WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

“V Kontakte” LLC v. zhou cai

Case No. D2018-2939

1. The Parties

The Complainant is “V Kontakte” LLC of Saint-Petersburg, Russian Federation, represented by Internet and Law Legal Company, Russian Federation.

The Respondent is zhou cai of Inverness, Illinois, United States of America (“United States”), represented by ESQwire.com Law Firm, United States.

2. The Domain Name and Registrar

The disputed domain name <vk.app> is registered with GoDaddy.com, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on December 26, 2018. On December 26, 2018, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On December 26, 2018, the Registrar transmitted by email to the Center its verification response disclosing registrant and contact information for the disputed domain name. On January 9, 2019, the Center received an email communication from the Complainant. The Center sent an email communication to the Complainant on January 10, 2019 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 amendment to Complaint on January 10, 2019. The Center received an email communication from the Respondent on January 16, 2019.

The Center verified that the Complaint together with the amendment to 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 and 4, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on January 22, 2019. In accordance with the Rules, paragraph 5, the due date for Response was February 11, 2019. On February 7, 2019, the Respondent requested an automatic four-day extension of the Response due date. In accordance with paragraph 5(b) of the Rules, the due date for Response was February 15, 2019. The Response was filed with the Center on February 15, 2019. The Center received two supplemental filings from the Complainant, on January 23, 2019, and on February 19, 2019.

The Center appointed Assen Alexiev, Gabriela Kennedy and The Hon Neil Brown Q.C. as panelists in this matter on March 11, 2019. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

The Panel has decided to accept and take into account the supplemental filings of the Complainant as they refer to circumstances that have taken place after the filing of the Complaint.

4. Factual Background

The Complainant was founded in 2006. It is an online social media and networking service operating under the name VK (short for its original name “VKontakte”). The Complainant’s services are available in 86 languages and allow users to message each other, to create groups, public pages and events, share and tag images, audio and video and to play browser-based games. The Complainant operates through its official websites located at the domain names <vk.com> and <vkontakte.ru>. According to Similarweb International Internet Service, the Complainant’s website at “www.vk.com” has global ranking at number nine, ranking at number four in the world in category “Internet and telecom”, and Russian ranking at number two, and is ranked at number 18 in Alexa’s global Top 500 sites. The Complainant currently has more than 500 million accounts, including 97 million monthly active users exchanging 6.5 billion messages daily, and its market capitalization in 2014 was USD 2.5 billion.

The Complainant is the owner of the following trademarks that include “VK” (the “VK trademark”):

- the combined trademark VK with registration No. 477113, registered in the Russian Federation on December 20, 2012 for goods and services in International Classes 9, 14, 16, 18, 20, 25, 28, 30, 34, 35, 36, 38, 39, 41, 42, 43, 44 and 45;

- the combined trademark VK with registration No. 484596, registered in the Russian Federation on April 8, 2013 for goods and services in International Classes 9, 14, 16, 18, 20, 25, 28, 30, 34, 35, 36, 38, 39, 41, 42, 43, 44 and 45;

- the combined trademark VK with registration No. TMA905405, registered in Canada on June 4, 2015 for goods and services in International Classes 9, 35, 38, 41, 42 and 45;

- the combined trademark VK with registration No. TMA905406, registered in Canada on June 4, 2015 for goods and services in International Classes 9, 35, 38, 41, 42 and 45; and

- the combined trademark VK with registration No. 1308834, registered as an International trademark on March 18, 2016 for goods and services in International Classes 09, 28, 35, 38, 41 and 42 for different jurisdictions including the United States where the Respondent is located.

The Complainant is also the owner of the following trademarks for “VK.COM” (the “VK.COM trademark”):

- the trademark VK.COM with registration No. 547404, registered in the Russian Federation on July 6, 2015 for services in International Classes 35 and 38; and

- the combined trademark VK with registration No. 1300541, registered as an International trademark on March 18, 2016 for services in International Classes 35 and 38 for different jurisdictions including the United States where the Respondent is located.

The disputed domain name was registered on May 3, 2018. It resolves to a webpage that offers the disputed domain name for sale or rent and contains statements such as “Dedicated Domain to Present Mobile/SaaS App to a global market”, “.app is Google’s preferred top-level domain for Apps. Period!”, and “By combining your product name and ‘app’, your domain name says it all!”.

