Registrant forced to relinquish domain name despite rights in mark

South Africa
In Masstores (Pty) Ltd v Dore (Revolutionary Marketing CC) (Case ZA2009-0028, July 3 2009), an adjudicator at the South African Institute of Intellectual Property Law has ruled that the registration of 'gardenmaster.co.za' was abusive despite the fact that the registrant had been using the trademark GARDENMASTER for longer than the complainant.
 
The complainant, Masstores (Pty) Ltd, registered and started using the trademark GARDENMASTER in May 1999 in connection with gardening tools. The registrant, Chris Dore, could show rights in the GARDENMASTER mark in relation to gardening services dating as far back as 1969. In February 2007 Dore registered the domain name 'gardenmaster.co.za'.
 
In April 2008 Masstores contacted Dore and demanded that the domain name be transferred to it. Dore replied that he would do so only in exchange for the payment of a substantial amount of money. At that time, Dore had not started using the 'gardenmaster.co.za' domain name, and the domain name was still not in use by the time the complaint was filed.
 
Following the complaint, Dore sent a response to the attorneys acting for Masstores. However, Dore did not make a formal response. The adjudicator nevertheless found that the content of the letter should be taken into account despite the fact that Dore was, technically, in default. The adjudicator pointed out that in proceedings such as these, form should not be put above substance.
 
As Dore’s letter to Masstores’ attorneys gave rise to several questions, the adjudicator requested further particulars from Dore. No response was forthcoming.
 
The adjudicator confirmed that Masstores had shown that it had rights in the GARDENMASTER mark. It then fell to the adjudicator to determine whether the registration of the domain name 'gardenmaster.co.za' was abusive in terms of the '.za' Alternative Dispute Resolution Regulations. In essence, an 'abusive registration' is defined as a domain name that:
  • was registered in a manner which, at the time of the registration, took unfair advantage of the complainant's rights; or
  • has been used in a manner whichtakes unfair advantage of the complainant's rights.
Factors which may indicate that a registration is abusive include circumstances showing that the registration was primarily intended to:
  • block the registration of a name or mark in which the complainant has rights; or
  • prevent the complainant from exercising its rights.
In his letter to the attorneys for Masstores, Dore referred to a conflict between his name and that of Masstores. The letter stated that Dore had prior rights in the GARDENMASTER mark, but had acquiesced to Masstores’ continued use of that mark. Masstores would not have been able to stop Dore from using the GARDENMASTER mark due to the latter's prior rights. 
 
Dore also alleged that he had registered the domain name 'gardenmaster.co.za' to “protect its rights”. The adjudicator held that the purpose of domain name registration is not to protect rights, but rather to enable e-commerce. In any event, Dore clearly had prior rights and the registration of the domain name would not have taken this any further. In addition, it appeared that it was only in the light of the alleged conflict that Dore had “sought to protect” the domain name. 
 
The adjudicator found that in the absence of the requested further particulars from Dore, the automatic inference must be that the registration of the domain name aimed to prevent Masstores from doing so. This conclusion is supported by the fact that no such registration had been sought at any time before. 
 
The adjudicator held as follows:
 
"Furthermore, the domain is still in the hands of (at best) an agent. Moreover, whilst the absence of use, per se, offers no indication of abuse, in these circumstances (and absent an explanation from an enterprise already in existence for decades) the fact that, a number of years later, still no use has been made of the domain name lends credence to the perceived probabilities.
 
These probabilities are – and the adjudicator’s view, therefore, and on balance, is - that the registration was abusive. Given the circumstances, the refusal to transfer the registration except for a substantial amount of money, one in excess of the reasonable out-of-pocket expenses incurred in the actual registration, perpetuates the abuse."
 
Therefore, it seems that a domain name registrant may be forced to relinquish a domain name despite the fact that it has rights in the corresponding trademark which predate those of the complainant. However, this conclusion was reached only in the specific circumstances of the present case - and, particularly, in the absence of a proper response from Dore in the proceedings.
 
Megan Reimers, Spoor & Fisher, Pretoria

Get unlimited access to all WTR content