WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Philip Morris Products S.A. v. Lin Xiao Hang

Case No. D2018-2085

1. The Parties

The Complainant is Philip Morris Products S.A. of Neuchâtel, Switzerland, represented by Boehmert & Boehmert, Germany.

The Respondent is Lin Xiao Hang of Shenzhen, China.

2. The Domain Names and Registrar

The disputed domain names <iqoscloud.com>, <iqoshome.com>, and <noiqos.com> are registered with Alibaba Cloud Computing (Beijing) Co., Ltd. (the “Registrar”).

3. Procedural History

The Complaint was filed in English with the WIPO Arbitration and Mediation Center (the “Center”) on September 12, 2018. On September 12, 2018, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain names. On September 13, 2018, the Registrar transmitted by email to the Center its verification response disclosing registrant and contact information for the disputed domain names which differed from the named Respondent and contact information in the Complaint. The Center sent an email communication to the Complainant on September 18, 2018, providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. The Complainant filed an amended Complaint on September 21, 2018.

On September 19, 2018, the Center transmitted an email in English and Chinese to the Parties regarding the language of the proceeding. The Complainant requested that English be the language of the proceeding on September 21, 2018. The Respondent did not comment on the language of the proceeding.

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 in English and Chinese of the Complaint, and the proceedings commenced on September 24, 2018. In accordance with the Rules, paragraph 5, the due date for Response was October 14, 2018. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on October 15, 2018.

The Center appointed Kimberley Chen Nobles as the sole panelist in this matter on October 26, 2018. 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.

4. Factual Background

The Complainant Phillip Morris Products S.A. (“Phillip Morris”) is a company which is part of the group of companies affiliated to Phillip Morris International Inc. (“PMI”). PMI is a leading international tobacco manufacturing and sales company, with 46 production facilities and products sold in over- 180 countries. The most well-known brand in PMI’s portfolio is the MARLBORO brand, the foremost cigarette brand since 1972.

PMI is presently pursuing diversification of its brand portfolio by means of developing Reduced Risk Products (“RRPs”, defined by PMI as products that present, are likely to present, or have the potential to present less risk of harm to smokers who switch to those products versus continued smoking). One of these RRPs developed and sold by PMI is the IQOS brand. Products under the IQOS brand are considered by the industry as heat-not-burn (“HNB”) tobacco products and operate using a precisely controlled heating device into which specially designed tobacco products (including are inserted and heated to generate a flavorful nicotine-containing aerosol. The IQOS brand was first launched by PMI in Nagoya, Japan in 2014. Today, products under the IQOS brand are available in key cities in around 40 markets across the world. As a result of a USD 4.5 billion investment and extensive international sales and marketing efforts, the IQOS Products have achieved considerable international success and reputation. To date, products under the IQOS brand have been almost exclusively distributed through PMI’s official IQOS stores, websites and selected authorized distributors and retailers.

The Complainant is the owner of multiple trademark registrations for the IQOS mark.

The disputed domain name <iqoshome.com> was registered on December 4, 2017. The disputed domain name <iqoscloud.com> was registered on August 14, 2018. The disputed domain name <noiqos.com> was registered on August 16, 2018. The disputed domain names do not resolve to any active websites.

The Complainant frequently finds itself facing third parties who register and use the IQOS mark in their domain names in a misleading and infringing manner. The Complainant therefore attempts to acquire these domain names on a commercial basis to avoid the costs involved with a dispute. To this end, the Complainant has commissioned its domain service provider CSC Digital Brand Services (“CSC”) to provide an offer to the Respondent for the purchase of the first disputed domain name (the first offer was made before the registration of the second and third disputed domain names).

On July 27, 2018, CSC contacted the Respondent through the contact portal of the concerned registrar inquiring about the possibility of purchasing the disputed domain name <iqoshome.com>. No response was received to this initial communication. On August 9, 2018, CSC once again contacted the Respondent through the contact portal of the concerned registrar and again received no response. On August 13, 2018, CSC sent a third communication to the Respondent through the contact portal of the concerned registrar offering USD 1,000 for the disputed domain name <iqoshome.com>. On August 13, 2018, after receiving two reminders on August 9, 2018 and August 13, 2018, the Respondent replied to CSC’s offer by requesting USD 350,000 for the disputed domain name. On August 23, 2018, the Complainant provided a counter-offer of USD 3,000 to the Respondent through CSC. The Respondent replied by stating:

“I work in the HNB industry. I know the importance of this domain name.

