Affirm.com.au : Aussie #domain UDRP ends up with a Reverse Domain Name Hijacking finding

The UDRP filed against the Australian domain name, Affirm.com.au, did not end well for the Complainant.

Affirm, Inc., a US based corporation, asserted that that its AFFIRM mark enjoys a substantial social media following and through advertising and media exposure has developed a wide degree of renown.

The Respondent registered the disputed domain name in 2006 because it is a generic English dictionary term and that it has owned and used it since then in good faith. As the Complainant did not exist in 2006, it could not have had the Complainant in mind when it registered the disputed domain name and therefore did not do so in bad faith.

That combination did the trick for the three member panel at the WIPO that ordered the domain Affirm.com.au to remain with the Respondent. Here’s why they also found the Complainant guilty of Reverse Domain Name Hijacking:

It appears to the Panel that these proceedings were only brought when the Complainant’s management decided a couple of years after obtaining Australian trade mark registrations that it required the disputed domain name for its business launch in Australia and as a result the Complainant set out to harass the Respondent and to procure the disputed domain name, by fair means or foul. In doing so, in circumstances that the Complaint could never succeed, the Complainant has abused the Policy and wasted its own and the Respondent’s resources. This conduct clearly amounts to reverse domain name hijacking and the Panel has no hesitation in finding as such.

WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Affirm, Inc. v. Internet Products Sales & Services Pty Ltd
Case No. DAU2021-0014

1. The Parties

The Complainant is Affirm, Inc., United States of America (“United States”), represented by DLA Piper Australia, Australia.

The Respondent is Internet Products Sales & Services Pty Ltd, Australia, represented by DBR Domain Brokerage.

2. The Domain Name and Registrar

The disputed domain name <affirm.com.au> is registered with Drop.com.au Pty Ltd.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on April 12, 2021. On April 12, 2021, the Center transmitted by email to Drop.com.au Pty Ltd a request for registrar verification in connection with the disputed domain name. On April 13, 2021, Drop.com.au Pty Ltd 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 .au Dispute Resolution Policy (the “Policy”), the Rules for .au Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for .au 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 April 14, 2021. In accordance with the Rules, paragraph 5(a), the due date for Response was May 4, 2021. The Response was filed with the Center on May 3, 2021.

The Center appointed Alistair Payne, Debrett G. Lyons, and The Hon. Neil Brown, Q.C. as the three-member panel (the “Panel”) in this matter on May 25, 2021. 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 is a publicly traded financial technology company headquartered in San Francisco, United States. Founded in 2012, Affirm operates as a technology platform to facilitate lending of instalment loans for consumers to use at the point of sale to finance a purchase. It has used AFFIRM as its trade mark in respect of that business since 2012 and owns a number of trade mark registrations around the world for that trade mark. In particular it owns Australian trade mark registration 1898976 for AFFIRM registered on August 1, 2018. The Complainant operates its official website resolving from the domain name, <affirm.com>.

The Respondent, a domain name service company based in New South Wales, acquired the disputed domain name on August 9, 2006. Since that time, the disputed domain name has resolved to various advertising and pay-per-click sites.

5. Parties’ Contentions

A. Complainant

The Complainant submits that it owns registered trade mark rights in the AFFIRM mark as set out above.

It says that its AFFIRM mark enjoys a substantial social media following and through advertising and media exposure has developed a wide degree of renown. The Complainant submits that the Respondent has not made a bona fide offering of goods or services under and is not commonly known by the disputed domain name. It notes that the Respondent owns 6,869 domain names in Australia and there is no business name registration or other evidence to suggest that the Respondent was ever commonly known by the disputed domain name.

The Complainant also submits that the Respondent is not making a legitimate noncommercial or fair use of the disputed domain name since it currently resolves to a landing page stating that “This Domain Name Is Under Construction”.

As far as bad faith is concerned, the Complainant submits that the Respondent has not made use of the website located at the disputed domain name and that its failure to respond in a substantive way to the Complainant’s representative’s request to acquire it and the Respondent’s subsequent refusal of the Complainant’s commercial offer for AUD 20,000 and request, instead, for a six-figure sum amounts to evidence of use in bad faith. Further, says the Complainant, under paragraph 4(b)(i) of the Policy, the Respondent has registered the disputed domain name for the purpose of selling, renting or otherwise transferring it to another person, in this case the Complainant, for valuable consideration in excess of its documented out of pocket acquisitional costs. The Complainant says that this is supported by the Respondent’s repeated requests for a six-figure sum.

