Source: https://domaingang.com/domain-law/esqwire-esty-com-owner-beats-etsy-inc-in-domain-udrp/
Timestamp: 2019-04-25 21:57:49+00:00

Document:
Etsy, Inc. filed a UDRP against the owner of the aged domain, Esty.com.
Registered in 2001, Esty.com is at least four years older than the online arts and crafts marketplace, and registered more than five years before Etsy, Inc. trademarked ETSY.
Regardless of this timeline of events, Etsy, Inc. filed a UDRP at the National Arbitration Forum. The Respondent was represented by IP attorneys, Ari Goldberger and Jason B. Schaeffer, of ESQwire.com.
Note: ESQwire.com is an advertiser on DomainGang.com.
In the UDRP filing, Etsy, Inc. disclosed its financial prowess: more than $2.84 billion in gross merchandise sales in 2016, and more than 30.6 million active buyers, along with 1.8 million active sellers for arts, crafts, handmade and vintage goods.
The ETSY mark was registered after Etsy.com and the company formed in 2005.
The Complainant’s main point in filing this UDRP, was the “zero click” pop up ads, some of which allegedly delivered malware or fake “alerts” to update Adobe Flash, or to fix Windows errors.
A three member panel found no bad faith in the domain’s registration, and ordered the domain Esty.com to remain with the Respondent.
Currently, Esty.com is available on Sedo, with a minimum price of $100,000 dollars.
C. Respondent is using the Disputed Domain Name to divert Internet users to a commercial landing website that displays links to third-party websites that compete and overlap directly with Complainant’s services. Respondent’s pay-per-click landing page displays ESTY.COM prominently in the webpage header and provides links to directly competitive services, including “handmade products”, “baby gear”, “clothing and accessories,” “home furnishings,” “wedding supplies,” “fashion jewelry,” and “fashion clothing.” Complainant is well-known and famous for providing a platform for selling these exact goods. Given the identical nature of the goods identified on Respondent’s website, there can be no doubt that Respondent willfully seeks to trade on the goodwill of Complainant’s well-known ETSY Mark. Furthermore, upon information and belief, Respondent derives commercial benefit from these diversions due to click-through fees from the links on the website. Such use does not qualify as a bona fide offering of goods or services under Policy ¶ 4(c)(i) or a legitimate noncommercial or fair use of the domain name under Policy ¶ 4(c)(iii). See Bank of Am. Corp. v. Nw. Free Cmty. Access, FA 180704 (Forum Sept. 30, 2003) (“Respondent’s demonstrated intent to divert Internet users seeking Complainant’s website to a website of Respondent and for Respondent’s benefit is not a bona fide offering of goods or services under Policy ¶ 4(c)(i) and it is not a legitimate noncommercial or fair use under Policy ¶ 4(c)(iii).”); see also WeddingChannel.com Inc. v. Vasiliev, FA 156716 (Forum June 12, 2003) (finding that Respondent’s use of the disputed domain name to redirect Internet users to websites unrelated to Complainant’s mark, websites where Respondent presumably receives a referral fee for each misdirected Internet user, was not a bona fide offering of goods or services as contemplated by the Policy).
[I]ncludes a representation and warranty by the registrant that it will not now or in the future use the domain name in violation of any laws or regulations. This effectively imposes on the registrant a continuing duty to ensure that the domain name is not used in violation of another’s rights and clearly covers intellectual property rights and the laws protecting them, including copyright and trademark. … If a party uses the domain name in the future so as to call into question the party’s compliance with the party’s representations and warranties, this may be deemed to be retroactive bad faith registration. Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, WIPO Case No. D2009-0786; See also City Views Limited v. Moniker Privacy Services / Xander, Jeduyu, ALGEBRALIVE, WIPO Case No. D2009-0643; Phillip Securities Pte Ltd v. Yue Hoong Leong, ADNDRC Decision DE-0900226; and Octogen Pharmacal Company, Inc. v. Domains By Proxy, Inc. / Rich Sanders and Octogen e-Solutions, WIPO Case No. D2009-0786; Denver Newspaper Agency v. Jobing.com LLC, FA 1282148 (Nat. Arb. Forum Oct. 16, 2009); and Country Inns & Suites By Carlson, Inc. v. Shuai Nian Qing, La Duzi, WIPO Case No. D2009-1313.
It is well-established that, like common words, anyone is entitled to register domain names incorporating short letter combinations to which a Complainant does not have exclusive rights, and Respondents’ legitimate interest is established per se. See Tenenhaus v. Telepathy, Inc., Case No. 94355 (Forum May 17, 2000) (complainant not entitled to “exclusive use of the domain name DAF”); Trans Continental Records, Inc. v. Compana LLC, No. D2002-0105 (WIPO April 30, 2002) (“use of [LFO.com] . . . even for sale, is a legitimate business.”); Moreover, a registrant has legitimate interest in registering a single, two, three or four character — short letter — domain name provided it does not target or otherwise act inappropriately to a known trademark holder. SK Lubricants Americas v. Andrea Sabatini, Webservice Limited, D2015-1566 (WIPO Nov. 23, 2015).
While there are a handful of UDRP cases, which considered alternative approaches based on the warranty in paragraph 2 of the UDRP and the wording of paragraph 4(b), amongst other things, “the overwhelming approach of UDRP panels since then has been to affirm the literal meaning of paragraph 4(a)(iii) of the Policy and to require bad faith at the time of registration or acquisition of the disputed domain name.” Group One Holdings Pte Ltd v. Steven Hafto D2017-0183 (WIPO Mar. 28, 2017).
Finally, Respondent has renewed the Disputed Domain several times after Complainant had established strong rights to the ETSY trademark. Each renewal required Respondent to reaffirm its obligation to be bound by the ICANN Registrar/Registered Name Holder Agreement which requires, “to the best of the Registered Name Holder’s knowledge and belief, neither the registration of the Registered Name nor the manner in which it is directly or indirectly used infringes the legal rights of any third party.” Furthermore, upon information and belief, Portmedia Holdings, Ltd. did not exist at the time of the original registration of the Disputed Domain. There are several UDRP cases identifying various “Portmedia” companies as Respondent; however, there are no UDRP cases identifying involving Respondent until 2014. This strongly suggests that the Disputed Domain was only recently transferred to Portmedia Holdings, Ltd. and well after Complainant had established its rights to the ETSY trademark. For the reasons and authorities identified in the Amended Complaint, the transfer of the Disputed Domain subsequent to the establishment of Complainant’s trademark rights, Respondent has used and registered the Disputed Domain in bad faith.
Complainant’s case fails utterly on bad faith. It is well-settled that renewals and changes in registrar occurring after a complainant acquires rights in a mark do not convert a previously existing good faith registration into a bad faith registration, and Complainant’s arguments find no support within any exception of the now largely-discredited Mummy/Octogen line of decisions. See, WIPO UDRP Overview 3.0 at par. 3.2.1.

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