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WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

Randan Corp. v. Rapazzini Winery

Case No. D2003-0353

 

1. The Parties

The Complainant is Randan Corp., a corporation existing under the laws of California, with a place of business at Gilroy, California, United States of America. Complainant is represented by Daniel R. Richardson of Richardson Intellectual Property Law, P.C.

The Respondent is Rapazzini Winery, an entity with a place of business at Gilroy, California, United States of America. Respondent is represented by Michael K. Bosworth of Burns, Doane, Swecker & Mathis, LLP.

 

2. The Domain Names and Registrar

The domain names at issue are <garligarni.com> and <garlicgarni.com>. The domain names are registered with Network Solutions, Inc. ("NSI").

 

3. Procedural History

The Complainant initiated this proceeding by filing a Complaint by email with the World Intellectual Property Organization Arbitration and Mediation Center (the "Center") on May 7, 2003. On May 9, 2003, the Center received a hard copy of the Complaint. The Center verified that the Complaint satisfied the formal requirements of the ICANN Uniform Domain Name Dispute Resolution Policy (the "Rules") and the Supplemental Rules for Uniform Domain Name Dispute Resolution Policy.

On May 8, 2003, the Center sent an email to NSI requesting a registrant verification in connection with this case. On May 12, 2003, NSI sent an email to the Center confirming that the Respondent is the registrant of the domain names.

On May 12, 2003, the Center formally commenced this proceeding. On May 31, 2003, Respondent submitted its timely Response to the Complaint. On June 11, 2003, after clearing for any potential conflicts, the Center appointed David H. Bernstein as the Sole Panelist in this matter.

On June 16, 2003, the Panel issued Procedural Order No. 1, which stated, in relevant part:

"Respondent asserts that Complainant consented to Respondent’s registration of the <garligarni.com> and <garlicgarni.com> domain names (the ‘domain names’). Response, § III(C)(II); Declaration of Alex Larson (‘Larson Decl.’), ¶ 5. If true, this fact is potentially dispositive because the Policy requires that Complainant prove both bad faith registration and bad faith use. E-duction, Inc. v. Zuccarini, WIPO Case No. D2000-1369 (February 5, 2001); The Thread.com LLC. v. Poploff, WIPO Case No. D2000-1470 (January 5, 2001). If Complainant in fact consented to Respondent’s registration of the domain names, Complainant cannot satisfy one of the prerequisites for transfer under the Policy.

"Whether it is true remains to be determined. Because this is a new issue raised for the first time in the Response, this fact was obviously not addressed in the Complaint. Under the circumstances, the Panel determines that it is appropriate to grant the Complainant an opportunity to address this issue. Investissement Marius Saradar S.A.L. v. John Naffah, WIPO Case No. D2000-0853 (November 22, 2000). Because Rule 5 contemplates that a respondent will have the right to respond to a complaint, and because Rule 10(b) directs the Panel to treat the parties with equality, the Panel concludes that it is appropriate to give Respondent a right to respond to the Complainant’s supplemental submission, if any. Pacific Fence & Wire Co v. Pacific Fence, WIPO Case No. D2001-0237 (June 11, 2001).

"A related assertion in the Response is that Complainant granted Respondent written permission to use Complainant’s trademark and logo in Internet advertising. Larson Decl. ¶ 5. Respondent did not, however, attach a copy of that written consent to its Response. The specific terms of this consent, if it exists, may well have bearing on the disputed issues in this proceeding.

"Accordingly, the Panel issues the following request for supplemental submissions:

• On or before June 18, 2003, Respondent shall submit a copy of the written consent referenced in paragraph 5 of the Larson Declaration.

• On or before June 27, 2003, Complainant may submit a supplemental submission addressing the factual assertion that Complainant consented to Respondent’s registration of the domain names and the legal effect of any such facts.

• On or before July 7, 2003, Respondent may submit a supplemental submission responding to the Complainant’s supplemental submission.

