Paul Keating: What Does ceat.com UDRP Teach Us?

Paul Keating: What Does ceat.com UDRP Teach Us?

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This is a post written by contributor, Paul Raynor Keating. Mr. Keating is a California licensed attorney who has lived and worked in Barcelona and most recently London. He is a respected lawyer that represents domain investors, registrars and domain-related service providers. In this post, Mr. Keating discusses the recent controversial UDRP decision involving ceat.com.

In the blink of an eye – the ever changing world of the UDRP What does Ceat.com (D2011-1981) teach us?

I will not bore you with the history of the UDRP or that it was intended only to address cases of clear cybersquatting.  Such is left to the annals of history largely ignored by panelists who continue, IMO, to write decisions by searching for reasons to achieve their desired results.  With the breadth of UDRP case precedent it would take a very stupid monkey to not be able to find a case to support just about any position – including one stating that the Earth is indeed flat as we all know.  Ceat.com is a case in which the panelists went out of their way to fit the preverbal square peg in the round hole.

My focus here is in the subtle change in what constitutes “legitimate interest”, an issue which has been rearing its ugly head in several recent UDRP decisions such as Autoownersinsurance.com and Ceat.com.

Let’s set the stage.  In Ceat.com, the Complainant, an Indian company, held a trademark for tires.  It had received the trademark by assignment in 2010 from as third party.  The respondent registered the domain in 2001.  During the course of registration the domain was used in PPC for various purposes, none of which seemed to focus on the Complainant or its products.  We will ignore the issues of “Willful blindness” – which says that one ignores looking at what one knows to exist and not that one should explore what is unkown.  We will ignore that complainant’s evidence of fame were all attributed to the domains post-registration period.  We will also ignore that complainant was in India and respondent was in Barbados.

The Policy addresses legitimate interest by way of non-exclusive example.  The Policy provides several examples and the language makes clear that the examples are non-exclusive – meaning it can be established in any other appropriate manner fitting the facts. Each example is a defenses. (Policy ¶4(c)).  In other words, legitimate interest is proven through any available means and it is for the complaint to prove that no legitimate interest exists.

Although the Policy requires that a complainant prove that “(ii) you have no rights or legitimate interests in respect of the domain name;” these words seem to have taken on an ever-restrictive significance for registrants.

Prior UDRP decisions have held that the question posed by Policy 4(a)(ii) is whether the Respondent has any right or legitimate interest in the Domain Name.  Respondent must prevail if it has established a “potentially legitimate interest in the disputed domain name and Complainant has been unable to prove that such interest is illegitimate.” (Borges, S.A., Tanio, S.A.U. v. James English, D2007- 0477 (WIPO 2007)).  Respondent need only show “a plausible, non-infringing explanation for selecting the disputed domain name.” (Telephone and Data Systems, Inc. v. Protected Domain Services / Daniel Wang, D2011-0435 (WIPO 2011); emphasis in original – Citing, Choice Courier Systems, Inc. v. William H. Kirkendale, D2002-0483 (WIPO 2002) and Webvan Group, Inc. v. Stan Atwood, D2000-1512 (WIPO 2001).

A balancing of which party has a “better” right is not authorized under the UDRP. (Telephone and Data Systems, Inc. v. Protected Domain Services / Daniel Wang, D2011-0435 (WIPO 2011); Choice Courier Systems, Inc. v. William H. Kirkendale, D2002-0483 (WIPO 2002); Dial-A-Mattress Operating Corp. v Ultimate Search, D2001-0764 (WIPO 2001)) .

Complainant has the burden of proving that Respondent has no legitimate interest in the Domain Name, not of convincing the Panel that Complainant has more of an interest than Respondent in the Domain Name. (Telephone and Data Systems, Inc. v. Protected Domain Services / Daniel Wang, D2011-0435 (WIPO 2011); emphasis in original).

These decisions support the conclusion that a complaint must show that the Respondent has NO rights or legitimate interests in the domain. In other words, if the complainant fails to show a lack of legitimate interest, respondent should prevail.

The correct approach then is to view the Respondent’s use divorced from any trademark claim.  The question is whether Respondent has ‘a’ legitimate interest.  This is viewed entirely by the nature of the domain name, its composite words and the manner in which the domain name is used.

The analysis is limited to:

  • Does the domain name have significance aside from the asserted trademark?
  • Does the domain name exist merely to benefit from the trademark?
  • But for the trademark do the PPC links bear relationship to the Domain Name?

The truth of the above is seen in the example.  If I were to approach the 2nd Element with the complainant’s mark in mind, I would view the use only through those eyes.  I would judge legitimate interest only based upon the trademark and not the actual use.  In other words, if I am looking for red cars I will see a predominance of red cars.  Such is human nature.  However, the 2nd Element asks us to divorce ourselves from the asserted trademark and to look only at the use and determine whether that use legitimate, aside from the presence of a trademark.  The Policy demands that we answer the questions: Does it have any bonafide use other than in connection with the asserted trademark?

Ceat.com is an example of twisting the language of the Policy.

