CheapStuff.com : Sold for $3.875k in March, the #domain faced a #UDRP ordeal

CheapStuff.com, a 1997 domain registration that was auctioned off at NameJet in March, was hit with a UDRP at the WIPO.

According to NameBio, CheapStuff.com was sold for $3,875 dollars.

The domain was not a drop, but an expiration from the inventory of Network Solutions, a subsidiary of Web.com.

A company called Cheapstuff Inc., filed a UDRP following direct communications with the new registrant. In the UDRP, the Complainant asserted that the Respondent sought $150k in exchange for the domain. The Complainant also stated that their renewal fee was paid on time, and that the domain should have not expired.

Discovery during the UDRP process disputed most of the Complainant’s claims. The Respondent was represented by IP attorney, John Berryhill, who delivered an assertive defense.

End result: the domain’s transfer to the Complainant was denied. They were also found guilty of Reverse Domain Name Hijacking.

The Complaint was in the Panel’s view of the evidence submitted brought with disregard for the truth, and contains false statements and evidence designed to mislead the Panel.

For example, the Complainant says that the Complainant paid all renewal registration fees to the Registrar, including the recent renewal fee, but through some fault of the Registrar the Disputed Domain Name was not renewed. As part of the Complaint, the Complainant provides a purported invoice to show the payment of the renewal fees to the Registrar. The purported invoice is dated after the Respondent acquired the Disputed Domain Name at auction and after the Disputed Domain Name expired.

Full details on the CheapStuff.com decision follow:

Cheapstuff, Inc. v. Admin, Domain / NG9 Communications Pvt. Ltd
Case No. D2020-1354

1. The Parties

The Complainant is Cheapstuff, Inc., United States of America (“United States”), internally represented.

The Respondent is Admin, Domain, India / NG9 Communications Pvt. Ltd, India, represented by John Berryhill, Ph.D., Esq., United States.

2. The Domain Name and Registrar

The Disputed Domain Name <cheapstuff.com> (the “Disputed Domain Name”) is registered with Network Solutions, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on May 28, 2020. On May 29, 2020, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Disputed Domain Name. On May 29, 2020, the Registrar 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 Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), 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 and 4, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on June 2, 2020. In accordance with the Rules, paragraph 5, the due date for Response was June 22, 2020. The Center received an email communication from the Complainant on June 8, 2020. On June 17, 2020, the Respondent contacted the Center requesting an extension to the Response filing period. Pursuant to paragraph 5(b) of the Rules, on June 17, 2020, the Center informed the Parties that the Response due date was extended until June 26, 2020. The Response was filed with the Center on June 25, 2020.

The Center appointed John Swinson as the sole panelist in this matter on June 30, 2020. 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

Most of the relevant facts concerning the Disputed Domain Name are in dispute.

The Complainant is Cheapstuff Inc., a corporation incorporated in California, United States. The Complainant claims to be a corporation formed over 20 years ago, and that its business is Internet sales of discounted merchandise. The Respondent disputes that the Complainant was incorporated 20 years ago (providing evidence that it was registered in 2008), and says that the Complainant’s business was, in the past, chiefly distributing malware disguised as a discount shopping website, and that the Complainant is a cybersquatter. The Complainant appears to be associated with a business called Admedia.

The Respondent is NG9 Communications Pvt. Ltd, a company incorporated in India. The Respondent is a website development and digital marketing consultancy in Hyderabad, India. The Respondent also operates other websites focused on Indian news aggregation and movies

According to the Complaint, the Complainant previously owned the Disputed Domain Name.

The renewal fee for the Disputed Domain Name was apparently due on January 29, 2020.

The Complainant claims to have paid the renewal registration fee for the Disputed Domain Name. The Respondent says that the Complainant’s evidence to show this has been falsified.

On March 8, 2020, the redemption grace period for renewal of the Disputed Domain Name expired.

The Respondent acquired the Disputed Domain Name via auction on March 8, 2020 for USD 3,876. The Disputed Domain Name was formally registered to the Respondent on March 11, 2020.

The Complainant provided an invoice from the Registrar that appears to show that the Disputed Domain Name was renewed on April 22, 2020. The Respondent says that this renewal is four months late, and strongly asserts that the Complainant’s claim to have timely renewed the Disputed Domain Name is dishonest.

