The Complainant is Agros Trading Confectionery Spolka Akcyjna of Warsaw, Poland, represented by Melconian Law Office, Canada.
The Respondent is David Michaels of New York, United States of America (“United States”), self-represented.
The disputed domain names (collectively, the “Domain Names”) are registered with GoDaddy.com LLC (<sesamesnap.com>), 1&1 Internet AG (<sesamesnaps.biz>, <sesamesnaps.net>, <sesamesnaps.org>) and Go Montenegro Domains, Inc. (<sesamesnaps.com>) (collectively, the “Registrars”).
The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on September 8, 2016. On September 9, 2016, the Center transmitted by email to the Registrars a request for registrar verification in connection with the Domain Names. On September 10 and 12, 2016 respectively, the Registrars transmitted by emails to the Center their verification responses confirming that the Respondent is listed as the registrant and providing the contact details. In response to a notification by the Center that the Complaint was administratively deficient, the Complainant filed an amended Complaint on September 22, 2016.
The Center verified that the Complaint together with the amended 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 and 4, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on September 28, 2016. In accordance with the Rules, paragraph 5, the due date for Response was October 18, 2016. The Response was filed with the Center on October 19, 2016.
The Center appointed Tony Willoughby as the sole panelist in this matter on October 28, 2016. 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.
The Response was filed with the Center on October 19, 2016 one day late. However, it was served on the Complainant’s representative in time (Toronto time) and the delay, which was caused in part apparently by the fact that one of the annexes to the Response was too large, was trivial and caused no inconvenience. The Panel admits the Response into the proceeding.
On November 3, 2016 and November 8, 2016 respectively the Panel issued Procedural Order No. 1 (seeking clarification of certain matters from the parties) and Procedural Order No. 2 (permitting further submissions from the parties). The parties responded in timely fashion.
On November 22, 2016, the Respondent provided evidence that its application for United States Trade Mark application Serial No. 86966284 matured into Registration No. 5086046 (and is discussed below).
The Complainant is a Polish corporation incorporated in 2002. The Complainant is engaged in the export from Poland to Canada of, inter alia,sesame biscuits or bars, which are marketed in Canada under the name “Sesame Snaps”.
Agros Holding SA is the Complainant’s immediate predecessor in title in respect of its Canadian trade mark registrations upon which the Complaint is based. The Respondent describes it as the Complainant’s parent company. Its trading address is the same as that from which the Complainant trades. It assigned its SESAME SNAPS trade marks to the Complainant on June 26, 2002.
Przedsiebiorstwo Handlu Zagranicznego Agros1 is a predecessor in title of Agros Holding SA. According to the Respondent its name translates as “Foreign Trade Company Agros”. Its trading address given in the records of the Canadian Intellectual Property Office is the same as that of Agros Holding SA and the Complainant.
Dalimpex Limited was incorporated in Canada on or about November 22, 1965. The Panel accepts the evidence of the Complainant that “it was one of several distributors of products sold by Agros Holding SA and its subsidiaries.” It entered into agreements in January 2, 2001 and February 22, 2002 with K-Max Corp. (see “The Assignments” below) and was dissolved for “non-compliance” on November 5, 2003. As at the date of its dissolution it was the registered proprietor of United States Trade Mark Registration No. 2627618 SESAME SNAPS CANDY / FRIANDISE stylised device mark more particularly described below.
K-Max Corp., run by one K. Werocy, was an authorised distributor of the Complainant’s products from 2003 to 2010. On cessation of that distributorship the company commenced sales of a similar sesame product under the name “Classic Sesame”. As will be seen below, the Panel rejects the Respondent’s claims that this company was ever the owner of any trade mark rights in respect of “Sesame Snaps”.
K-Max (2013) Corporation was incorporated on October 23, 2013 by J. Picard, “for the specific purpose of purchasing the assets of [K-Max Corp.]”.2 It is a company run by the same K. Werocy who previously ran K-Max Corp. When its stock of the Complainant’s products was depleted it commenced sales of “Classic Sesame”.
Exclusive Candy and Novelty Distributing Limited, of which the same J. Picard was an officer, was an authorised distributor of the Complainant’s products from 2002 to 2013.
The Respondent identifies UNITOP as the early supplier of “Sesame Snaps” to K-Max Corp. The Complainant does not appear to dispute that fact, but asserts that its full name is PPHU Unitop Krzysztof Bubrowiecki and that it is the name of an enterprise registered in Poland to Mr. K. Bubrowiecki, who is said to be the ultimate owner of the Complainant and the related Agros and Unitop companies. The Panel accepts the evidence of the Complainant.
The Respondent is a qualified lawyer based in Toronto who, according to his website at “www.intelliguard.com”, runs a business involving “Patents Trademarks Copyright Business Consulting”. He was the representative for service for K-Max Corp. in the latter’s application for its CLASSIC SESAME trade mark registration (see below) and in August 2012 he claimed to be a brand consultant for K-Max Corp. He claims to run an online retail services business via a website connected to the <sesamesnaps.com> Domain Name.
The Domain Name <sesamesnap.com> was first registered by a third party on December 18, 2005 and acquired by the Respondent in an online auction of abandoned domain names on January 20, 2013. It is connected to what appears to the Panel to be a static WordPress webpage. It features a recipe for “Chewy Sesame Seed Bars”.
The Domain Name <sesamesnaps.com> was first registered by a third party on December 25, 2009 and acquired by the Respondent in an online auction on January 22, 2014. It is connected to the Respondent’s United States based online trading site dealing in sesame food products. The products on offer include “Sesame Snaps Honey Sesame Sticks”, “Sesame Snaps Sesame Sticks” and “Classic Sesame Snack Bars”. The evidence of the Respondent suggests that there was an earlier registration of that Domain Name, which the Respondent asserts was held by K-Max Corp. Evidently, the earlier registration lapsed prior to the Respondent’s acquisition of the current registration.
The Domain Name <sesamesnaps.net> was registered by the Respondent on December 28, 2012. It resolves to a generic landing page at <sesamesnaps.org> (see below).
The Domain Name <sesamesnaps.biz> was registered by the Respondent on December 28, 2012. It is connected to a generic landing page featuring Google Advertisements.
The Domain Name <sesamesnaps.org> was registered by the Respondent on December 29, 2012. It is connected to a generic landing page featuring Google Advertisements some of which relate to the Complainant’s products. It now features in addition commentary on this proceeding and the bulk of the text of the Response.
The Complainant is the registered proprietor of several Canadian Trade Mark Registrations including the following3 :
(i) No. 332104 SESAME SNAPS design mark (incorporating also the words “BISCUITS BISCUITS DE”) applied for on June 16, 1986 and registered on September 18, 1987 in Class 30 for “Confectionery products, namely, sesame bars”. The registration features a disclaimer: “The right to the exclusive use of all the reading matter is disclaimed apart from the trade mark.” The application featured a first use claim in Canada going back to 1971. The original applicant was Przedsiebiorstwo Handlu Zagranicznego Agros of Warsaw, Poland. On a date prior to December 28, 2000 the registration was assigned to Agros Holding SA. On a date prior to June 11, 2007 (probably in 2002) the registration was assigned to the Complainant. Significantly, in light of certain allegations made by the Respondent, all three registrants of this trade mark gave as their address the same address in Warsaw. The Panel is satisfied on the evidence before it that all three companies are associated companies. Indeed, the Respondent describes Agros Holding SA as the Complainant’s parent company.
