The domain name Beds.com became the subject of a UDRP filed by Sleep Number Corporation. The company asserted that the domain was used by them from 2000 to 2018 but then someone allegedly stole it.
After it became obvious that the Respondent didn’t steal the domain but rather won it via a Sedo auction which we covered at the time, the Complainant tried to accuse the Respondent that they knowingly bid on and won a stolen asset.
Attorney John Berryhill represented the Respondent, noting:
“Respondent purchased the disputed domain name for value from Sedo.com, an ICANN accredited registrar and domain marketplace. Complainant’s accusation that Respondent misappropriated the disputed domain name is false and unsupported by evidence. Complainant also provides no explanation for why it took no action for over a year and a half after the claimed cyberattack.”
The three member panel at the WIPO took all the evidence into consideration and delivered a decision favoring the Respondent and ordered the domain Beds.com to remain with them.
In addition, the panel found the Complainant guilty of engaging in Reverse Domain Name Hijacking:
This Panel makes a finding of RDNH against Complainant. Not only did Complainant fail to establish any of the three elements, it is clear that Complainant made a speculative case at best by first alleging theft of the disputed domain name by Respondent without supporting evidence pointing to the role of Respondent in the alleged theft, and then after seeing Respondent’s response, essentially changing its arguments to say while Respondent might not have stolen the disputed domain name, Respondent should have known about the theft because of the low price, etc. The fact that Complainant only cited court cases but not UDRP cases to support its “willful blindness” theory is telling – UDRP proceedings are clearly not the appropriate forum.
Sleep Number Corporation v. Omri Shalom / Silver Scope Media
Claim Number: FA2309002062168
PARTIES
Complainant is Sleep Number Corporation (“Complainant”), represented by Ben L. Wagner of Troutman Pepper Hamilton Sanders LLP, California, USA. Respondent is Omri Shalom / Silver Scope Media (“Respondent”), represented by John Berryhill, Pennsylvania, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is beds.com, registered with NameCheap, Inc.
PANEL
The undersigned certifies that they have acted independently and impartially and to the best of their knowledge have no known conflict in serving as Panelist in this proceeding.
Eugene I. Low, Jeffrey J. Neuman and Douglas M. Isenberg as Panelists.
PROCEDURAL HISTORY
Complainant submitted a Complaint to Forum electronically on September 18, 2023; Forum received payment on September 18, 2023.
On September 19, 2023, NameCheap, Inc. confirmed by e-mail to Forum that the beds.com domain name is registered with NameCheap, Inc. and that Respondent is the current registrant of the name. NameCheap, Inc. has verified that Respondent is bound by the NameCheap, Inc. registration agreement and has thereby agreed to resolve domain disputes brought by third parties in accordance with ICANN’s Uniform Domain Name Dispute Resolution Policy (the “Policy”).
On September 20, 2023, Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of October 16, 2023 (as extended pursuant to Respondent’s request made under Forum’s Supplemental Rule 6(a)(i)) by which Respondent could file a Response to the Complaint, via e-mail to all entities and persons listed on Respondent’s registration as technical, administrative, and billing contacts, and to postmaster@beds.com. Also on September 20, 2023, the Written Notice of the Complaint, notifying Respondent of the e-mail addresses served and the deadline for a Response, was transmitted to Respondent via post and fax, to all entities and persons listed on Respondent’s registration as technical, administrative and billing contacts.
A timely Response was received and determined to be complete on October 12, 2023.
On October 19, 2023, pursuant to Respondent’s request to have the dispute decided by a three-member Panel, Forum appointed Eugene I. Low, Jeffrey J. Neuman and Douglas M. Isenberg as Panelists.
Having reviewed the communications records, the Administrative Panel (the “Panel”) finds that Forum has discharged its responsibility under Paragraph 2(a) of the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”) “to employ reasonably available means calculated to achieve actual notice to Respondent” through submission of Electronic and Written Notices, as defined in Rule 1 and Rule 2.
