Domain Name Investing Universally Accepted by UDRP Panels

INDRP arbitrators should review this UDRP panel decision in future INDRP where Domain Name Investing is in question


Case Comment by ICA General Counsel, Zak Muscovitch: Congratulations to our stalwart Editor-in-Chief, Ankur Raheja, for successfully representing the Respondent in this case. We should all be thankful for him bringing us his weekly summaries of noteworthy cases and also for his real-time Twitter summaries.

This case may contain the clearest and most emphatic statement yet about domain name investing:

“This business is universally accepted as legitimate by UDRP panels”; and

“Investing in common-word domain names is a perfectly legitimate business and can qualify as a bona fide offering of goods or services so long as the Respondent did not target a specific complainant or protected mark with a particular domain name”.

This constitutes a right and legitimate interest, with the Panel clearing stating that the Respondent’s use of the domain name as part of his stock in trade as an investor, constitutes use “in connection with a bona fide offering of goods or services as contemplated by in Policy” which “entitled [the Respondent] to make whatever lawful use of it he chooses, and offering it for sale as part of his stock in trade under the circumstances present in this case is entirely within his rights, regardless of Complainant’s claims to the Domain Name”. Contrast this decision from the Crew.com decision from 2000, where the majority of the Panel (with Gervaise Davis dissenting) stated that:

“The majority of the Panel does not decide that all speculation in domain names is prevented by the Policy. Rather, for the purpose of this case, we merely hold that registration of domain names for speculative purposes constitutes an abusive registration when (1) the respondent has no demonstrable plan to use the domain name for a bona fide purpose prior to registration or acquisition of the domain name; (2) the respondent had constructive or actual notice of another’s rights in a trademark corresponding to the domain name prior to registration or acquisition of the domain name; (3) the respondent engages in a pattern of conduct involving speculative registration of domain names; and  (4) the domain name registration prevents the trademark holder from having a domain name that corresponds to its registered mark.

This definition is consistent with the considerations stated in the WIPO Report and allows speculation in domain names that do not correspond to registered marks or where the registrant has a demonstrable plan to use the domain name for a bona fide purpose prior to registration or acquisition.”

As the dissenting Panelist noted, this “biased test” where a transfer would result every time a Complainant has a trademark since it “automatically creates a situation, in every case, where there is only one element left to test, if the Complainant has a registered trademark and the domain registered by the Respondent is similar to the Complainant’s registered trademark”. Accordingly, we have come a long way from this erroneous interpretation of the UDRP to the point where domain name investing is “universally” recognized as legitimate under the Policy. If it had not gone in this direction, domain name investing would have been virtually finished off by the UDRP.

The case is also noteworthy for the cautionary warning that the RDNH finding provides. Obtaining the Registrar Verification after filing the Complaint should give Complainants pause as the outcome may change depending on what it reveals. It should not be treated as an unimportant speed bump but rather as an opportunity to revaluate one’s Complaint prior to proceeding further. Many Panelists would lament just how often Complainants do not take care to change anything in their Complaint despite material new information being revealed by the Registrar Verification. Not only is this a lost opportunity for Complainants, but it can also result in RDNH where a Panel finds that a Complainant essentially ignores it despite it revealing a material problem with the Complaint, and proceeds headlong anyhow.

Swype.in sold for $2500 

UDRP and RDNH (Reverse Domain Name Hijacking)

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