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WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Velcro Industries B.V., Velcro USA Inc. v. Chung, Mitch

Case No. D2007-1263

1. The Parties

Complainant is Velcro Industries B.V., of Curacao, Netherland Antilles, The Netherlands; Velcro USA Inc, of Manchester, New Hampshire, United States of America, represented by Foley Hoag, LLP, of the United States of America.

Respondent is Mitch Chung of Oakland, California, United States of America.

2. The Domain Name and Registrar

The disputed domain name <velcro.biz> is registered with Network Solutions, LLC.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on August 27, 2007. On August 29, 2007, the Center transmitted by email to Network Solutions, LLC a request for registrar verification in connection with the domain name at issue. On August 29, 2007, Network Solutions, LLC transmitted by email to the Center its verification response confirming that 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”), 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 Respondent of the Complaint, and the proceedings commenced on September 4, 2007. In accordance with the Rules, paragraph 5(a), the due date for Response was September 24, 2007. The Response was filed with the Center on September 24, 2007.

The Center appointed Ross Carson as the sole panelist in this matter on October 3, 2007. 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

Complainant Velcro Industries B.V. (“VIBV”) is a global organization and the industry leader in hook and loop fasteners. VIBV, through its worldwide subsidiaries including Complainant Velcro USA Inc. (“VUSA”) (collectively “Complainants”) offers hundreds of different hook and loop products and fastening systems. Complainant VIBV is the owner of over 370 trademark registrations for VELCRO and variations thereof in more than 160 countries around the world. Complainant VUSA is the exclusive licensee of the VELCRO trademark in the United States. Complainant VIBV is the owner of, inter alia, twenty United States trademark registrations for marks that comprise the word VELCRO, for goods that comprise or contain hook and loop fastener material, components thereof, and products incorporating such fasteners. The earliest registration dates back to 1958.

Complainant VIBV is also the owner of a number of trademark registrations in Indonesia and Korea, for marks that comprise the word VELCRO, in Roman letters, Korean characters, or Japanese characters, for goods that comprise or contain hook and loop fastener material, components thereof, and products incorporating such fasteners. Complainants also have trademark rights in the mark VELCRO based on use of the mark in commerce since at least 1958 to identify the source or origin of its goods, and as the trade name of Complainants and their predecessors.

Complainant VUSA is the registered holder of hundreds of Internet domain names that include the word VELCRO, including, e.g., the <velcro.com> domain name.

5. Parties’ Contentions

A. Complainants

1 Identical or Confusingly Similar

Complainant VIBV is the owner of over 370 trademark registrations throughout the world for trademarks including VELCRO and variations thereof for use in association with different hook and loop products and fastening systems. Complainant VUSA is the exclusive licensee authorized to use the VELCRO trademarks in the United States of America.

Complainants submit that since at least 1958, Complainants, their predecessors, and affiliated companies, have continuously used the VELCRO trademark in connection with the goods they offer throughout the world. As a result of their substantial investments and extremely high quality standards, the VELCRO trademark is renowned in the industry and is recognized throughout the world as signifying the high quality of Complainants’ products.

Complainants further submit that the domain name <velcro.biz> is identical and thus confusingly similar to Complainant VIBV’s registered trademarks for or including VELCRO. See, CBS Broadcasting Inc. f/k/a CBS Inc. v. Goldmark, WIPO Case No. D2004-0330 (<wbbm.com> was identical to Complainant’s WBBM trademark, and the addition of the top-level domain “.com” was an insignificant difference, thus confusion was likely).

2 No Rights or Legitimate Interests in Respect of the Domain Name

Complainants state that Respondent is neither an agent nor a licensee of Complainants, and therefore has no right to the use of the VELCRO trademark in its domain name. Complainants’ further state that Respondent registered <velcro.biz> approximately 44 years after the mark VELCRO was first registered on the principal register in the United States of America.