B. Respondent

The Respondent says that it registered the disputed domain name in 2006 because it is a generic English dictionary term and that it has owned and used it since then in good faith and in accordance with the .au Domain Name Administration’s (“AUDA’s”) policies. It notes that as the Complainant did not exist in 2006, it could not have had the Complainant in mind when it registered the disputed domain name and therefore did not do so in bad faith.

The Respondent submits that the Complaint is an abuse of process and that the Complainant has no proper basis under the Policy to bring it. It says that the Complainant is attempting to reverse domain name hijack the disputed domain name which has been owned by the Respondent for over 14 years. The Respondent notes that the Complainant only very recently filed Australian trade marks for “affirm” in January 2018 and that it does not even trade as yet in Australia and is not known by the AFFIRM mark in Australia. The Respondent asserts that the Complainant then initiated anonymous contact with the Respondent by hiring third-party agencies to make highly undervalued offers to purchase the disputed domain name. It says that this was either a commercial attempt to acquire the disputed domain name at an extremely undervalued price, or it effectively sought to “set the Respondent up” to look as though it had engaged in conduct for purely financial gain.

The Respondent says that, by its own admission, the first time the Complainant ever considered registering an Australian domain name including the term “affirm” was in July 2020. It notes that the Complainant anonymously initiated contact with the Respondent to purchase the disputed domain name in October 2020 for AUD 7500 and then made a further offer in February 2021 of AUD 5000 and finally in March 2021 of AUD 20,000. The Respondent says that it was only after receiving the initial offers that the Respondent requested a domain name broker to appraise the value of the disputed domain name.

The Respondent asserts that no-one offers AUD 20,000 for a name they genuinely believe infringes a trade mark and notes that the Complainant never alleged infringement. It says that it is clear that the Complainant offered AUD 20,000 because it wanted to purchase the disputed domain name some 13 years and 11 months after the Respondent had first legitimately registered it. The Respondent submits that the Complainant engaged various “anonymous” sources in an attempt to purchase the domain name for what it hoped would be an extremely undervalued amount for a short, generic, dictionary word domain name.

As far as use is concerned, the Respondent submits that the disputed domain name has resolved at times to a full website, to a default hosting page, to suspended hosting pages, to unresolved sites, and to parking and domain name monetisation pages and that the Respondent’s use of advertising links over the years establishes that it has rights and legitimate interests in the disputed domain name. It says that it never approached the Complainant or its competitors to sell the disputed domain name.

The Respondent denies that it registered the disputed domain name for the purpose of selling it and notes that in any event in 2006, at the time of its registration, AUDA’s policy was that it was not legally possible to sell a domain name in Australia and that this rule remained in effect until 2008.

The Respondent maintains that the Complainant and its trade mark are presently unknown in Australia and have not even launched in this country yet. It says that if the Complainant truly wanted to have a “worldwide” presence on the Internet and felt that the disputed domain name would have been such an important part of the Complainant’s online branding in Australia, then it would have attempted to purchase the disputed domain name at some point over the past 9 years, after registration of the United States trade mark and the incorporation of the company in that country in 2012. Instead, says the Respondent, the Complainant deceptively engaged various “anonymous” sources in an attempt to purchase the disputed domain name for what it hoped would be an extremely undervalued amount and is now attempting to engage in reverse domain name hijacking in order, effectively, to steal the disputed domain name from the Respondent for no payment or compensation.

In short, submits the Respondent, AUDA’s domain name system is a “first in, first served” system in which it was the bona fide registrant of the disputed domain name long before the Complainant had even commenced business in the United States and that in the absence of any evidence of cybersquatting or any of the indicia within paragraph 4(b) of the Policy the Respondent is fully entitled to be the ongoing registrant of the disputed domain name and in the absence of bad faith registration or use the Complaint must fail.

In addition, the Respondent requests that the Panel makes a finding of reverse domain name hijacking on the grounds that:

a) the Complainant has at no time served the Respondent with a cease and desist letter, outlining the subject matter of its dispute;

b) the term “affirm” is a generic term which is most well-known around the world as meaning “to express agreement”;

c) the term “affirm” is registered as a trade mark in Australia by 20 companies and has been used daily for decades by 35 businesses. The Complainant only represents roughly 25% of all the 19 trademarks in Australia under the term “affirm” and operates no active businesses in Australia;

d) the Complainant has attempted to use the .au Dispute Resolution Policy to resolve a competing rights dispute, rather than a bona fide cybersquatting dispute for which the policy was created, and accordingly it ought to have known that there was no proper basis to bring these proceedings; and

e) although failing to make out the necessary grounds under the Policy, the Complainant has used the process to harass and intimidate the Respondent.

