In the case of BRH International, Inc. v. Mira Hold/Mira Holdings, Inc.,FA2010001918789, the FORUM 3-person panel not only found for the Respondent, but also found the Complainant guilty of Reverse Domain Name Hijacking of the domain HEMPER.COM. The Respondent had the winning bid at an auction in 2018, and it turns out that the Complainant was the losing bidder. The Complainant then made two offers to purchase the domain that were turned down by the Respondent.
Mira Holdings, Inc. is a Minnesota corporation with a portfolio of domain names that are all listed for sale or rent. The Panel found that the business of domain Investing (or as they refer to it as “reselling”) is a legitimate business and that the Respondent had every right to simply park it and list it for sale or lease.
We are proud to have represented Mira Holdings, Inc. in this case. Here are the complete findings of the Panel.
Paragraph 15(a) of the Rules instructs this Panel to “decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”
Paragraph 4(a) of the Policy requires that Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:
Respondent in bad faith.
It is indisputable that the domain name <hemper.com> is substantively identical and confusingly similar to Complainant’s claimed HEMPER mark. The domain name incorporates the mark in its entirety, with only the addition of the generic Top Level Domain (“gTLD”) “.com.” This alteration of the mark, made in forming the domain name, does not save it from the realm of confusing similarity under the standards of the Policy. See, for example, Isleworth Land Co. v. Lost in Space, SA, FA 117330 (Forum September 27, 2002):
[I]t is a well-established principle that generic top-level domains are irrelevant when conducting a Policy ¶ 4(a)(i) analysis.
This is because every domain name requires a gTLD or other TLD.
But our analysis under Policy ¶ 4(a)(i) does not end with a determination of identity or confusing similarity, because Complainant must also show that it has rights in the claimed mark sufficient to demonstrate that it has standing to pursue its claim in a UDRP proceeding. On this question, Complainant offers that it has common law rights in the HEMPER mark, running from at least February 16, 2016. A showing of rights in a mark acquired under the common law would meet the test of standing under Policy ¶ 4(a)(i). See, for example, Artistic Pursuit LLC v. calcuttawebdevelopers.com, FA 894477 (Forum March 8, 2007) (finding that Policy ¶ 4(a)(i) does not require a trademark registration if a UDRP complainant can prove that it has common law rights in its mark).
The required showing may be made in a variety of ways. See, for example, WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”) at sec. 1.3:
Relevant evidence … includes a range of factors such as (i) the duration and nature of use of the mark, (ii) the amount of sales under the mark, (iii) the nature and extent of advertising using the mark, (iv) the degree of actual public (e.g., consumer, industry, media) recognition, and (v) consumer surveys.
Complainant alleges that it has used the mark in commerce continuously since the indicated date and has advertised its products and services under the mark and has been the subject of appearances in public media in its industry, which together have produced thousands of monthly subscribers. In support of these contentions, Complainant submits a “declaration” of one of its officers, which asserts that Complainant has delivered thousands of boxes of its products to subscribers monthly since 2015, attached to which declaration are copies of three magazine articles featuring Complainant, the most recent dating from 2018, and a series of screen captures from YouTube videos showing Complainant’s subscriber “boxes.” Noticeably missing from this presentation, however, is evidence of Complainant’s sales revenues and advertising expenditures over time. In light of Complainant’s very brief life history, its showing is simply insufficient to support a finding of secondary meaning, and, therefore, of common law rights in the mark satisfying the requirements of Policy ¶ 4(a)(i). See, for example, CW & Associates Consulting and Recruiting Inc. v. Lynda Pitchford / ITSR, FA 1619758 (Forum June 29, 2015), finding that a UDRP complainant failed to establish common law rights in a mark where: “Complainant has failed to provide evidence of any sales figures or advertising expenditures or any indication of the extent of use aside from what may be implied from the business name registration and placement of the name(s) on social media.”