"Each party shall limit its supplemental submission to the specific request and shall deliver its submission to the Center via email no later than 11 p.m., Greenwich Mean Time, on the due date, with a copy by email to the other party. Exhibits, if any, not available in electronic form shall either be scanned and sent with the email or shall be contemporaneously faxed to the Center and the other party with hard copies to follow by overnight courier."

On June 18, 2003, Respondent submitted a statement declaring that the alleged written consent referenced in ¶ 5 of the Larson Declaration had been destroyed by water damage to Respondent’s office. On June 27, 2003, Complainant submitted a statement denying that it ever consented to Respondent’s use of the mark for purposes other than retail promotion. Complainant’s response included declarations by Tom Reed and Caryl Simpson, both vice presidents of Complainant. Respondent thereafter elected not to file any additional supplemental submission.

 

4. Factual Background

Complainant, located in the self-styled "Garlic Capital of the World" (see "www.gilroy.org"), produces and distributes garlic-based products under its federally-registered "GARLIC FESTIVAL" trademark. Complainant sells its products through wholesale distributors, operates a local retail store, and offers its products online for purchase at "www.garlicfestival.com."

In 1985, Complainant began using the mark "GARLI GARNI" on its garlic food seasoning labels. Since then, the Complainant has made continuous use of the mark in commerce. Complainant registered "GARLI GARNI" as a trademark with the state of California on July 12, 2001; it does not appear to have applied for any similar registration at the federal level.

Respondent owns and operates a winery and tasting room, also in Gilroy. In the tasting room, Respondent sells Complainant’s Garli Garni product line as well as other garlic-based seasoning products. Respondent has sold the Garli Garni products for years, purchasing the product both directly from Complainant and indirectly. Currently, Complainant has terminated local distribution of the Garli Garni product line to Respondent’s Gilroy stores but continues to supply Respondent’s Garlic Shoppe stores in Monterey, CA and Bloomington, MN. In addition, Respondent sells Complainant’s Garli Garni products on its primary website, "www.garlicshoppe.com." In 1999, Respondent registered and began use of the domain names in conjunction with its primary website.

 

5. Parties’ Contentions

Complainant asserts that the <garligarni.com> domain name is identical to its mark, "GARLI GARNI" Although it does not claim to have trademark rights in the name "Garlic Garni," Complainant argues that the <garlicgarni.com> domain name is confusingly similar to its GARLI GARNI mark.

Complainant also claims that Respondent has no rights or legitimate interest in the domain names because Respondent knew of Complainant’s use of the mark for years preceding Respondent’s registration of the domain names. Complainant argues that Respondent has used the domain names for the sole purpose of diverting actual and potential customers to Respondent’s website for commercial gain.

Complainant further alleges that Respondent registered and used the domain names in bad faith. According to Complainant, Respondent’s unauthorized use of the Complainant’s "Garlic Festival" mark on its web page creates a false commercial impression in the mind of the potential customer that they have found Complainant’s site. This creates a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the Respondent’s website.

Finally, in its supplemental submission, Complainant denies Respondent’s assertion that, shortly after the domain names were registered, Respondent offered to transfer the domain names at no cost to the Complainant. To the contrary, Complainant avers that it never was offered transfer and that it never consented to the registration of the domain names by Respondent.

In its defense, Respondent argues that, although the <garligarni.com> domain name is identical to Complainant’s mark, the <garlicgarni.com> domain name is not. Rather, Respondent states, that domain name is a combination of the generic words "garlic" and "garni" (French for garnish) and, therefore, is merely descriptive of garlic garnishes.

Respondent also asserts that it has rights or a legitimate interest in the domain names because Respondent is using the domain names to sell and promote genuine Garlic Festival products. Under the principle of exhaustion of rights, Respondent claims that it is permitted to make use of the domain names to advertise the brand name and manufacturer of products that the Respondent sells at retail. Respondent claims that it does not divert Complainant’s customers because Respondent sells bona fide Garlic Festival products produced by Complainant.