Whether the purchaser is PMI or illegal. I didn’t accept an offer of $50,000 from a non-PMI customer last month, and I didn’t want the domain to be sold illegally. I also have the iqoscloud.com.noiqos.com domain name.

Are you interested? If you are interested in buying, please give a reasonable price. If your client is PMI. I believe his reasonable price is much higher than your offer.”

The second and third disputed domain names were registered between date of the Respondent’s first reply and the date of CSC’s communication conveying the Complainant’s counter-offer.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the disputed domain names are identical or confusingly similar to the Complainant’s IQOS mark. The Complainant has rights in the IQOS mark by virtue of its trademark registrations. When comparing the disputed domain names to the Complainant’s trademark, the comparison should be made to the second-level portion of the disputed domain names only. The Top-Level Domain (“TLD”) “.com” should not be considered. The first disputed domain name consists of the IQOS mark plus the term “home”, which is a generic term. The second disputed domain name consists of the IQOS mark and the term “cloud”, which is a generic term. The third disputed domain name consists of the IQOS mark plus the term “no”, which is a generic term. The generic terms “home”, “cloud”, and “no” do not negate the confusing similarities. This indicates that the Respondent intended the disputed domain names to be confusingly similar to the Complainant’s trademarks.

The Complainant also contends that the Respondent has no rights or legitimate interests in the disputed domain names. The Complainant has not licensed or otherwise permitted the Respondent to use any of its trademarks or to register the disputed domain names incorporating its IQOS mark. The Respondent is not making a legitimate noncommercial or fair use of the disputed domain names. On the contrary, the Respondent’s behavior upon having been contacted by the Complainant’s domain provider CSC (with reasonable offers to purchase the first disputed domain name) provides clear evidence that the Respondent registered the disputed domain names primarily for the purpose of selling, renting, or otherwise transferring the disputed domain name registrations to the Complainant who is the owner of the IQOS mark or to a competitor of the Complainant, for valuable consideration in excess of its documented out-of-pocket costs directly related to the adoption and use of the Complainant’s IQOS mark within the disputed domain names. Further, the Respondent did not indicate any potentially intended fair use of the first disputed domain name which could justify such an exorbitant price for it. Instead the Respondent made clear that he intended to sell the first disputed domain name for what the Respondent absurdly calls a “reasonable price” of USD 350,000 to the Complainant from the beginning and registered the disputed domain names in full knowledge of the Complainant’s registered IQOS mark.

Finally, the Complainant contends that the Respondent registered and is using the disputed domain names in bad faith. The Complainant’s IQOS mark enjoys a substantial and widespread reputation and was in use well before the Respondent registered the disputed domain names. Furthermore, the term IQOS is a purely imaginative term and has no inherent meaning. It is also evident from the Respondent’s use of the disputed domain names and the Respondent’s communications that the Respondent registered the disputed domain names only for the reason of capitalizing on the fame of the Complainant’s registered IQOS mark incorporated in the disputed domain names, and by selling the Disputed Domain Names for an unreasonable price to the Complainant or a competitor.

The Complainant requests that the disputed domain names be transferred to it.

B. Respondent

The Respondent did not reply to the Complainant’s contentions.

6. Discussion and Findings

The Policy provides for transfer or cancellation of the disputed domain name(s) if the complainant establishes each of the following elements set out in paragraph 4(a) of the Policy:

(i) The disputed domain name is 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 disputed domain name; and

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

A. Identical or Confusingly Similar

The Complainant has rights to the IQOS mark. The Complainant has established that it is the registered owner of Chinese and international trademark registrations of the IQOS mark.

