Plaintiff obtains transfer of domain names under tort law

The tribunal of Lons-le-Saunier, near Lyons, has issued a decision regarding the registration by an individual of eight domain names corresponding to the business identifiers of a company of which he was a former employee. The most interesting elements of this decision relate to the grounds on which the tribunal ordered the transfer of the domain names and its dismissal of the registrant's arguments in defence.

The case involved French glasses manufacturer Gouverneur Audigier, with a history dating back to the late 19th century and a well-established company dating back to 1955. One of its former employees decided, in January 2013, to register eight domain names corresponding to the identifiers of the company, both under the generic extension ‘.com’ and the country-code top-level domain ‘.fr’. The domain names corresponded to different variations of either the business name of the plaintiff (Gouverneur Audigier, with or without hyphens) or the name of the founder of the company (Clément Gouverneur, with or without hyphens).

Upon discovering the registrations in October 2013, Gouverneur Audigier requested its former employee to transfer the domain names into its management. The registrant, a Mr Patrice G (whose details were hidden for privacy reasons), acknowledged upon receipt of the cease and desist letter that he did not have any rights in the names, but still requested compensation in the amount of €5,000 to proceed with the transfer.

Gouverneur Audigier decided to initiate legal action against Mr G, claiming that his actions constituted a fault which had disrupted the business of the company, which had planned the launch of a new digital initiative including specific internet marketing and the launch of a new line of glasses. Accordingly, in addition to the transfer of the eight domain names in question (under penalty of €3,000 per day of delay), damages in the amount of €25,000 were requested.

In his defence, Patrice G claimed, first, that the registration had occurred in the context of business management (gestion d'affaires in French) - ie, that he had registered the domain names for the benefit of the company. He also alleged that, even though he was not opposed to transferring the domain names to Gouverneur Audigier, he would not be able to do so since the domain names had to be renewed in the weeks following the hearing and he would not be entitled to conduct such renewals due to the plaintiff's opposition to such registration. Finally, he claimed that Gouverneur Audigier had not demonstrated any actual damage and requested reimbursement of the amounts spent for the registration of the domain names.

In its decision, the tribunal decided to order the transfer of the domain names but rejected the claim in damages.

Concerning the transfer of the domain names, the grounds used by the tribunal were quite original in a domain name case. Indeed, the plaintiff did not rely on a registered trademark or even on its business name to claim for the transfer of the domain names.

The tribunal simply noted that the registrant of the domain names had not contested the fact that he did not have any rights to the domain names and that the registration of the domain names, without previously informing the managers of Gouverneur Audigier, constituted a fault on his behalf. In this respect, the registrant's argument that the domain names had been registered in the context of business management was dismissed because:

• the domain names had not been registered in the name of the company but, rather, in the defendant's name;
• instead of avoiding litigation by Gouverneur Audigier with a third party to recover the domain names, the defendant's actions had still resulted in litigation; and
• the domain name registrations appeared to be a way for Mr G to leverage an offer he had made to acquire shares in the company.

In addition, the "technical" argument associated with the renewals of the domain names was simply rejected by the judges, who ruled that it was for the illicit registrant to first renew the domain names and, secondly, to ensure that they were duly transferred to their rightful owner. As a consequence of such fault, Mr G was precluded from claiming for the reimbursement of his out-of-pocket expenses for the registration of the domain names.

However, the tribunal found that the damage to the business associated with this misconduct had not been demonstrated by the plaintiff and therefore dismissed the plaintiff's claim for damages.

This decision is of interest as it reminds entities of the possibility available to them to obtain the transfer of domain names on the ground of tortious liability, as the "fault" put forward by the tribunal was a mere application of the French provisions of tort law. This cause of action can prove a helpful addition to the usual grounds of the infringement of IP rights, business name violations or breach of the provisions of Article L45-2 of the French Posts and Electronic Communications Code (which would, however, only have applied to the ‘.fr’ domain names).

David Taylor and Lionel de Souza, Hogan Lovells LLP, Paris