US state registrations get a flat tire in UDRP decision

A recent domain name dispute under the Uniform Domain Name Dispute Resolution Policy (UDRP) has confirmed the well-established principle that state trademark registrations, as opposed to federal registrations, in the United States are generally insufficient to establish trademark rights for the purpose of recovering a domain name under the UDRP.

The complainant was South Fork Hardware Inc, doing business as TireChain.com and based in Pennsylvania (United States). The complainant had been using the trademarks TIRECHAIN.COM and TIRECHAINS.COM since 1998, as well as the corresponding domain names ‘tirechain.com’ and ‘tirechains.com’, namely in connection with tire chains for cars and other motor vehicles.

The respondent was Vulcan Sales Inc, doing business as Vulcan Tire Sales, based in Utah (United States). The respondent had registered ‘tirechian.com’ and ‘tirechians.com’ on September 23 2004. The domain names were being used by the respondent to redirect to its main website at ‘vulcantire.com’, where it offered for sale various tire-related products, including tire chains.

The complainant argued that, by registering the domain names ‘tirechian.com’ and ‘tirechians.com’, the respondent had engaged in the practice of ‘typosquatting’, as the domain names consisted of common typographical errors made by internet users when entering the complainant's addresses ‘tirechain.com’ and ‘tirechains.com’.

The complainant sent a cease and desist letter to the respondent on September 28 2012 and the respondent refuted the complainant's claims by letter dated October 12 2012. The complainant thus sought to recover the domain names by filing a UDRP complaint before WIPO.

To be successful in a complaint under the UDRP, a complainant must satisfy all of the following requirements:

• The domain name is identical, or confusingly similar, to a 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 and is being used in bad faith.

The first limb of the three-prong test is a low threshold, standing requirement, which is generally satisfied by providing evidence of trademark rights, regardless of where the trademark is registered and/or its date of registration, although these factors may be important for the purpose of the third limb of the test.

The complainant thus needed to demonstrate that it had trademark rights, whether registered or unregistered, in the term ‘tirechain.com’ in order to enable the panel to assess whether the domain names and the complainant's trademarks were identical or confusing similar. As evidence, the complainant submitted a Pennsylvania state trademark registration and a pending application for TIRECHAIN.COM with the US Patent and Trademark Office (USPTO). It should be noted that the complainant had previously attempted to register TIRECHAIN.COM with the USPTO, but the trademark application had been refused for being generic or descriptive of the goods and services, and the complainant had failed to prove that the name TIRECHAIN.COM had acquired distinctiveness.

The panel held that the complainant's state trademark registration (and pending application before the USPTO), without proof of acquired distinctiveness (or common law rights in the name), were insufficient to establish trademark rights for the first limb of the three-prong test.

In the United States, a trademark can be protected at either the state level and/or the federal level. Whilst state trademark protection is limited to a specific state, a federal trademark registration grants protection across all 50 states (and US territories). At the federal level, trademarks are regulated by the Lanham Act, §15 USC 1051 et seq, whilst at the state level, trademarks are protected by the laws of each respective state.

State registrations are granted a lower degree of protection than federal registrations. Drawing from previous UDRP decisions, the panel held that "state registrations are issued without examination" and thus "do not give rise to the same presumptions of validity as a federal registration". Similarly, to support its finding, the panel made reference to WIPO's Overview of WIPO Panel Views on Selected UDRP Questions, second Edition, Paragraph 1.1, which states that:

"[P]anels have typically found trademark registrations that are automatic or unexamined (such as US state registrations as opposed to US federal registrations) are not owed the same deference under the UDRP as examined registrations".

Thus, the panel held that the complainant's Pennsylvania registration was inadequate to demonstrate rights in the name.

Having determined that the complainant's state registration was not sufficient to establish trademark rights for the purpose of the first limb of the three-prong test of the UDRP, the panel proceeded to examine whether the complainant had acquired unregistered rights or common law rights in the term ‘tirechain.com’. Given the descriptive or generic nature of the term, the complainant needed to prove that it had acquired distinctiveness or secondary meaning - that is, that "the term has become an identifier associated with the complainant or its goods or services" (as noted in Paragraph 1.7 of the WIPO Overview). However, whilst the complainant had submitted evidence of use of the name Tirechain.com (eg, external business signage of Tirechain.com and one online article from a third-party website), the panel found that such evidence was insufficient to establish acquired distinctiveness. In this regard, the panel noted:

"Evidence of trade name use, however, is not necessarily evidence of trademark rights, as is the case here. [The c]omplainant’s evidence falls far short of the kind and amount of evidence required to establish secondary meaning and distinctiveness such that the relevant purchasing public exclusively associates the terms with [the c]omplainant as a source of services. See Pet Warehouse v Pets.Com Inc, WIPO Case No D2000-0105; see also WIPO Overview 2.0 at Paragraph 1.7 (“The complainant must show that the name has become a distinctive identifier associated with the complainant or its goods or services. Relevant evidence of such ‘secondary meaning’ includes length and amount of sales under the trademark, the nature and extent of advertising, consumer surveys and media recognition”).”

Thus, the panel held that the complainant had failed to demonstrate that it had rights in the name Tirechain.com and, therefore, the complaint was denied without needing to assess whether the domain names were identical or confusingly similar, nor whether the second and third limbs of the UDRP test were satisfied. It is worth noting in relation to the third limb of the UDRP that the panel did observe in the beginning that the respondent's registration of the domain names containing typographical errors may have been an indication of bad faith.

Whilst confirming a well-established principle that state trademark registrations (as opposed to federal registrations) in the United States are generally insufficient to establish trademark rights for the purpose of the first limb of the UDRP, this decision also highlights that, whilst the UDRP is a faster and cheaper alternative than court proceedings, complaints are still reviewed with a fine-tooth comb and panels are particularly strict when assessing evidence, in particular evidence of secondary meaning and acquired distinctiveness for the purpose of establishing trademark rights. Thus, complainants must make sure that they provide adequate and strong evidence to support their claims, in particular in the case of descriptive or generic names, such as in the present case.

David Taylor, Soraya Camayd and Vincent Denoyelle, Hogan Lovells LLP, Paris