(ii) No. 728997 SESAME SNAPS (word mark) applied for on November 21, 2007 and registered on November 20, 2008 in Class 30 for “Confectionery products, namely, sesame bars”. There is no disclaimer in respect of this registration. However, the record for this trade mark registration at the Canadian Intellectual Property Office indicates that it is the subject of a “Request” from the Respondent filed with the Canadian Intellectual Property Office on September 16, 2016, which from what is said in the Response is taken by the Panel to mean that the Respondent has launched a challenge to the validity of the registration.
(iii) No. 728998 SESAME SNAPS (design) applied for on November 21, 2007 and registered on November 20, 2008 in Class 30 for “Confectionery products, namely, sesame bars”. There is no disclaimer in respect of this registration and so far as the Panel has been able to determine, this registration is not the subject of any “Request” from the Respondent.
For completeness it is convenient to mention at this stage two other Canadian trade mark applications and one further Canadian trade mark registration mentioned in the Response, namely:
(a) Application No. 0888860 SESAME SNAPS (design) filed on August 31, 1998 in Class 30 for “Sesame snaps” by Dalimpex Ltd. of Quebec, Canada. The application featured a disclaimer reading: “The right to the exclusive use of the words SESAME SNAPS is disclaimed apart from the trade mark.” The application was abandoned on May 9, 2003.
(b) Application No. 0889167 SESAME SNAPS (box design) filed on September 2, 1998 in Class 30 for “Confectionery products, namely, sesame bars” by Agros Holding SA. The application was abandoned on July 13, 2004. This application featured a first use claim going back to 1998.
(c) Registration No. 830204 CLASSIC SESAME (word mark) applied for on January 4, 2010 and registered on August 21, 2012 in class 30 for “Confectionery products, namely, sesame bars, sesame cookies, sesame sticks, and sesame wafers” in the name of K-Max Corp. There is a disclaimer reading: “The right to the exclusive use of the word SESAME is disclaimed apart from the trade mark”. The record states that the registrant’s “representative for service” is Intelliguard Corp. of the same address as the Respondent.
The Respondent places heavy reliance upon the history of the parties’ attempts to register Sesame-related marks in the United States. Consistently, the United States Patent and Trade Mark Office (“USPTO”) has held that the words “Sesame Snaps” (per se) for use in relation to sesame bars are descriptive and generic and unregistrable as a trade mark even when a disclaimer of those words has been offered in relation to certain device marks.
Despite several applications over the years, the only potentially relevant United States registrations that the Complainant has succeeded in obtaining are stylised device marks (with “Sesame Snaps” disclaimers) for AMKI ORIGINAL SESAME SNAPS (registered October 16, 2012) and SESAME SNAPS DELICIOUS TRY ONE SEZME BRAND (registered April 9, 2013).
However, on February 22, 2001 Dalimpex Limited applied successfully to the USPTO for registration of a SESAME SNAPS CANDY / FRIANDISE stylised device mark in Class 30 for “Candy, namely sesame snaps” with a first use claim dating back to 1998. The registration came through on October 1, 2002 under No. 2627618, but was cancelled on May 16, 2009 for failure to file a required declaration. By then Dalimpex Limited had been dissolved for almost six years.
On May 22, 2010 K-Max Corp. applied to the USPTO (Serial No. 85045757) for registration of SESAME SNAPS in a stylised form with a disclaimer of “Sesame Snaps” apart from the mark as shown. The application was in Class 30 for “sesame sticks; Sweetmeat made of sesame oil”. The application was assigned to the Respondent on July 4, 2012, but abandoned on November 10, 20144 .
On March 20, 2015 the Respondent applied to the USPTO (Serial No. 86570617) for registration of SESAME SNAPS in stylized form with a disclaimer of “Sesame” apart from the mark as shown. The application was in Class 35 for “online retail store services featuring sesame based foods”. The application was abandoned on December 29, 2015.
On April 6, 2016 the Respondent applied to the USPTO (Serial No. 86966284) for registration of SESAME SNAPS (in a stylized form) with the disclaimer: “No claim is made to the exclusive right to use SESAME apart from the mark as shown”. The application is in Class 35 for “online retail store services featuring sesame based food products; computerised online retail store services in the field of sesame based food products.” The application records that the Respondent is the successor in interest to the above-mentioned expired Dalimpex Limited SESAME SNAPS CANDY / FRIANDISE registration. He claims a first use anywhere in another form going back to January 1, 1971; and first use in commerce going back at least as far as March 10, 2014. The application was published for opposition on September 16, 2016.5 His rights are said to stem from an assignment from K-Max Corp. dated July 4, 20126 .
In the further submissions submitted by the parties following issuance of Procedural Order No. 1 reference is made to a dispute between the Complainant’s predecessor, Agros Holding SA, and Dalimpex Limited. The Panel has insufficient information in relation to that dispute to comment upon it and is not certain that it is related to the SESAME SNAPS trade mark. The Panel ignores it.
In about March 2012, the Complainant discovered that one of its erstwhile distributors, K-Max Corp., which had been a distributor in Canada of Sesame Snaps from 2003 to 2010, was selling a competing product under the name “Classic Sesame”. The Complainant took the view that the product’s branding and packaging rendered it confusingly similar to the Complainant’s “Sesame Snaps” product and on August 13, 2012 launched an action against K-Max Corp. in the Ontario Superior Court of Justice for unfair competition, trade mark infringement, passing off and copyright infringement. The Statement of Claim was issued and served on K-Max Corp.
On August 31, 2012 the Respondent emailed the Complainant’s representative stating “I am a brand consultant for K-Max Corp. and today I reviewed the Statement of Claim you issued in the Ontario Superior Court against K-Max Corp.” The email went on to point out that K-Max Corp. was the registered proprietor of the above-mentioned Canadian word mark Trade Mark Registration No. 830204 for CLASSIC SESAME. It also asserted that the Complainant was not authorised to bring a lawsuit in Ontario as it had not been registered as an extra-provincial corporation. The email ‘sign-off’ gave the Respondent’s contact details including his web address, “www.intelliguard.com”. There he is identified as a highly qualified lawyer with a business in “Patents Trademarks Copyright Business Consulting”.
The Complainant proceeded with the action, but K-Max Corp. failed to file a defence. K-Max Corp. was “noted in default” on April 17, 2014 and, while it applied to have the “noting in default” set aside, it did not proceed with the application.