Finally, Respondent denies that it has registered and used the domain names in bad faith. As noted above, Respondent alleges that, shortly after it registered the domain names, it offered the domain names to Complainant at no cost, but that Complainant refused Respondent’s good faith offer. Contrary to Complainant’s assertions, Respondent claims that Complainant expressly consented to Respondent’s use of the domain names to sell Garli Garni products. Further, Respondent asserts that it did not register the domain names primarily for the purpose of selling, renting, or transferring them to Complainant or a competitor, but rather for the sole purpose of promoting its retail sale of Complainant’s Garli Garni products.

 

6. Discussion and Findings

In order to succeed in its claim, Complainant must demonstrate that all of the following elements in Paragraph 4(a) of the Policy have been satisfied:

1. The domain names are identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

2. Respondent has no rights or legitimate interests with respect to the domain names; and

3. The domain names have been registered and used in bad faith.

The Complainant must carry its burden of proof by a preponderance of evidence. Bootie Brewing Co. v. Ward, WIPO Case No. D2003-0185 (May 28, 2003).

A. The Domain Names are Identical or Confusingly Similar to Complainant’s Trademark

Respondent does not contest Complainant’s ownership of the trademark GARLI GARNI[1]. Nor does it contest that <garligarni.com> is identical to the Complainant’s trademark. Thus, the only question for resolution is whether the <garlicgarni.com> domain name is confusingly similar to Complainant’s mark.

Respondent challenges this similarity on the ground that <garlicgarni.com> is a combination of two generic words - garlic and garni - and therefore that the domain name is descriptive of garlic garnishes. That argument misses the point. The descriptiveness of the domain name, if any, may be relevant to the question of whether Respondent is making a fair use or otherwise has a legitimate interest in the name. It is not, however, germane to the question of whether the domain name and the trademark share sufficient similarity as to satisfy this threshold question. See generally Wal-Mart Stores, Inc. v. MacLeod, WIPO Case No. D2000-0662 (September 19, 2000); cf. Schouten Industries B.V. v. Canadian Soylife Health Co., NAF Claim No. FA0303000149188 (July 19, 2003).

When analyzed under the proper standard, it is clear that <garlicgarni.com> is so close to the GARLI GARNI trademark as to easily satisfy this first element. The only relevant difference between the mark and the domain name is the addition of a single letter. That letter, Respondent concedes, is one that consumers are likely to mistype if they mistakenly think the product is called "Garlic Garni" rather than "Garli Garni." Under well-settled principles, such efforts to capture Internet users who may mistype the domain name are more than sufficient to prove confusing similarity. Cf. Shields v. Zuccarini, 254 F.3d 476 (3^d Cir. 2001) (<joescartoons.com>, <joecarton.com>, <joescartons.com>, <joescartoon.com>, and <cartoonjoe.com> are all confusingly similar to <joecartoon.com>); Compaq Info. Tech. Group, L.P. v. Jones, NAF File No. 99091 (October 4, 2001), (<compaqq.com> is confusingly similar to "Compaq" trademark); Oxygen Media, LLC v. Primary Source, WIPO Case No. D2000-0362 (June 19, 2000), (<oxygen.com>, with a zero rather than the letter "o," is confusingly similar to "Oxygen" trademark).

Accordingly, Complainant easily sustains its burden of proof on this first factor.

B. Respondent Does Not Have a Legitimate Interest in the Domain Names

Although a closer question, Complainant also has satisfied the second element of the Policy.

Respondent forcefully argues that it has a legitimate interest in these domain names because it is using them to sell Complainant’s own GARLI GARNI product. It thus seeks to take advantage of the safe harbor provided by paragraph 4(c)(i) of the Policy, which provides that a use is legitimate if, prior to commencement of the dispute, Respondent used the domain names in connection with a bona fide offering of goods or services.