Complainants submit that Respondent’s registration of the domain name in dispute prevents valid use of the domain by Complainants, and therefore wastefully restrains the legitimate and proper use of the domain name in dispute and unlawfully tarnishes Complainants’ marks. Respondent’s registration of the domain name in dispute prevents Complainants from using a domain name that customers worldwide are likely to expect to be in use for business purposes, given the nature of the .biz top-level domain.

Complainants submit that they have established that the domain name in dispute is identical or confusingly similar to their VELCRO trademark and given that Respondent is not licensed to use the mark, the burden shifts to Respondent to establish some right or legitimate interest.

The Policy… appears to envisage a respondent taking steps to demonstrate its right or interest, and it is generally accepted that, once a complainant has proved that the domain name is identical or confusingly similar to its mark and that it has not authorized the respondent to use the domain name, the evidential onus shifts to the respondent to demonstrate that it has some right or legitimate interest.

Auto-C, LLC v. MustNeed.com, WIPO Case No. D2004-0025

Complainants further submit that Respondent cannot meet its burden to demonstrate any legitimate rights to the domain. Respondent cannot show that, before any notice of the dispute, it used the domain name in dispute in connection with a bona fide offering of goods or services. See, paragraph 4(c)(i) of the Policy. Respondent is not commonly known by the domain name <velcro.biz>. The relevant WHOIS information indicates that Respondent is CHUNG, MITCH. See paragraph 4(c)(ii) of the Policy.

Complainants further submit that Respondent cannot demonstrate legitimate rights in the domain name in dispute because Respondent is not making a legitimate, non-commercial use of the domain name. See, paragraph 4(c)(iii) of the Policy. Since at least May 2005, the disputed domain name has resolved to a “pay-per-click” website, where Respondent presumably has been using the disputed domain names for commercial gain by redirecting Internet users to commercial websites for profit. Such use cannot confer legitimate rights in the disputed domain names. See, RX America, LLC. v. Matthew Smith, WIPO Case No. D2005-0540 (pay-per-click websites do not establish legitimate right or interest); Sociйtй Air France v. Virtual Dates, Inc., WIPO Case No. D2005-0168.

3 Registered and Used in Bad Faith

Complainants submit that Respondent should be considered as having registered and used the domain name in dispute in bad faith as Complainant VIBV’s registered VELCRO trademark, as well as Complainant’s use-based rights in the VELCRO trademark, entitle Complainants to the exclusive use of VELCRO as a domain name. The domain name in dispute is identical and confusingly similar to the aforementioned trademarks in which Complainants have exclusive rights. See, Policy, para. 4(a)(i). Thus there can be no question that there is a high likelihood of confusion as to the source, sponsorship, affiliation, or endorsement of Respondent’s website with Complainants’ trademarks for or including VELCRO.

Complainants further submit that it is a virtual certainty that Respondent was aware of Complainants and the nature of Complainants’ business when Respondent registered the <velcro.biz> domain name in November 2001. Respondent is active in the same industry as Complainants. Upon information and belief, Mitch Chung is the Chief Executive Officer of PT Samcro Hyosung Adilestari (“Samcro”), an Indonesian company and competitor of Complainants that manufactures and exports hook and loop material. In the WHOIS information for <velcro.biz>, Mitch Chung’s e-mail address is listed as mitch@samcro.net. A popular global trade site, Alibaba.com, describes Mitch Chung as Samcro’s “Legal Representative/CEO”. The website for Department of Commerce of Hainan Province, People’s Republic of China describes Mitch Chung as “President” of Samcro. Printouts from Samcro’s website state that PT Samcro Hyosung was established as a joint venture in 1989 by an Indonesian and a Korean company. One of the products of the joint venture is hook and loop fasteners. Complainants engaged Indonesian counsel to contact Mitch Chung via Samcro, and have confirmed that Mitch Chung is affiliated with Samcro.

