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WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Dreamgirls, Inc. v. Dreamgirls Entertainment

Case No. D2006-0609

1. The Parties

The Complainant is Dreamgirls, Inc., Tampa, Florida, United States of America, represented by Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP, Los Angeles, California, United States of America.

The Respondent is Dreamgirls Entertainment, Brea, California, United States of America, represented by Joel G. MacMull, Esq., Vancouver, Canada.

2. The Domain Name and Registrar

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

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on May 17, 2006. On May 17, 2006, the Center transmitted by email to Network Solutions, LLC a request for registrar verification in connection with the Domain Name. On May 19, 2006, Network Solutions, LLC transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details for the administrative, billing, and technical contact.

The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), 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(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on May 30, 2006. In accordance with the Rules, paragraph 5(a), the due date for Response was June 19, 2006. The Response was timely filed with the Center on June 16, 2006.

On July 5, 2006, the Complainant forwarded to the Center a supplemental filing, to which the Respondent replied with a supplemental filing of its own on July 18, 2006.

After clearing potential conflicts of interest, the Center appointed David H. Bernstein (presiding), Jonathan Hudis and M. Scott Donahey as panelists in this matter on July 25, 2006. 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.

4. Factual Background

Complainant, a Florida corporation, owns a United States service mark registration for DREAMGIRLS (Reg. No. 2250830) for “retail and wholesale distributorship of videos featuring adult entertainment.” Complainant’s predecessor filed its trademark application on June 2, 1997; the U.S. Patent and Trademark Office issued the registration on June 8, 1999. The registration indicates that the date of first use in commerce of the mark was February 15, 1996.

Complainant registered the domain name <dreamgirls-videos.com> on February 25, 1996.

Respondent registered the Domain Name, <dreamgirls.com>, on October 7, 1995. Respondent uses its domain name for a website at which it sells “adult entertainment” products and services.

5. Parties’ Contentions

A. Complainant

Complainant contends that the Domain Name is identical or confusingly similar to its federally-registered DREAMGIRLS mark.

Complainant alleges that Respondent lacks any rights or legitimate interests in the Domain Name. Although Respondent sells adult entertainment videos on its website, Complainant contends that Respondent’s use of the Domain Name is not bona fide because Respondent’s website business competes directly with Complainant’s business, and Respondent’s use of the Domain Name thus constitutes trademark infringement. Complainant further alleges that Respondent has never been known by the Domain Name, is not an authorized reseller of Complainant’s products, and is not making a noncommercial or fair use of the Domain Name because Respondent uses the Domain Name for a commercial website through which it sells products.

Complainant asserts that Respondent registered the Domain Name in bad faith in order to create consumer confusion and to profit commercially from this confusion. Complainant also asserts that Respondent has tarnished Complainant’s trademark by selling “hardcore” products alongside Complainant’s products, which Complainant asserts are only “softcore.”

B. Respondent

Respondent does not dispute that the Domain Name is identical or confusingly similar to a trademark in which Complainant asserts it has rights.

Respondent contends, however, that it has been conducting a legitimate on-line retail business utilizing the contested Domain Name since October 1995. Respondent asserts that it not only makes a fair, descriptive use of the Domain Name for the sale of adult entertainment products that feature “dream girls,” but that, from June 2000 through June 2001, it was an authorized reseller of Complainant’s DREAMGIRLS videos. Respondent further asserts that Complainant cannot establish exclusivity over the term “dreamgirls,” either because the purported mark is a generic term or because it is merely descriptive without a showing of secondary meaning. Respondent asserts that it chose the term “dream girls” merely for its descriptive value in relation to Respondent’s products. Respondent asserts that it did not become aware of Complainant until well after Respondent registered the Domain Name, and that Complainant has provided no evidence to indicate that Respondent was aware of Complainant’s trademark rights or otherwise targeted Complainant or its mark at the time Respondent registered the Domain Name.

Respondent argues that because it registered the Domain Name several months before Complainant’s predecessor filed its U.S. trademark application, and because there is no direct proof that Respondent registered or acquired the Domain Name for the purpose of profiting from Complainant’s mark, there can be no finding of bad faith. Respondent argues that its continued use of the Domain Name for ten years is evidence that it acted in good faith when it registered the Domain Name. Respondent asserts that its sale of Complainant’s products alongside “hardcore” products does not tarnish Complainant’s marks because Complainant’s websites themselves advertise hardcore products, and because tarnishment allegations are inapposite when all the products in question are pornographic.