Towards the end of 2014 the Complainant applied to the court for a default judgment. Judgment was given by Justice Mew on January 22, 2015 in favour of the Complainant and a declaration granted in the following terms: “that the sesame candies identified as ‘Classic Sesame’ infringe the trade-marks and copyrighted works of the [Complainant]”. Injunctions were granted which effectively restrained all further dealings in K-Max Corp.’s “Classic Sesame” product. Significantly, the court order contained the following further paragraph:
“THIS COURT FURTHER ORDERS AND ADJUDGES that the defendant and all persons to whom a copy of this Judgment is provided take all steps necessary to cause any advertising, selling or other distribution of ‘Classic Sesame’ sesame candies and any other confectionery items which infringe on the rights of the plaintiff to be terminated forthwith;”
Inevitably, this last paragraph would have been a cause for concern to any traders holding stocks of the offending “Classic Sesame” product of K-Max Corp. and on March 18, 2015 two such entities, Exclusive Candy and Novelty Distributing Limited (an authorised distributor of the Complainant’s product from 2002 to 2013) and K-Max (2013) Corporation (a company incorporated “for the specific purpose of purchasing the assets of K-Max Corp.”7 ), applied to the court to have the judgment in default set aside. After what appears from the ensuing judgment to have been a detailed review of the law and the facts, the judge, Justice E.M. Morgan dismissed the application and upheld the judgment of Justice Mew. Paragraph 42 of the judgment reads:
“The evidence before me makes it clear that the Moving Parties [i.e Exclusive Candy and Novelty Distributing Limited and K-Max (2013) Corporation] went out of their way to find a product that would sow confusion in the mind of the consuming public, and that they succeeded in this task. They marketed Classic Sesame candies by passing them off as Sesame Snaps.”
It should also be noted that contemporaneously there was a dispute in Canada between the parties over the domain name, <sesamesnaps.ca>, a domain name registered by the Respondent on February 15, 2012. The Complainant launched a complaint against the Respondent under the Canadian Internet Registration Authority Domain Name Dispute Resolution Policy on May 12, 2014. The Respondent participated in that proceeding by filing a detailed Response. The three-member panel delivered its decision on July 14, 2014. Paragraph 72 of the decision reads as follows:
“The Panel concludes that the Complainant has rights in the ‘Sesame Snaps’ mark that predate the registration of the <sesamesnaps.ca> domain name by the [Respondent]. It also concludes that the domain name is confusingly similar to the Complainant’s mark and that the [Respondent] has no legitimate interest in the domain name. Finally, it finds that the Complainant has shown that the [Respondent] registered the domain name in bad faith.”
The panel upheld the complaint and directed that the domain name, <sesamesnaps.ca>, be transferred to the Complainant. At that time the Respondent’s website connected to the <sesamesnaps.ca> domain name featured at the foot of the page a legend reading: “Copyright © 2010-2013 David Michaels, dba Sesame Snaps. All rights reserved. Sesame Snaps is a trade mark of David Michaels in Canada and the USA.” This copyright notice will be referred to further below.
On January 2, 2001 K-Max Corp. and Dalimpex Limited entered into an agreement whereby the parties “agreed to cooperate in Sesami [sic] Sanps [sic] and Inka coffee product import and distribution”. The principal obligations were for K-Max Corp. to provide funds in specified amounts on specified dates between January 3, 2001 and December 27, 2001 for the purchase of the product and for Dalimpex Limited to make repayments of specified sums on specified dates between April and September 2001. Dalimpex Limited agreed to provide security to K-Max Corp. by agreeing, inter alia,to give up in favour of K-Max Corp. its distribution rights, intellectual property etc. in respect of, inter alia, Sesame Snaps.
On February 7, 2002 K-Max Corp. and Dalimpex Limited entered into a further agreement whereby K-Max Corp. agreed, inter alia,to fulfil Dalimpex Limited’s obligation to pay the producer of sesame snaps 139,270.65 Canadian dollars. In return, Dalimpex Limited agreed to transfer “all of its existing distribution rights, contracts and accounts”.8
On July 4, 2012 K-Max Corp. entered into an agreement with the Respondent whereby “K-Max Corp. assign[ed] the entire interest and goodwill in the SESAME SNAPS trademark around the world, in exchange for assisting K-Max Corp. with its CLASSIC SESAME trademark in Canada and elsewhere and for assisting K-Max Corp. with its [GSI]9 bar code registration for 2012.”
On November 1, 2013 K-Max Corp. assigned to K-Max (2013) Corporation “all of [K-Max’s] intellectual property and proprietory information, including trade-marks, business names, trade names, industrial designs and copyrights.”10
The Complainant contends that the Domain Names are identical or confusingly similar to the Complainant’s SESAME SNAPS trade mark registration, that the Respondent has no rights or legitimate interests in respect of the Domain Names and that the Domain Names have been registered and are being used in bad faith.
The Respondent acknowledges that the Complainant is registered proprietor of a 2008 Canadian trade mark registration for SESAME SNAPS (word mark), but observes that the rights are restricted territorially to Canada and that the registration post-dates by three years the Respondent’s 2005 registration of the Domain Name, <sesamesnap.com>11 . He also contends that it post-dates by “about 50 years” his predecessor-in-interest’s first use of the “various SESAME SNAPS designs as trade marks in Canada and the USA.”
The Respondent contends that his rights in the Domain Name, <sesamesnaps.com>, which he acquired by auction on January 22, 2014 date back to an earlier registration of the Domain Name when it was registered in 2002 or 2003 in the name of K-Max Corp. who transferred all rights to the SESAME SNAPS trade mark to the Respondent in 2012. The Respondent produces evidence to show an earlier use, but the Panel has been unable to identify the user.
The Respondent asserts that the name “Sesame Snap” is descriptive of a type of cookie and refers to numerous findings to that effect issuing out of the USPTO in respect of the Complainant’s attempts to register the name in the United States. He also contends that the Complainant has admitted that the term is descriptive in offering disclaimers of the term in its United States trade mark applications.
The Respondent claims to be the ultimate successor-in-interest to Dalimpex Limited, a Canadian corporation, which he asserts was incorporated in 1965 and traded from 1965 to 2002 in goods imported from Poland ranging from snack foods to heavy machinery. He contends that Dalimpex Limited used the SESAME SNAPS trade mark and associated designs from about 1966 to 2002. He refers to the assignments described in Section 4 above, states that Dalimpex Limited defaulted on the loan referred to therein and that as a result K-Max Corp. “was the owner of the SESAME SNAPS brand in both Canada and the USA between 2002 and 2012” and thus claims to be the senior user of the SESAME SNAPS trade mark.
The Respondent points to the fact that he is the applicant for registration of the United States trade mark SESAME SNAPS (Serial No. 86966284) referred to in Section 4 above, which has been published for opposition. He observes that to date the Complainant has not opposed any of his United States trade mark applications and contends that the application will mature into a registration in the near future.
The Respondent claims that he has rights and legitimate interests in respect of the Domain Names. He acknowledges that the Domain Names, <sesamesnaps.biz>, <sesamesnaps.net> and <sesamesnaps.org> are connected to landing pages with Google Advertisements, but contends that that constitutes a legitimate business and cites a United States court decision in support of that contention.