While Complainant’s proof in support of its claim of common law rights in the HEMPER mark is deficient, Complainant may still, as noted above, establish standing under Policy ¶ 4(a)(i) if it can show that it holds a registration for the mark on file with a competent trademark authority. Complainant’s registration of the HEMPER trademark with the USPTO, a national trademark authority, meets this test. See, for example, DIRECTV, LLC v. The Pearline Group, FA 1818749 (Forum December 30, 2018):
Complainant’s ownership of a USPTO registration for … [its mark]… demonstrate[s] its rights in such mark for the purposesof Policy ¶ 4(a)(i).
We thus find that Complainant has satisfied the requirements of Policy ¶ 4(a)(i).
Under Policy ¶ 4(a)(ii), Complainant must make a prima facie showing that Respondent has neither rights to nor legitimate interests in the <hemper.com> domain name, whereupon the burden shifts to Respondent to show that it does have such rights or interests. See Hanna-Barbera Prods., Inc. v. Entm’t Commentaries, FA 741828 (Forum August 18, 2006) (finding that a complainant must make a prima facie case that a respondent lacks rights to or legitimate interests in a domain name under UDRP ¶ 4(a)(ii) before the burden shifts to that respondent to show that it does have such rights or interests).
As to Respondent’s rights or interests in the <hemper.com> domain name, Complainant argues that Respondent fails to use it in connection with a bona fide offering of goods or services, as provided in Policy ¶ 4(c)(i), in that Respondent is merely offering the domain name for sale. Respondent answers that it is a domain name investor with hundreds of legitimate domain names in its inventory, and that domain name investing is a bona fide commercial use of domain names. Respondent is correct that commercial enterprises, often referred to as domain name resellers, have been found by UDRP panels to be engaged in a legitimate course of business meeting the test of Policy ¶ 4(c)(i). See, for example, Alphalogix Inc. v. DNS Servs., FA 491557 (Forum July 26, 2005):
Respondent is in the business of creating and supplying [domain] names for new entities, including acquiring expired domain names. This is a legitimate activity in which there are numerous suppliers in the United States.
See also Front Range Internet, Inc. v. Murphy, FA 145231 (Forum April 4, 2003):
In some circumstances, the trading of domain name registrations is considered a bona fide offering of goods and services.
The evidence before us shows that Respondent acquired the <hemper.com> domain name for a price of $36,150.00 by participating in an online auction in which Complainant also participated in pursuit of the same domain name. In light of these facts alone, we might well conclude that Respondent has adequately shown that it has rights to and a legitimate interest in the domain name within the contemplation of Policy ¶ 4(a)(ii).
But we must also consider the inherent nature of the term “hemper,” which is, notwithstanding Complainant’s protestations to the contrary, unmistakably descriptive. This question was squarely before the USPTO in connection with a mark registration for the mark HEMPER filed by Complainant’s predecessor in interest, which Complainant inherited by merger of the two enterprises. That application was abandoned in October of 2020, shortly before this proceeding was commenced. In it the applicant argued that the word “hemper” is not descriptive because consumers would not understand it as meaning that the relevant goods were comprised of hemp. The USPTO’s examining attorney disagreed, concluding that consumers would give the word precisely that descriptive meaning.
Complainant repeats here the argument rejected by the USPTO, and now adds that the word is “not in the dictionary” and has “no dictionary meaning.” No great effort is required to discover that, in this contention, too, Complainant is mistaken. The word “hemper” is defined in the Urban Dictionary, to mean: “A person with an occupation in the hemp industry, including growing hemp, processing hemp into derivative products such as oils, cbd, other cannabinoid isolates, and fiber, and crafting with and/or selling these hemp derived products.”
Hence “hemper” is a descriptive term, so that anyone, including Respondent, had the right to register a domain name containing it, subject to the proviso that it may not be used to invoke a trademark or engage in untoward conduct against, or to target, a trademark owner. No such conduct has been proven here.
Therefore, by this additional measure, Complainant still fails to satisfy the proof requirements of Policy ¶ 4(a)(ii).
As to whether Respondent has registered or is using the disputed domain name in bad faith, we look first to Policy ¶ 4(b)(i)–(iv), which detail the circumstances in which bad faith registration and use are likely to be encountered.
