WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Jappy GmbH v. Satoshi Shimoshita

Case No. D2010-1001

1. The Parties

The Complainant is Jappy GmbH of Hauzenberg, Germany, represented by Rechtsanwälte Bettinger Schneider Schramm, Germany.

The Respondent is Satoshi Shimoshita of Tokyo, Japan, appearing pro se.

2. The Domain Name and Registrar

The disputed domain name <jappy.com> is registered with eNom.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on June 17, 2010. On June 17, 2010, the Center transmitted by email to eNom a request for registrar verification in connection with the disputed domain name. On June 17, 2010, eNom transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced June 25, 2010. In accordance with the Rules, paragraph 5(a), the due date for Response was July 15, 2010. The Response was filed with the Center on July 14, 2010.

On August 14, 2010, the Respondent sent a further email to the Center, inter alia forwarding a communication received from the Complainant’s counsel concerning potential settlement options.

The Center appointed David Perkins, Andrew F. Christie and Douglas Clark as panelists in this matter on August 26, 2010. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

4. Factual Background

4.A. The Complainant

4.A.1 The Complainant is an Internet service provider located in Hauzenberg, Germany. It was founded in 2001 and is now recognised as a leader in providing online social networking services (SNS) and related products in Austria, Germany and Switzerland.

4.A.2 The Complainant has more than 150 employees and 1.7 million active users of its online services. It’s website at ”www.jappy.de” has more than 103 million visits and more than 5.000 million page views per month from more than 200 countries.

The Complainant’s domain names

4.A.3 The Complainant registered <jappy.tv> on April 15, 2002 and <jappy.de> in 2003.

The Complainant’s JAPPY registered trademarks

4.A.4 The Complainant has the following registered trademarks for the mark JAPPY

Visitors from Japan to the Complainant’s Website

4.A.5 In 2006, the year when the disputed domain name was transferred to the Respondent, the Complainant’s website at “www.jappy.de” had 1,719 visitors from Japan. The Respondent’s address is in Tokyo, Japan. In the current year for the period from January 1, 2010 to June 8, 2010 the number of visitors to the website from Japan was 7,976.

4.B. The Respondent

4.B.1 According to the Complaint, the Respondent is the registered owner of more than 5,500 domain names. The Respondent states that he is the registrant of thousands of domain names and the owner of some 20 websites. He says that he began registering domain names in 2000. The disputed domain name was registered on November 6, 2000 (by whom, it is not clear).

4.B.2 Prior to February 20, 2006, when the disputed domain name was transferred into the Respondent’s name, the registrant was Domains.Co.JP and the Respondent was the Administrative and Technical Contact. The Respondent says that he has owned Domains.Co.JP since 2000. It appears that Domains.Co.JP became the registrant of the disputed domain name in February 2003.

4.B.3 The Respondent explains that where he is not actively using a domain name, the Registrar – which is eNom in the case of the disputed domain name – will use the domain name as a parking site with links to various websites. The Respondent says that those links are established by eNom and not by him. Those links provide the Respondent with click-through revenue which he uses to pay the renewal fees due on his large portfolio of domain names.

4.B.4 The Complaint exhibits screenshots of the website to which the disputed domain name resolves. That website has links to online social networking services which compete with the Complainant’s SNS. Such links include <zoosk.com>; <neu.de>; <flirtfever.de>; <flirtcafe.de>; <flirtflair.de> and <edarling.de>.

4.B.5 The disputed domain name is also being offered as available for sale.

5. Parties’ Contentions

5.A. Complainant

Identical or Confusingly Similar

5.A.1 The Complainant’s case is that the disputed domain name is identical to its JAPPY word trademark and confusingly similar to its figurative JAPPY trademark.

Rights or Legitimate Interests

5.A.2 The Complainant has neither licensed nor otherwise authorised the Respondent to use its JAPPY trademark.