5. Parties’ Contentions

A. Complainant

According to the Complainant, the disputed domain name is confusingly similar to the Complainant’s VK trademark, as it incorporates the trademark entirely, and the inclusion of the “.app” generic Top‑Level‑Domain (“gTLD”) does not eliminate the likelihood of confusion.

The Complainant maintains that the Respondent has no rights or legitimate interests in the disputed domain name. It points out that there is no affiliation between the parties, the Respondent is not using the disputed domain name in connection with a bona fide offering of goods or services, is not commonly known by it and is not making a legitimate noncommercial or fair use of it. The Complainant adds that the Respondent has no trademark rights in “VK” and has not been authorized by the Complainant to use the VK trademark. The Complainant also states that when the disputed domain name was registered, the Complainant and its VK trademark had already become world famous.

According to the Complainant, the disputed domain name was registered and is being used in bad faith. The Respondent registered the disputed domain name being aware of the reputation and fame of the Complainant’s VK trademark, and its choice of the disputed domain name was not accidental but was aimed at this trademark. The website at the disputed domain name contains the banner “Vk.app: domain for sale/rent” located at the top of the page, and the center of the page contains the text “Vk.app. Best landing page domain for web/mobile app”. The Complainant points out that the Respondent also directly offered to sell the disputed domain name to the Complainant, stating that the Complainant had the corresponding trademark, so it would be interested in buying the disputed domain name in the “.app” zone to reflect its trademark.

The Complainant also contends that the Respondent’s registration of the disputed domain name prevents the Complainant from reflecting its VK trademark in a secured domain zone for numerous applications for VK social media. The Complainant points out that the “.app” zone is the new, more secure domain zone for application vendors and developers, created to inform the world about apps, and that users all over the world associate “.app” domain names with websites devoted to different mobile applications.

In its supplemental submissions, the Complainant points out that on January 18 and 21, 2019 the Respondent again offered to sell the disputed domain name to the Complainant for USD 50,000, although its original asking price for it was USD 100,000. According to the Complainant, this shows that the Respondent acquired the disputed domain name primarily for the purpose of selling it to the Complainant for valuable consideration in excess of its out-of-pocket costs directly related to the disputed domain name. The Complainant also submits that the disputed domain name does not consist of common terms or ordinary words in the Russian language or in any European language.

B. Respondent

The Respondent submits that it decided to obtain the disputed domain name when the Google Registry offered “.app” domain names for public sale because it believed the combination of “vk” and “app” was a highly valuable, short, two-letter domain name to which no one could claim exclusive rights. The Respondent conducted an independent research on the domain investment market and Google’s positioning of the “.app” Registry, and determined that the “.app” extension had great potential in the marketplace.

The Respondent submits that since the launch of the “.app” Registry it has registered over fifty generic dictionary and short character “.app” domain names. According to the Respondent, it registers generic and descriptive common word and short character domain names because they best fulfill the purpose of a domain name which is to be easy to remember. Common word domain names serve well as online identities and as a result are commercially valuable. The Respondent’s decision to register inherently valuable short domain names is also done in part because the decisions of impartial panels of legal experts have found in favor of such a business strategy of domain investing.

The Respondent adds that it chose to register the disputed domain name and the many other “.app” domain names because of the past decade of public information concerning domain name investing and domain name valuations for short character domain names and valuable keyword domain names. The historical data for two-letter domain names is well known in the domain name investment community as one of the most valuable domain assets available. The two-letter domain names are coveted, in part, because of their scarcity – there are only 676 possible variations per TLD. Many well-known global brands have purchased two-letter “.com” domain names over the years, including the Complainant itself, who purchased its domain name <vk.com> from a domain name investor who was its original registrant until 2009. Facebook purchased the domain name <fb.com> for USD 8.5 Million from its prior owner, while others, such as American Airlines, British Airways, Chrysler Group and Philip Morris have also purchased and use two-letter “.com” domain names to use for their brands. Historical data shows pricing for such domain names to range between USD 1,500 and USD 8.5 Million with an historical average of US Dollars 561,000, and with recent pricing between 2015 and the present averaging USD 1.12 Million. These domain names have many possible meanings and are not exclusive to any single trademark owner or company. It is disingenuous for the Complainant to claim ignorance to the value of two-letter domain names when the Complainant purchased the disputed domain name <vk.com> from a domain investor.

