WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Bialetti Industrie S.p.A. v. Gary Valenti Inc.

Case No. D2019-0190

1. The Parties

The Complainant is Bialetti Industrie S.p.A. of Brescia, Italy, represented by Baker & McKenzie, Italy.

The Respondent is Gary Valenti Inc.of Maspeth, New York, United States of America (“United States”), represented by Mauriel Kapouytian Woods LLP, United States.

2. The Domain Name and Registrar

The disputed domain name <bialettiusa.com> is registered with Network Solutions, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on January 25, 2019. On January 25, 2019, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On January 26, 2019, the Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details.

The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the Rules, paragraphs 2 and 4, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on January 31, 2019. In accordance with the Rules, paragraph 5, the due date for Response was February 20, 2019. The Response was filed with the Center on February 20, 2019.

The Center appointed Adam Taylor as the sole panelist in this matter on March 4, 2019. 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, which has traded under the name “Bialetti” since the 1930s, is an internationally well-known supplier of coffee-making equipment such as the “Moka” coffee pot.

The Complainant owns many trade marks worldwide for the term “Bialetti” including United States trade mark no. 1149419, filed on April 3, 1979, registered on March 24, 1981, in class 21.

The Respondent was formerly an authorised distributor of the Complainant’s products in the United States. (The nature of the relationship between the parties is discussed in more detail in section 6 below.)

The Respondent registered the disputed domain name on October 4, 1999.

According to an archive page from the Wayback Machine dated February 5, 2001, the website at the disputed domain name included a page promoting Italian-made “Atlas Pasta Machines”, with a link to a website at “www.marcatousa.com”.

The relationship between the Complainant and the Respondent terminated in 2003 / 2004.

On an unspecified date, the Respondenthas used the disputed domain name for a webpage which included only the phrase “For Bialetti Spare Parts Click Here”, in the form of an email link to an email address utilising the disputed domain name.

On October 22, 2018, the Complainant’s internal lawyer sent a cease and desist email to the Respondent.

The Respondent’s lawyer responded on November 7, 2018, denying infringement and asserting that the Respondent had registered the disputed domain name in connection with the agency relationship between the parties. The Respondent’s lawyer rejected the Complainant’s demand to transfer the disputed domain name to the Complainant “for free” but indicated the Respondent’s willingness to sell the disputed domain name to the Complainant for a reasonable price.

The Complainant replied in a “without prejudice” email the next day, stating that the Respondent “currently” had no right to act on behalf of the Complainant or to use its trade marks. The Complainant then added:

“However, considering that it seems that your client acted in good faith when registering the domain name, in order to find an amicable solution to this matter but without any admission of your client’s rights and without prejudice to any claim, Bialetti is available to reimburse your client of the yearly domain name registration fee from 1999 to 2018 as consideration of the transfer of the domain name.”

The Complainant sent a chaser email on November 19, 2018, to which the Respondent did not reply.

5. Parties’ Contentions

A. Complainant

The following is a summary of the Complainant’s contentions.

The Complainant’s products are icons of Italian design, which appear in almost every Italian kitchen and also have a significant presence worldwide.

Online sales constitute a substantial share of the Complainant’s revenue. The Complainant owns many “bialetti” domain names including <bialetti.it>, registered in 1998, which indicates the Complainant’s interest in online distribution pre-dating registration of the disputed domain name.

To the best of the Complainant’s knowledge, between 2000 and 2003 the Respondent was appointed as an agent of the Complainant to promote the conclusion of sale contracts of the Complainant’s products. The Respondent was never an “affiliate” of the Complainant and never had power to act in the Complainant’s name.

The disputed domain name is confusingly similar to the Complainant’s trade mark, which it incorporates in its entirety and which is easily recognisable within the disputed domain name. The “usa” suffix, far from constituting dissimilarity, is an indicator of endorsement by the Complainant, increasing the likelihood of confusion. Also, the Complainant itself uses a domain name structure consisting of the word “Bialetti” plus the initials of the relevant country.

The Respondent lacks rights or legitimate interests in the disputed domain name.

The Complainant did not authorise the Respondent to register the disputed domain name.

The Respondent registered the disputed domain name well after the Complainant’s entry into the market in the 1930’s. The Complainant’s prior interest in the United States market is evidenced by its United States trade mark no. 1149419.