5.A.3 The Complainant says that there is no evidence that the Respondent can demonstrate that any of the circumstances set out in paragraph 4(c) of the Policy apply in this case. The actual use of the disputed domain name described in paragraph 4.B.4 above is, the Complainant says, neither a bona fide use of that name under paragraph 4(c)(i) of the Policy, nor a legitimate noncommercial or fair use pursuant to paragraph 4(c)(iii) of the Policy.

Registered and Used in Bad Faith

5.A.4 The Complainant’s case revolves around the proposition that, when the disputed domain name was transferred into the Respondent’s name on February 20, 2006 (see, paragraph 4.B.2 above), such transfer amounted to a new registration within the meaning of the Policy. Accordingly, intention to use and actual use is to be judged as of that date.

5.A.5 By that date, the Complainant says that it had established a strong presence on the Internet and was visited by more than 5,000 Internet users from Japan. From that, the Complainant says it can be inferred that the Respondent had actual knowledge of its Jappy SNS business and its rights in the JAPPY trademark.

5.A.6 Alternatively, willful blindness to the trademarks of others cannot, the Complainant says, enable a respondent to escape a finding of bad faith registration.

5.A.7 This is particularly the case – the Complainant says – with professional domainers such as the Respondent in this case, who typically register large swaths of domain names for resale without any attention to whether they may be identical to third party trademark rights.

5.A.8 In that context, the Complainant refers to three cases under the Policy brought against the Respondent, in each of which the Complaint was upheld. They are: Ranbaxy Laboratories, Inc .v. Satoshi Shimoshita, NAF Claim No. 1247091 (eurax.com); Ashley Furniture Industries, Inc v. Satoshi Shimoshita, NAF Claim No. 1238993, (ashleyfurniturestores.com); and La Quinta Worldwide L.L.C v. Satoshi Shimoshita, WIPO Case No. D2007-1241 (la-quinta.com).

5.A.9 As to use of the disputed domain name, the Complainant relies on the use described in paragraphs 4.B.3 and 4 above which, the Complainant says, constitutes circumstances falling within paragraph 4(b)(iv) of the Policy.

5.A.10 The Complainant also asserts bad faith use within paragraph 4(b)(ii) of the Policy by reference to the three decisions listed in paragraph 5.A.8 above.

5.B. Respondent

5.B.1 The Respondent points to the fact that he obtained, through his company Domains.Co.JP, the disputed domain name in February 2003, the same year that the Complainant apparently registered <jappy.de>. The Respondent says he has visited Germany only once with the implication that he was unaware of the Complainant at that time.

5.B.2 The Respondent says that the leading SNS in Japan are MySpace.com and Mixi.jp. By comparison, he points to the very low rate of hits recorded by the Complainant’s website as late as 2006: see, paragraph 4.A.5 above.

5.B.3 The Respondent says that “Jappy” has an attractive sound to Japanese people. It is, he says, like a nickname and it is easy to remember. So, the disputed domain name has a worthwhile value, which is the reason why he has renewed the registration. He doubts whether at the time he registered the disputed domain name the Complainant’s “Jappy” website was even active.

5.B.4 The disputed domain name has been parked for the reason set out in paragraph 4.B.3 above. As also explained in that paragraph, he is not responsible for the links advertised on the website to which the disputed domain name has been directed by eNom.

5.B.5 As to the three decisions under the Policy cited by the Complainant as an indication of bad faith, the Respondent explains that in the past decade he has been the recipient of a total of five complaints under the Policy, including the three cited by the Complainant (see, paragraph 5.A.8 above). The other two apparently involved the domain names <mix1.com> and <classicmedia.com>, where he duly responded. He states that, due to lack of resources, he was unable to respond to the three complaints cited in paragraph 5.A.8.

5.B.6 The Respondent summarises his case as follows. First, the Complainant company was not in existence at the date when the disputed domain name was registered in November 2000. He was also unaware of its existence in February 2003 when his company, Domains.Co.JP, became the registrant. Indeed, he was unaware of the Complainant until he was served with this Complaint.