Respondent also argues that the doctrine of waiver, estoppel, acquiescence and/or laches should preclude the Complainant’s requested remedy.

Respondent asks that the Panel enter a finding of Reverse Domain Name Hijacking against Complainant.

6. Preliminary Matters

The Panel must first determine whether the Complainant’s supplemental submission and the Respondent’s reply thereto should be considered.

The Complainant’s supplemental submission purports to “present and clarify salient facts necessary to a fair determination of the present dispute which have not previously been brought to the attention of the Administrative Panel.” In its supplemental filing, Complainant alleges “passive warehousing” and inaction on the part of Respondent, and offers another argument in support of its bad faith allegation: namely, that Respondent’s re-registration of the Domain Name, which occurred after Complainant’s federal registration of the trademark on or about June 8, 1999, constitutes bad faith registration.

Respondent reiterates in its rebuttal that it had no knowledge of Complainant’s interest in the trademark “DREAMGIRLS” as of October 7, 1995, when it registered the Domain Name. Respondent further argues that Complainant’s unsolicited supplemental submission should be barred from consideration.

As Respondent properly notes, unsolicited supplemental filings are appropriate in UDRP proceedings only when such submissions address new, relevant facts or arguments that were not known until after the submission of the original Complaint, or that the Complainant could not reasonably have anticipated. Deutsche Post AG v. NJDomains, WIPO Case No. D2006-0001; Custom Bilt Metals v. Conquest Consulting, WIPO Case No. D2004-0023. Complainant’s supplemental submission does not meet this standard. All of the facts and arguments in the supplemental submission were known to Complainant at the time it filed the original Complaint and, if relevant, should have been included in the Complaint.

Further, Complainant’s argument that bad faith registration should be measured at the time that the Domain Name registration was renewed is not well taken. As the WIPO Overview of WIPO Panel Views on Selected UDRP Questions (the “WIPO Decision Overview,” available at http://www.wipo.int/amc/en/domains/search/overview/)¹ makes clear, “While the transfer of a domain name to a third party does amount to a new registration, a mere renewal of a domain name does not amount to registration for the purposes of determining bad faith. Registration in bad faith must occur at the time the current registrant took possession of the domain name.” WIPO Decision Overview at § 3.7.

The Panel thus declines to consider Complainant’s supplemental submission. Because it has disregarded Complainant’s supplement submission, the Panel need not consider Respondent’s rebuttal thereto.

7. Discussion and Findings

Complainant has the burden of proving all three of the following elements under paragraph 4(a) of the Policy:

(i) That the Domain Name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights;

(ii) That Respondent has no rights or legitimate interests in respect of the Domain Name; and

(iii) That the Domain Name has been registered and is being used in bad faith.

Failure to prove any one of these factors is fatal to the Complaint.

Bad faith registration cannot be found if the Domain Name was registered before Complainant acquired trademark rights. The consensus view of WIPO panelists, as reported in the WIPO Decision Overview, is that “when a domain name is registered before a trademark right is established, the registration of the domain name was not in bad faith because the registrant could not have contemplated the complainant’s non-existent right.” WIPO Decision Overview at § 3.1.²

Here, there is no dispute about the relevant chronology. Although Complainant states that it produced its first video under the DREAMGIRLS mark in 1994, it does not allege any distribution of that video or any other use in commerce of the DREAMGIRLS mark circa 1994. Rather, as Complainant’s predecessor noted in its trademark registration, and as Complainant’s CFO acknowledged in his declaration, the first use and first use in commerce of the DREAMGIRLS mark was on February 15, 1996. Respondent, however, registered the Domain Name more than four months earlier, in October 1995. In light of these uncontroverted facts, it is clear that Respondent did not register the Domain Name in bad faith with the intent of profiting from any goodwill inherent in Complainant’s trademark or interfering with Complainant’s use of its mark. Primal Quest, LLC v. Gabriel Salas, WIPO Case No. D2005-1083.