The Respondent contends that the defence of laches should apply. He asserts that the limitation period in Ontario is two years and that in most of the United States it is two to four years. He contends that his 2005 registration of the <sesamesnap.com> Domain Name is over ten years old and that his predecessor-in-interest registered the Domain Name <sesamesnaps.com> back in 2003. He contends that he will suffer undue prejudice if those Domain Names are taken away from him.
In paragraph 6 of the Response the Respondent disclaims any knowledge of, inter alia,the judgments of the Ontario Superior Court dated January 22, 2015 and March 18, 2015.
The Respondent seeks a finding of Reverse Domain Name Hijacking against the Complainant broadly on the basis that the Complainant has provided the Panel with false and materially incomplete information. In the absence of a list of the grounds upon which the Respondent relies, the Panel has identified from the Response the following potential grounds:
(i) The Complainant failed to disclose in the Complaint the problems that it had had with its United States trade mark applications and particularly having regard to the fact that the USPTO regards the term “Sesame Snap” as descriptive, generic and unregistrable.
(ii) The Complainant’s 1971 first use claims made in respect of its Canadian trade mark registrations are false. The Complainant was only incorporated in 2002 and it is not an operating company. The Respondent asserts that it is “apparently a shell company invented to dodge taxes in the EU and elsewhere”. The Respondent describes it as a subsidiary holding company. He asserts that privatisation of state-owned companies only commenced in 1998 and that the Complainant’s predecessor-in-interest, Agros Holding SA, which applied to register a SESAME SNAPS box design in September 1998 only claimed use in Canada “since at least 1998”.
(iii) The Complainant falsely contends in the Complaint that its 1987 registrations for SESAME SNAPS & Design are “for the exclusive use of the words SESAME SNAPS and design logo in relation to confectionery products, namely sesame bars”. The Respondent points out that the registration includes a disclaimer of SESAME SNAPS apart from the trade mark.
(iv) The applicant for registration of the Complainant’s 1987 registrations was a non-existent fictitious entity. Its name, Przedsiebiorstwo Handlu Zagranicznego Agros, means “Foreign Trade Company Agros”. According to the Respondent such an entity never existed in communist Poland and the Complainant acquired the registrations via a back-dated assignment dated February 16, 1989. The Respondent asserts that “No Polish State property was ever legally assigned to anyone before 1998”.
(v) The Complainant falsely claims in the Complaint that CLASSIC SESAME and SESAME SNAPS are confusingly similar and points to K-Max Corp.’s Canadian trade mark registration of CLASSIC SESAME.
(vi) The Complainant falsely states that the Respondent was one of the parties, which attempted to set aside the Complainant’s 2015 default judgment.
(vii) The Complainant’s lawyer misled the Ontario court as to the law. The Respondent contends that the Complainant’s lawyer failed to point out to the court that the court does not have jurisdiction to enjoin a registered trade mark owner from using its valid and subsisting trade mark registration in respect of the goods and services for which it is registered.
According to paragraph 4(a) of the Policy, for this Complaint to succeed in relation to the Domain Names, the Complainant must prove that:
(i) The Domain Names are identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and
(ii) The Respondent has no rights or legitimate interests in respect of the Domain Names; and
(iii) The Domain Names have been registered and are being used in bad faith.
Moreover, in writing its decision, the Panel has to have regard to paragraph 15(e) of the Rules and in particular the following sentence namely:
“If after considering the submissions the Panel finds that the Complaint was brought in bad faith, for example in an attempt at reverse domain name hijacking or was brought primarily to harass the domain name holder, the Panel shall declare in its Decision that the Complaint was brought in bad faith and constitutes an abuse of the Administrative Proceeding.”
Reverse Domain Name Hijacking is defined in paragraph 1 of the Rules as “using the Policy in bad faith to attempt to deprive a registered domain name holder of a domain name”.
The Respondent contends that the Complainant’s delay in launching this proceeding entitles him to the benefit of the defence of laches. He states that “the limitation period is two years in Ontario”. He states that his <sesamesnap.com> Domain Name registration goes back to December 18, 2005 and that his predecessor’s <sesamesnaps.com> Domain Name registration goes back to 2003. Those, however, are not the relevant dates. The Respondent acquired both those Domain Names by auction. The <sesamesnap.com> Domain Name he acquired on January 20, 2013 and the <sesamesnaps.com> Domain Name he acquired on January 22, 201412 , which severely reduces the length of delay that he claims in the Response. More significantly, the Panel notes that the Respondent registered the <sesamesnaps.ca> domain name on February 15, 2012. The Complainant launched its complaint in respect of that domain name on May 12, 2014 (i.e. over two years later) and the Ontario panel did not feel inhibited by any two year limitation period applicable in Ontario.
In any event it is now widely recognized that the defence of laches does not apply in proceedings under the Policy. The matter is addressed in paragraph 4.10 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition, which poses the question: “Does delay in bringing a complaint prevent a complainant from filing under the UDRP?” The answer to that question reads:
“Panels have recognized that the doctrine or defense of laches as such does not generally apply under the UDRP, and that delay (by reference to the time of the relevant registration of the disputed domain name) in bringing a complaint does not of itself prevent a complainant from filing under the UDRP, or from being able to succeed under the UDRP, where a complainant can establish a case on the merits under the requisite three elements. Panels have noted that the remedies under the UDRP are injunctive rather than compensatory in nature, and that a principal concern is to avoid ongoing or future confusion as to the source of communications, goods, or services.”
The answer goes on to point out that an extended delay can have a bearing on a panel’s findings under the second and third elements of the Policy and that a small number of panels continue to find, where the circumstances warrant, that a defence of lachesmay be applicable. The Panel is not a member of that small group of panelists and, absent exceptional circumstances not present in this case, does not believe that the delay here in respect of any of the Domain Names merits a finding in favour of the Respondent under any of the three elements of the Policy on the basis of undue delay.
The Complainant is the registered proprietor of, inter alia,Canadian Trade Mark Registration No. 728997 SESAME SNAPS (word mark) applied for on November 21, 2007 and registered on November 20, 2008 in Class 30 for “Confectionery products, namely, sesame bars”. Unlike several of the Complainant’s trade mark registrations this registration features no disclaimer of the words “Sesame Snaps”. The Respondent is contesting the validity of that registration, but currently the registration is valid and subsisting. Canadian Trade Mark Registration No. 728998, the design registration, is not subject to the same attack.
The Respondent claims rights in respect of “Sesame Snaps” pre-dating the Complainant’s above-mentioned trade mark registration, but for the purpose of paragraph 4(a)(i) of the Policy the Complainant merely has to establish that its rights were in existence as at the date of the Complaint.
The Domain Name, <sesamesnap.com> comprises the Complainant’s SESAME SNAPS trade mark (albeit omitting the plural “s”) and the “.com” generic Top-Level-Domain (“gTLD”) identifier. The other four Domain Names all comprise the Complainant’s SESAME SNAPS trade mark in full combined with one or other of the “.com”, “.net”, “.biz” and “.org” gTLD identifiers.