In this case, it is undisputed that Respondent was and remains an authorized distributor of Complainant’s goods. There remains, however, a question as to whether Respondent’s offerings can be characterized as bona fide. That issue has been explored by numerous prior panels, which have articulated a series of requirements in order for a reseller’s use to be deemed legitimate. See generally Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903 (November 6, 2001). Those include, at the minimum, the following:

• Respondent must actually be offering the goods or services at issue. E.g., World Wrestling Federation Entertainment, Inc. v. Ringside Collectibles, WIPO Case No. D2000-1306 (January 24, 2001).

• Respondent must use the site to sell only the trademarked goods; otherwise, it could be using the trademark to bait Internet users and then switch them to other goods. Nikon, Inc. v. Technilab, WIPO Case No. D2000-1774 (February 26, 2001), (use of Nikon-related domain names to sell Nikon and competitive cameras not a legitimate use); Kanao v. J.W. Roberts Co., CPR Case No. 0109 (July 25, 2001) (bait and switch is not legitimate).

• The site must accurately disclose the registrant’s relationship with the trademark owner; it may not falsely suggest that it is the trademark owner, or that the website is the official site, if, in fact, it is only one of many sales agents. See, e.g., Houghton Mifflin Co. v. Weatherman, Inc., WIPO Case No. D2001-0344 (June 14, 2001), (no bona fide offering where website’s use of Complainant’s logo, and lack of any disclaimer, suggested that website was the official Curious George website).

• The Respondent must not try to corner the market in all domain names, thus depriving the trademark owner of reflecting its own mark in a domain name. Magnum Piering, Inc. v. Mudjackers, WIPO Case No. D2000-1525 (January 29, 2001), ("a single distributor is extremely unlikely to have a legitimate interest in precluding others from using numerous variants on a mark").

Based on the screen shots Respondent itself has submitted, the Panel finds Respondent’s use cannot be deemed bona fide. That is because Respondent has not used the domain names to sell only Complainant’s trademarked goods; rather, Respondent has used the domain names to offer an array of competitive products for sale. There can be no justification for using the Complainant’s trademark as a domain name to lure users to the site, and then offer those consumers products that directly compete with the GARLI GARNI products. Nikon, Inc., supra.

An even closer question is presented by the domain name <garlicgarni.com>. If consumers came to this site to find generic garlic garnishes, the offering for sale of numerous competitive products could well be legitimate, and the use of that descriptive domain name could be determined fair. See Commerce LLC v. Hatcher, NAF File No. FA0203000105749 (April 9, 2002). Once again, though Respondent’s own submission is determinative. In paragraph 5 of Respondent’s Larson Declaration, Mr. Larson explains that he secured this domain name because "so many of our customers refer to [Complainant]’s products as "Garlic Garni." Thus, in registering and using the <garlicgarni.com> domain name, Respondent’s intent was not to register a generic term for garlic garnish products, but rather, to specifically capture those consumers who erroneously refer to Complainant’s GARLI GARNI products as GARLIC GARNI. In light of this testimony, Respondent’s use of <garlicgarni.com> cannot be considered fair or legitimate.

C. Respondent Has Registered and Used the Domain Names in Bad Faith

As noted in the Panel’s Procedural Order No. 1, to sustain its burden of proof with respect to the final element, Complainant must show that Respondent registered and used the domain names in bad faith. The Panel concludes that Complainant has met that burden.

Respondent concedes that it registered the domain names in 1999, knowing that Complainant produced and sold garlic-based products under the mark GARLI GARNI, without prior consultation of the Complainant. Respondent appears to recognize that such registration, if done without consent, would have been problematic when it states that, shortly after procuring these registration, it specifically asked Complainant for consent and offered to transfer the domain names to Complainant. Larson Decl. ¶ 5.

In light of Respondent ‘s own testimony, it is clear that, at the time of registration, Respondent lacked permission. A hotly disputed issue, though, is whether Complainant subsequently endorsed Respondent’s ownership of these domain names. Respondent, through Mr. Larson, says it offered to transfer the names at no cost, but that Complainant declined and in fact consented to Respondent’s use; Complainant, in contrast, vehemently insists that it never was offered transfer of the domain names, never consented to Respondent’s use of the domain names, and, in fact, did not know of Respondent’s ownership of these domain names until years later.

