Decision raises issue of correct registration date for UDRP purposes

International
In La Société des Bains de Mer et du Cercle des Etrangers à Monaco v Easthaven Ltd (Case D2010-1167, October 22 2010), La Société des Bains de Mer et du Cercle des Etrangers à Monaco (the complainant) has obtained the transfer of the domain name 'suncasino.com' under the Uniform Domain Name Dispute Resolution Policy (UDRP). 
 
The domain name was registered in 2010, although this was contested by Easthaven. At the time of the complaint, the domain name did not resolve to an active website.
 
The complainant owned the registered Monegasque trademark SUNCASINO, which it had filed in 1991. Interestingly, the panel noted that this complaint was not the first domain name dispute filed by the complainant and that, in a previous UDRP case, the complainant had not relied on its trademark. In the present case, the complainant not only relied on this mark, but also on numerous other marks, although it failed to provide evidence of such other marks.
 
To be successful under the UDRP, a complainant must prove that:
  • the domain name is identical, or confusingly similar, to a trademark or service mark in which it 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.
With regard to the first criterion, the complainant contended that:
  • its casinos were famous around the world;
  • it had been granted a monopoly for casinos and gambling activities in Monaco; and
  • it had been operating the Casino de Monte-Carlo for more than 140 years, as well as the Sun Casino since 1975.
The complainant alleged that the domain name consisted entirely of its trademark, the only difference being the space between the words 'sun' and 'casino'.
 
To establish the second UDRP requirement, the complainant asserted that:
  • Easthaven had no trademarks in the words 'sun' and 'casino';
  • the complainant had not authorised Easthaven to use either its SUN CASINO mark or the domain name; and
  • the complainant did not have a business relationship with Easthaven.
Finally, with regard to bad faith, the complainant indicated that Easthaven had sought the services of a third party to assist it in selling the domain name to the complainant for an amount that exceeded its out-of-pocket expenses, namely €1 million. The complainant also referred to abusive and threatening emails received by its legal representation from the third party. 
 
Easthaven explained that the domain name was registered in 1998 by an entity related to it, to be used in relation to the website 'casinoland.com', but that, in 2000, Easthaven was forced to close this website. The domain name had never been used since then. Easthaven further stated that the domain name was transferred to it in 2010, but argued that both the previous registrant and Easthaven were beneficially controlled by the same people.
 
Easthaven also argued that:
  • 'Sun Casino' was descriptive, which was the only reason why Easthaven had registered it; and
  • there were several other registered or pending trademarks incorporating the words 'sun' and 'casino'.
Easthaven further claimed that the domain name was registered to be used as a potential online casino website in conjunction with 'casinoland.com' and that it had registered other gaming-related descriptive domain names.
 
Finally, Easthaven stated that:
  • its decision to sell the domain name did not show that it was registered in bad faith; and
  • the complainant's delay in initiating proceedings showed that the latter did not truly believe that Easthaven had engaged in bad-faith registration.
Easthaven also accused the complainant of reverse domain name hijacking and indicated that it had not authorised the abusive and threatening emails.
 
The majority of the panel found that the complainant had established all of the three required elements. Firstly, it held that one trademark registration was sufficient to establish trademark rights. In addition, it found that the terms 'sun' and 'casino' were not descriptive when used together for the services for which the trademark was registered, and the absence of space between the terms composing the mark did not distinguish the domain name from the mark.
 
Turning to the second limb, the majority of the panel chose not to consider Easthaven's assertions that it registered the domain name in 1998 because both the initial registrant and Easthaven were beneficially controlled by the same entity. The majority of the panel considered that this was not sufficiently evidenced by means of an affidavit, and thus decided to examine Easthaven's rights and interests on the basis that it had registered the domain name in 2010.
 
The majority of the panel found that the complainant had met the burden of proof in relation to Easthaven's absence of rights or legitimate interests since:
  • Easthaven had not used the domain name and its intention was merely to speculate in the sale of domain names; and
  • third-party rights in trademarks or domain names in the terms 'sun' and 'casino' could not create rights or legitimate interests for Easthaven in the domain name.
The majority of the panel further determined that, even if the initial registrant was taken into consideration, it would have found that the latter had passively held the domain name for more than 10 years. The majority of the panel thus found in favour of the complainant on this point.
 
Finally, the majority of the panel accepted the complainant's assertion that the domain name had been registered and used in bad faith, pointing out that, when Easthaven acquired the domain name, it was aware of the complainant and its trademarks, and that Easthaven immediately sought to sell the domain name to someone in the casino industry.
 
The majority of the panel added that it was not prepared to take the complainant's delay in bringing proceedings into account, and that it had not been provided with any evidence that would make it decide against the generally recognised position that the doctrine of laches did not apply to proceedings under the UDRP.
 
The Hon Neil Anthony Brown QC, the dissenting panellist, strongly disagreed with all findings by the majority of the panel.
 
Brown first contested the validity of the trademark registration certificate provided by the complainant, as it only evidenced that the mark was filed in 1991 and renewed in 2001, but not that it was in force in 1998 when the domain name was initially registered. Brown explained that he would not be concerned about this aspect usually but that, in this instance, the majority of the panel had ruled against Easthaven substantially on the inadequacy of its evidence. It thus seemed "incongruous" that the complainant should be able to succeed on inadequate evidence.
 
 
"While the transfer of a domain name to a third party does amount to a new registration, a mere renewal of a domain name does not amount to registration for the purposes of determining bad faith. Registration in bad faith must occur at the time the current registrant took possession of the domain name."
 
According to Brown, the consensus view did not claim to be an immutable rule and did not apply to transfers between entities with common ownership. In this case, the affidavit provided by Easthaven was sufficient evidence to prove that it was the successor in title of the original registrant and, therefore, the transfer should not have been regarded as a new registration because the two parties were in common ownership.
 
In addition, Brown found that the expression 'sun casino' was generic and was registered in the absence of any circumstances showing that the complainant was targeted or any intention to infringe its trademarks or business interests.
 
Regarding bad faith, Brown indicated that "the interests associated with the respondent" were not aware of the SUN CASINO mark or the complainant's business when the domain name was registered, since the fact that the Sun Casino was opened in 1975 was not even indicated on the complainants' website. Concerning the offer to sell the domain name, Brown quoted the panel in another UDRP case filed by the complainant, which it had lost. The panel in that case stated that nothing indicated that the respondent was basing its activity on the inherent value of trademarks belonging to others to free ride on somebody else's goodwill. Brown thought that the same conclusion should be drawn in the present case, and that there was every ground for concluding that the domain name had in fact been registered and used in good faith.
 
Brown added that the inordinate delay until the complainant filed the complaint added to the doubt as to whether the latter ever had grounds to claim the domain name, a position in favour of the applicability of the doctrine of laches in UDRP cases that this particular panellist has also adopted in previous UDRP decisions (for further details please see "WIPO decision raises issue of applicability of laches in UDRP proceedings").
 
This decision raises several interesting legal issues, in particular in relation to the correct registration date of a domain name for the purposes of the UDRP. It also shows why it is important for parties to substantiate their evidence and enter into as much detail as possible to prove the three criteria of the UDRP or refute them.
 
The decision should also act as a warning to brand owners to always select a three-member panel in cases that are not completely straightforward and could potentially result in a valid difference of opinion. This is particularly so given that there is no appeal mechanism under the UDRP and the only way to challenge a decision is to bring a case in the relevant national court.
 
David Taylor and Sarah Taieb, Hogan Lovells, Paris

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