The Respondent does not dispute that the disputed domain name is identical to the Complainant’s trademark, but notes that the Complainant does not have exclusive right to the letters “V” and “K,” and does not appear to be well known or used in the United States where the Respondent is domiciled.

The Respondent contends that it has rights and legitimate interests in the disputed domain name based on its inherent value as a short character domain name. Evidence of rights or legitimate interests in a disputed domain name can be determined by a finding that the Respondent is a generic domain name reseller with numerous similar domain names. It is well-established that, like common words, anyone is entitled to register domain names incorporating short letter combinations to which a complainant does not have exclusive rights, and the respondents’ legitimate interest is established per se. A registrant has a legitimate interest in registering a single, two-, three- or four-character domain name provided it does not target or otherwise act inappropriately to a known trademark holder. The Respondent has registered many similar, valuable, two-letter “.app” domain names, and the only reasonable inference to be drawn from this is that the Respondent does not target trademarks.

The Respondent maintains that there is no evidence of bad faith registration or use of the disputed domain name with the intent to sell the registration to the Complainant or to a competitor.

The Respondent alleges that it, being a United States citizen, living and working in the United States, did not register the disputed domain name with the Complainant’s VK trademark in mind and had no knowledge of the Complainant, its website, business name or trademark when it registered the disputed domain name. The Respondent further states that it did not register the disputed domain name with the intent to sell it to the Complainant, to disrupt the Complainant’s business, to confuse consumers seeking to find the Complainant’s website or to prevent the Complainant from owning a domain name incorporating its VK trademark.

The Respondent made a good faith announcement that the disputed domain name, like its many other domain investment properties, was available for purchase or rent, and nothing in the Respondent’s communications or its use of the disputed domain name shows that it has targeted the Complainant. Contrary to the Complainant’s submission, the Respondent’s effort to settle the matter after the Complainant filed its Complaint shows that the Respondent believed that it had rights and legitimate interests and was acting in good faith. According to the Respondent, it does not constitute bad faith to offer a descriptive term or a two-letter domain name for sale.

6. Discussion and Findings

Pursuant to the Policy, paragraph 4(a), the Complainant must prove each of the following to justify the transfer of the disputed domain name:

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

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

(iii) the Respondent has registered and is using the disputed domain name in bad faith.

A. Identical or Confusingly Similar

The Complainant has provided evidence and has thus established its rights in the VK trademark.

The disputed domain name consists of the elements “vk” at the second level and “.app” as the TLD. The second level element is identical to the word element of the VK trademark and to the distinctive element of the VK.COM trademark. As stated by the Complainant, users would associate the “.app” TLD with a website devoted to mobile applications. The Respondent has a similar understanding, as the website at the disputed domain name contains the following advertisements: “VK App, Welcome home. Dedicated Domain to Present Mobile/SaaS App to a global market” and “By combining your product name and ‘app’, your domain name says it all!”,and in its Response, the Respondent explains that it chose the disputed domain name because the combination of “vk” and “app” was a highly valuable, short, two-letter domain name. In its correspondence to the Complainant prior to the commencement of this proceeding the Respondent also states that “[it] feel[s] ‘vk.app’ is quite suitable for [the Complainant’s] online social media mobile application and complements [the Complainant’s] main domain “vk.com”.

Taking all the above into account, the Panel considers as likely that Internet users would regard the combination of “vk” and “app” in the disputed domain name as suggestive of an online location of the Complainant dedicated to the mobile application for access to its services. Therefore, the Panel finds that the disputed domain name is confusingly similar to the VK trademark in which the Complainant has rights. It is also worth mentioning that the Respondent does not deny this confusing similarity.

B. Rights or Legitimate Interests

The Complainant contends that the Respondent has no rights or legitimate interests in the disputed domain name, because it is not using it in connection with a bona fide offering of goods or services. According to the Complainant, the Respondent registered the disputed domain name targeting the VK trademark, and then offered it for sale to the Complainant.