Complainants further submit that as they and their affiliates are worldwide industry leaders in the hook and loop fastener business and have been using the VELCRO trademark for over fifty years, and because Complainants had extensive worldwide sales of countless products bearing their mark, including use and sales in Indonesia and Korea in association with transliterations of the VELCRO trademark, well before Respondent registered the <velcro.biz> domain name, Respondent was aware of Complainants, the nature of Complainants’ business, and Complainants’ famous VELCRO trademark prior to Respondents registration of the domain name in dispute.

Complainant submits that the arbitrary and fanciful qualities of Complainants’ VELCRO trademark strongly suggest that Respondent did not independently arrive at the conclusion that <velcro.biz> would form a strong foundation for a website, because the domain name is not an obvious choice of name, apart from its obvious association with Complainants’ long-established and famous business.

Complainants state that Respondent registered the <velcro.biz> domain name with knowledge that it was identical to Complainants’ registered trademark. Therefore, the domain name was registered and is being used in bad faith. See, e.g., Yahoo! Inc. v. CPIC NET and Syed Hussain, WIPO Case No. D2001-0195 (finding bad faith registration and use in light of widespread use of Yahoo marks on the Internet and because trademark search on date of registration would have revealed trademarks); Trip.com v. Daniel Deamone, WIPO Case No. D2001-1066 (“Actual or constructive knowledge of the Complainant’s rights in the Trademarks is a factor supporting bad faith.”).

Complainants further submit that Respondent registered and used the domain name in bad faith because it has hindered Complainants’ customers from contacting Complainants. See, SGS Sociйtй Gйnйrale de Surveillance S.A. v. Inspectorate, WIPO Case No. D2000-0025 (holding bad faith includes “diverting – even nonsensically – eventual customers to a commercial entity totally different from the one intended, and even by using a mere tombstone.”). Respondent acquired the domain name <velcro.biz> either with willful disregard for Complainants’ rights, or with a deliberate plan to divert customers of Complainants who expect Complainants to own the domain name for their trademark. Such customers are likely to be confused as to whether websites emanating from the <velcro.biz> home page are related to or affiliated with Complainants. Any dissatisfaction with Respondent’s “www.velcro.biz” website, or the services offered on the linked sites, will reflect upon and irreparably damage Complainants’ valuable and hard-earned reputation and goodwill associated with its VELCRO trademark.

Complainants submit that Respondent’s illicit use of the <velcro.biz> domain name creates the erroneous impression of endorsement by, or affiliation with, Complainants. See, CBS Broadcasting Inc., infra (transfer ordered where <wbbm.com> was identical to Complainant’s WBBM trademark, and where “Respondent [was] attracting users to its website and creating a likelihood of confusion as to the source, sponsorship, affiliation or endorsement of the links found there.”).

Complainants further submit that although Complainant and its agents were able to establish very limited contact with Respondent via e-mail, Complainant has continually attempted to send letters to Respondent at the mailing address listed in the concerned registrar’s WHOIS database. These letters have been returned as undeliverable. The provision of false contact details in the WHOIS information can be considered in determining bad faith. See, Bart van den Bergh Merk-Echt BV v. Kentech Company Ltd., WIPO Case No. D2005-0127 (Complainant was unable to contact Respondent by either phone or e-mail; this could be considered a provision of false contact details and could be relied upon in determining bad faith).

B. Respondent

1 Identical or Confusingly Similar

Respondent submits that the word “velcro” isn’t only a trademark, it’s also a name of specific product containing hook and loop fastener material, and such term has been generally used for many websites and by people around the world. Respondent submits that Complainant Velcro Industries B.V. registered the name of a product as their own trademark and it should not be deemed that such activity allows VIBV to monopolize the name. Respondent further submits that the public knows the difference between the brand VELCRO and the product or object commonly known and called “velcro”. Confusing similarity is unlikely by anyone.

Respondent states that the landing site associated with the domain name in dispute has never been utilized for any purpose yet, but if it were there would be no confusing similarity.

