Peppercorn Gourmet Goods & Cooking School, Inc. registered the domain name Peppercorn.com in 1998 and used it directly to promote its business. As of 2009, the domain was transferred to a marketing company as part of a business agreement, to handle such services “more efficiently.”
In 2024, that agreement that spanned 15 years was terminated by Peppercorn Gourmet Goods & Cooking School, Inc. – the domain was not returned and the company filed a UDRP.
Tyson Brawley / Goozmo Inc. was the Respondent in this UDRP. The Complainant claimed that to speed up the domain’s return they offered $5,000 dollars; meanwhile, the Respondent allegedly demanded $25,000 dollars in exchange for Peppercorn.com.
The Respondent rejected the Complainant’s claims, stating that they have been the lawful owner of the Domain Name since 2008 but not providing specific information on how that took place:
Respondent rejects Complainant’s claimed explanation for the reason behind transfer of the Domain Name in 2008, because there was no need to transfer the domain name to facilitate easier access for domain name development.
Respondent asserts it has been in the business of leasing domain names since 2002. This practice establishes Respondent’s legitimate interest in the domain names it leases. Respondent contends that when a leased domain name is no longer in use – whether due to closing of services, non-payment, or other reasons – Respondent as the legal owner of such domain name is entitled to decide how to handle the domain name thereafter.
The Panelist disagreed:
However, Respondent offers no explanation or evidence refuting Complainant’s claim that this transfer was understood by Complainant to be necessary for this very purpose. There is no question Respondent knew Complainant and of its rights in the PEPPERCORN mark at the time Respondent became the registrant on record of the Domain Name – Respondent was Complainant’s web agency. A prior panel has held that where an agent knowingly and unnecessarily registers a domain name in its’ own name – against the interest its principle – such conduct can be an indication of bad faith.
Final decision: Order the transfer of the domain name Peppercorn.com to the Complainant.
Peppercorn Gourmet Goods & Cooking School, Inc. v. Tyson Brawley / Goozmo Inc
Claim Number: FA2408002110221
PARTIES
Complainant is Peppercorn Gourmet Goods & Cooking School, Inc. (“Complainant”), represented by Miriam D. Trudell of Sheridan Ross P.C., Colorado, USA. Respondent is Tyson Brawley / Goozmo Inc (“Respondent”), Colorado, USA.
REGISTRAR AND DISPUTED DOMAIN NAME
The domain name at issue is peppercorn.com, registered with GoDaddy.com, LLC (“Domain Name”).
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.
Claire R. Kowarsky as Panelist.
PROCEDURAL HISTORY
Complainant submitted a Complaint to Forum electronically on August 7, 2024; Forum received payment on August 7, 2024.
On August 7, 2024, GoDaddy.com, LLC confirmed by e-mail to Forum that the peppercorn.com domain name is registered with GoDaddy.com, LLC and that Respondent is the current registrant of the name. GoDaddy.com, LLC has verified that Respondent is bound by the GoDaddy.com, LLC 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” or “UDRP”).
On August 8, 2024, Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of August 28, 2024 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@peppercorn.com. Also on August 8, 2024, 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.
On August 27, 2024, a timely Response was received and determined to be complete.
On August 28, 2024, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, Forum appointed Claire R. Kowarsky as Panelist.
On August 29, 2024, Complainant filed unsolicited Additional Submissions.
On August 29, 2024, Respondent filed unsolicited Additional Submissions.
The Panel has decided the case based on the initial Complaint and Response, and based in part on the unsolicited Additional Submissions, as discussed below.
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 ADDITIONAL SUBMISSIONS BY COMPLAINANT AND RESPONDENT
The Panel partially accepts and partially disregards Complainant’s and Respondent’s unsolicited Additional Submissions.
Paragraph 10 of the Rules the panel to conduct the proceedings “with due expedition”. Given the imperative to conduct UDRP proceedings expeditiously, unsolicited supplemental filings are generally discouraged except in “exceptional” circumstances and where the submitting party shows why it was unable to provide such information in the original complaint or response. See WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition, (“WIPO Overview 3.0”) Section 4.6 and Welcomemat Services, Inc. v. Michael Plummer Jr., MLP Enterprises Inc. WIPO Case No. D2017-0481 (“UDRP panels are typically reluctant to countenance delay through additional rounds of pleading and normally accept supplemental filings only to consider material new evidence or provide a fair opportunity to respond to arguments that could not reasonably have been anticipated.”).