Many prior decisions have dealt with PPC usage.  In general the best defense to a UDRP claim is that the domain has been used consistently in its descriptive sense.  While prior decisions (including those cited by the majority) found that descriptive domains used for descriptive PPC pages was a legitimate use, those decisions were issued in response to defenses based upon descriptive use.

In Ceat.com, the panel expanded the rule by holding that PPC use is not legitimate unless the PPC pages reflect descriptive use of the domain name; meaning that unless the PPC results are descriptively related to the words comprising the domain your use is illegitimate.  This turns the precedent on its head and is a significant change of the Policy.

Such a proposition acts to limit legitimate interest – otherwise unlimited by the Policy.  More importantly, the panel decision forecloses PPC uses as legitimate unless the PPC results are descriptive.

The respondent in Ceat.com provided numerous examples of non-infringing use of “CEAT” including other trademarks and acronyms adopted by third parties.  The PPC webpage was generic and did not target “tires”.  As of the date of this article, the 2-click lander showed:

While none of the above links bring the phrase “CEAT” to mind, the simple absence of a logical link does not render the use illegitimate.  In reality, the absence of a link to the complainant or “tires” should be telling.

The panel concluded that because there was no dictionary definition, the primary significance to the registrant must have been the trademark.

There is no dictionary meaning for the term “ceat.” The value of the disputed domain name to the Respondent is, therefore, its value as a trademark referring to Complainant and to the several other organizations identified by the Respondent who also use the letters “CEAT” as their marks.

The above ignores the premise that the legitimate interest may in fact be “whatever the user intends to find”.  Such use does not envision targeting the complainant and the use of a common word.  The use of a word or phrase in a non-trademark sense is simply not within the ambit of the UDRP.  The issue is not whether the domain is used descriptively; it is whether it is used to target the complainant or its marks.  That is the entire point of the UDRP.

The above language establishes the presumption that “if the domain is not used descriptively it must be used to unfairly detract from the complainant’s trademark”.  This was the conclusion of the Panel in AutoOwnersInsurance.com NAF 1423534.  Such a proposition is not only unsupported by the Policy, it displays ignorance as to the workings of the Internet.  Aside from the fact that PPC pages are not displayed in search engines, it presupposes what Internet users are looking for when they type a word that happens to be a trademark of a complainant.  I know that the complainant in this case provided no evidence as to user intent.  Absent such evidence (not bald allegations mind you) this is prejudice in favor of the complainant.

So is any of this surprising?  No.  Panelists are largely legal counsel for trademark holders.  This is a fault of the UDRP system and its providers as a whole.  The result, however, is that as representatives of trademark interests, they see everything through the eye of a trademark holder.  The results although disappointing, should not be surprising.  Unless the panelist has litigated a tough trademark claim in favor of a defendant they have no idea that life exists outside of the trademark context because that is how they have been trained to see the world.  It is sort of like not seeing “theknot.com” illegitimate because the panelist failed to see the context between “the knot” and marriage.

Panelists’ aside, one issue is with the structure of the UDRP itself.  To prevail, a complainant must prove all three elements.  Having sat in many a panel presentation I can tell you they are fearful of “expanding” legitimate interest for the simple reason that the UDRP is an all-or-nothing proposition for the complainant.  This is not a bad thing given the original intent of the Policy.

In closing I am reminded of the words of Ron Coleman who said of domain and trademarks in general:

And thus trademark’s girth continues to bloat.  The rich get richer, the range of possibility for both free commerce and expression contracts — and the “brand equity” in society of the law and those that interpret it sinks like a stone.

IMO, the dissent – by Neil Brown – got it right and Mr. Bernstein should re-think his approach.

[T]he right to register such acronyms cannot be unlimited. Knowing of a complainant’s trademark, registering a domain name to copy the trademark or using it to trade off it or to target the trademark owner or act inappropriately towards it must put the registrant in a different position and put at risk its claim to have a right or legitimate interest in the domain name. But in the absence of such factors, the registrant has as much right as anyone else to use expressions such as acronyms, generic, dictionary words or other domain names made up from a small number of letters.

Panelists may argue that if the UDRP is interpreted broadly in favor of respondents then cybersquatting will grow.  My answer is that While the Policy is not the best example of draftsmanship, is what we have to work with and we do ourselves a disservice to ignore what is written in favor of what we wish had been.  We cannot rewrite history so that the white guys always win.  Panelists must step back occasionally and ADR providers should ensure that panelists are drawn from a more diverse background.


About The Contributor: Paul Raynor Keating is a California licensed attorney who has lived and worked in Barcelona and most recently London. He is a respected lawyer that represents domain investors, registrars and domain-related service providers.

Connect with Paul: Website | LinkedIn

Comments (9)

    George Kirikos

    Well said. The respondents in this case should appeal in real court.

    March 7th, 2012 at 9:35 am

    Mike

    This beloved domain name industry is wrought with lack of accountability. I see nothing to be proud of here.