Even if Complainant’s activities in 1994 could give rise to trademark rights, the Panel still would conclude that Complainant has failed to prove bad faith registration because Respondent’s President submitted a sworn affidavit asserting that he had no knowledge of Complainant or its trademark at the time he registered the Domain Name. Although not every assertion of lack of knowledge is credible (see, e.g., The Knot v. In Knot We Trust LTD, WIPO Case No. D2006-0340 (respondent’s assertion that it had no knowledge of complainant or its trademark was not credible because respondent used its domain name for a wedding-related website and complainant operated a highly-successful, well-known wedding website)), Respondent’s assertion in this proceeding is credible given that Complainant made only limited use (if any) of the trademark in 1994, that Complainant’s predecessor did not file its trademark application until nearly two years after Respondent registered the Domain Name, and that Complainant has not offered any evidence that Respondent was aware of Complainant’s trademark at the time of it registered the Domain Name.

Because the Panel finds that Complainant did not establish the third element necessary to succeed in its Complaint (bad faith registration and use), the Panel does not need to address the other factors under the Policy.

8. Reverse Domain Name Hijacking

Respondent has requested a finding of Reverse Domain Name Hijacking (“RDNH”), which is defined in the Rules as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name.” The Panel finds that Complainant in this proceeding has committed RDNH.

As noted above, where the Domain Name was registered prior to the establishment of trademark rights, bad faith registration usually will not be found and the Complaint usually will fail. That principle is so well established that it is among the twenty issues covered in the WIPO Decision Overview for which a consensus has been identified. When a Complainant files a UDRP Complaint that fails to heed this consensus, RDNH has been found. Primal Quest, LLC v. Gabriel Salas, WIPO Case No. D2005-1083.

In this proceeding, Complainant is represented by counsel who cited numerous UDRP decisions in support of the Complaint. This shows that, at a minimum, Complainant’s counsel is familiar with the UDRP system and with the methods of researching prior UDRP decisions. From an objective view of the facts, Complainant, employing experienced counsel, had to have known that it did not possess trademark rights prior to Respondent’s registration of the contested Domain Name.

Finally, Complainant’s long delay in bringing this action is another factor supporting a finding of its bad faith. Although laches does not necessarily bar relief in cases of genuine cybersquatting, the fact that Complainant filed this proceeding nearly ten years after the Domain Name was registered, six years after Respondent first became a distributor of Complainant’s videos, and more than two years after Complainant acknowledged to customers that it was aware of Respondent,³ all suggests that Complainant knew it had a very weak claim and nevertheless filed its UDRP Complaint in bad faith.

The Panel accordingly finds that Complainant’s actions constitute an abuse of the UDRP process.

9. Decision

For the foregoing reasons, the Complaint is denied and the Panel declares that the Complaint was brought in bad faith and thus constitutes Reverse Domain Name Hijacking.

David H. Bernstein Presiding Panelist
Jonathan Hudis Panelist	M. Scott Donahey Panelist

Dated: August 10, 2006

¹ “Although the WIPO Decision Overview is not precedential in nature, it does reflect a studied and considered summary of consensus positions culled from the decisions of numerous panelists during the first five years of administration of the UDRP. When such a consensus has developed, it is incumbent upon panels to follow the consensus (or the majority view) to promote consistency among UDRP decisions.” Fresh Intellectual Properties, Inc. v. 800Network.com, Inc., WIPO Case No. D2005-0061 (March 21, 2005), at n.3.

² There are certain limited exceptions to this rule, such as “when the respondent is clearly aware of the complainant, and it is clear that the aim of the registration was to take advantage of the confusion between the domain name and any potential complainant rights. . . . This often occurs after a merger between two companies, before the new trademark rights can arise, or when the respondent is aware of the complainant’s potential rights, and registers the domain name to take advantage of any rights that may arise from the complainant’s enterprises.” WIPO Decision Overview § 3.1. Complainant, however, does not allege any facts that would cause any of these exceptions to apply. Primal Quest, LLC v. Gabriel Salas, WIPO Case No. D2005-1083, at n. 2

³ In an email to a customer in October 2003, Complainant states that it was aware of Respondent’s site, and that Respondent registered the Domain Name two months before Complainant was ready to launch its website.