WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Votorantim Participações S.A. v. Fatec S.A., Netstructure Soluções Ltda., Carlos Navarro

Case No. D2012-1549

1. The Parties

Complainant is Votorantim Participações S.A. of São Paulo, Brazil, represented by Silveiro Advogados, Brazil.

Respondents are Fatec S.A. of São Paulo, Brazil, Netstructure Soluções Ltda. of São Paulo, Brazil, and Carlos Navarro of Dallas, Texas, United States of America, internally presented.

2. The Domain Name and Registrar

The disputed domain name <uszinc.com> is registered with Network Solutions, LLC.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on July 31, 2012. On July 31, 2012, the Center transmitted by email to Network Solutions, LLC. a request for registrar verification in connection with the disputed domain name. On July 31, 2012, Network Solutions, LLC transmitted by email to the Center its verification response confirming that the Respondent Fatec S.A. 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 Respondents of the Complaint, and the proceedings commenced on August 3, 2012. In accordance with the Rules, paragraph 5(a), the due date for Response was August 23, 2012. The Response was filed with the Center on August 21, 2012 by Netstructure Soluções Ltda., Carlos Navarro.

The Center appointed Gabriel F. Leonardos as the sole panelist in this matter on September 3, 2012. The Panel finds that it was properly constituted. 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.

Complainant presented a supplemental filing, on September 26, 2012, alerting the Panel of the decision recently issued by the National Arbitration Forum, regarding the domain name <votorantim.us> and also involving Respondent Netstructure Soluções Ltda and Complainant Votorantim Participações S.A, where the National Arbitration Forum ordered Respondent to transfer the domain name <votorantim.us> to Complainant, pursuant to the U. S. Department of Commerce’s usTLD Dispute Resolution Policy.

4. Factual Background

Complainant is a Brazilian company headquartered in the city and state of São Paulo. Votorantim Participações S.A’s (part of the Votorantim Group) activities are focused on key sectors of the economy that demand capital intensive and high scale production processes such as cement, mining and metallurgy, steel mill, pulp, concentrated orange juice, and energy self generation.

Specifically in the metal field, Complainant operates through Votorantim Metal – a leading company in the zinc, aluminum and nickel electrolyte producing field.

In 2007, the North-American company U.S. Zinc Corporation (hereafter named U.S. Zinc) – a domestic market leading company in recycling of industrial residues from galvanization, metallic zinc production and products of greater added-value, like zinc oxide and zinc powder – was acquired by Votorantim Metal, becoming part of Complainant’s business group (Attachment 05 of the Complaint).

Complainant is the legitimate owner of trademark registrations for trademark USZINC in Brazil (registration nº. 829992740, for U.S. ZINC, in international class 40, filed on November, 19, 2008 and granted on August 02, 2011) and in the United States of America (registration nº. 3579310, for U.S. ZINC, filed on May 27, 2008 and granted on February 24, 2009), having the company U.S. Zinc Corporation been incorporated by Votorantim Metal, becoming part of the same business group as Complainant.

Respondents are Fatec S.A. (“First Respondent”), Netstructure Soluções Ltda. (“Second Respondent”), and Carlos Navarro (“Third Respondent”). In the year of 2008, Votorantim Industrial S.A. – which is also part of the Votorantim Group, signed a Service Agreement (Attachment 07 of the Complaint) with Second Respondent in order to obtain technical advice on domain names management and DNS services. There is evidence in the case record (Attachment 21 of the Complaint) that shows that the disputed domain name was registered to Complainant (in this case a company acquired by Complainant) in February 2008. The disputed domain name is currently registered to the First Respondent.

During the contractual relationship between Votorantim Industrial S.A. and Second Respondent, over 400 domain names owned by the several companies of the Votorantim Group were being managed by Second Respondent, including the disputed domain name <uszinc.com> (Attachment 08 of the Complaint).

The Service Agreement mentioned above included relevant clauses specifically related to the protection of Complainant's intellectual property rights, such as clauses 16.6 and 16.8 (Attachment 07 of the Complaint).

5. Parties’ Contentions

A. Complainant

Complainant and its business group are owners of trademarks registrations for U.S. ZINC in Brazil and in the United States of America. Complainant alleges that, due to its activities and market share, trademark U.S. ZINC reached a well-known status in the field worldwide.

Complainant claims that the services contracted in the Service Agreement (the “Agreement”) did not generate to Second Respondent any intellectual property rights over the domain names managed, whose property should remain with Complainant and the other companies of its business group. It also states that during the contractual relationship several technical problems involving many domain names occurred, which justified Complainants’ legitimate intent to change the service provider – at that time, all Complainant's domain names were being held by Second Respondent and managed through its own login ID and password – data which was never shared with Complainant or the other companies of its business conglomerate, preventing them from making any arrangements over its own domain names’ portfolio. Complainant then requested Second Respondent to transfer the domain names back to it and to repair the technical problems that had occurred.