On April 22, 2020, the Complainant first emailed the Respondent, claiming that the Disputed Domain Name had been owned by the Complainant since 1997 and asking for it to be transferred to the Complainant. The Respondent says that it is an outright lie, and that the Disputed Domain Name was registered to Richard Carlson until late 2008, and that the Complainant did not exist at this time.

In the April 22, 2020 email to the Respondent, the Complainant asks, “Can you please let me know the cost associated with the reimbursement or fees to get this domain back up and running?” The Complainant alleges that the Respondent responded to this email on May 17, 2020, by making an offer as follows: “$150K is the price.” The Respondent asserts that it did not write this email, and that the email Response was in fact written by the Complainant, and that (for various stated reasons) the exhibit relied upon by the Complainant is “unusual”.

The Complainant also seeks to name the Registrar as a respondent in this dispute.

According to the Complaint, when the Complainant contacted the Registrar to enquire as to what had happened, the Complainant learned in conversations with the Registrar that:

1.The current renewal fee from the Complainant was received and accepted by the Registrar;
2. The Disputed Domain Name was “moved out” of the Complainant’s domain name account and to another account;
3. The Complainant had been locked out of the domain name account and no longer had access;
4. The Registrar could not explain why the Disputed Domain Name had been removed.

However, none if this is supported by documented evidence, and the Complainant does not disclose the date of these conversations with the Registrar or who were the parties to these conversations. The Complaint contains no emails or letters between the Complainant and the Registrar dealing with the issues concerning the renewal (or failed renewal) of the Disputed Domain Name.

The Complainant has not provided any details of any registered trade marks owned by the Complainant.

The Respondent has not yet used the Disputed Domain Name as it has been locked out by the Registrar due to this dispute.

5. Parties’ Contentions

A. Complainant

The Complainant makes the following submissions:
Identical or confusingly similar

The Complainant does not make any submissions specifically under this element of the policy and instead refers to Argument B “Rights or Legitimate Interests”. In the Complaint, the Complainant says that it is a corporation formed over 20 years ago. The Complainant says that it is in the business of Internet sales of discounted merchandise. The Complainant claims to have common law trade mark rights in “CHEAP STUFF”.

Rights or Legitimate Interests

The matter before the Panel involves the improper termination by the Registrar of the Disputed Domain Name. The matter also involves the subsequent wrongful and improper acquisition and re-registration of the Disputed Domain Name by the Respondent.

The Complainant was the owner of the Disputed Domain Name and paid all renewal registration fees to the Registrar, including the most current fee.

The Complainant obtained a WhoIs record and learnt that the Complainant was not the owner of the Disputed Domain Name, and that the Respondent had become the owner. The Complainant contacted the Registrar who was not able to explain why this had occurred.

On April 22, 2020, the Complainant contacted the Respondent to let them know that the Complainant was the rightful owner of the Disputed Domain Name and the Disputed Domain Name had been wrongfully removed from the Complainant’s domain name account.

The Complainant followed up with another email to the Respondent on May 14, 2020.

On May 17, 2020 (three weeks after the Complainant sent the first email to the Respondent), the Complainant received an email from the Respondent which states “150K is the price”.

There was no reason for the Registrar to lock the Complainant out of the Disputed Domain Name and therefore it should be transferred back to the Complainant. The Registrar accepted the renewal fees from the Complainant and therefore should have ensured that the Complainant’s rights were protected.

The Respondent did not acquire the Disputed Domain Name for the purpose of using it to conduct a legitimate business, and in fact it has conducted no business using the Disputed Domain Name since registration.

The Disputed Domain Name was acquired for the sole purpose of selling it back to the Complainant or another third party. Since the Complainant has a trade mark in the Disputed Domain Name, there is no way the Respondent is able to use it.
Registered and Used in Bad Faith

The Complainant does not make any submissions specifically under this element of the Policy and instead refers to Argument B “Rights or Legitimate Interests”. In the Complaint, the Complainant states that bad faith registration includes circumstances where a domain name was acquired primarily for the purpose of selling it to the Complainant. The actions of the Respondent constitute bad faith.

B. Respondent

Generally, the Respondent asserts that many of the statements made by the Complainant are willfully false and that exhibits in the Complaint are falsified. The Respondent states, for example:

“… the Respondent is quite frankly and rightfully incensed at the blatant and outstanding disregard for truth embodied in the Complaint…” and “… the Complainant has shown a stunning disregard for the truth.”

The Respondent makes the following submissions:
Identical or confusingly similar

The Complaint does not specifically address the first element of the Policy.
The Complainant has no registered trade mark rights.

