
the case, to the complainant's attention before the case
was commenced.
In
finding that the complainant had engaged in prohibited
reverse domain name hijacking, the Goldline panel
noted:
Complainant's
actions in this case constitute bad faith. Prior to filing
its Complaint, Complainant had to know that Complainant's
mark was limited to a narrow field, and that Respondent's
registration and use of the domain name could not, under
any fair interpretation of the facts, constitute bad
faith. Not only would a reasonable investigation have
revealed these weaknesses in any potential ICANN complaint,
but also, Respondent put Complainant on express notice
of these facts and that any further attempt to prosecute
this matter would be abusive and would constitute reverse
domain name "hijack[ing]"....
Complainant's decision to file its Complaint in the face
of those facts was in bad faith. Accordingly, the Panel
finds that Complainant has engaged in Reverse Domain
Name Hijacking.
Even
more important was the Goldline panel's adoption of a standard
set down in Smart
Design LLC v. Hughes, a case where the panel also
found reverse domain name hijacking not because of established
bad intent, but because the allegations of the respondent's
bad faith were made in a manner that the panel concluded
should have been obvious as insufficient to the complainant.
In Smart
Design, the panel concluded that the complainant
committed reverse domain name hijacking even though it
did not explicitly find bad faith. The panel concluded
that the complainant made allegations that the respondent
acted in bad faith in reckless disregard of whether the
facts underlying its claims supported that finding. As
the panel found:
The
Panel is unable to assess the Complainant's state of mind
when the Complaint was launched, but in the view of the Panel
the Complaint should never have been launched. Had the Complainant
sat back and reflected upon what it was proposing to argue,
it would have seen that its claims could not conceivably
succeed.
In
other words, the standards exemplified by Smart Design
and Goldline show that bad faith and a resulting finding
of reverse domain name hijacking can be found not only
in cases showing malicious intent, but also in cases where
the panel subjectively concludes that the complainant brought
a case that the panel retroactively concludes should have
been obviously insufficient to the complainant.
If
you think that this type of standard leaves a lot of room
for interpretation, you're right. But it doesn't stop there.
Selective
Disclosure
Other
UDRP panels have gone even further and found bad faith
based on their evaluation of whether a complainant bared
all the relevant facts of a dispute within the four corners
of the complaint.
A dispute over
the domain name "armani.com" shows this point. The complainant
was the registered proprietor of the trademarks ARMANI,
GIORGIO ARMANI, and EMPORIO ARMANI, which it had registered
in a large number of countries including the United Kingdom,
the United States of America and Canada. The Rrspondent
was a graphic artist and technical illustrator, whose full
name is Anand Ramnath Mani, but who had been doing business
under the name A.R.Mani for some time, according to the
panel's findings.
The
complainant's first offer to the respondent to purchase
the name for $1,250 (Canadian) was met with a counter offer
of $1,950.00 (U.S.) plus an assurance that complainant
wouldn't oppose him in his registering "amani.com". The
complainant didn't agree and, instead, filed a complaint
under the UDRP, charging that Mr. Mani was a cybersquatter
who had no rights to use its international trademark.
Apparently,
the complainant did not choose to mention these failed
negotiations in its complaint, but when Mr. Mani brought
it up in his defense, it then tried to use it as "proof" of
his bad faith. The panel strongly disagreed and instead
found that the complainant was the one showing bad faith
by bringing the complaint at all and by not being forthcoming
with all the facts, an omission determined by the panel
to have been at odds with the complainant's required UDRP
certification that "the information contained in the Complaint
is to the best of the Complainant's knowledge complete
and accurate."
Non-Commercial
of the Use
This
apparent imposition on the complainant of the burden of
not only making its case, but pointing out its own weak
points as well, also came up in a proceeding involving
an effort to recover a domain name from a registrant who
claimed to intend to use it for personal or non-commercial
purposes.
In Societe
des Produits Nestlé S.A. v. Pro Fiducia Treuhand
AG, the Nestle company sought to recover the "maggie.com" domain
name for one of its subsidiaries. The respondent did
not then have a website, but it claimed to have been
developing one for personal use and for use of a family
foundation.
Here,
too, there had been failed negotiations that were omitted
from the complaint, an omission to which the panel strongly
objected:
As
a result of its rather lengthy dealings with Mr. Maggi, Complainant
was aware that Mr. Maggi intended to use the Domain Name
for personal use, yet Complainant ignores these negotiations
in the Complainant and fails to even mention Respondent's
alleged personal interest in the Domain Name.
As
a result, the panel not only declined to grant the relief
requested by Nestle, but it found the complainant to be
in bad faith as well and guilty of reverse domain name
hijacking.
What
it All Means
What
can be learned from the recent cases boils down to this:
A proceeding under the UDRP isn't the way to determine
complex trademark issues. It is a limited proceeding originally
intended to be used in very limited circumstances and where
there may be a backlash in the making against previous
decisions that, in retrospect, seem too expansive in the
extent to which they rewarded trademark holders.
Further,
as the number of these complaints grows, the dependency
of the panels upon the candor and comprehensiveness of
the submissions has fueled a sense of righteous indignation
when the panel concludes that the complainant has "held
back" on the panel.
The
growing number of panel decisions finding reverse domain
name hijacking on the part of complainants means that this
is a charge that will be more reflexively leveled by respondents
in such proceedings. Since UDRP rules do not automatically
allow for replies or rebuttals to a respondent's answer
to a complaint -- this means that UDRP complaints will
now have to be tailored differently to survive such charges.
Some complaints may, in fact, no longer be brought in view
of the emerging interpretations of the reverse domain name
hijacking standard.
These
cases reinforce the notion that the UDRP procedure was
established to handle only a very limited type of case.
It was specifically designed to prevent cybersquatting,
not necessarily trademark infringement. It is now painfully
clear that it is possible to have a valid trademark and
yet fail in a cybersquatting action under the UDRP.
If
you still feel you have a legitimate complaint, how should
you integrate the lessons of the cases illustrated here?
Be
polite and don't bully or harass the respondent, because
that is a very quick way to be found a reverse hijacker,
and don't be sneaky and withhold pertinent information
from the arbitration panel. Your opponent is going to raise
those facts anyway, and that may paint you as acting in
bad faith. If the respondent offers to sell you the disputed
name for a reasonable sum, accept it or refuse, as you
wish, but don't thereafter bring a complaint under the
UDRP, alleging bad faith on the respondent's part, because
it's not likely to persuade the panel.
Remember
that the burden of proof is on the complainant under the
UDRP rules, so you must provide enough evidence to prove
each and every element of your complaint.
Conclusion
Cybersquatting
proceedings are still relatively new legal territory but,
as the cases continue to proliferate, it is becoming more
and more apparent what works and what doesn't. Judging
from recent rulings, it's clear that in a UDRP action,
you need to watch out for Rule 15(e) and evaluate with
your attorney carefully -- before deciding to file a complaint
-- whether you might be vulnerable to a countercharge of
reverse domain name hijacking. Attempts to "bypass legitimate
disputes over trademark rights" is not the way to win under
the UDRP. Copyright © Jay Hollander, 2007. All Rights Reserved.
![]()
![]()
|