Complainant’s Additional Submissions
In broad terms, Complainant’s Additional Submissions address four main topics to: (i) rebut Respondent’s claim that Complainant’s trademark is generic and therefore Complainant lacks standing under the UDRP; (ii) rebut Respondent’s claim that it has legitimate rights in the domain name and was “leasing” the domain name to Complainant; (iii) rebut Respondent’s claim that Complainant had acted in bad faith and is using the UDRP process as an intimidation tactic; and iv) argue that the current case is well-suited to the UDRP process. Regarding topic (i), Respondent’s argument regarding the nature of Complainant’s trademark was foreseeable, and Complainant’s additional submission on this point is not grounded on evidence unavailable to Complainant when the Complaint was filed. Hence, the Panel finds it unnecessary and inappropriate to consider topic (i) in Complainant’s Additional Submissions. Similarly, regarding topic (iv), the Panel will not consider Complainant’s arguments about the suitability of the UDRP for the instant matter, because they do not rest on evidence not available to Complainant at the time of filing the Complaint. However, regarding topics (ii) and (iii) the Panel concedes that Complainant could not have reasonably foreseen Respondent’s arguments asserting a “lease” arrangement nor the allegations of bad faith on the part of Complainant. As such, Panel is prepared to take into consideration Complainant’s Additional Submissions on topics (ii) and (iii).
Respondent’s Additional Submissions
In broad terms, Respondent’s Additional Submissions comprise four topics (i) further arguments regarding the Complainant’s lack of rights in the dictionary term “peppercorn”; (ii) an explanation that Respondent has been in the business of leasing domain names since 2002 and as such has rights or legitimate interests in the Domain Name in accordance with its business practices; (iii) assertions that Complainant acted in bad faith when it tried to “hijack” the domain name by contacting the registrar in an attempt to gain unauthorized control thereof, following termination of the service agreement between the Parties; (iv) a reiteration of claims that Complainant is abusing the UDRP process. Regarding topic (i), Respondent’s additional submissions regarding the nature of the trademark shall be treated consistently with those of Complainant, that is, they shall be disregarded, as no “exceptional” circumstances justifies their inclusion in these proceedings. In the same vein regarding topic (iv), Respondent’s arguments on this point do not rest on new evidence not available to Respondent at the time it filed its Response, and, because no other “exceptional” reason weighs in favor of their inclusion, shall be disregarded. On the other hand, regarding topics (ii) and (iii), Paragraph 10(b) of the Rules enjoins a panel to “ensure that the Parties are treated with equality and that each Party is given a fair opportunity to present its case.” Here, the Panel partially accepted Complainant’s Additional Submissions, and in the interest of providing a fair opportunity to both parties, the portion of Respondent’s Additional Submissions addressing topics (ii) and (iii) is accepted by the Panel and given due consideration.
PRELIMINARY ISSUE: BUSINESS/CONTRACTUAL DISPUTE BEYOND THE SCOPE OF THE UDRP
The Panel finds it appropriate to issue a decision in this proceeding because the dispute that is the basis of the Complaint is not a business and/or contractual dispute between parties that falls outside the scope of the UDRP. Whether or not a matter concerning parties known to each other is suitable for resolution under the UDRP requires close examination of the evidence and circumstances of the case.
The purpose of the UDRP is to resolve cases of abusive registrations involving cybersquatting. See e.g. Jason Crouch and Virginia McNeill v. Clement Stein, WIPO Case No. 2005-1201 (“The Policy was adopted to deal as is with the problem of cybersquatting, the registration of domain names consisting of, including, or confusingly similar to marks belonging to another for the purpose of profiting from the goodwill associated with said marks.”). However, the Policy clearly does not exclude cases where the parties are known to each other. See e.g. Bootie Brewing Company v. Deanna D. Ward and Grabebootie Inc. WIPO Case No. D2003-0185 (“Just as cybersquatting can occur between strangers, so can it occur between business partners.”).
It is clear that not all cases concerning complex fact patterns or prior business relations between the parties are outside the scope of the Policy1. See e.g. Alaska Health Fair, Inc. v. Chris Jacobson FA 1500868 (Forum June 24, 2013) ([referring to cases dismissed for being outside of Policy scope] “This resolution is most frequently used in cases where there are genuine issues of material fact which UDRP panels, because of the constraints of the Policy itself, are not equipped to resolve. In this case, however, while significant factual issues are indeed present, the Panel believes it can still resolve the matter of the Domain Name registration within the framework of the Policy and elects to do so, even though the parties will need to resolve their other issues elsewhere.”). See e.g Bob Anderson v. DAVE BANCROFT / BRANSON MEDIA FA 1638376 (Forum Nov. 3, 2015) ([in which the dispute was found to be within Policy scope] “It is clear for the panel that the bottom line of the case at hand relates with the fact that there used to be a business and personal relationship between Complainant and Respondent pursuant to which one of the parties entrusted to the other the registration of the domain name bobanderson.com and the handling of the website, and the other followed the instructions although reserving certain rights for himself, which are the rights that arise from the ownership of the domain name that is now the basis of the dispute that began after the relationship ended.”)