It being permissible for panels to ignore gTLDs where they serve no purpose other than the technical one (in other words they do not serve any distinctive function), the Panel finds that the Domain Names are identical or confusingly similar to the Complainant’s SESAME SNAPS trade mark, which is not only a registered trade mark in Canada, but in light of the finding of passing off made by Justice EM Morgan in his judgment in the case of the Complainant v. K-Max Corp. (see Section 4 above) is likely also, in the view of the Panel, to be a common law or unregistered trade mark in Canada.
The Complainant’s position is relatively straightforward. It has traded in Canada in its “Sesame Snaps” product since incorporation in Poland in 2002. It was incorporated to take over Agros Holding SA’s interests in the “Sesame Snaps” product, which its predecessor had acquired via a restructuring of that company’s predecessor, Przedsiebiorstwo Handlu Zagranicznego Agros. Przedsiebiorstwo Handlu Zagranicznego Agros was the original registrant of Canadian Trade Mark Registration No. 332104 SESAME SNAPS design mark (incorporating also the words “BISCUITS BISCUITS DE”) applied for on June 16, 1986 and registered on September 18, 1987 in Class 30 for “Confectionery products, namely, sesame bars”. The registration features a disclaimer: “The right to the exclusive use of all the reading matter is disclaimed apart from the trade mark.” The application featured a first use claim in Canada going back to 1971.
Przedsiebiorstwo Handlu Zagranicznego Agros, Agros Holding SA and the Complainant all trade or traded (as the case may be) from the same address in Poland. While the Respondent has made various allegations questioning the veracity of the Complainant’s evidence as to the source of its rights in respect of its “Sesame Snaps” product, none of those allegations has been supported by any convincing evidence. Moreover, on the evidence before the Panel, it seems to the Panel to be more likely than not that the progression from Przedsiebiorstwo Handlu Zagranicznego Agros to Agros Holding SA to the Complainant, all being companies having the same address, is likely to have been a natural and genuine progression from a so-called “foreign trade company” trading from Poland while that country was a Communist country through privatization/reorganization to the Complainant.
On November 21, 2007 the Complainant applied for registration in Canada of SESAME SNAPS (word mark) in Class 30 for “Confectionery products, namely, sesame bars”. The registration came through on November 20, 2008 under No. 728997. There is no disclaimer in respect of this registration. The validity of this registration is being challenged by the Respondent, but the trade mark is currently valid and subsisting.
The Complainant prays in aid of its contention that the Respondent has no rights or legitimate interests in respect of the Domain Names the finding of the panel in the domain name dispute involving the domain name, <sesamesnaps.ca> registered by the Respondent on February 15, 2012. As can be seen from Section 4 above, the panel, in its decision of July 14, 2014, found that “the Complainant has rights in the ‘Sesame Snaps’ mark that predate the registration of the <sesamesnaps.ca> domain name by the [Respondent].” It also concluded that the domain name was “confusingly similar to the Complainant’s mark and that the [Respondent] [had] no legitimate interest in the domain name.” Finally, it found that “the [Respondent] registered the domain name in bad faith.” From that panel’s decision, it would appear that the Respondent argued many of the same arguments as to the parties’ respective rights that it has deployed in this proceeding.
The Complainant also prays in aid the judgments in the proceedings in the Ontario Superior Court of Justice, which are referred to in Section 4 above. In those proceedings the defendant was K-Max Corp. and the applicants to vary or set aside the judgments in those proceedings (in particular, the judgment of Justice EM Morgan dated March 18, 2015) had been long-term former distributors of the Complainant’s product in Canada. In paragraph 42 of his judgment Justice EM Morgan had this to say:
“The evidence before me makes it clear that the Moving Parties [i.e Exclusive Candy and Novelty Distributing Limited and K-Max (2013) Corporation] went out of their way to find a product that would sow confusion in the mind of the consuming public, and that they succeeded in this task. They marketed Classic Sesame candies by passing them off as Sesame Snaps.”
The Panel finds that the Complainant has made out a prima facie case calling for an answer from the Respondent.
The Respondent has provided a detailed series of answers and contends that he has rights or legitimate interests in respect of the Domain Names. These rights or legitimate interests are said to derive from four sources. First, his United States-based online retail service conducted via his <sesamesnaps.com> Domain Name; secondly, his United States Trade Mark application for SESAME SNAPS dated April 6, 2016; thirdly, the rights assigned to him by K-Max Corp. on July 4, 2012; fourthly, the businesses associated with the <sesamesnaps.net>, <sesamesnaps.org> and <sesamesnaps.biz> Domain Names, which are said by the Respondent to give rise to legitimate business interests.
(1) The Respondent’s United States-based online retail service.
The Respondent asserts that he operates a United States-based online retail store featuring sesame based food products and provides related computerized services via his website connected to the <sesamesnaps.com> Domain Name, a domain name which he acquired in an online auction on January 22, 2014. The Respondent supports this claim with screenshots from his website dated October 18, 2016 featuring products for sale such as “Sesame Snaps Honey Sesame Sticks”, “Sesame Snaps Sesame Sticks”, “Classic Sesame snacks”, “Nuts ‘N More Sesame Cranberry Peanut Butter” and “Nuts ‘N More Almond Butter”. Were it the case that the Respondent operated a genuine online business as claimed, the Respondent would have a basis for an argument under paragraph 4(c)(i) of the Policy. However, the Respondent has produced no other evidence to support the existence of that business. The Panel has no idea as to whether or not it is an active bona fide business. In the view of the Panel, that evidence is insufficient to demonstrate the existence of a bona fide business for the purposes of paragraphs 4(c)(i) and 4(a)(ii) of the Policy.
Generally, the Respondent’s claims to have operated a “Sesame Snaps” business are difficult to swallow. On the one hand, he claims have been a brand consultant to K-Max Corp. from whom he acquired rights to the “Sesame Snaps” brand by way of the July 4, 2012 assignment. On the other hand, as indicated above, in June 2013 the website of the Respondent connected to the Respondent’s <sesamesnaps.ca> domain name (see Section 4 above) featured at the foot of the page a legend reading: “Copyright © 2010-2013 David Michaels, dba Sesame Snaps. All rights reserved. Sesame Snaps is a trade mark of David Michaels in Canada and the USA.” There is nothing in the case file to justify that copyright notice and no explanation as to how that copyright notice came to feature on that website. It seems counter-intuitive to the Panel that an independent brand consultant representing K-Max Corp. in a Canadian trade mark application for CLASSIC SESAME on January 4, 2010 could be coexisting with his client as a competitor to that client trading under the name “Sesame Snaps” in Canada.
This copyright notice contrasts directly with paragraph 30 of the Response in this proceeding, which reads: “K-Max Corp. was the owner of the SESAME SNAPSbrand in both Canada and the USA between 2002 and 2012”.