6. Discussion and Findings

A. Identical or Confusingly Similar

The Complainant has demonstrated that it owns Australian trade mark registration 1898976 for AFFIRM registered from August 1, 2018. Excluding the Top-Level Domain name suffix of “.com.au”, the disputed domain name is identical to the only other element of the Complainant’s registered trade mark. As a result, the Panel finds that the disputed domain name is identical to the Complainant’s registered trade mark rights and therefore that the Complaint satisfies this element of the Policy.

B. Rights or Legitimate Interests

The Complainant’s attempt to make out the necessary prima facie case that the Respondent had no rights or legitimate interests in the disputed domain name was problematic from the outset.

In circumstances that the disputed domain name is a common English word and was registered by the Respondent in 2006, some six years prior to the Complainant’s incorporation and commencement of business in California, the Complainant could never hope to make out the case that the Respondent had it in mind when it registered the disputed domain name. Without additional evidence of illicit conduct of the Respondent, neither could it hope to show that the Respondent somehow acted illegitimately in registering the disputed domain name.

The Respondent had every right to register the disputed domain name in 2006 and while it has subsequently used the disputed domain name for various purposes, including to resolve to a website, a default hosting page, to parking and domain name monetisation pages, and for an unresolved site, there is no evidence that it has subsequently used the disputed domain name in an illegitimate way such as might support a case of passive holding in bad faith, or in a manner which targets the Complainant. It is notable in this regard that the Complainant never alleged infringement of its trade mark rights, presumably because it had no grounds to do so.

The Complainant’s case under this element of the Policy appears to be based mainly upon the Respondent having registered the disputed domain name as part of a large portfolio of domain names and that the Respondent has not used the disputed domain name for a particular business activity and is not commonly known by the disputed domain name. However, there is nothing wrong per se in a domain name investor registering a commonly used word as a domain name and holding it provided that the circumstances do not indicate illegitimate conduct or bad faith. The fact remains that the Complainant has failed to submit evidence to demonstrate that the Respondent’s registration and use of the disputed domain name has been other than bona fide and as a result it has failed to meet the onus upon it and therefore the Panel finds that the Complaint fails under this element of the Policy.

C. Registered or Subsequently Used in Bad Faith

The Policy only requires a finding of registration, or use, of a disputed domain name in bad faith. As noted under Part B above, it was never going to be possible for the Complainant to make out a case that the disputed domain name was registered in bad faith in circumstances that the Respondent registered it six years before the Complainant had even commenced its business in the United States. Neither was a case of use in bad faith ever going to succeed where there was no evidence of illicit conduct or of targeting of the Complainant’s mark.

There is nothing to suggest that the Respondent ever sought pro-actively to sell the disputed domain name to the Complainant at all, or for more than its out- of-pocket costs. On the contrary, the evidence suggests the exact opposite, namely that the Complainant attempted to use brokers to make increased purchase offers for the disputed domain name and when this did not work it commenced these proceedings and tried to use evidence of the commercial negotiations and counter-offers as evidence of the Respondent’s bad faith. Contrary to the Complainant’s assertion this is not the sort of conduct described in paragraph 4(b)(i) of the Policy which is rather aimed at circumstances that amount to evidence of cybersquatting.

Further, a case of passive holding in bad faith was never going to succeed in circumstances that the disputed domain name comprises a commonly used term, that there is no evidence of illicit conduct by the Respondent, and where it has simply been holding the disputed domain in its portfolio since well before the Complainant even commenced its business.

Accordingly, the Panel finds that the Complainant has failed to make out either registration or use of the disputed domain name in bad faith and the Complaint also fails under this element of the Policy.

D. Reverse Domain Name Hijacking

The Complainant, a publicly listed United States corporation advised by reputed international legal advisors, should have known better than to bring the Complaint in the circumstances. It appears to the Panel that these proceedings were only brought when the Complainant’s management decided a couple of years after obtaining Australian trade mark registrations that it required the disputed domain name for its business launch in Australia and as a result the Complainant set out to harass the Respondent and to procure the disputed domain name, by fair means or foul. In doing so, in circumstances that the Complaint could never succeed, the Complainant has abused the Policy and wasted its own and the Respondent’s resources. This conduct clearly amounts to reverse domain name hijacking and the Panel has no hesitation in finding as such.

7. Decision

For all the foregoing reasons, the Complaint is denied and the Panel makes a finding of reverse domain name hijacking against the Complainant.

Alistair Payne
Presiding Panelist

Debrett G. Lyons
Panelist

The Hon. Neil Brown, Q.C.
Panelist
Date: June 4, 2021

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