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No Time Bar, No Laches under the UDRP

Gerald M. Levine

Two Uniform Domain-Name Dispute-Resolution Policy (UDRP) decisions posted this month involved domain names registered 20 and 21 years ago, David Duchovny v. Alberta Hot Rods c/o Jeff Burgar, FA1706001734414 (Forum July 4, 2017) (<davidduchovny.com>, 21 years) and Commonwealth Bank of Australia v. Registration Private, Domains By Proxy, LLC / Ravindra Patel, gbe, D2017-0807 (WIPO July 6, 2017) (<bankwest.com>) (20 years). Complainants prevailed in both cases. The domain names stand out as being the oldest to have been found registered in bad faith, and transferred. Readers unfamiliar with the UDRP may be surprised to learn there is no time bar for making a cybersquatting claim, and laches is not a defense.

While David Duchovny and Commonwealth Bank are similar in filing complaints for long-held domain names, Complainants' circumstances are strikingly dissimilar (celebrity name versus a name composed of two dictionary words and parties located on different continents). While the first decision is understandable, the second is questionable.

The "no time bar/no laches" limitation which is one of the core principles of the UDRP is consistent with WIPO's recommendations for the proposed administrative procedure that became the UDRP. The WIPO Final Report (1999), Paragraph 197 stated that "a time bar to the bringing of claims in respect of domain names (for example, a bar on claims where the domain name registration has been unchallenged for a designated period of years) should not be introduced." Then, in Paragraph 199, "time bar" is expressly endorsed: "It is not recommended that claims under the administrative procedure be subject to a time limitation.” (Italics in original).

While the recommendation did not achieve written recognition in the Policy Panels quickly enshrined it in their decisions: "[there is] no room for general equitable doctrines under the Policy such as would be possessed by Courts in common law jurisdictions." Edmunds.com, Inc. v. Ult. Search Inc., D2001-1319 (WIPO February 1, 2002). The Panels in David Duchovny and Commonwealth Bank make the same point: "This Panel lacks equitable powers; therefore, even a delay of 21 years does not implicate laches" and "Panels have . . . declined to specifically adopt concepts such as laches or its equivalent in UDRP cases."

Whatever advantage complainants may appear to gain by the rejection of any time limitation or laches is offset in two ways: by respondents' rebuttal evidence (which if there is any, would have to be countered) and by the evidentiary demands on complainant for proving bad faith. The specific antidote to complainants sleeping on their rights is expressly set forth in Paragraph 4(c)(i) of the Policy; that is, if in the long interval before complainant wakes up a respondent accrues rights in the domain name, the complaint must be denied.

It will be noticed that the 4(c)(i) defense incorporates a key element of laches, namely detrimental reliance, so that while laches is ostensibly rejected it is present through the back door. Paragraph 4(a)(iii) also plays a role because the passage of time is a black hole; all evidence is lost if not maintained, so that even if respondent is found to lack rights or legitimate interests, if complainant cannot marshal evidence of bad faith registration the domain name must remain with respondent.

Proving cybersquatting of marks predating domain name registration is easier the closer in time between the registration and filing the complaint. It becomes increasingly difficult the longer complainant waits, particularly for weak marks (as opposed to celebrities' strong marks ). When complainants lose, the inapplicability of laches is no help to them and should be no hindrance to respondents; the evidentiary problem lies in complainant's inability to marshal the necessary evidence.

The database of complainants losing for lack of evidence is full of these disputes. The Sinclair Group Nevada, LLC v. behnam tabrizi, FA1606001679802 (Forum August 3, 2016) (<rapidtransformation.com>, 7 years. Complaint dismissed). The reverse is also true. Unlawful registrations will be cancelled or transferred regardless the length respondents have held them. Coles Pen Company Limited v. Cole, Samantha / Coles of London, FA1702001717458 (Forum March 30, 2017) (<pen heaven.com>. 8 years). Complainants prevail when the evidence dictates that result, and fail if it doesn't. Hôpitaux Universitaires de Genève v. Aydin Karadeniz, D2016-1620 (WIPO October 10, 2016) (<hug.com>, <hug.net>, and <hug.org>. Respondent acquired the domain names for a business that never developed. Complaint dismissed).

While there is no time bar, delay has consequences. As Panels were rejecting laches they were developing a nuanced approach that took into account the totality of circumstances. Bosco Prod., Inc. v. Bosco email Servs., FA 94828 (Nat. Arb. Forum June 29, 2000) (<bosco.com>) for "vanity e-mail" service. The Panel held that "[w]ithout determining if the passage of considerable time would alone bar Complainant from relief in this proceeding, the Panel notes that Complainant does not explain why it has waited nearly four years to try and resolve the domain name dispute"; Novartis AG v. Name Administration Inc. (BVI), FA1403001548210 (Nat. Arb. Forum April 24, 2014) (<clearcare.com>). "It appears to the Panel that any business disruption or confusion suffered by Complainant as a result of Respondent's domain name registration was either non-existent or de minimis, else Complainant would have taken action in a more timely fashion."

