Failure to actively use domain name not in itself evidence of bad faith

Australia

Spain-based online travel company Vacaciones eDreams SL has lost a case filed under the ‘.au’ Dispute Resolution Policy (auDRP), which applies to domain names registered under ‘.au’, the country-code top-level domain for Australia. The domain name at issue was ‘edreams.com.au’, which was registered by Australian company BuyDirect Pty Ltd on November 29 2011, when it was allowed to lapse by its previous registrant.

The auDRP is very similar to the Uniform Domain Name Dispute Resolution Policy (UDRP), which applies to various generic top-level domains, such as ‘.com’. To succeed under the auDRP, a complainant must evidence that:

  • the domain name is identical, or confusingly similar, to a name (meaning a company, business or other legal or trading name, as registered with the relevant Australian government authority), trademark or service mark in which the complainant has rights;
  • the respondent has no rights or legitimate interests in respect of the domain name; and
  • the domain name has been registered or subsequently used in bad faith.

It can be seen that one of the main differences between the auDRP and the UDRP is that, under the auDRP, it is sufficient to prove that either registration or subsequent use of the domain name by the registrant occurred in bad faith, whereas the UDRP requires that the complainant prove both these elements.  

The panel appointed by the World Intellectual Property Organisation had no difficulty in finding that the first limb was satisfied, as the complainant owned a number of EDREAMS marks, including one in Australia.

However, the second and third limbs were not made out. Given the complainant's failure to prove bad faith under the third limb, the panel did not feel it necessary to set out detailed reasoning as regards the complainant's failure to establish the respondent's lack of rights or legitimate interests under the second limb.

Turning to the complainant's failure to prove that the respondent had registered the domain name in bad faith, the panel was convinced by the respondent's evidence that the complainant was not particularly well known in Australia. In particular, the respondent provided evidence that the complainant did not appear in the list of the "Hitwise Hottest 100 Australian Travel Websites", and that there were few references to the complainant in the English-speaking online media. The panel repeated the respondent's Google search and noted that the complainant did not appear on any of the first 10 pages of results.

In its arguments relating to good-faith registration, the respondent also asserted that:

  • the term ‘eDreams’ was used descriptively or as an abbreviation for ‘electric dreams’; and
  • there were numerous ‘eDreams’ domain names registered by third parties unrelated to the complainant.

Somewhat mysteriously, the respondent also stated that its director had "a strong personal association with the 80s movie 'Electric Dreams' and the hit song 'Together in Electric Dreams'", which is why the domain name caught his attention when it was listed as ‘Pending Deletion’. Moreover, the respondent underlined that the complainant had already lost three separate UDRP cases in 2006 and 2009 relating to the domain names ‘edream.com’, ‘e-dreams.com’ and ‘edrams.com’.

In all the circumstances, and having regard to the evidence adduced, the panel found, on balance of probability, that:

  • the respondent did not register the domain name in an attempt to appropriate the complainant's goodwill in its name or trademark; and
  • its registration of the domain name was not in bad faith.

This finding was not affected by the fact that the respondent had subsequently become aware of the complainant's trademark, given that it was not unreasonable for the respondent to believe that its intended use of the domain name in relation to an online e-commerce store selling high-end environmentally friendly products for the home would not infringe the complainant's mark.

As far as bad-faith use was concerned, the panel pointed out that the respondent's failure to actively use the domain name was not in itself evidence of bad faith, especially because the domain name had been inactive for only a month at the time the complaint was filed, and this month coincided with part of the summer vacation period in Australia. Furthermore, the panel believed that the respondent's stated planned use was not intended to give rise to confusion with the complainant or its services, especially given the evidence of substantial third-party use of the term ‘eDreams’ in a variety of fields. Bad-faith use was therefore not made out.

The respondent also requested the panel to make a finding of reverse domain name hijacking, defined in the UDRP Rules as using the UDRP in bad faith to attempt to deprive a registered domain name holder of a domain name. However, the panel refused to do this, even though the complainant had omitted certain facts from the complaint (eg, regarding the four attempts it had made to buy the domain name), as it found that such omissions were not critical.

David Taylor and Jane Seager, Hogan Lovells LLP, Paris

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