The Respondent is aware that the Complainant places reliance upon the decision in the <sesamesnaps.ca> case, but dismisses that decision by way of nothing more than a heading between paragraphs 50 and 51 of the Response reading: “SesameSnaps.ca CDRP Decision Not Relevant to Non-.ca Disputes.” Nothing under that heading even mentions that decision, still less justifies the statement. The Panel concludes that the Respondent appreciates that that decision with its finding of bad faith intent on the part of the Respondent toward the Complainant is inconvenient to him, but has nothing of substance to say in respect of it. It is this anomaly and the Respondent’s failure to deal with it that has, as much as anything else, led the Panel generally to prefer the evidence of the Complainant to that of the Respondent where there is disagreement. It has also led the Panel to doubt the Respondent’s word where the Respondent’s evidence is counter-intuitive and lacking solid evidentiary support.
The Panel is not satisfied that the Respondent’s evidence as to his online business under the “Sesame Snaps” name is sufficient to give rise to a right or legitimate interest in respect of the Domain Names for the purposes of paragraph 4(a)(ii) of the Policy.
(2) The Respondent’s United States Trade Mark application for SESAME SNAPS.
On April 6, 2016, the Respondent applied to the USPTO (Serial No. 86966284) for registration of SESAME SNAPS (in a stylized form overlapping a sesame wafer design) with the disclaimer: “No claim is made to the exclusive right to use SESAME apart from the mark as shown”. The application is in Class 35 for “online retail store services featuring sesame based food products; computerised online retail store services in the field of sesame based food products.” The application records that the Respondent is the successor in interest to the expired Dalimpex Limited SESAME SNAPS CANDY / FRIANDISE registration referred to in Section 4 above. He claims a first use anywhere in another form going back to January 1, 1971; and first use in commerce going back at least as far as January 1,1998. The application was published for opposition on September 16, 2016. His rights are said to stem from the assignment from K-Max Corp. dated July 4, 2012, to which further reference is made below.
The short point is that a trade mark application gives rise to no relevant rights for the purposes of paragraph 4(a)(ii) of the Policy. It could give rise to a legitimate interest, but, as indicated above, the Panel is not satisfied on the evidence before it that the use in commerce upon which the application is based is a genuine use. Accordingly, the Panel is not satisfied that this trade mark application gives rise to any right or legitimate interest in respect of the Domain Names.
Even if, as the Respondent anticipates, registration follows, that registration with its disclaimer would give to the Respondent no rights in respect of the words “Sesame Snaps” per se. Nor, in the view of the Panel, given the Respondent’s history of bad faith in relation to “Sesame Snaps”, would any such registration give to the Respondent any legitimate interest in respect of the name “Sesame Snaps” per se for the purposes of paragraph 4(a)(ii) of the Policy.13
(3) The Assignment dated July 4, 2012.
On July 4, 2012, K-Max Corp. entered into an agreement with the Respondent whereby “K-Max Corp. assign[ed] the entire interest and goodwill in the SESAME SNAPS trademark around the world, in exchange for assisting K-Max Corp. with its CLASSIC SESAME trademark in Canada and elsewhere and for assisting K-Max Corp. with its [GSI]14 bar code registration for 2012.”
What constituted K-Max Corp.’s “entire interest and goodwill in the SESAME SNAPS trademark around the world” in July 2012? Insofar as Canada is concerned, that interest and goodwill must have been non-existent otherwise the Ontario Superior Court of Justice would not have decided as it did in January and March 2015. It concluded that the sale of K-Max Corp.’s “Classic Sesame” product constituted passing off and infringed the rights of the Complainant in respect of the Complainant’s “Sesame Snaps” product. It came to that conclusion notwithstanding K-Max Corp.’s Canadian Trade Mark Registration No. 830204 CLASSIC SESAME (word mark) in Class 30, which was registered on August 21, 2012. As to the rest of the world, the Panel has no information on the extent of any business conducted outside Canada by K-Max Corp.
The Panel is not satisfied that the July 4, 2012 Assignment provided the Respondent with any relevant rights sufficient to give rise to rights or legitimate interests in respect of the Domain Names.
For completeness the Panel adds that the Panel is by no means certain that the agreements between Dalimpex Limited and K-Max Corp. in 2001 and 2002 (see Section 4 above) were anything more than agreements to agree, but that even if they did constitute assignments they do not on their face involve assignments of any identified intellectual property. In the view of the Panel, it is likely that the key property to be assigned were Dalimpex Limited’s distribution rights. It is true that a potential trade mark right of Dalimpex Limited, which could have formed part of any assignment to K-Max Corp. on registration was its application for United States Registration No. 2627618 SESAME SNAPS CANDY / FRIANDISE stylised device mark in Class 30 for “Candy, namely sesame snaps” which was filed on February 22, 2001. However, the registration came through on October 1, 2002 over 7 months after the second of the two Dalimpex Limited agreements and there is nothing before the Panel to suggest that that registration was ever in fact assigned to K-Max Corp. While the registration subsisted until 2009 when it was cancelled for failure to file a declaration, any use made of it in the United States would presumably have ceased on or shortly after dissolution of Dalimpex Limited in November 2003. At all events the Panel has been provided with no evidence of any use of this mark in the United States by anybody.
(4) The <sesamesnaps.net>, <sesamesnaps.org> and <sesamesnaps.biz> businesses.
The Respondent concedes that these Domain Names are connected to “generic landing pages with Google Ads”. He asserts that these landing pages constitute “a legitimate business interest” and cites a decision of an Eastern District of Virginia court in support. The Panel has not been provided with the court’s reasoning, but would require significantly more in the way of evidence to be satisfied that the pages in question constitute part of a bona fide offering of goods or services sufficient to give rise to rights or legitimate interests in respect of those Domain Names for the purposes of paragraph 4(a)(ii) of the Policy.
Moreover, the Panel notes that those Domain Names were registered by the Respondent on December 28, 2012, December 29, 2012 and December 28, 2012, respectively. In 2014, the panel hearing the <sesamesnaps.ca> domain name case under the Canadian Internet Registration Authority Domain Name Dispute Resolution Policy, which in many respects is very similar to the Policy, found that in registering the <sesamesnaps.ca> domain name in February 2012 the Respondent was targeting the Complainant in bad faith. The Panel sees no reason to come to any different conclusion in relation to the <sesamesnaps.net>, <sesamesnaps.org> and <sesamesnaps.biz> Domain Names and concludes that the landing pages connected to those Domain Names do not give rise to any right or legitimate interest in respect of those Domain Names.
The Panel concludes that the Respondent has no relevant rights or legitimate interests in respect of the Domain Names for the purposes of paragraph 4(a)(ii) of the Policy.
In so finding the Panel is heavily influenced by the findings of both law and fact in the judgment of Justice EM Morgan in his 2015 judgment in the Ontario Superior Court proceedings. The Respondent states that he was unaware of the application leading to that judgment and that since he did not participate in that proceeding it would be unjust to hold against him anything stated in the judgment. He adds that the Complainant’s lawyer misled the Court as to the law.