All of the disputed domain names contain the IQOS mark in its entirety, a generic term, and the TLD “.com”. As a technical part of the domain name, the “.com” TLD may be disregarded in determining confusing similarity. Alienware Corp. v. Truther, WIPO Case No. DCO2012-0027; Belo Corp. v. George Latimer, WIPO Case No. D2002-0329.

Regarding the disputed domain names, the addition of generic terms (i.e. “home”, “cloud” and “no”) does not distinguish the disputed domain names from the IQOS mark to avoid confusing similarity. See Compagnie Generale des Etablissements Michelin-Michelin & Cie. v. Tgifactory, WIPO Case No. D2000-1414; Millennium & Copthorne Hotels PLC, Millennium & Copthorne International Limited (MCIL) v. Sanjay Makkar and Millennium Hotel, WIPO Case No. D2015-0210. The trademark IQOS remains the dominant part of the disputed domain names.

Accordingly, the Panel finds that the disputed domain names are confusingly similar to the Complainants’ trademark.

B. Rights or Legitimate Interests

As noted above, the Complainant has provided evidence of its prior rights in the IQOS mark. These rights precede the registration of the disputed domain names.

The disputed domain names <iqoshome.com>, <iqoscloud.com> and <noiqos.com> incorporate the Complainant’s trademark in its entirety. There is no evidence indicating that the Respondent is licensed to use the Complainant’s IQOS mark, that the Respondent is associated or affiliated with the Complainant, or that the Respondent has any other rights or legitimate interests in the term “IQOS”. As such, the Complainant has made out its prima facie case, which the Respondent has not rebutted.

Accordingly, the Panel finds that that the Respondent has no rights or legitimate interests in respect of the disputed domain names.

C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy states that any of the following circumstances, in particular, but without limitation, shall be evidence of the registration and use of the disputed domain name(s) in bad faith:

(i) Circumstances indicating that the respondent has registered or has acquired the disputed domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of the respondent’s documented out-of-pocket costs directly related to the disputed domain name; or

(ii) The respondent has registered the disputed domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the Respondent has engaged in a pattern of such conduct; or

(iii) The respondent has registered the disputed domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) By using the disputed domain name, the respondent has intentionally attempted to attract, for commercial gain, Internet users to the respondent’s website or other online location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of such website or location or of a product or service on such website or location.

The present case falls squarely within that contemplated by paragraph 4(b)(i) of the Policy.

The Respondent has registered domain names that are virtually identical to the Complainant’s trademark except for the addition of generic terms. Further, the Respondent makes it clear in the email presented above that he knew of the Complainant’s rights in the IQOS mark. In claiming a familiarity with the HNB industry and the Complainant’s mark in particular (as represented by the disputed domain names), the Respondent has left no room for doubt that he was well aware of the Complainant, its business and the IQOS mark. The Respondent’s registration of the disputed domain names incorporating the Complainant’s mark, being fully aware of the Complainant’s rights in the mark, without any rights or legitimate interests in doing so is registration in bad faith. See, e.g, Research In Motion Limited v. Privacy Locked LLC/Nat Collicot, WIPO Case No. D2009-0320; The Gap, Inc. v. Deng Youqian, WIPO Case No. D2009-0113.

The timeline of events further indicates registration in bad faith on the behalf of the Respondent. Registering two additional domain names containing the IQOS mark in its entirety after making a sales offer of USD 350,000 to the Complainant’s representative, then in turn offering to sell the newly-registered domain names to the Complainant, establishes a pattern of behavior wherein the Respondent registers domain names containing highly distinctive trademarks to seek valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly related to the disputed domain names. The evidence of the Respondent registering and using the latter two disputed domain names is sufficient to infer that the Respondent registered and used the first disputed domain name in bad faith. See Magnum Piercing, Inc. v. The Mudjackers and Grwood S. Wilson, Sr., WIPO Case No. D2000-1525.

Accordingly, the Panel finds that the Respondent’s registration and use of the disputed domain names is in bad faith.

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 names <iqoscloud.com>, <iqoshome.com> and <noiqos.com> be transferred to the Complainant.

Kimberley Chen Nobles
Sole Panelist
Date: November 9, 2018