2 Rights or Legitimate Interests in respect of the Domain Name

Respondent states that the Internet is a world wide concept and it has no limit as concept of country territory. The fact that Complainant VIBV registered VELCRO as a trademark doesn’t support their allegation that it has exclusive and unlimited right to own all the previous, present and future domains related to such trademark.

Respondent further states that among many companies around the world that have produced loop and hook fasteners commonly known as Velcro, Samcro is one of the product manufacturers producing loop and hook fasteners since 1989 in Indonesia and 1972 in another country. By being involved for over 35 years in producing loop and hook fasteners, Samcro must have rights to use the name of the product that the company has been manufacturing.

Respondent states that there are over 70 companies outside Indonesia and 600 companies in Indonesia alone that use the product commonly known and called “Velcro” produced by Samcro Inc. Respondent submits that registering and holding the domain name in dispute which incorporates the name of the product its company has been manufacturing is a very natural action to do.

3 Registered and Used in Bad Faith

Respondent states that Respondent hasn’t used the domain name in dispute in commerce yet and all the contents shown on the landing page is what Network Solutions Inc. has linked to the website without Respondent’s consent. Therefore, Complainants statement that Respondent has unlawfully harmed them by running the domain as a “pay-per-click” website is not correct.

Respondent further states that Complainants claim they have been seriously harmed by Respondents unlawful possession of the domain name in dispute. If Complainants statement is right, they should have claimed to take the domain name in dispute back 6 years ago when the respondent bought the domain name in dispute. Respondent has dedicated significant time, budget and effort to maintain the domain name in dispute when .biz was not a popular designation. Respondent renewed the domain in 2006 after giving several days for Complainants to register it. Complainants didn’t even make such effort, and only now alleges Respondent possessed an intention to harm Complainants.

Respondent submits that there are hundreds of websites shown by searching for “velcro” at global portal sites because “velcro” is a name of specific product, a commonly used term, as well as a trademark. If <velcro.biz> is considered as being used in bad faith and should be possessed by Complainant, it would mean all the other domains related to the word “velcro”, should be in the same situation, which Respondent contends is nonsense.

Respondent further submits that Respondent’s business can’t be a parameter in deciding whether the domain name in dispute was registered and used in bad faith. Complainants have attempted to prove that Respondent is acting in bad faith based partly on the fact that Respondent is CEO of a corporation in the same industry as Complainants. Respondent submits that Complainants would presumably have stated Respondent was acting in bad faith even if Respondent was in different industry.

Respondent denies providing false contact information. Respondent’s address in “Whois” is shown as a US address simply because Network Solutions, Inc, cannot process an Indonesian address for payment purposes. As Complainants are well aware of and pointed out in their documents, Respondent resides in Indonesia.

6. Discussion and Findings

Paragraph 15(a) of the Rules instructs this Panel to “decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable”.

Paragraph 4(a) of the Policy requires that the Complainant must prove each of the following three elements to obtain an order that a domain name should be cancelled or transferred:

(1) the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and

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

(3) the domain name has been registered and is being used in bad faith.

A. Identical or Confusingly Similar

Pursuant to paragraph 4(a)(i) of the Policy, Complainants must establish rights in a trademark and secondly prove that the domain name in dispute is confusingly similar to a trademark in which Complainants have rights.

Complainant VIBV is the owner of over 370 trademark registrations for VELCRO and variations thereof for hook and loop type fasteners and products incorporating hook and loop type fasteners in more than 160 countries around the world. Complainant VUSA is the exclusive licensee of the VELCRO trademark in the United States. Complainant VIBV is the owner of, inter alia, twenty United States trademark registrations for marks that comprise the word “VELCRO”, for goods that comprise or contain hook-and-loop fastener material, components thereof, and products incorporating such fasteners. The earliest registration dates back to 1958.