The Respondent maintains that it has rights and legitimate interests in the disputed domain name because anyone is entitled to register domain names incorporating short letter combinations to which a complainant does not have exclusive rights, and a registrant has a legitimate interest in registering a short domain name as long as it does not target or otherwise act inappropriately to a known trademark holder. The Respondent points out that it is a generic domain name reseller and has registered many similar two-letter “.app” domain names, and the only reasonable inference to be drawn from this is that the Respondent does not target trademarks. The Respondent adds that it chose to register the disputed domain name because of its inherent value, without knowledge of the Complainant and without targeting its VK trademark.

As discussed in section 6.A above, the disputed domain name incorporates the VK trademark in combination with the “.app” TLD, which makes it likely that Internet users would regard it as related to a mobile application for accessing the services of the Complainant. It is notable in this regard that the Complainant has provided evidence that its social media platform and website are very popular on a global scale.

The Respondent is principally correct in stating that a domain name investor would have a legitimate interest in registering short domain names, including two-letter domain names in appropriate cases, if it does not target others’ trademarks, but in the light of the unchallenged evidence, this is of no help to it here.

Whilst the Respondent alleges that the disputed domain name was registered purely based on its descriptive, valuable inherent nature (particularly due to the scarcity of two-letter domain names) and provides examples of other two-letter domain names registered by it, the non-generic pairing of the characters “v” and “k” in the specific circumstances of the present case would suggest otherwise. Given that there are hundreds of two-letter domain name permutations available, any of which could have met the Respondent’s desire to register a further two-letter domain name, combined with the fact that the Respondent is a professional domain name investor, it is unlikely that it did not research the potential marketability of the specific domain name “vk” prior to registering the disputed domain name and that it was unaware of the Complainant. In view of this, the Panel is not convinced by the Respondent’s assertions that “vk” was selected randomly due to its supposed generic nature without intending to target the Complainant for commercial gain.

Moreover, the evidence submitted by the Complainant shows that prior to this proceeding the Respondent contacted the Complainant with the following message: “We are contacting you concerning the domain name ‘vk.app’. We own this domain name and are in the early stages of listing this domain for sale. As you own the corresponding domain name ‘vk.com’, we’d like to offer you the opportunity to purchase this domain name before we offer it for auction. We feel ‘vk.app’ is quite suitable for your online social media mobile application and complements your main domain ‘vk.com’.”

The Respondent has submitted no comments on this message and the Panel is therefore entitled, if not obliged, to draw whatever inferences from it that are justified. For the Panel, it clearly shows that the Respondent, being well aware of the Complainant and of its social media platform and official website, initiated the contact with the Complainant prior to the commencement of this proceeding and prior to offering the disputed domain name for sale to the public through the announcement on the landing page at the disputed domain name. It appears that the Complainant was the first entity to which the Respondent offered the disputed domain name for sale and no evidence has been submitted that the Respondent also offered the disputed domain name to parties other than the Complainant. The content and timing of this message satisfy the Panel that it is more likely than not that the Respondent registered the disputed domain name targeting the Complainant and with an intent to offer it for sale to the Complainant at a high price. The statements in the Response about the market prices of two-letter domain names and its second offer for sale of the disputed domain name made in the course of this proceeding are revealing in this respect. The Panel does not regard the conduct of the Respondent in respect of the disputed domain name as being carried out in good faith and as giving rise to rights and legitimate interests of the Respondent in the disputed domain name.

Therefore, the Panel finds that the Respondent does not have rights and legitimate interests in the disputed domain name.

C. Registered and Used in Bad Faith

As discussed in section 6.B above, the Panel has drawn the only inference that is open to it on the unchallenged evidence, namely that the Respondent is likely to have registered the disputed domain name with knowledge of the Complainant and targeting its VK and VK.COM trademarks with a plan to offer it for sale to the Complainant at a high price. This satisfies the Panel that the Respondent has registered the disputed domain name primarily for the purpose of selling it to the Complainant for valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly related to the disputed domain name.

Therefore, the Panel finds that the Respondent has registered and is using the disputed domain name 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 name <vk.app> be transferred to the Complainant.

Assen Alexiev
Presiding Panelist

Gabriela Kennedy
Panelist

The Hon Neil Brown Q.C.
Panelist
Date: April 18, 2019