The Complainant provides nothing to substantiate an exclusive right in the widely-used generic phrase “cheap stuff” or in the Disputed Domain Name. The evidence of use of “cheap stuff” provided by the Complainant is an undated screenshot of a webpage. This webpage is about 10 years old. This can be seen from the screenshot which purports to advertise discounted merchandise from “Buy.com”. Buy.com was bought and rebranded by Rakuten.com in 2010, and so the webpage must be prior to this date. The webpage consists of obsolete information (advertising old electronic products, such as a television from 2009) and non-functional telephone numbers. The Complainant’s screenshot does not demonstrate any ongoing business.

The Complainant of United States was formed in September 2008, and has since been suspended for non-payment of taxes. Under applicable local law, the suspension leaves the Complainant bereft of any “powers rights or privileges, which include the right to use the entity’s name”.

The Complainant is or was known for distributing malware. There are numerous guides for removing the Complainant’s spyware, which was described as detecting Google and Yahoo searches and redirecting them to the Complainant’s site. The Complainant is also a cybersquatter and, the Complainant’s principal has been involved in various other domain name disputes. The Respondent refers to Oracle International Corporation v. Danny B / Admedia,NAF Case No. FA1605001674542, as a case with similar features to this dispute. The Response states:

“The cybersquatting decision against the Complainant’s apparent principal strikes a curiously familiar chord with the Complainant making false claims to run a shopping portal, while actually distributing malware. The description of Complainant’s principal’s defense rejected by the panel in that adverse 2016 decision reads remarkably like the Complainant’s description of its business here, and is just as factually false.”

The Complainant’s principal, and the Complainant appear to be associated with Ad.com Interactive Media, which owns the <admedia.com> domain name and with which Complainant’s principal is associated in his LinkedIn profile.

The Complainant has not made out common law trade mark rights or any rights in the name “cheap stuff”. Instead, the Complainant does not manage to prove its current existence or status as a corporation capable of owning or asserting any legal rights whatsoever, let alone the existence of common law trade mark rights in the generic phrase embodied in the Disputed Domain Name “cheapstuff.com”.

Rights or Legitimate Interests

The Disputed Domain Name was sold at auction on March 8, 2020, for USD 3,875 and the Respondent was the winning bidder.

The Respondent, unlike the Complainant, has a demonstrable record of providing development and marketing services for others and for its own account. “cheap stuff” is a common and popular, non‑distinctive generic phrase that the Respondent believes would be readily capable of use by the Respondent on behalf of any of its clients, for the Respondent’s own benefit.

The Complainant has no registered mark or public reputation for anything other than fraud. The Complainant has not provided any basis on which to conclude that the Respondent, a web developer, acquired the Disputed Domain Name for any other purpose than the value of the generic phrase it embodies.

The Respondent registered the Disputed Domain Name for its descriptive meaning. The Respondent was not aware of any rights or reputation of the Complainant.

Registered and Used in Bad Faith

The Complainant claims to have existed for 20 years and to have held the Disputed Domain Name since 1997. However, the Complainant did not exist 20 years ago. Over the past 20 years the Disputed Domain Name has been owned by various people. The WhoIs chronology also shows at no time was the Disputed Domain Name registered to the Complainant.

The Complainant shows what it claims as an “invoice” which the Complainant claims to have paid on April 22, 2020. This is four months after the domain name expired on January 29, 2020. The Complainant knows full well that on April 22, 2020, it was far too late to renew the Disputed Domain Name which expired in January.

The Complainant claims to have sent correspondence to the Respondent on May 14, 2020. This email was sent to the wrong email address and could not have been received by the Respondent.

The Respondent submits that not only has the Complainant failed to show the Disputed Domain Name to have been registered and used in bad faith, but the Complainant has shown a stunning disregard for the truth.

The Complainant could not have renewed the Disputed Domain Name in April 2020, and the Complainant’s claims about its history and that of the Disputed Domain Name are pure fabrications.

Reverse Domain Name Hijacking

The Respondent asks the Panel to consider whether the Complaint certification could possibly have been made in good faith upon due diligence, and to consider, in the Panel’s discretion, the application of paragraph 15(e) of the Policy.

6. Discussion and Findings

To succeed, the Complainant must demonstrate that all of the elements enumerated in paragraph 4(a) of the Policy have been satisfied, namely:

(i) the Disputed Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights; and

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

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

The onus of proving these elements is on the Complainant.