RELIEF SOUGHT
Complainant requests that the domain name be transferred from Respondent to Complainant.
PRELIMINARY ISSUE: UNSOLICITED SUBMISSIONS
Complainant filed an unsolicited “Supplemental Rule 7 Reply” on October 20, 2023.
Forum’s Supplemental Rule 7 provides that it is within the discretion of the Panel to accept or consider unsolicited additional submissions.
The Panel considered that Complainant’s unsolicited additional submissions do not materially impact on the substance of the case and Respondent is not prejudiced by the lack of an opportunity to respond. In the interest of conducting these proceedings in an efficient manner, the Panel decided to take into account Complainant’s additional submissions.
PARTIES’ CONTENTIONS
The Panel has considered both parties’ arguments and evidence. The parties’ respective cases are summarized as follows.
A. Complainant
Complainant is a famous smart bed and wellness technology company. Since 2000, and up until 2018, Complainant has owned and consistently used the BEDS.COM mark and the beds.com domain name as a major consumer-facing landing page for promoting the SLEEP NUMBER brand of mattresses (and its predecessor SLEEP COMFORT) with estimated millions of customer visits. In 2018, Complainant converted the beds.com domain name into an auto-redirect to the main SleepNumber.com page. Complainant’s operation of the beds.com domain name in the past two decades resulted in consumers visiting the domain name and associating it with SLEEP NUMBER, which is a registered famous mark owed by Complainant. Complainant’s use of the BEDS.COM mark and the beds.com domain name for such an extended period and their inseparable link with the SLEEP NUMBER mark give Complainant common law rights in the BEDS.COM mark. Respondent’s beds.com domain name is identical to Complainant’s BEDS.COM mark.
Respondent has no rights or legitimate interests in the beds.com domain name. Respondent is not licensed or permitted to use Complainant’s BEDS.COM mark and is not commonly known by the disputed domain name. Additionally, Respondent has not engaged in a bona fide offering of goods or services or legitimate noncommercial or fair use of BEDS.COM. Rather, Respondent generated click-through ad revenues through the disputed domain name and misdirected consumers looking for SLEEP NUMBER’s products to sites unaffiliated with SLEEP NUMBER. Respondent also attempted to sell the disputed domain name for sale through auctions.
Respondent registered and uses the beds.com domain name in bad faith. Respondent acquired the disputed domain name by stealing it from Complainant’s servers in a cyberattack with the intent to generate ad revenue and gain profits by selling it. Respondent placed the disputed domain name for sale at first for US$3,500,000 then later US$2,500,00. Respondent also used privacy protect services while providing false contact information to DOMAINS BY PROXY. Further, Respondent transferred servers to Iceland and the UK. Respondent’s actions constituted cybersquatting under 15 U.S.C. § 1125(d)(1)(A).
In its unsolicited additional submissions, Complainant argued that Respondent’s evidence demonstrates that although Respondent did not steal the disputed domain name from Complainant, he bought it from the person who did and under circumstances that suggested Respondent either knew or was willfully blind to the theft. Such evidence includes: (1) the purchase of the domain at a suspiciously low price; (2) evidence that Respondent was himself suspicious of the circumstances and believed the domain may be stolen; (3) Respondent’s knowledge that the long-standing owner of the domain is Complainant; and (4) Respondent’s
choice to not engage in any meaningful inquiry or diligence despite the foregoing knowledge.
B. Respondent
Complainant has no common law rights in the BEDS.COM mark. Complainant’s application to register the BEDS.COM mark filed in 2000 was refused and abandoned by Complainant. Further, Complainant fails to present sufficient evidence to establish acquired distinctiveness in the highly descriptive mark. Complainant merely claims that it has used the disputed domain name for a number of years principally as a re-direct domain to its main website. Complainant fails to present evidence of advertisements, press mentions, third party reviews or sales figures of goods or services denominated “BEDS.COM”. In any event, Complainant made no use of BEDS.COM as a mark from 2014 – 2018 and no independent use for five years prior to this Proceeding since 2018, which constitutes prima facie evidence of abandonment of a mark under US law.