5.B.7 Second, from the outset he had no bad faith intention to use the disputed domain name. His intention was to make future use of that name.

5.B.8 Third, if the Panel considers it appropriate, he will discontinue the links provided on the website to which the disputed domain name presently resolves.

5.B.9. Fourth, in all the circumstances, he urges that the Complainant be held to be attempting reverse domain name hi-jacking.

6. Discussion and Findings

6.1 The Policy paragraph 4(a) provides that the Complainant must prove each of the following in order to succeed in an administrative proceeding:

(i) that the Respondent’s domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

(ii) that the Respondent has no rights or legitimate interests in respect of the domain name; and

(iii) that the domain name has been registered and is being used in bad faith.

6.2 The Policy paragraph 4(c) sets out circumstances which, in particular but without limitation, if found by the Panel to be proved shall demonstrate the Respondent's rights or legitimate interest in the disputed domain name.

6.3 The Policy paragraph 4(b) sets out circumstances which, again in particular but without limitation, if found by the Panel to be present shall be evidence of the registration and use of a domain name in bad faith.

6.4 As stated, the circumstances set out in paragraph 4(b) and 4(c) of the Policy are not exclusionary. They are without limitation. That is, the Policy expressly recognizes that other circumstances can be evidence relevant to the requirements of paragraphs 4(a)(ii) and (iii) of the Policy.

Identical or Confusingly Similar

6.5 The Panel finds that the Complainant clearly has rights in the JAPPY registered trademark, the earliest of which was registered in Germany in December 2005.

6.6 The Complainant does not expressly assert common law trademark or equivalent rights in the JAPPY mark prior to that date. However, the Complainant does assert that the company was founded in 2001 and registered the <jappy.tv> domain name in April 2002 with the implication that the company was trading under the JAPPY name and mark as a SNS at that time. Certainly, since 2006 and currently the Complainant points to quite significant visitor traffic, a high level of usage in Austria, Germany and Switzerland and hits from users in more than 200 countries in total. So, at the date of the Complaint and from the evidence before the Panel, it seems fair to say that the JAPPY trademark is quite well known as indicating the Complainant’s SNS.

6.7 The disputed domain name is identical to the Complainant’s JAPPY trademark.

6.8 Consequently, the Complaint meets the requirements of paragraph 4(a)(i) of the Policy.

Rights or Legitimate Interest

6.9 The Panel finds that there is nothing per se objectionable in the business of a professional domain name registrant. However, those – like the Respondent – who trade in domain names must be vigilant not to register and use names identical or confusingly similar to third party trademarks.

6.10 Can the Respondent show that, before this Complaint was filed, he was making or at least had an intention to make bona fide use of the disputed domain name within the meaning of paragraph 4(c)(i) of the Policy? In that respect, the Respondent says that he has “thousands of domain names registered with a view to their future use”. While explaining the particular value of the disputed domain name for Japanese speakers (paragraph 5.B.3 above), the Respondent has not produced evidence of any specific use or intended use of the disputed domain name by the Respondent within the meaning of paragraph 4(c)(i) of the Policy. See e.g. Trade Me Limited v. Vertical Axis Inc, WIPO Case No. D2009-0093. To the contrary, the disputed domain name is parked with eNom and produces revenue from the website links to which it is directed. The domain name is also stated to be open to offers to purchase it (paragraph 4.B.5 above). In the circumstances, the Panel finds that the Respondent cannot bring himself within paragraph 4(c)(i) of the Policy.

6.11 Nor is there anything to suggest that paragraph 4(c)(ii) of the Policy applies.

6.12 As to paragraph 4(c)(iii) of the Policy, the use to which the disputed domain name is being put is certainly not “noncommercial”. It is to derive click-through revenue. That use, the Respondent confirms, was begun in 2005. By that time the Complainant had been operating its SNS under the JAPPY mark for three years.