6.1. Procedural Issues

A. Complainant’s Capacity to Bring Proceedings

According to the Respondent, Complainant was formed in September 2008, and has since been suspended for non-payment of taxes, and under applicable local law, the suspension leaves the Complainant bereft of any “powers rights or privileges, which include the right to use the entity’s name”.

The Panel discusses this issue under the first element below.

B. Improper Joinder

The Respondent claims that the Registrar should not be listed as a co-respondent and that the Policy is not the appropriate venue to pursue a claim against the Registrar.

The Panel has determined that the correct respondent is the current registrant of the Disputed Domain Name, being NG9 Communications Pvt. Ltd, India. This is the company confirmed by the Registrar as the registrant of the Disputed Domain Name.

The Panel agrees with the Respondent. The Registrar is not a proper party to these proceedings. Whether the Complainant has a commercial dispute with the Registrar is not relevant to whom is the proper subject of a UDRP proceeding. The Complainant is free to make that claim against the Registrar in the appropriate forum.

C. Supplemental Filings

The Complainant made a number of untimely email submissions to the Center. On June 8, 2020, the Complainant submitted that the Disputed Domain Name was acquired by the Respondent for USD 3,875 and thereafter they offered it back to the Complainant for USD 150,000. On June 30, 2020, the Complainant submitted the United States Supreme Court’s recent decision concerning the Booking.com case to the Panel. The Respondent then submitted a provisional reply to the Complainant’s Supplemental Submissions.

Paragraph 10 of the Rules vests the Panel with the authority to determine the admissibility, relevance, materiality and weight of the evidence, and also to conduct the proceedings with due expedition. Paragraph 12 of the Rules provides that the Panel may request, in its sole discretion, further statements or documents from either of the Parties. There is no provision in the Rules for a party to file additional unsolicited submissions. Unsolicited supplemental filings are generally discouraged.

A party submitting an unsolicited supplemental filing should show some exceptional circumstances as to why it was unable to provide the information contained therein in its complaint or response (see section 4.6 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”).

The Panel has reviewed the supplemental filings from both Parties and has decided to admit them in this instance. Having said this, the supplemental filings were mostly irrelevant and carried little weight.

6.2. Substantial Issues

B. Identical or Confusingly Similar

Paragraph 4(a)(i) of the Policy provides that the Complainant must establish that the Disputed Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights.

The Complainant is only relying on the common law trade mark rights in CHEAP STUFF.

To establish unregistered or common law trade mark rights for purposes of the UDRP, the Complainant must show that its mark has become a distinctive identifier which consumers associate with the Complainant’s goods and/or services (see RoofPro, LLC v. Privacydotlink Customer 774656 / Blue Nova Inc., WIPO Case No. D2018-0883 and section 1.3 of WIPO Overview 3.0).

Relevant evidence demonstrating such acquired distinctiveness includes a range of factors such as the duration and nature of use of the mark; the amount of sales under the mark; the nature and extent of advertising using the mark; and the degree of actual public recognition.

In this instance, the Complainant has not provided any evidence to support any of these factors. For example, the Complainant has not provided any sales figures, marketing material, figures relating to number of customers or any evidence (for example, media reports or articles) to show how they are known as a brand.

The Complainant makes a broad assertion that their company name is Cheap Stuff Inc. and that they have been in operation for over 20 years. The Complainant does not provide any evidence of this. There is no evidence provided of the date of first use, no evidence of current use, and no evidence of consistent use.

The Respondent on the other hand provided credible evidence that the Complainant has not been in operation for 20 years.

The only evidence of use provided is a one-page screenshot of a website that appears to be over 10 years old. This website provides little support for the Complainant. Towards the top of the website, the website uses the alleged trade mark in a descriptive non-trade mark sense on the website: “Cheap Stuff of the Day”. There is notably no use of the trade mark symbol on this website.

The Panel has not detected any clear indication from the Complainant itself that it presents the name “CHEAP STUFF” or “cheapstuff.com” as a trade mark.

There is also no clear evidence that this website was operated by the Complainant.