As the Respondent was formerly an authorised distributor of the Complainant’s products in the United States, the Complainant acknowledges that it is reasonable to assume that, for a specific period of time, the disputed domain name was used in connection with the authorised offering of goods or services.

However, the offering was not “bona fide” in accordance with the reseller tests in Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903 (“Oki Data”).

First, the Respondent has not used the site at the disputed domain name to sell only the trade marked goods. The Complainant has reason to believe that the Respondent sold, and still sells, products from other brands, thereby diverting the Complainant’s customers to other companies. This is evidenced by the screenshot of the page on the Respondent’s website in 2003 promoting third party pasta machines.

Second, the Respondent has failed to comply with the requirement to accurately disclose the registrant’s relationship with the trade mark owner. The Respondent’s notice inviting users to click an email link in relation to spare parts for the Complainant’s products provides no information about the relationship between the Complainant and the Respondent. Such users, thinking that they had reached the Complainant’s official website, would probably proceed to purchase spare parts for the Complainant’s products, and the Complainant’s products themselves, thinking that they had reached the Complainant’s official or affiliated store. In this manner, the Respondent as an authorised distributor is appropriating the standing achieved by the Complainant in nearly 100 years of activity.

The Respondent could have clarified the relationship with a simple disclaimer, as the Complainant’s authorised retailer in Australia has done at its website at “www.bialetti.com.au”. This makes the Respondent’s bad faith more obvious.

To the best of the Complainant’s knowledge, the Respondent is not commonly known by the disputed domain name. Nor is the Respondent making noncommercial or fair use of the disputed domain name.

The disputed domain name was registered and is being used in bad faith.

The Respondent was well aware of the Complainant’s trade mark at the time of registering the disputed domain name. This encouraged the Respondent to register the disputed domain name to attract visitors, thereby benefitting from the value of the Complainant’s trade mark. While the Respondent was authorised to sell the Complainant’s products, it was never authorised to register the disputed domain name or use it to sell products bearing different trade marks.

The disputed domain name, consisting of the Complainant’s well-known trade mark plus the geographical term “usa”, may confuse consumers into thinking that the Respondent’s web page is operated by the Complainant or an affiliate of the Complainant. The Respondent registered the disputed domain name precisely because of its confusing similarity to the Complainant’s mark, in order to divert consumers to its own web page.

The Respondent’s rejection of the Complainant’s suggestion that it transfer the disputed domain name to the Complainant in return for out-of-pocket expenses and the Respondent’s offer to sell the disputed domain name for a reasonable price proves that the Respondent engaged in bad faith conduct for the purposes of commercial gain. This is even more surprising, given that the Respondent has no rights or legitimate interests in relation to the disputed domain name. The Respondent is seeking to profit from the underlying value of the Complainant’s trade mark. Accordingly, any further use of the disputed domain name by the Respondent would constitute the taking of unfair advantage of the value of the Complainant’s trade mark.

B. Respondent

The following is a summary of the Respondent’s contentions.

The parties’ relationship ran far deeper and lasted much longer than the Complainant admits. The Complainant’s predecessor started doing business with the Respondent’s founder, Gary Valenti, in the 1950’s, when Mr. Valenti became the exclusive distributor of the Complainant’s “Moka Express” product in the United States. Mr. Valenti and Renato Bialetti, the son of the Complainant’s founder became personal friends. Because of this personal relationship, and their mutual trust, Mr. Valenti and Mr. Bialetti never entered into a formal distribution agreement.

In the mid 1970’s, the Respondent ceased being the Complainant’s exclusive United States distributor but remained a distributor. The Respondent also became the Complainant’s sales representative / agent in the United States, which involved choosing other distributors and approving supplies by the Complainant to them. The Respondent also handled customer service for all of the Complainant’s goods in the United States. Accordingly, the Respondent remained the Complainant’s “business arm” in the United States.

In a 1989 letter to a customer, the Respondent offered to arrange for the Complainant to send it a product sample.

In 1999, while still the Complainant’s United States sales representative, and with the Complainant’s acknowledgment and agreement, the Respondent registered the disputed domain name. It then began taking online orders for the Complainant’s products. In pre-action correspondence, the Complainant acknowledged that the Respondent registered the disputed domain name in good faith.