Respondent has legitimate interests in the beds.com domain name. Respondent is the principal officer of Silver Scope Media Ltd., which is a legitimate web design and search marketing company. Respondent purchased the disputed domain name for value from Sedo.com, an ICANN accredited registrar and domain marketplace. Complainant’s accusation that Respondent misappropriated the disputed domain name is false and unsupported by evidence. Complainant also provides no explanation for why it took no action for over a year and a half after the claimed cyberattack.
Respondent did not register or use the beds.com domain name in bad faith. Respondent, a legitimate web developer and marketing expert, was a bona fide purchaser of the disputed domain name from an ICANN accredited dealer in domain names.
FINDINGS
Complainant has failed to establish all three elements. As such the disputed domain name shall remain with Respondent. The Panel finds that Complainant has engaged in Reverse Domain Name Hijacking.
DISCUSSION
Paragraph 15(a) of the Rules instructs this Panel to “decide a complaint on the basis of the statements and documents submitted and 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 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 Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
(2) 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.
Identical and/or Confusingly Similar
It is common ground that Complainant does not have any trademark registration for the BEDS.COM mark. As discussed below, this Panel also finds that Complainant’s evidence is insufficient to support that it has acquired common law rights in the BEDS.COM mark.
In order for Complainant to establish common law rights in the mark, it must provide sufficient evidence that the mark has become a distinctive identifier which consumers associate with Complainant’s goods and/or services. The Panel notes that the disputed domain name comprises solely of a descriptive term which is not inherently distinctive. In such case, there is a greater onus on Complainant to present evidence of the acquired distinctiveness or secondary meaning. According to section 1.3 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition, relevant evidence demonstrating such acquired distinctiveness or secondary meaning includes for example (i) the duration and nature of use of the mark, (ii) the amount of sales under the mark, (iii) the nature and extent of advertising using the mark, (iv) the degree of actual public (e.g., consumer, industry, media) recognition, and (v) consumer surveys.
Evidence submitted by Complainant shows that it used the beds.com domain name to promote SLEEP NUMBER products in the early years. From 2018-2021, evidence shows that the beds.com domain name was redirected to Complainant’s website www.sleepnumber.com, and nothing in the evidence suggests that the BEDS.COM mark appears on the website www.sleepnumber.com.
Based on the website archived screenshots among the evidence submitted by both Complainant and Respondent, a BEDS.COM mark/logo appeared on the website until 2014, but other than the reference to this BEDS.COM mark/logo on the archived website screenshots, there is no other evidence to show how Complainant used the BEDS.COM mark over the years, still less evidence showing that this mark has acquired a secondary meaning among the relevant public.
In other words, there is scant evidence of use of the BEDS.COM mark produced by Complainant. The Panel is not satisfied that such scant evidence of use is sufficient to establish the requisite common law rights in the BEDS.COM mark under this element.
Accordingly, Complainant has failed to establish the first element.
Rights or Legitimate Interests
Given the Panel’s decision under the first element, it is not necessary for the Panel to embark on a detailed analysis of the second and third elements. However, for the sake of completeness and to address some of Complainant’s arguments, the Panel will also briefly address the other two elements.
The Panel also finds in favor of Respondent under the second element.