Complainant VIBV is also the owner of a number of trademark registrations in Indonesia and Korea, for marks that comprise the word “VELCRO”, in Roman letters, Korean characters, or Japanese characters, for goods that comprise or contain hook and loop fastener material, components thereof, and products incorporating such fasteners.

The Respondent does not dispute the allegation that the domain name in dispute is identical or confusingly similar to Complainants VELCRO trademark. The domain name in dispute <velcro.biz> is comprised of Complainants trademark VELCRO together with the gTLD “.biz”.

Respondent submits that the word “velcro” is not only a trademark distinguishing fasteners manufactured or sold by the Complainants but states it is also used on the Internet and by people around the world to describe a hook and loop fastener or a product incorporating a hook and loop fastener. Respondent submits that Complainant Velcro Industries B.V. registered as its own the VELCRO trademark which is in fact the name of a product manufactured by many companies including itself for many years.

Complainants state that since at least 1958, Complainants, their predecessors, and affiliated companies have continuously used the VELCRO trademark in connection with the goods they offer throughout the world. Samples of product brochures and advertisements filed by Complainants disclose use of the word “VELCRO” accompanied by the letter “R” in a circle, i.e., “®” indicating that VELCRO is Complainant’s registered trademark. The samples of Complainants’ product brochures and advertisements disclose that VELCRO is used as a trademark in association with nouns such as “touch fasteners” or “hook and loop self-adhesive”. Complainants filed copies of pages from over 50 dictionaries or thesauri from around the world; each of which notes the status of VELCRO as Complainant’s trademark or proprietary name. Complainants state that they diligently monitor use of their VELCRO trademark and actively enforce their rights to prevent infringement or other damage to, or dilution of their valuable asset. In three recent UDRP decisions different panels have ordered the transfer of domain names to the present Complainants. See, Velcro Industries B.V. and Velcro USA Inc. v. Qingdao Kunwei Knitting Co. Ltd., WIPO Case No. D2007-0203; Velcro USA Inc., Velcro Industries B.V. v. Domain Master, Kenteck Inc. / Titan Net, WIPO Case No. D2006-0653; Velcro Industries B.V. and Velcro USA Inc. v. Qingdao Kunwei Velcro Co., Ltd., WIPO Case No. D2006-0023. The validity of the VELCRO trademarks was not an issue in the decisions referred to immediately above. These decisions support Complainants contention that they are actively enforcing their rights relying on their VELCRO trademarks.

The UDRP Policy and Rules are not intended as a forum to decide the issue of distinctiveness of trademark registrations for lack of distinctiveness at the date of registration or loss of distinctiveness at the time of commencement of the UDRP proceeding. National law with respect to invalidity of a trademark on the issue of distinctiveness varies in different jurisdictions. There is no opportunity for Complainants to respond to evidence of lack of or loss of distinctiveness under the Rules. While Respondent made allegations about alleged invalidity in the Response, Respondent did not submit evidence supporting the allegation of lack of or loss of distinctiveness of the VELCRO trademark.

The domain names in dispute incorporate the whole of Complainants’ registered VELCRO trademarks. Numerous UDRP panels have held that a domain name is confusingly similar to a trademark when the domain name incorporates the mark in its entirety. See, e.g., Am. Online, Inc., v. aolgirlsgonewild.com, FA0207000117319 (Nat. Arb. Forum September 19, 2002) (noting that “aolgirlsgonewild” incorporated complainant’s “entire mark” and implied “an affiliation that simply does not exist”).

The addition of a generic top-level domain name such as “.org”, “.net”, “.com”, or “.biz” is irrelevant when determining whether a disputed domain name is confusingly similar to a protected mark. See, e.g., Aous Uweyda v. Abdallah Sheet, FA165119 (Nat. Arb. Forum June 22, 2003).

The Panel finds that Complainant has proven that the domain name in dispute

is confusingly similar to Complainants’ registered trademarks.