The Respondent has legitimately used the term “Bialetti” for decades in connection with relationships with other “Bialetti” businesses. For over 50 years, the Respondent was a distributor for a different Italian manufacturer called Officine Meccaniche Gozzano – Brevetti Bialetti (“OMG Bialetti”), which was acquired by the Complainant in 2003. Also, into the middle of the first decade of the 2000’s, the controllers of the Respondent handled servicing and spare parts for electrical appliances supplied by I.P.E. Nuova Bialetti (which had become bankrupt in the 1980’s) and many such service requests came via the website at the disputed domain name.

In an email of April 4, 2003, the Complainant asked the Respondent for assistance with an enquiry from a New Zealand customer, stating “… I always use you to solve almost impossible things”.

At the time of termination of the relationship between the parties, the Complainant was substantially behind on its payment of commission to the Respondent for sales in the United States dating back to 1999. These fees are still owed.

In 2003, the Respondent wrote to the Complainant’s new distributor to say that, as discussed with the Complainant’s General Manager in the United States, the Respondent was selling the Complainant’s merchandise “through our regular channels” until it was liquidated. The letter adds that the Respondent introduced the Complainant’s Moka Express product to the United States market and that it represented the Complainant for over 50 years. The Respondent sold off the Complainant’s stock via the website at the disputed domain name until 2007 / 2008 and it still continues to sell spare parts for the Complainant’s products through the website.

In 2007 or 2008, the Complainant’s new United States distributor wrote to the Respondent, asking why it was still using the disputed domain name. Ultimately, because the Complainant had still not paid off its debts to the Respondent, and because the Respondent had lawfully registered the disputed domain name and had always used it in an appropriate manner, the Respondent decided to continue using it. The Respondent offered to sell the disputed domain name to the Complainant for what it deemed fair value in the circumstances but the Complainant did not respond. Most likely, the Complainant decided that the Respondent had legitimate rights in the disputed domain name and decided to drop the matter. The Respondent heard nothing further from the Complainant regarding the disputed domain name until some 10 years later.

This complex business dispute between the parties is not capable of resolution via the UDRP. Because it covers a 50-year relationship which was never formally reduced to a written contract and where many of the most critical documents likely no longer exist, oral testimony is even more important than usual. The case is complicated further by the Respondent’s relationship with other Bialetti entities and the fact that the Complainant itself has plainly had difficulty uncovering the facts about the historical relationship. The dispute involves matters of contract and equity which are outside the Panel’s jurisdiction including delay / acquiescence by the Complainant and issues regarding the debts owed by the Complainant. If the Complainant has any grounds for obtaining transfer of the disputed domain name, it should bring its claims in court.

The Respondent possessed rights and legitimate interests in the disputed domain name arising from its role as exclusive distributor and sales representative in the United States for more than 50 years, the fact that the Respondent registered the disputed domain name with the full knowledge and cooperation of the Complainant, and its use of the disputed domain name to make authorised sales of the Complainant’s products and parts as well to sell OMG Bialetti products. All of which was known by the Complainant.

The Oki Data tests are not mandatory. UDRP panels that have considered them point out that they are guidelines.

The Complainant has failed to provide the evidentiary basis to prove that the Respondent lacks rights or legitimate interests in the disputed domain name.

The only evidence produced by the Complainant, a screenshot from the Respondent’s website, is misidentified as being from 2003, whereas the document itself is dated 2001 when the Respondent was undisputedly the Complainant’s distributor. The Complainant had to go back 18 years to find a single example of alleged appearance of a non-Bialetti product on the Respondent’s website. Furthermore, this product, a pasta machine, does not compete with the Complainant’s coffee makers and so it does not fall foul of the Oki Data tests. Also, the reference is only a link to another webpage for further information about the products. A customer would have to make a phone call before buying.

The “About Us” page on a February 4, 2001, version of the Respondent’s site shows that the Respondent accurately described the relationship between the parties, providing information about the Complainant and then stating that the Respondent introduced the Complainant’s Moka Express to the United States in the early 1950’s and that it continued to supply the Complainant’s products. The Complainant was clearly aware of this webpage as it is from the same version exhibited by the Complainant.