It also appears that the Complainant’s corporate status has been suspended for non-payment of taxes. The Panel has carefully reviewed printouts from the California Secretary of State website. Under California law, the suspension apparently leaves the Complainant bereft of any “powers rights or privileges, which include the right to use the entity’s name”. The Panel is not a Californian lawyer, however based on the materials reviewed, this appears to corroborate that the Complainant has no current common law rights in “CHEAP STUFF” if it indeed has any. It also strongly suggests that the Complainant may lack legal capacity to bring these proceedings, but the Panel does not need to decide the issue of capacity to reach the decision below.

The Complainant used the Disputed Domain Name to sell or market cheap goods. The Disputed Domain Name consists of two common, correctly spelled English words. The Complainant’s “CHEAP STUFF” mark is neither arbitrary nor particularly distinctive.

The Complainant has failed to demonstrate that it has trade mark rights in the term “CHEAP STUFF” and has therefore not established the first element of the Policy.

C. Rights or Legitimate Interests

Paragraph 4(a)(ii) of the Policy provides that the Complainant must establish that the Respondent has no rights or legitimate interests in respect of the Disputed Domain Name. To do so the Complainant must at least first make out a prima facie case showing that the Respondent lacks rights or legitimate interests.

The Respondent has presented evidence that it has purchased the Disputed Domain Name from auction as a bona fide purchaser. There is no evidence that the Respondent acquired the Disputed Domain Name because of the Complainant. The Complainant’s reputation in the Disputed Domain Name according to the evidence presented seems to be virtually non-existent. Any reputation that the Complainant had in the Disputed Domain Name seems rather to be as the distributor of malware – and a registrant ordinarily would not acquire such related domain name to take advantage of this reputation.

In light of the Complainant’s feeble evidence of use and reputation, unless there is persuasive evidence that the Disputed Domain Name was selected opportunistically by the Respondent to create confusion and exploit the Complainant’s mark – such as it is, the Panel would conclude that the Respondent has a legitimate interest in using the Disputed Domain Name, as it is of descriptive English words, for advertising or other commercial purposes. Thus, the determination of legitimacy in this case is intertwined with the question of bad faith, which is better addressed below in connection with the third element of the Policy. See for example, Tax Analysts v. eCorp, WIPO Case No. D2007-0040.

D. Registered and Used in Bad Faith

Paragraph 4(a)(iii) of the Policy provides that the Complainant must establish that the Respondent registered and used the Disputed Domain Name in bad faith.

Even assuming the Complainant proved ownership of common law trade mark rights in “CHEAP STUFF”, the Panel notes that there is insufficient evidence submitted by the Complainant to demonstrate bad faith registration and use on the part of the Respondent. There are also serious factual inconsistencies in the Complainant’s submissions.

To demonstrate registration and use in bad faith, the Complainant points to:

– the Respondent’s passive holding of the Disputed Domain Name; and

– the Respondent’s request for USD 150,000 for the Disputed Domain Name.

Passive holding of the Disputed Domain Name for a very short period of time does not in the circumstances of this case demonstrate bad faith registration or use.

If the Respondent did request USD 150,000 from the Complainant, it was in response to a request for an offer from the Complainant. Such a response to a request for an offer does not, in this case, demonstrate bad faith. However, after careful review of the emails provided by the Complainant, the Panel does not find the Complainant’s account credible and concludes that no such offer was made by the Respondent.

The evidence before the Panel does not in any way suggest that the Respondent acquired the Disputed Domain Name primarily for the purposes targeting the Complainant and subsequently selling it.

Therefore, even if the Complainant did establish common law rights in the trade mark, it has failed to establish that the Disputed Domain Name was registered and used in bad faith.

7. Reverse Domain Name Hijacking

Paragraph 15(e) of the Policy states:

“… If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.”

The Panel declares that the Complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.

The Complaint was in the Panel’s view of the evidence submitted brought with disregard for the truth, and contains false statements and evidence designed to mislead the Panel.

For example, the Complainant says that the Complainant paid all renewal registration fees to the Registrar, including the recent renewal fee, but through some fault of the Registrar the Disputed Domain Name was not renewed. As part of the Complaint, the Complainant provides a purported invoice to show the payment of the renewal fees to the Registrar. The purported invoice is dated after the Respondent acquired the Disputed Domain Name at auction and after the Disputed Domain Name expired.

The Panel’s jurisdiction ends with this Decision, but the Respondent may have reason to report Complainant’s representative who certified the Complaint to the appropriate (e.g., bar association or otherwise) authorities.

8. Decision

For the foregoing reasons, the Complaint is denied.

John Swinson
Sole Panelist
Date: July 14, 2020

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