Complainant contended that Respondent (or its agent) either stole the disputed domain name from Complainant by cyberattack or bought it from the person who did it. In the latter case, Complainant alleged that Respondent either knew or was willfully blind to the theft. However, there is no evidence in support of such allegations. Despite making allegations in its original Complaint that the Respondent (or its agent) “stole” the disputed domain name from the Complainant and was the same person who “stole” other domain names from the Complainant, there was no evidence that points to Respondent (or its agent) being the person who made unauthorized online access to Complainant’s server and stole the beds.com domain name. The evidence submitted in relation to the theft of the domain name COMFORT.COM is irrelevant as it concerns a different domain name and in any event, Respondent is not named as a defendant in that case. Conversely, Respondent has provided evidence of his negotiations history and purchase of the beds.com domain name from Sedo.com, an ICANN accredited registrar and domain marketplace. Respondent provided evidence showing that Sedo.com publicly advertised that the beds.com domain name would be sold at an auction. In its unsolicited additional submissions, Complainant contended that Respondent bought the beds.com domain name knowing or being willfully blind to the fact that it was stolen from Complainant. The Panel is not persuaded by such submissions. Respondent’s evidence on the negotiations history, combined with the fact that the disputed domain name is inherently descriptive, suggest that the purchase was conducted at arms-length and the Panel finds no reason to find otherwise.
The Panel is of the view that Complainant has failed to establish a prima facie case that Respondent has no rights or legitimate interests under the second element.
Registration and Use in Bad Faith
Given the Panel’s findings in the second element, that Respondent has provided credible evidence showing that it is a bona fide purchaser of the beds.com domain name and in the absence of any evidence to the contrary, the Panel is satisfied that Complainant has failed to establish that the disputed domain name has been registered and is being used in bad faith. The Panel also disagrees with Complainant’s argument that the Respondent should have known about the Complainant’s use of the disputed domain name and therefore registered the domain name in bad faith. This is not a case in which the Respondent should be held to such a “willful blindness” standard. “Willful blindness” is generally only found in UDRP cases where marks are so distinctive that the use of the mark can only be associated with the Complainant. Here, the disputed domain name does not contain such a distinctive mark (both in terms of inherent distinctiveness and acquired distinctiveness), and therefore, based on the current evidence the Panel finds that the Respondent did not register the disputed domain name in bad faith. See Intocable, Ltd. v. Paytake LLC, D2016-1048 (WIPO July 29, 2016)( The facts that Respondent did not conduct a search to discover Complainant’s rights, “is not determinative, since even if Respondent had performed such due diligence, the word “intocable” is not merely an acronym or fanciful term that could refer reasonably only to Complainant and its musical group; it is also a common Spanish language word.)
Reverse Domain Name Hijacking
While Respondent has not explicitly requested the Panel to make a finding of Reverse Domain Name Hijacking (“RDNH”), this Panel is entitled to consider whether the Complaint was brought in bad faith within the meaning of Paragraph 15(e) of the Rules, thereby constituting RDNH. RDNH is defined under the Rules to mean using UDRP in bad faith to attempt to deprive a registered domain name holder of the disputed domain name. The mere lack of success of a complaint does not necessarily constitute RDNH, but the panel may make a finding of RDNH if the complainant knew it could not reasonably succeed as to any of the three elements.
This Panel makes a finding of RDNH against Complainant. Not only did Complainant fail to establish any of the three elements, it is clear that Complainant made a speculative case at best by first alleging theft of the disputed domain name by Respondent without supporting evidence pointing to the role of Respondent in the alleged theft, and then after seeing Respondent’s response, essentially changing its arguments to say while Respondent might not have stolen the disputed domain name, Respondent should have known about the theft because of the low price, etc. The fact that Complainant only cited court cases but not UDRP cases to support its “willful blindness” theory is telling – UDRP proceedings are clearly not the appropriate forum.
DECISION
Having not established all three elements required under the ICANN Policy, the Panel concludes that relief shall be DENIED.
Accordingly, it is Ordered that the beds.com domain name REMAINS WITH Respondent.
Jeffrey J. Neuman, Panelist
Dated: November 2, 2023
Douglas M. Isenberg, Panelist
Dated: November 2, 2023
Eugene I. Low, Panelist and Chair
Dated: November 2, 2023