B. Rights or Legitimate Interests

Pursuant to paragraph 4(a)(ii) of the Policy, Complainants must prove that Respondent has no rights or legitimate interests in respect of the domain name.

Respondent is not affiliated with Complainants and has never been authorized by Complainants to use Complainants’ VELCRO trademarks.

On the material before the Panel, Respondent has not used the VELCRO trademark in association with any bona fide offering of goods or services.

The landing pages associated with the domain name in dispute appear to be comprised of “Sponsored Links” and “Popular Categories: Travel, Financial Planning, E Commerce, Lifestyle and Real Estate”. The sponsored links include VELCRO brand hook and loop fasteners of Complainants or their licensees as well as hook and loop fasteners offered by competitors of Complainants. The use of the domain name in dispute to divert Internet traffic to competitors of Complainant or Internet Users interested in Popular Categories does not give rise to a right or legitimate interest in the domain name in dispute.

Respondent states in the Response that it has not used the domain name in dispute for commercial reasons. Respondent did not submit that it is planning to use the domain name in dispute in the future. Respondent states that the contents of the landing page associated with the domain name in dispute are placed on the website at the domain name <velcro.biz> by the Registrar without Respondents permission.

Complainants have made out a prima facie case that Respondent does not have any rights or legitimate interests in the domain name in dispute. The evidentiary onus thus switches to Respondent. Respondent did not establish any rights or legitimate interests in the domain name in dispute under paragraph 4(c) of the Policy.

The Panel finds that Complainants have proven that Respondent has no rights or legitimate interests in the domain name in dispute as required by paragraph 4(a)(ii) of the Policy.

C. Registered and Used in Bad Faith

Pursuant to paragraph 4(a)(iii) of the Policy, Complainant must prove that the domain name in dispute has been registered and used in bad faith.

Complainant VIBV is the owner of over 370 trademark registrations for VELCRO and variations thereof in more than 160 countries around the world. Complainant VUSA is the exclusive licensee of the VELCRO trademark in the United States. Complainant VIBV is the owner of, inter alia, 20 United States trademark registrations for marks including VELCRO, for goods that comprise or contain hook and loop fastener material. The earliest registration dates back to 1958. The VELCRO trademark has been extensively used by Complainants and their predecessors in association with goods that comprise or contain hook and loop fastener material since1958.

Respondent is a senior executive of a company with operations in South Korea and Indonesia which is in the hook and loop fastener business. Complainants have demonstrated extensive worldwide sales of countless hook and loop fasteners bearing the VELCRO trademark, including use and sales in Indonesia and Korea in association with transliterations of the VELCRO trademark into Korean and Indonesian prior to registration of the domain name in dispute.

The panel finds that Respondent was aware of Complainants’ VELCRO trademarks prior to registration of the domain name in dispute.

The web pages currently associated with the domain name in dispute registered in Respondent’s name return landing pages with what appear to be sponsored links to companies competing with Complainants in the hook and loop fastener business. The domain name in dispute is likely to cause confusion with Complainants’ VELCRO trademarks. Attracting Internet users familiar with Complainants’ VELCRO trademarks to competitors sponsored websites is damaging to Complainants business. The panel cannot conceive of a situation in which Respondent could use the domain name in dispute in good faith. See, e.g., Jupiters Limited v. Aaron Hall, WIPO Case No. D2000-0574; Cobham Plc. v. Neog Inc., WIPO Case No. D2005-0503.

The registration of domain names identical or confusingly similar to well-known trademarks by a person with no connection to that trademark amounts to “opportunistic bad faith” See, Expedia, Inc. v European Travel Network, WIPO Case No. D2000-0137.

The Panel finds that Complainants have satisfied paragraph 4(a)(iii) of the Policy by proving that Respondent registered and is using the domain name in dispute in bad faith

7. Decision

For all the foregoing reasons, in accordance with Paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name <velcro.biz> be transferred to the Complainant

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Ross Carson
Sole Panelist

Dated: October 15, 2007