Respondent had rights or legitimate interests because of its status as bulk reseller of 4-letter domain names

In the case of Randall E. Kay v. Sebastian Kleveros, a three-member NAF Panel denied the Complainant’s efforts to have the domain name <nvrt.com>  transferred because the Complainant failed to demonstrate that the Respondent lacked rights or legitimate interests in the disputed domain name, and failed to demonstrate the disputed domain name was registered and used in bad faith.

Concurrent Court Proceedings

As an initial matter, the Panel first considered whether it should forbear deciding the present domain name dispute pending federal litigation in the U.S. brought by the Complainant against a number of parties, including the disputed domain name (as an in rem case under 15 U.S.C. 1125(d)). The Panel decided to make a determination in this proceeding because the parties were not identical to the parties in the litigation. Neither party to this proceeding had asked the Panel to abstain from exercising its jurisdiction. It was not certain the Nevada federal court would be able to issue an order which bound the current registrar located in the Cayman Islands (something this Panel could do). Complainant had submitted to the jurisdiction of the courts at the principal office of the registrar in its Complaint. This Panel also had substantial expertise in the subject area, having issued a combined 2,261 decisions. A court could also review the Panel’s decision, so the Panel was not ousting a court of jurisdiction. These factors weighed in favor of the Panel deciding this case.

Rights or Legitimate Interests

By a majority vote (two of the three members), the Panel found that the Complainant had not established a prima facie case in support of its arguments the Respondent lacked rights and legitimate interests under the UDRP.  The Respondent did not know about any claims related to the disputed domain name because the Complainant never served or sent notice to the Respondent regarding the pending in rem action against the domain name. The Panel observed that a four-letter domain is a valuable property and can have many different purposes related to its letters which do not involve a complainant’s mark.  In this case, the Respondent purchased the domain in a batch of 41 four-letter domains.  The Panel further observed that a respondent may have rights or legitimate interests in a disputed domain name where the the Respondent is a generic domain name reseller, depending of course on the facts of the individual case. According to the Panel, the Respondent had rights or legitimate interests based on its status as a generic domain name reseller under the facts of this case.

No Bad Faith

Since the Respondent had rights or legitimate interests in the disputed domain name pursuant to the second element of the UDRP, the Panel found that the Respondent did not register or use the disputed domain name in bad faith under the third element. Specifically, the Panel found that the Respondent had not registered or used the disputed domain name in bad faith because the Respondent had not violated any of the factors listed in UDRP or engaged in any other conduct that would constitute bad faith registration and use.  Apart from those issues, the substance of this case in the opinion of the majority of the Panel was that a bad faith finding would be inappropriate because the Respondent bought the domain name as part of a commercial transaction involving 40 other four-letter domain names.  On the evidence, the Respondent had no intent or knowledge of any potential infringement of the Complainant’s rights.

Randall E. Kay v. Sebastian KleverosNAF Case No. FA1602001659119

 


Evan_BrownAbout the Author: Evan Brown is a Chicago technology and intellectual property attorney helping clients with a wide variety of issues, including domain name disputes under the UDRP. Call him at (630) 362-7237, send email to ebrown [at] internetcases.com, or follow him on Twitter @internetcases. Read Evan’s other blog, internetcases, for more information about general internet law.