If the Respondent had come forward with any evidence to show that K-Max Corp. had trade mark rights in respect of the Sesame Snap product prior to 2012, the Panel would have been prepared to consider making findings counter to those appearing in that judgment. However, for the reasons already expressed above, the Panel is not persuaded that the Dalimpex Limited agreements transferred any relevant trade mark rights to K-Max Corp. On the evidence before the Panel, the Panel takes the view that it is more likely than not that the “Sesame Snaps” product supplied to Dalimpex Limited and to K-Max Corp. and to Exclusive Candy and Novelty Distributing Limited were supplied to those entities for distribution in Canada either by the Complainant or one of its predecessors or by one of its associated companies (e.g. Unitop). There is nothing to demonstrate to the Panel that the trade mark was applied by (or on the authority of) anyone other than a Complainant-related entity. On the evidence before the Panel Dalimpex Limited, K-Max Corp. and Exclusive Candy and Novelty Distributing Limited were all distributors, not trade mark owners.
Moreover, the Panel finds it very difficult to accept that the Respondent, someone so closely associated with K-Max Corp., had no knowledge of the proceedings, which in turn were so closely connected with his claimed personal interest in the brand. It was not as if he was unaware of the underlying dispute. He had been in email contact with the Complainant’s lawyer having read the original Statement of Claim in his capacity as the K-Max Corp. brand consultant, a role which he appears to have held since at least 2010 when he was the K-Max Corp.’s representative for the purposes of the latter’s 2010 CLASSIC SESAME trade mark application. He knew that the Complainant’s lawyer was expecting a defence and it defies belief that he did not keep himself informed as to the progress of the action. Of course, at that stage he knew (as the Complainant’s lawyer did not) that the previous month K-Max Corp. had assigned to him all its interest in the “Sesame Snaps” brand. Maybe, it suited him to distance himself from the proceeding. The Panel simply does not know, but if that was the case, he only has himself to blame for permitting the case (and its aftermath) to proceed on a false basis. It is clear from the judgment that the Court believed the trade mark rights to lie with the Complainant and while there was argument as to whether the “Classic Sesame” product was confusingly similar to the “Sesame Snaps” product, there is nothing in the judgment to suggest that the Complainant was not the SESAME SNAPS trade mark owner.
Manifestly, however, the applicants for variation or setting aside of the default judgment were fully aware of the background facts. It is inconceivable to the Panel that every available argument was not deployed in that application. After all, K. Werocy who signed the Dalimpex Limited agreements on behalf of K-Max Corp. was the same K. Werocy who signed the July 4, 2012 assignment on behalf of K-Max Corp. and was the same K. Werocy who on behalf of K-Max Corp. signed the Asset Purchase Agreement dated November 1, 2013 whereby K-Max Corp. assigned all its assets to K-Max (2013) Corporation. According to paragraph 18 of the judgment, K. Werocy was then running the operations of K-Max (2013) Corporation. Moreover, J. Picard of the distributor, Exclusive Candy and Novelty Distributing Limited, was the other signatory to the Asset Purchase Agreement on behalf of the purchaser, K-Max (2013) Corporation.
This administrative proceeding is an inappropriate forum for attempting to unravel precisely what was going on, but the Panel is left with the unpleasant feeling that all was not completely above board on the part of the former distributors of the Complainant’s “Sesame Snaps” product. Indeed, the Court found (paragraphs 14-16 of the judgment) that the signatories to the asset purchase agreement were aware that it contained or was likely to have contained a misrepresentation. The Panel has no idea as to the extent to which (if at all) the Respondent was caught up in all this, but inevitably the Panel is left with the feeling that the Respondent has not been entirely candid. That the Respondent is capable of making false statements is clear from paragraph 56 of the <sesamesnaps.ca> decision, which reads:
“The Panel notes that a search on the Internet Wayback Machine shows that on June 23, 2013 the website resolving from the [<sesamesnaps.ca> domain name] looked very similar to what it looks like at the time of the present proceedings. The top left corner of the webpage illustrates a box of sesame bars that looks identical to those sold by the Complainant. The disclaimer at the bottom of the page indicates that ‘Sesame Snaps is a trade mark of David Michaels in Canada and the USA’. The Registrant does not hold any registered trade mark in Canada for the mark ‘Sesame Snaps’; it is the Complainant that is the registered owner of the ‘Sesame Snaps’ trade mark in Canada. The Respondent is thus misleading Internet users with respect to the present ownership of the ‘Sesame Snaps’ trade mark in Canada and he does so on a website resolving from a domain name that is identical with the said mark.”
As indicated above, the Respondent, aware of the reliance placed on the <sesamesnaps.ca> decision by the Complainant, nonetheless simply dismisses it as irrelevant. The Respondent has only himself to blame if, as is the case, the Panel draws inferences adverse to him from his failure to deal with that issue.
The Panel has already found that the <sesamesnaps.net>, <sesamesnaps.biz> and <sesamesnaps.org> Domain Names, which were registered in December 2012 fall into the same category as the <sesamesnaps.ca> domain name registered in the same year and condemned as a bad faith registration by the panel hearing that dispute under the Canadian Internet Registration Authority Domain Name Dispute Resolution Policy (see Section 4 above). In the view of the Panel, the use of those Domain Names, which in the view of the Panel were registered to target the Complainant’s trade mark rights, to connect to generic landing pages, unaccompanied by any evidence to indicate that they form part of a genuine business offering, is not use in good faith and constitutes an abusive threat hanging over the head of the Complainant. In the case of those Domain Names the Panel finds that they were registered and are being used in bad faith within the meaning of paragraph 4(a)(iii) of the Policy.
The remaining two Domain Names, <sesamesnap.com> and <sesamesnaps.com>, were acquired by the Respondent in subsequent auctions on January 20, 2013 and January 22, 2014 respectively.
The <sesamesnap.com> Domain Name is connected to what appears to the Panel to be a static WordPress site featuring a recipe for “Chewy Sesame Seed Bars”. None of the links leads anywhere. The Panel finds it likely, on the balance of probabilities, that this Domain Name was also acquired with the Complainant’s trade mark in mind rather than for any genuine commercial use and, as with the previously mentioned Domain Names, constitutes a continuing abusive threat hanging over the head of the Complainant.
That leaves the <sesamesnaps.com> Domain Name, which purports to connect to an online retailing business of the Respondent, a business about which the Panel has very little information. Is it a genuine business or is it a sham set up to defeat the Complainant? The Panel does not know, but believes it more likely than not to be a sham. If it is an active business it ought to have been so easy for the Respondent to produce evidence of substance instead of a collection of very recent screenshots. In the view of the Panel the Domain Names stand or fall together and, having regard to all the facts and circumstances of this case, they fall together.
The Panel finds that the Domain Names have been registered and are being used in bad faith.
The Panel has found that the Complaint succeeds. In the view of the Panel, the Complaint was launched in good faith to protect the Complainant’s brand.
However, the Respondent’s allegations as to the Complainant’s bad faith raise a number of issues, which have not been dealt with above, but which the Panel wishes to address. The Panel deals with those issues by reference to the list appearing in Section 5B above, namely:
(i) The Complainant failed to disclose in the Complaint the problems that it had had with its United States trade mark applications and particularly having regard to the fact that the USPTO regards the term “Sesame Snap” as descriptive, generic and unregistrable.