Complainant states that the transfers, which took place in late 2011 - early 2012, only included 88% of the domain names, having Second Respondent not transferred over 50 domain names – including the disputed one <uszinc.com> – despite the contractual clauses mentioned above regarding Complainant’s intellectual property (clauses 16.6 and 16.8 – Attachment 07 of the Complaint).

Thereby, as a consequence, on February 28, 2012, during an in-person meeting with Second Respondent’s elected representative (clause 12.2 of the referred Attachment 07 of the Complaint), Complainant delivered a rescission letter in accordance to clause 11.14 of the Agreement, with the legitimate expectation to recover the remaining domain names that were being still managed by Second Respondent (Attachment 11 of the Complaint).

Complainant alleges that, from that moment on, Second Respondent started to impose explicit barriers to the transfer of the remaining domain names, with the clear intent to prevent Complainant from changing the service provider and to keep on perceiving financial benefits. Second Respondent’s representative declared it would not to proceed with the transfer of domain names with no additional costs – even though the amount paid by Complainant in accordance to the contract comprised “all the costs inherent to the rendering of services”, as established in clause 9.2 (Attachment 11 of the Complaint). Despite Complainant’s request for information about these additional costs, no budget was ever informed by Second Respondent.

Complainant then sent a cease-and-desist letter to Second Respondent, where it stated the absence of any debts regarding the domain names and stressed the request for transfer, not getting any result.

Complainant also realized that Second Respondent had registered the disputed domain name in the name of the First Respondent, a company completely unknown to Complainant and that had never been allowed to make use of Complainant’s trademark as a domain name. Complainant claims this was done in order to unfairly raise barriers to the domain name transfer at the end of the contract.

Complainant argues that, in view of the narrated facts, there is no doubt that Respondents are clearly “kidnapping” Complainant’s domain names and sabotaging its DNS, in order to keep perceiving financial advantages from Complainant, since it is refusing to proceed with the transfer of the domain names by not disclosing their ID and password, preventing Complainant from managing the domain names registered under its own name and supposedly under its control.

B. Respondent

The Response was filed by the Second and Third Respondents.

Respondents replied to the Complaint stating they registered the domain names for future sale or lease to Complainant. They also allege they did not intent for any commercial gain, to mislead consumers or to tarnish the trademarks at issue.

Respondents claim they just want recognition by Complainant that the disputed domain name ownership belongs to Respondents and, therefore, Complainant would need to pay them for the use or transfer of ownership of the disputed domain name.

Respondents allege that some domain names held by them were owned by Complainant and that with the termination of the Agreement, these domain names were duly transferred to Complainant in good faith and without any questioning.

Respondents claim that performing international domain name registrations for Complainant was not the subject matter of the Agreement and that Complainant – part of a major Brazilian company – disposes of the services of large international offices for registering trademarks and domain names, and if it really wanted to register domain names in its name, it would appeal to these offices, not to Respondents.

Respondents argue that during the term of the Agreement, Second Respondent, in good faith, gave free use of several domain names to Complainant, including the disputed domain name, and with the termination of the Agreement, Second Respondent started negotiations with Complainant to continue disposing of these domain names, but it unfortunately distorted the facts to try to usurp the ownership of domain names it knows does not belong to it and are not related in any way to the Agreement.

At last, while negotiations were taking place, Second Respondent allegedly continued to provide administration services for Internet domains of its property to Complainant without charge.

6. Discussion and Findings

In order to succeed in a UDRP proceeding, Complainant must prove each of the following requirements specified under paragraph 4(a) of the Policy:

(i) that the disputed domain name registered by Respondents is identical or confusingly similar to a trademark or service mark in respect of which Complainant has rights; and

(ii) that Respondents have no rights or legitimate interests in respect of the disputed domain name; and

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

As indicated above, this case involves three different Respondents with one of them having entered in a contractual relationship in 2008 with Complainants’ group of companies. Based on the case record, and more particularly on the Response filed by the Second and Third Respondents and on the fact that the First Respondent’s email address as confirmed by the Registrar appears to be related to the Second Respondent (the email address in question being “[…]@netstructure.com.br”), the Panel is satisfied that all three Respondents are in fact related and most likely controlled by the same entity. This Panel’s decision and its findings shall therefore apply equally to all Respondents in this case.

A. Identical or Confusingly Similar

Complainants have duly proved the first element under paragraph 4(a) of the Policy by attesting that it is the owner of trademark registrations for U.S. ZINC in Brazil and in the United States of America, and that such trademark is entirely incorporated in the disputed domain name <uszinc.com>. The disputed domain name also reproduces the central and distinctive portion of the company name U.S. Zinc Corporation, which belongs to the same business group as Complainant (Attachment 05 of the Complaint).