    March 7th, 2012 at 10:12 am

    Biggie.us

    it would be nice to find out if any of those panelists own any domain names, and if so….how are they using them.

    good article, which sheds some insight and it seems to be the trend in every legal system nowadays, which is to construe the evidence in favor of one party or the other.

    but i question this excerpt:

    “Aside from the fact that PPC pages are not displayed in search engines, it presupposes what Internet users are looking for when they type a word that happens to be a trademark of a complainant.”

    i have domains parked, that are listed in Goog and other SE’s, so unless i misread the intent, then i’ll have to dispute that as being factual.

    really an educational post though, especially for those who don’t know what “time” it is.

    :)

    March 7th, 2012 at 10:16 am

    Mike

    Great of you getting this piece, Elliot. It’s very well thought out.

    It’s a damn shame these panelists don’t have a broader spectrum of vision.

    I’ve definitely decided to go to court from now on. I’ll just file a lawsuit against anyone the day I receive a UDRP if I believe I am in the right.

    March 7th, 2012 at 3:28 pm

    Dan

    The complaintant just hired these udrp lawyers/panel to take the domain name for a fee, so they worked their asses off to do what they were paid for, that easy, it was clear from the start

    March 7th, 2012 at 3:53 pm

    Paul Keating

    “i have domains parked, that are listed in Goog and other SE’s, so unless i misread the intent, then i’ll have to dispute that as being factual.”

    The recent changes by Google were specifically intended to eliminate from search results duplicate content, multiple listings of the same sites and PPC domains. It is obviously not going to work 100% of the time and perhaps I should have been less absolutist in the statement…. However, I still think the underlying concept is correct. People do not find PPC pages via a Google search.

    PRK

    March 7th, 2012 at 5:21 pm

    Steve Jones

    It’s really a shame that these kinds of decisions have been handed down because they are essentially saying that domain speculation is not a legitimate business. Yes, actual cybersquatting is not a legitimate business, but domain speculation as a whole should never be looped in with cybersquatting. Many folks in the mainstream that missed out on getting their domain do it, but UDRP panelists should know better.

    They’re basically saying unless you are actually using a domain like Ceat.com for a business right this minute, you can’t possibly have legitimate rights to it because it’s not a generic domain. It’s one step closer to eminent domain being practiced with domain names and it’s quite scary really, not just for domain speculators but for small businesses in the process of developing their business. God forbid they have a parked page up in the meantime.

    UDRP really needs to be overhauled, but I’m not sure the ones that could undertake that overhaul have enough motivation to do it. They probably figure better to overly please businesses/trademark holders than to do the right thing.

    March 7th, 2012 at 6:42 pm

    Nat Cohen

    Paul, thanks for writing this up. Elliot, thanks for posting it.

    It is very disturbing that respected intellectual property attorneys would issue a decision that so distorts the UDRP.

    The purpose of a domain is to be an aid to human memory – otherwise we would be using IP numbers. A short domain has inherent value because by being short it is easy to remember.

    As Paul says, when you see things through the eyes of a trademark enforcer for too long, you become blind to other perspectives. CEAT.com has value outside of any use that a company may make of that term, simply because it is a short, easily remembered domain that is suitable for many purposes, including ones that may be developed in the future.

    The decision is also very disturbing because of its attitude towards ‘bad faith’. There was no evidence that Respondent registered the domain with any awareness of the Complainant.

    The majority of the panel found that simply offering the domain for sale was bad faith-

    “the Respondent’s general offer to sell the domain name shows that the Respondent knew or should have known that someone with rights in the “Ceat” name would have an interest in the domain name. ”

    “Thus, the general offer to sell the domain name constitutes bad faith use.”

    But this is clearly false. It is quite possible that a new business start-up with no rights in the ‘ceat’ name would have an interest in acquiring it.

    Trademark owners do not have an exclusive right to a common word or acronym, nor can they prevent new non-infringing uses. Yet this decision adopts the viewpoint that existing trademark holders are the only possible acquirers of common word or acronym terms.

    As Paul says, the UDRP is very overdue for an overhaul.

    The UDRP isn’t standing the test of time. It is cracking and losing its integrity as the inherent flaws in the policy and the lack of oversight by ICANN, allow the UDRP to be interpreted in ways that distort its original intent.

    The core flaw of the UDRP is that the Complainant chooses the “neutral” arbitration body from among competing arbitration providers.

    It is no accident that active trademark attorneys are appointed as panelists, while no attorney who primarily represents respondents has ever been appointed. But more to the point, no active attorney of any sort should be appointed as a panelist, when there are more than sufficient retired judges and mediators available who don’t find the conflict of interest or narrow perspective of an attorney who has spent his career aggressively pursuing the interests of trademark holders, and is then asked to put on a ‘neutral’ hat to decide a trademark matter.

    The bias towards complainants is growing increasingly pronounced. Radical pro-trademark reinterpretations of the UDRP, are then cited as precedent by other pro-trademark panelists, until what was originally a radical view becomes an acceptable alternate interpretation.

    I have recommended that the ICA form a working group on UDRP reform, to develop a comprehensive report to present to ICANN outlining the failings of the UDRP and proposing reasonable improvements.

    The ICA needs the support of the domain community to move forward in these efforts. I hope some of you will contact the ICA, or contact me directly, to offer your support.

    Thanks,

    Nat

    March 8th, 2012 at 8:21 am

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