6.13 Moreover, the current website to which the disputed domain name resolves has links to SNS which compete with the Complainant (paragraph 4.B.4 above). Given the confusing similarity of the disputed domain name to the Complainant’s JAPPY mark and the very extensive reach of the Complainant’s SNS “www.jappy.de” website, such use by the Respondent cannot, in the Panel’s opinion, be characterized as fair.

6.14 In the circumstances, on the evidence before the Panel, the Respondent cannot establish rights or legitimate interests in the disputed domain name. Consequently, the Complaint fulfills paragraph 4(a)(ii) of the Policy.

Registered and Used in Bad Faith

6.15 The available record indicates that the disputed domain name was initially created in November 2000. It is not clear from the record in whose name the disputed domain name was first registered. In February, 2003 the registration of the disputed domain name was transferred to an entity said to be owned by or otherwise connected with the Respondent, and in February 2006 it was transferred to the Respondent. The Complainant acquired registered rights in the trademark JAPPY in December, 2005. Arguably the Complainant acquired unregistered trademark rights in the trademark JAPPY sometime before December, 2005 as a result of the registration and use as the URL for its SNS the domain names <jappy.tv> (in April 2002) and <jappy.de> (sometime in 2003). In the circumstances, can it be said that the disputed domain name was registered and is being used in bad faith?

6.16 The Respondent’s case is that it cannot be right that a later domain name registrant – here, said to be the Complainant with its <jappy.tv> and <jappy.de> domain names – can then acquire a trademark by means of which the later registrant can obtain transfer of the Respondent’s earlier registered <jappy.com> domain name.

6.17 The Panel finds that, in principle, that proposition must be correct. However, the registrant of a domain name must comply with the representation made under paragraph 2 of the Policy. In material part, that representation reads:

“By applying to register a domain name, or asking us to renew a domain name registration, you hereby represent and warrant to us that … (d) you will not knowingly use the domain name in violation of any applicable laws or regulations. It is your responsibility to determine whether your domain name infringes or violates someone else’s rights.”

In Octogen Pharmacal Company, Inc. v. Domains by Proxy, Inc. / Rich Sanders and Octogen e-Solutions, WIPO Case No. D2009-0786, it was held that this provision not only imposes a duty on the registrant to conduct an investigation of third party trademark rights at the time of registration … “but also includes 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 of regulations.”¹

6.18 Consequently, the panelist in the Octogen case found that even though a party may register or acquire a domain name in good faith, if it uses the domain name in the future so as to call into question the party’s compliance with his representations and warranties (under paragraph 2 of the Policy), this may provide basis for a finding of registration and use in bad faith. The Octogen case was applied and followed by the panelist in Ville de Paris v. Jeff Walter, WIPO Case No. D2009-1278, concerning the disputed domain name <parvi.org>. In that decision the Panelist referred back to his earlier decision in Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003, and the analysis of paragraph 4(b)(iv) of the Policy contained in that decision. The circumstances described in that paragraph of the Policy, if found to be demonstrated in a complaint, would be evidence of bad faith registration and use. In that connection, it should be noted that the paragraph addresses only use of the disputed domain name. So far as two of the panelists in this administrative proceeding are concerned, it follows that, if a finding of bad faith is made under paragraph 4(b)(iv), the answer to the question posed in paragraph 6.15 above must be answered in the affirmative.

6.19 While the third panelist does not draw that conclusion, he nevertheless takes the position that, regardless of what was in the mind of the registrant at the time of registration, the registrant made express representations and warranties as to future use (see, paragraph 6.17 above) of which the registrant is now in breach through generating revenue from the domain name via likely Internet user confusion with another party's rights. Accordingly, in substance this Panel is of the unanimous view that, whatever his motives may have been when the disputed domain name was first registered or subsequently acquired by the Respondent, the Respondent is now acting in bad faith within the meaning of paragraph 4(b)(iv) of the Policy (see further discussion under paragraph 6.25 below) and in breach of those representations and warranties.