Returning to <davidduchovny.com> and <bankwest.com>, Doug Isenberg examined the David Duchovny decision in an informative essay recently published here in CircleID. Mr. Isenberg properly points out that "the 21-year delay could have undermined Duchovny's case." It didn't because in large part "David Duchovny" (as a mark) has a single source. That is not true of marks composed of generic elements (even though combined they may be distinctive). The Panel certainly ticked off Complainant's evidentiary problems in pointing out there was no evidence of harm: "registration alone of the disputed domain name for 21 years [did not cause] any Internet users to be confused as to the source or origin of any goods or services and there were certainly no lost profits or loss of business or goodwill."

Nevertheless, Mr. Duchovny prevailed on his strong mark because Respondent's position (even had it not defaulted in appearance) was indefensible under any Paragraph 4(c) defenses. (This may not have been true if the domain name had been <duchovny.com> assuming it is a well represented surname). In large measure Respondent lost because celebrities are in a class by themselves when it comes to having their names protected under the UDRP (the Bruce Springsteen decision referred to by Mr. Isenberg was in fact repudiated in Kevin Spacey v. Alberta Hot Rods, FA0205000114437 (Nat. Arb. Forum August 1, 2002) by the presiding panelist in the earlier case.)

Notwithstanding "no lost profits or loss of business or goodwill" the Panel found that the evidence pointed to bad faith registration: "Although no one would claim that the DAVID DUCHOVNY mark, in 1996, was as famous as GOOGLE is today, given the demonstrated notoriety of David Duchovny in 1996 and the totality of the circumstances, the Panel finds that Respondent had actual knowledge of Complainant's mark prior to the registration of the disputed domain name." Knowledge (that couldn't plausibly be denied) and celebrity were the key factors.

No one would say that combining two dictionary words makes for a strong mark (exceptions always excluded) or that knowledge could not plausibly be denied. Herein lies the drama in Commonwealth Bank of Australia. Since Respondent held <bankwest.com> passively and failed to explain the circumstances for registering the domain name Complainant succeeded on its prima facie case that Respondent lacked rights or legitimate interests in it, but that doesn't get a complainant to bad faith. Knowledge is an issue for the third, not the second limb of the Policy, and it's complainant's burden to prove.

Bad faith presupposes (requires proof of) respondent registered the domain name with knowledge of complainant and its mark. Since there was no direct evidence of knowledge it had to be found circumstantially, by inference. Separate from the passage of time in Commonwealth Bank is that Complainant is located in Australia and Respondent is an individual located in the United States, in New Jersey. In determining that such evidence as there was after 20 years supported inferences of bad faith, it can be argued that the Panel put his finger on the scale in Complainant's favor.

Drawing inferences, of course, is a valuable tool, but shifting the burden to Respondent to come forward with rebuttal evidence under the third limb is questionable. The principal fact from which the Panel drew its inference was Respondent holding the domain name passively. The Panel's chain of reasoning is as follows:

[T]he entire Response provides absolutely no information whatsoever about the Respondent other than to confirm he is resident in New Jersey. The Panel is not told whether he [Respondent] is in business and if so what that business is, whether or not he deals in domain names, whether this is the only domain name he owns, why and how he decided to register it, or indeed any other of the no doubt numerous factors which would bear on whether or not the Respondent acted in bad faith.

Using this reasoning as leverage the Panel then conjectured that

It would have been an entirely straightforward matter for the Respondent to say (hypothetically), with appropriate evidence 'I had never heard of the Complainant when I registered the Disputed Domain Name' and 'this was part of my strategy of registering names involving the word "bank" combined with a geographic identifier and I also registered (say) banknorth.com, banksouth.com, and bankeast.com.'

In other words, Respondent is held liable as a cybersquatter for its silence: "Given that the Respondent is represented the Panel is left concluding that this silence on such critical issues is not simply inadvertent but represents a deliberate decision." For a Panel to draw these inferences and then fault respondent (and its counsel) for failing to address factual issues raised only conjecturally is extraordinary. (The Panel in Duchovny also draw inferences but they were anchored to specific facts). The problem is not the logic, the algorithmic steps make perfect sense, but its application. It exceeds a Panel's authority under the UDRP.

This is not to say that in a plenary action, after all the evidence is marshaled and arguments made that Commonwealth Bank would not prevail, but the UDRP as a summary proceeding is not the right venue. Nevertheless, the Panel's finding that respondents must answer to the particular inferences it identified serves a useful purpose as a warning to them and their counsel: where they control the facts relating to their acquisitions of domain names, silence will be held against them. And, equally important, respondents should not rely on a laches defense as though it is dispositive (which Respondent did in Commonwealth Bank). Even though some Panels have embraced the defense, it's not a good defensive strategy.

By Gerald M. Levine, Intellectual Property, Arbitrator/Mediator at Levine Samuel LLP. Information about the firm can be found on the Firm’s website at iplegalcorner.com. Mr. Levine has a litigation and counseling practice representing clients in Intellectual Property rights and management, Internet and Cyberspace issues, domain names and cybersquatting.

Related topics: Domain Management, Domain Names, UDRP

 
   

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