Turning to Policy ¶ 4(b)(i), we find no evidence in the record suggesting that Respondent registered or acquired the <hemper.com> domain name primarily for the purpose of selling it to Complainant or one of Complainant’s competitors. To the contrary, the evidence suggests that Complainant tried on two occasions to buy the domain name from Respondent and on both such occasions Respondent refused its advances. Policy ¶ 4(b)(i) therefore does not apply here.
We also find that there is no evidence here that Respondent has engaged in a pattern of registering domain names in order to prevent mark holders from reflecting their marks in corresponding domain names. Rather, the record indicates that Respondent has been a party to only one UDRP proceeding in which it was found, by default, to have registered and used a domain name in bad faith, and, in that instance, it appears that the complainant ultimately settled its differences with Respondent by paying for a transfer to it of the domain name there in issue. So, just as one data point does not make a trend, one ambiguous default does not make a pattern. Thus Policy ¶ 4(b)(ii) does not apply here.
And, inasmuch as it is clear from the record that Respondent is a domain name reseller and not, like Complainant, a vendor of smoking products and related services, it cannot be said that Policy ¶ 4(b)(iii), which condemns disruption of the business of a commercial competitor, is applicable to this case.
Similarly, Complainant acknowledges that Respondent makes no active use of the contested domain name, but only offers it for sale within its domain name reseller’s business model. As a consequence, we cannot conclude that Respondent is employing the domain name deceptively to attract Internet users to a resolving website for its commercial gain at the expense of Complainant. Consequently, Policy ¶ 4(b)(iv) is equally inapposite.
Because Policy ¶ 4(b) does not represent an exclusive list of all circumstances that might qualify as evidence of a respondent’s bad faith in registering or using a domain name, we can and sometimes do look to other indicia. So, for example, in this case, there is a difficulty with Complainant’s trademark registration on the point of time. This is because the record reflects that, while the <hemper.com> domain name was registered by Respondent on May 10, 2018, Complainant’s mark registration with the USPTO became effective much later, as of August 6, 2019, on the basis of an application filed June 26, 2018. We are thus confronted with a situation in which Complainant asks us to conclude that Respondent registered the contested domain name in bad faith notwithstanding that Complainant’s application for registration of its competing mark was not filed until more than six weeks after the domain name was registered in favor of Respondent. It is difficult to impossible on these facts to reach any other conclusion than that Respondent did not register the domain name in bad faith because it cannot be held to have had an obligation to anticipate a mark registration that hadn’t yet occurred, nor even been applied for, when it won the domain name at auction. See, for example, Martin Golf, LLC v. Whois Privacy Services Pty Ltd / Stanley Pace, D2013-0496 (WIPO May 21, 2013):
Generally … , when a domain name is registered by the respondent before the complainant’s relied-upon trademark right is shown to have been first established, the registration of the domain name would not have been in bad faith because the respondent could not have contemplated the complainant’s then non-existent right.
No other circumstance appearing in the record to suggest that Respondent has registered or is using the <hemper.com> domain name in bad faith, the Panel finds that Complainant has failed to prove bad faith in Respondent’s registration and use of the domain name satisfying the proof requirements of Policy ¶ 4(a)(iii).
Reverse Domain Name Hijacking
Respondent alleges in its Response and Additional Submission that, in pursuing its Complaint in this proceeding, Complainant has engaged in “Reverse Domain Name Hijacking,” defined in Rule 1 as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name.” Upon review of all of the pleadings and proofs submitted by the parties, the Panel concludes that Complainant, while knowing or having reason to know that it could not succeed in proving all of the required elements of its case, has nonetheless commenced and prosecuted this proceeding for the evident purpose of obtaining by misuse of the UDRP system what it failed to secure through a legitimate competitive auction process, and, in so doing, has engaged in Reverse Domain Name Hijacking.
Complainant having failed to establish all of the three elements required to be proven under the ICANN Policy, the Panel concludes that the relief requested must be, and it is hereby, DENIED.
Accordingly, it is Ordered that the <hemper.com> domain name REMAIN WITH Respondent.
Hon. Bruce E. Meyerson (Ret.), Panelist Hon. Neil A. Brown QC, Panelist
Dated: December 14, 2020 Dated: December 14, 2020
Atty. Terry F. Peppard, Chair, Panelist
Dated: December 14, 2020