6.20 Addressing the Respondent’s concern summarized in paragraph 6.16 above, the panelist in Ville de Paris reasoned as follows:

“The intent of the Policy is to provide a fair and efficient mechanism for trademark owners to obtain redress in situations where their trademark rights are abused as a result of bad faith activities of domain name registrants. There seems no reason in logic or in principle why the availability of redress should be confined to situations where bad faith is present at the time of acquisition of the domain name. To limit the trademark owner's redress in this way would result in outcomes that make no sense. In particular, it would mean that even the most damaging abuse of a trademark right through the most egregious bad faith use of a domain name would be immune from remedy under the Policy so long as the registrant was not acting in bad faith when the domain name was acquired. It would, in short, give a ’green light‘ to good faith domain name registrants to later abusively use their domain names, safe in the knowledge that any such bad faith use could not provide the basis for a successful action under the Policy.

The Policy itself expressly recognizes that, where the disputed domain name is identical or confusingly similar to the complainant's trademark and the respondent has no rights or legitimate interests in the domain name, in certain circumstances bad faith use of a domain name alone is sufficient to entitle the complainant to a remedy. The Policy describes, in Paragraph 4(b)(iv), one instance of such circumstances. Other instances of such circumstances may be found by a panel, on consideration of all the facts before it.”

6.21 A succession of recent panel decisions have come to a different view – see, e.g., the decisions cited in the majority opinion in A. Nattermann & Cie. GmbH and Sanofi-aventis v. Watson Pharmaceuticals, Inc., WIPO Case No. D2010-0800. Those panels are of the opinion that paragraph 4(a)(iii) of the Policy requires that the complaint must fail if it cannot establish that the initial registration by the respondent occurred in bad faith. Put in summary form, the reasoning of those panels is that the “ordinary meaning” (Nattermann) or “plain meaning” (Validas, LLC v. SMVS Consultancy Private Limited, WIPO Case No. D2009-1413) of the phrase “domain name has been registered and is being used in bad faith” shows “unequivocally” (Torus Insurance Holdings Limited v. Torus Computer Resources, WIPO Case No. D2009-1455) that the complainant must show bad faith registration of the domain name by the respondent as well as bad faith use of the domain name by respondent. According to those panels, the word “and” is used conjunctively not disjunctively; thus, it is plain and unequivocal that initial registration in bad faith by the Respondent is a prerequisite to success under the Policy.

6.22 In this Panel’s view, the meaning of paragraph 4(a)(iii) is far from unequivocal; and, it is far from self-evident that the ordinary or plain meaning of its words is the meaning attributed to it by those panels. There are at least two problems with the “ordinary/plain meaning” approach. The first problem is that paragraph 4(a)(iii) does not actually say the very meaning that is attributed to it by these panels as being ordinary or plain. In particular, the paragraph does not say (as it could well have said, if its meaning was indeed unequivocal) “domain name has been registered in bad faith and is being used in bad faith”. It seems that the “ordinary/plain meaning” Panels assume the presence of the underlined words – yet, those words are plainly not present in the paragraph. So, even if it is accepted that the word “and” is conjunctive, it still needs to be determined what, exactly, it conjoins. To this Panel’s mind, an ordinary or plain meaning approach would give the result that the word “and” conjoins “registered” and “is being used in bad faith” – not “registered in bad faith” and “is being used in bad faith”.

6.23 The second problem as this Panel sees it with the “ordinary/plain meaning” approach is that it is far from unequivocal that the word “and” in paragraph 4(a)(iii) acts conjunctively. As Lord Salmon stated in Federal Steam Navigation Co Ltd v. Department of Trade [1974] All ER 97 at 112: “My Lords, I do not suppose that any two words in the English language have more often been used interchangeably than ‘and’ and ‘or’. However unfortunate or incorrect this practice may be, many examples of it are to be found in all manner of documents and statutes. There are many reported cases which turn upon whether, in its particular context, the word ‘or’ is to be read conjunctively or the word ‘and’ disjunctively.”