The “Contact Us” page on the Respondent’s current site accurately identifies the Respondent and does not state any current formal relationship with the Complainant. This disclosure suffices to comply with the criteria in the Oki Data tests, particularly given that the Respondent’s website does not have the look and feel or colour scheme of the Complainant’s site. An express disclaimer is not required.

The Complainant has not shown that the Respondent registered and used the disputed domain name in bad faith. In fact, the Complainant admitted that the Respondent did not register the disputed domain name in bad faith, which dooms the Complainant’s case due to the conjunctive requirement of registration and use in bad faith.

The Complainant has a heavy burden to establish bad faith, given the parties’ long history together. Whereas the Complainant has presented a woefully incomplete account of the relationship, suggesting that it lasted four years instead of 50 years. And the Complainant knew about the Respondent’s registration and use of the disputed domain name from the beginning and certainly for at least 10 years.

While the Complainant asserts that the Respondent inappropriately attempted to sell the disputed domain name for more than out-of-pocket costs, it does not mention that it still owes the Respondent commission on authorised sales made over a decade ago. Nor does the Complainant explain the Respondent’s historical dealings with the other Bialetti entities. Such omissions refute any attempt to show that the Respondent acted in bad faith.

The Respondent registered the disputed domain name in absolute good faith as part of the 50-year distribution and agency relationship and to further the parties’ joint business interests. The Complainant does not point to any contractual prohibition on the Respondent’s conduct at that time.

The Complainant’s acquiescence in the Respondent’s use of the website at the disputed domain name, despite having raised a concern in 2007/2008, further undercuts the Complainant’s ability to establish bad faith.

The Respondent’s recent counter-offer to sell the disputed domain name does not demonstrate bad faith, bearing in mind the commission that the Complainant still owes to the Respondent as well as the economic value of the website to the Respondent’s business based on the Respondent’s still legitimate interests therein.

6. Discussion and Findings

Under the Policy, the Complainant is required to prove on the balance of probabilities that:

- the disputed domain name is identical or confusingly similar to a trade mark in which the Complainant has rights;

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

- the disputed domain name has been registered and is being used in bad faith.

A. Identical or Confusingly Similar

The Complainant has established rights in the mark “Bialetti” by virtue of its registered trade marks as well as unregistered trade mark rights deriving from the extensive and worldwide use of that name.

Section 1.8 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”) makes clear that, where the relevant trade mark is recognisable within the disputed domain name, the addition of other terms, whether descriptive, geographical, or otherwise, would not prevent a finding of confusing similarity under the first element.

Here, the Complainant’s distinctive trade mark is readily recognisable within the disputed domain name and, accordingly, the addition of the geographical term “usa” does not avert a finding of confusing similarity.

For the above reasons, the Panel concludes that the disputed domain name is confusingly similar to the Complainant’s trade mark.

The Panel therefore finds that the Complainant has established the first element of paragraph 4(a) of the Policy.

B. Rights or Legitimate Interests

It is unnecessary to consider this element in view of the Panel’s finding under the third element below.

C. Registered and Used in Bad Faith

In order to succeed, the Complainant must establish both registration and use of the disputed domain name in bad faith.

To assist the Panel’s assessment of bad faith registration, the Panel will first consider the evidence from the parties concerning their historic relationship.

The Respondent talks of a deep relationship between the parties lasting no less than 50 years, deriving from personal friendship between the Respondent’s founder and the son of the Complainant’s founder. The Respondent says that, because of this personal connection, as well as mutual trust, no formal distribution contract was ever signed but, nonetheless, the Respondent was effectively the Complainant’s “business arm” in the United States. The Respondent has produced a number of documents which evidence the length and closeness of the relationship including a 1989 letter from the Respondent to a customer regarding a sample Complainant product as well as references to the 50-year relationship in a 2001 version of the Respondent’s website at the disputed domain name and in a letter from the Respondent to the Complainant’s new distributor in 2003.

For its part, the Complainant has little to say on the subject beyond making the unsupported assertion that “[t]o the best of the Complainant’s knowledge”, the Respondent was an authorised distributor of the Complainant’s products in the United States between 2000 and 2003. Clearly this is a substantial understatement. It indicates that the current management of the Complainant may have limited knowledge of the historical relationship, which is perhaps not surprising as it ended some 16 years ago.