The trademark U.S. ZINC was initially filed before the Brazilian PTO and United States Trademark Office in 2008, and its certificates of trademark registration were issued in 2011 and 2009, respectively.

The Panel therefore finds that the disputed domain name is identical to Complainant’s trademark registration, and, thus, that the requirement of paragraph 4(a)(i) of the Policy is met.

B. Rights or Legitimate Interests

Second Respondent celebrated the Agreement with Complainant and the other companies of its business group in order to provide technical advisement on domain names management and DNS services, including the disputed domain name <uszinc.com>.

As stated in the referred Agreement, “the service provider, by itself, its representatives, employees and occasional subcontractors, may not use names, trademarks, signs and distinctive colors, as well as any other means of identification of the company and its products and services, unless with the express authorization of this one” (clause 16.6 of the Complaint). It is also established that “Belongs to the company [in this case, Complainant] any intellectual property rights that may arise as a consequence of the fulfillment of this contract” (clause 16.8).

Thus in this Panel’s view, it is clear that Second Respondent was only authorized to register and manage Complainant’s domain names on its behalf, having no legal rights over the domain names, being also not authorized to transfer the domain names to a third party – as it did with First Respondent.

Moreover, Complainant has proved to the satisfaction of this Panel that Respondents do not have rights or legitimate interests over the disputed domain name on the expression “uszinc” pursuant to the Policy, since they are not commonly known as “uszinc”, do not run any business under the name “uszinc” and have never filed trademark applications for “uszinc”.

Furthermore, the disputed domain name still resolves to Complainant’s official website, which also confirms Respondent’s lack of rights and legitimate interests over the domain name.

In view of the above, the Panel finds that Respondents have no rights or legitimate interests in the disputed domain name. Accordingly, the Panel finds that Complainant has satisfied the requirements of paragraph 4(a)(ii) of the Policy.

C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy lists a number of circumstances which, without limitation, are deemed to be evidence of the registration and use of a domain name in bad faith. Those circumstances include: (iv) by using the disputed domain name, Respondents have intentionally attempted to attract, for commercial gain, Internet users to Respondents’ website or other online location, by creating a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondents’ website or location or of a product or service on Respondents’ website or location.

In this Panel’s view, the reported facts are unequivocal evidence of Respondents’ bad faith. The disputed domain name <uszinc.com> was managed by the Second Respondent since 2008 due to the Agreement signed with Complainant, under which Second Respondent was a mere representative of Complainant, entitled only to manage and register its domain names, as its agent, on its behalf.

Albeit the termination of the Agreement, the disputed domain name <uszinc.com> is still being managed by Respondents, now registered in the name of First Respondent, who is denying access to the concerned ID and password by Complainant, preventing it to manage, transfer or use the disputed domain name which has been managed on its behalf since 2008.

In support of its arguments, Complainant cites a number of decisions made by previous UDRP panels in similar cases, such as one regarding the withholding of a domain name by the former service provider, where the panel found the registration of the domain name during the contractual relationship in the name of others than the contracting party constitutes bad faith: Nürmont GmbH v. PCC Heilbronn GbR Eberhard Düttra, WIPO Case No. D2001-0954.

Moreover, the Panel notes that in VOTORANTIM PARTICIPAÇÕES S.A. v. Carlos Navarro / NetStructure, NAF Claim No. FA1207001456005, which involved Respondent Netstructure Soluções Ltda and Complainant Votorantim Participações S.A, and where the facts were similar to this case, the panel ordered the domain name <votorantim.us> be transferred to Complainant.

In addition, Complainant and the other companies of its business group remain repeatedly facing technical problems, which leads us to believe Respondents are intentionally withholding the disputed domain name in order to prevent Complainant from effectively changing its management provider, keep perceiving financial benefits, which constitutes an unequivocal use of bad faith.

It is clear that Respondents elected the disputed domain name to remain in their possession due to its value as an intellectual property asset, since the trademark U.S ZINC belongs to a leading company in its market segment, being, therefore, widely celebrated. Evidently, the unavailability of the disputed domain name causes great damage to Complainant’s activities, and Respondents are apparently turning the disputed domain name into an element of coercion for Complainant to pay more money in order to recover it.

Furthermore, in their Response, the Second and Third Respondents confessed to have registered the disputed domain name for future sale or lease to Complainant, in a clear act of bad faith, as settled by paragraph 4(b)(i) of the Policy and recognized by previous UDRP panels.

Accordingly, the Panel concludes that the disputed domain name was registered and is being used in bad faith, and, thus, that the requirement of paragraph 4(a)(iii) of the Policy is met.

7. Decision

For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the disputed domain name <uszinc.com> be transferred to Complainant Votorantim Participações S.A. as requested by Complainants.

Gabriel F. Leonardos
Sole Panelist
Dated: October 15, 2012