The registrability or otherwise of any given trade mark is a territorial issue. The fact that the USPTO regards the term “Sesame Snaps” as generic and/or descriptive does not necessarily mean that the term may not be distinctive elsewhere. A similar issue arose in Sensis Pty Ltd., Telstra Corporation Limited v. Yellow Page Marketing B.V., WIPO Case No. D2011-0057 where it transpired that “Yellow Pages”, while regarded as generic/descriptive by the USPTO, is a registered trade mark in Australia. The Panel does not regard the Complainant’s failure to mention the position in the United States as relevant to its trade mark position in Canada, it being its Canadian trade marks upon which it is relying in this administrative proceeding. In any event, the Panel noted from the annexes to the Complaint that certain of the Canadian applications and registrations feature disclaimers.
(ii) The Complainant’s 1971 first use claims made in respect of its Canadian trade mark registrations are false. The Complainant was only incorporated in 2002 and it is not an operating company. The Respondent asserts that it is “apparently a shell company invented to dodge taxes in the EU and elsewhere”. The Respondent describes it as a subsidiary holding company. He asserts that privatisation of state-owned companies only commenced in 1998 and that the Complainant’s predecessor-in-interest, Agros Holding SA, which applied to register a SESAME SNAPS box design in September 1998 only claimed use in Canada “since at least 1998”.
The Panel treats all first use claims with caution, but believes it more likely than not that the first use claims for the Complainant’s registrations are claims (or originate from claims) made by the original registrant. In the absence of any evidence to the contrary, the Panel believes it reasonable for the Complainant to have relied upon the accuracy of those claims. In passing the Panel notes that certain of the Respondent’s trade mark applications feature the same claims.
(iii) The Complainant falsely contends in the Complaint that its 1987 registrations for SESAME SNAPS & Design are “for the exclusive use of the words SESAME SNAPS and design logo in relation to confectionery products, namely sesame bars”. The Respondent points out that the registration includes a disclaimer of SESAME SNAPS apart from the trade mark.
The Panel notes the point, but, as indicated above, the Panel noticed the disclaimer and was not deceived. In any event, the Panel doubts that the Complainant was seeking to mislead the Panel.
(iv) The applicant for registration of the Complainant’s 1987 registrations was a non-existent fictitious entity. Its name, Przedsiebiorstwo Handlu Zagranicznego Agros, means “Foreign Trade Company Agros”. According to the Respondent such an entity never existed in communist Poland and the Complainant acquired the registrations via a back-dated assignment dated February 16, 1989. The Respondent asserts that “No Polish State property was ever legally assigned to anyone before 1998”.
Proving a negative is of course difficult, but the Respondent has produced no evidence in support of its contention that Przedsiebiorstwo Handlu Zagranicznego Agros did not exist. As indicated in Section 4 above, the Panel is satisfied on the evidence of the Complainant and on the record appearing at the Canadian Intellectual Property Office that Przedsiebiorstwo Handlu Zagranicznego Agros was a genuine entity and the original registrant of the trade mark in question.
(v) The Complainant falsely claims in the Complaint that CLASSIC SESAME and SESAME SNAPS are confusingly similar and points to K-Max Corp.’s Canadian trade mark registration of CLASSIC SESAME.
The Respondent’s allegation flies in the face of the 2015 decisions of the Ontario Superior Court of Justice referred to above. By way of example Justice EM Morgan, having found that the products and their packaging were confusingly similar, went on to say in paragraph 40 of his judgment: “In fact, the name ‘Classic Sesame’ is doubly confusing, as it suggests to any consumer that might by chance notice the difference between the two products that the ‘Classic’ one is the original one that the purchaser had long purchased. That, of course, would be a false and misleading impression in itself. Sesame Snap is the classic product and Classic Sesame is the not-so-classic newcomer.”
The Panel sees no reason why the existence of a trade mark registration should be a complete answer to an allegation that the manner of its use is leading to passing off.
(vi) The Complainant falsely states that the Respondent was one of the parties, which attempted to set aside the Complainant’s 2015 default judgment.
The Complainant annexed the decision of Justice EM Morgan to the Complaint, which made clear who were the applicants before the Court, one of which was K-Max (2013) Corporation, operated by K. Werocy, with whom the Respondent had long been associated as the prime mover behind his client, K-Max Corp. In the view of the Panel it was reasonable for the Complainant to have assumed that the Respondent was involved.
(vii) The Complainant’s lawyer misled the Ontario court as to the law. The Respondent contends that the Complainant’s lawyer failed to point out to the court that the court does not have jurisdiction to enjoin a registered trade mark owner from using its valid and subsisting trade mark registration in respect of the goods and services for which it is registered.
The Panel is not in a position to assess what was or was not said in that court. However, the Panel observes that use of a registered trade mark in a deceptive manner is unlikely to defeat a claim for passing off and the court’s findings included a finding of passing off.
For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the Domain Names, <sesamesnap.com>, <sesamesnaps.com>, <sesamesnaps.net>, <sesamesnaps.biz> and <sesamesnaps.org>, be transferred to the Complainant.
Tony Willoughby
Sole Panelist
Date: November 20, 2016
1 The Respondent contends that it was a fictitious entity, which never existed. However, the Respondent has produced no evidence to support that contention and the Panel concludes on the evidence before it and on the balance of probabilities that it was a state-owned corporation.
2 Paragraph 13 of the judgment of Justice E.M.Morgan (infra)
3 Much of this information has been verified by the Panel through an online search of the publicly available database of the Canadian Intellectual Property Office, a search which the Panel felt obliged to make given a certain lack of clarity in the parties’ evidence in this regard.
4 The second recital to the July 4, 2012 assignment (see below) records that the Respondent paid USD 250 to the USPTO “to revive the application”.
5 On November 22, 2016 the Panel received notice from the Respondent of the granting of USPTO Registration No. 5086046. References to USPTO application Serial No. 86966284 are understood to refer to USPTO Registration No. 5086046 for purposes of this Decision and are referenced in “Discussion and Findings” below.
6 That assignment and its predecessors are referred to in greater detail under “The Assignments” below.
7 Paragraph 13 of the judgment of Justice E.M.Morgan (infra)
8 This assignment identifies the producer of sesame snaps as UNITOP. The figure of 139,270.65 Canadian dollars is close to the figure of 138,749.77 said by the Complainant to have been the principal debt covered by a default judgment obtained by the Complainant against Dalimpex Limited “for unpaid accounts”. However, the Panel has insufficient information on that default judgment to assess whether or not that is a coincidence.
9 The bar code description was not readily legible to the Panel – the assignment was handwritten.
10 Quotation from paragraph 13 of the judgment of Justice EM Morgan
11 In his response to Procedural Order No. 1 the Respondent disclosed that he acquired this Domain Name registration by way of auction on January 20, 2013.
12 and not from his predecessor in title who had apparently let the domain name go some years earlier.
13 The Panel was notified of the granting of USPTO Registration No. 5086046 on November 22, 2016.
14 The bar code description was not readily legible to the Panel – the assignment was handwritten.