Dueling declarations of this type pose a unique problem in proceedings under the Policy given the lack of discovery, cross-examination and live testimony at which credibility determinations can be made. Tribeca Film Center, Inc. v. Lorenzo Brusasco-Mackenzie, WIPO Case No. D2000-1772 (April 10, 2001). The Panel must nevertheless do the best it can to resolve the disputed facts on the paper record. Bootie Brewing Co., supra. If, because of these inherent limitations, the Panel gets it wrong, the parties still are free to pursue their dispute in court, where all of the procedural protections missing from the proceedings under the Policy are available. Policy ¶ 4(k).

In this case, the evidence tends to support Complainant’s version of the events – that is, that Complainant was never asked and never consented to Respondent’s registration of these domain names. First, though Mr. Larson claims that his conversation with Tom Reed and Carol Simpson was witnessed by Jon and Zondra Rapazzini, Mr. and Mrs. Rapazzini’s declarations are too conclusory to be of any evidentiary value. Rather than provide factual support for Mr. Larson’s assertions, they simply state: "The events as Alex Larson has sworn on his Declaration dated May 27, 2003, are true and accurate." That statement is demonstrably over broad, as some of the statements in Mr. Larson’s declaration reflect his own actions, and thus it is highly dubious that Mr. and Mrs. Rapazzini have sufficient personal knowledge to affirm that every statement in his declaration is true. Moreover, Mr. and Mrs. Rapazzini offer no basis for even their conclusory statement – they do not, for example, state that they witnessed the discussion between Messrs. Larson and Reed and Ms. Simpson, nor do they recount their recollection of what was said. Accordingly, the Panel disregards the Rapazzini declarations.

In contrast, Complainant has submitted detailed, credible declarations. Not only do Mr. Reed and Ms. Simpson recount the specific events and deny having consented to the registration, but they also provide persuasive reasons why they never would have consented had they been asked. Mr. Reed, for example, explains that, because of his background in advertising, he is sensitive to the need to protect trademarks, and thus would not have allowed one retailer to own a domain name incorporating his company’s trademark. Moreover, Mr. Reed recounts how he first learned of Respondent’s registration through a consumer comment – a fact that further undermines any suggestion that he had earlier knowledge of Respondent’s registration and use of the domain names. Finally, both Mr. Reed and Ms. Simpson specifically state that they never had any contact with Mr. and Mrs. Rapazzini.

The Panel thus finds, on this record, that Complainant’s version of the events leading to this dispute are more credible than Respondent’s. With that as the factual predicate, a finding of bad faith flows naturally. Respondent’s conduct is on all fours with Policy paragraph 4(b)(iv), which provides that a Complainant can prove bad faith by showing that Respondent "intentionally attempted to attract, for commercial gain, Internet uses to [its] website . . . by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation or endorsement of [its] website." In light of the evidence, that appears to have been Respondent’s intent from the start.

 

7. Decision

Complainant has met its burden of proof under Paragraph 4 of the Policy. The domain name <garligarni.com> is identical, and the domain name <garlicgarni.com> is confusingly similar, to Complainant’s GARLI GARNI trademark, Respondent lacks a legitimate interest in those domain names, and Respondent has registered and used the domain names in bad faith. Accordingly, the Panel concludes that the domain names at issue should be transferred to the Complainant.

 

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David H. Bernstein
Sole Panelist

Dated: July 28, 2003

 

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1. The Panel notes that Complainant relies, in part, on a California state registration to establish its trademark rights. Unlike a federal trademark registration, a state registration may not deserve a presumption of validity. That is because, unlike the thorough examination process at the U.S. Patent and Trademark Office, applications for state trademark registrations are subject to only minimal, if any, review. In this case, though, Complainant also has alleged continuous use of the mark since 1985, which is more than sufficient to establish common law trademark rights.