6.24 In this Panel’s assessment, whether or not the word “and” has the conjunctive effect attributed to it by the “ordinary/plain meaning” panels cannot be assumed; rather, it has to be shown by considering the context in which it is used, and in the light of the object and purpose of the instrument in which it is used (a point recognised by the majority in Nattermann). The context in which paragraph 4(a)(iii) of the Policy is used includes, in particular, paragraphs 2(d)² and 4(b) of the Policy. The object and purpose of the Policy includes “the avoidance of consumer confusion, the protection of consumers against fraud, the credibility of the domain name system and the protection of intellectual property rights” (Final Report of the WIPO Internet Domain Name Process, paragraph 168). In our opinion, both the context of the Policy and the object and purpose of the Policy makes it clear that the phrase “has been registered and is being used” in paragraph 4(a)(iii) is not a binary concept. Accordingly, in our view the requirement that the domain name “has been registered and is being used in bad faith” can, in certain circumstances, be satisfied in the absence of bad faith intent upon initial registration where such registered domain name is being used in bad faith.

6.25 The question remaining is whether the current use of the disputed domain name by the Respondent in this administrative action – which is described in paragraphs 4.B.3 and 4 above – falls within paragraph 4(b)(iv) of the Policy. In that respect, whether or not the Respondent is directly responsible for the links contained on the website to which the disputed domain name resolves, is in this case immaterial. The Respondent openly states that the name is parked with eNom for the purpose of generating click-through revenue to fund his domain name business. In putting a domain name to such use, the registrant must be accountable for the use to which it is put. If such use violates the rights of a third party, the registrant cannot claim “lack of responsibility” for that use.

6.26 Here, the website to which the disputed domain name resolves contains links to SNS which compete with the Complainant’s “www.jappy.de” website. Numerous decisions under the Policy have found that such use falls within paragraph 4(b)(iv) of the Policy. In the Panel’s view, an obvious likelihood of confusion with the Complainant’s JAPPY mark will result here, as a result of use of the disputed domain name for a website with links to competitor social networking sites.

6.27 Accordingly, the Panel finds that the Complaint satisfies the requirements of paragraph 4(a)(iii) of the policy.

6.28 In the circumstances of this case, where there has been substantial delay in bringing the case and some fault must be attributed to the Complainant in not clearing the domain name before commencing business, one member of the Panel considers that cancellation is the appropriate remedy rather than the usual remedy of transfer. In appropriate cases, panels have ordered cancellation, for example, Lamprecht AG v Registrant [1690]: com fma, Future Media Architects, Inc, WIPO Case No. D2009-1778, where the complainant had taken over 12 years to bring a complaint despite clear knowledge of the respondent and that there were entities that might be entitled to the domain name. The other two panellists disagree and take the view that, since the Panel unanimously finds the Complaint has been made out, the Complainant is entitled to the remedy requested, namely transfer of the disputed domain name.

7. Decision

For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name <jappy.com> be transferred to the Complainant.

David Perkins
Presiding Panelist

Andrew F. Christie
Panelist

Douglas Clark
Panelist

Dated: September 28, 2010

¹ For a contrary view, in which panels have questioned the relevance of a breach of the representation and warranty under paragraph 2 of the Policy in assessing whether or not there has been bad faith under paragraph4(c)(i) of the Policy, see e.g. TRS Quality, Inc v. Namespro.ca Private WHOIS, WIPO Case No. D2010-0393.

² On the perceived relevance of paragraph 2(d) to determinations under paragraph 4(b), see generally paragraph 6.17 above, including also footnote 2.