The Complainant plainly faces a relatively high hurdle in establishing registration in bad faith in these circumstances.

For example, it is difficult to see how the Complainant can confidently state, as it does, that, despite being authorised to sell the Complainant’s products, the Respondent was not authorised to register the disputed domain name. This appears to be mere supposition on the part of the Complainant. On the other hand, the Respondent insists that the Complainant specifically approved its registration of the disputed domain name.

The Complainant relies on two aspects of the Respondent’s use of the website at the disputed domain name.

First, the Complainant produces a single screenshot illustrating use of the Respondent’s website at the disputed domain name to promote a third-party pasta making machine. The Complainant says that this occurred in 2003 but, as the Respondent observes, the screenshot exhibited to the Complaint is dated 2001. In any case, albeit relatively close in time to the Respondent’s registration of the disputed domain name in 1999, in the particular circumstances of this case the Complainant has still not satisfied the Panel that the Respondent’s motive in registering the disputed domain name was to take unfair advantage of the Complainant’s trade mark by using it to promote third-party products – especially when set against the parties’ long-standing commercial and personal relationship dating back many years previously. Furthermore, the Complainant has not provided evidence which shows that pasta making machines compete directly with the Complainant’s products, which are apparently focused on coffee-making.

Second, the Complainant objects to another version of the Respondent’s website, which consists only of the phrase “For Bialetti Spare Parts Click Here”, in the form of an email link to an email address utilising the disputed domain name. The Complainant says that the failure of this page to accurately disclose the Respondent’s relationship with the Complainant was likely to have confused website users into thinking that they had reached the Complainant’s own store or that of an affiliate.

The Complainant says that the Respondent could have clarified the relationship with a simple disclaimer, as the Complainant’s authorised retailer in Australia has done at its website at “www.bialetti.com.au”. However, the screenshot of the Australian website exhibited by the Complainant consists of a page dominated by the Complainant’s name and logo, with a link to “Buy Bialetti Online” and a large image of a Complainant product. The disclaimer is in tiny font at the bottom of the page. This indicates that the Complainant may afford a relatively wide degree of latitude towards its authorised distributors in terms of the nature of their use of the “Bialetti” brand.

In any case, the Complainant’s screenshot of the Respondent’s site is undated. Without knowing how soon after its registration the disputed domain name was used in this manner, the Panel is unable to take it into account when considering the Respondent’s state of mind at the time. Indeed, the same content was present when the Panel visited the website on March 15, 2019, indicating that this may be a relatively recent version of the website, first launched many years after the disputed domain name was registered.

Similarly, the Panel does not consider that the Respondent’s offer to sell the disputed domain name to the Complainant for “a reasonable price” following the Complainant’s cease and desist letter is of any relevance to the Respondent’s state of mind when registering the disputed domain name some 20 years previously.

In conclusion, the onus is on the Complainant to prove its case on the balance of probabilities – see section 4.2 of the WIPO Overview 3.0 – and, in the above circumstances, the Complainant has not satisfied the Panel that the Respondent’s registration of the disputed domain name was unauthorised by the Complainant or that it fell outside the ambit of what may reasonably have been expected from the nature of the Parties’ very long-standing prior relationship.

Furthermore, as explained in section 4 above, in the course of pre-action correspondence and as a precursor to its offer to reimburse the Respondent the total domain registration fees for the disputed domain name, the Complainant admitted that “it seems that [the Respondent] acted in good faith when registering the disputed domain name”. The Complainant could have retreated from this position in its Complaint, perhaps arguing that new factors had come to light regarding the Respondent’s motives. However, while the Complainant deals with other aspects of this exchange of correspondence in its Complaint, it makes no reference to its admission. Correspondence made by parties in settlement discussions is admissible in UDRP proceedings – see section 3.10 of the WIPO Overview 3.0.

For all of the above reasons, the Panel therefore finds that the Complainant has failed to establish the third element of paragraph 4(a) of the Policy.

7. Decision

For the foregoing reasons, the Complaint is denied.

Adam Taylor
Sole Panelist
Date: March 25, 2019