In this proceeding, the Parties’ claims demonstrate misalignment in the expectations of the business relationship, which had endured some 15+ years. However, like in the Alaska Health Fair case, while there are points of disagreement between the Parties and certain factual complexities due to their prior business relationship, there is sufficient consensus between the Parties regarding the material facts necessary to resolve the dispute under the Policy. Further, the specifics of this case: (i) concerning a complainant client and respondent service provider acting it its capacity as agent; and (ii) circumstances of Respondent’s acquisition and use of the Domain Name for the benefit of Complainant; point to a matter within Policy scope. Accordingly, the Panel determines it proper to resolve this dispute.
PARTIES’ CONTENTIONS
A. Complainant
Complainant is a Colorado corporation whose business includes operating a bricks and mortar kitchenware store in Boulder, Colorado.
Complainant states and provides evidence to support that it is the owner of the U.S. trademark PEPPERCORN, registration no. 1959055, registration date February 27, 1996 (the “PEPPERCORN trademark”)
Complainant states that it has been using the PEPPERCORN trademark since at least 1977 in relation to retail stores featuring bake ware, cook ware, flatware, kitchen utensils, tabletop items, crystal, gourmet packaged foods and cookbooks.
Complainant registered the Domain Name on June 10, 1998 and used it for Complainant’s online store since at least as early as December 12, 1998.
In around March 20092, Complainant hired Respondent to provide web design services. At some point after hiring Respondent, the Domain Name was transferred to Respondent. Complainant asserts there was never any intention for Respondent to be anything but a website designer for Complainant, and the transfer of the Domain Name was understood by both parties to be for the sole purpose of giving Respondent easier access to the website it was designing on behalf of Complainant.
For around 15 years, Respondent provided website design services for Complainant. During the first half of 2024, Complainant decided to sever its business relationship with Respondent. Despite Complainant’s requests, Respondent refused to transfer the Domain Name to Complainant.
In July 2024, Respondent deactivated the website and emails associated with the Domain Name which had – until then – been in use by Complainant to promote its business.
Complainant asserts Respondent is attempting to sell the Domain Name for $25,000. Complainant claims that offering a domain name for sale for a sum well in excess of registration costs is not a bona fide offering of goods and services nor a legitimate non-commercial fair use.
Complainant asserts Respondent has no legitimate interest in the Domain Name because it is not commonly known by the domain name, nor is it making a legitimate noncommercial or fair use of the domain name without intent for commercial gain. Respondent displays Complainant’s PEPPERCORN mark as one of about 45 clients shown on Respondent’s website promoting its web design services, evidencing that Respondent recognizes the PEPPERCORN mark belongs to Complainant, its former client.
Regarding bad faith registration and use, Complainant states that Respondent’s intent to sell the Domain Name for an excessive price is evidence of bad faith registration and use.
B. Respondent
Respondent claims because multiple entities hold rights to a PEPPERCORN formative service mark or trademark, Complainant cannot assert exclusive rights over the Domain Name. Moreover, the lack of exclusive rights is emphasized because “peppercorn” is a generic word found in the dictionary.
Respondent has been the lawful owner of the Domain Name since 2008. Respondent rejects Complainant’s claimed explanation for the reason behind transfer of the Domain Name in 2008, because there was no need to transfer the domain name to facilitate easier access for domain name development.
Respondent asserts it has been in the business of leasing domain names since 2002. This practice establishes Respondent’s legitimate interest in the domain names it leases. Respondent contends that when a leased domain name is no longer in use – whether due to closing of services, non-payment, or other reasons – Respondent as the legal owner of such domain name is entitled to decide how to handle the domain name thereafter.
When Complainant terminated the services of Respondent on January 9, 2024, Respondent made several attempts to meet with Complainant to formally conclude their business relationship after 15 years of service, but Complainant failed to respond to such attempts.
Around six months after Complainant cancelled Respondent’s services and payment thereof, Respondent deactivated the Cloudflare DNS service on July 5, 2024, thus disconnecting the Domain Name from Complainant’s web host, Shopify, and Gmail accounts, causing Complainant’s website and emails to go offline.
Regarding its decision to offer the Domain Name for sale $25,000, Respondent obtained appraised value from several sources and used these to determine an average market value. Complainant’s offer of $5,000 for the Domain Name was significantly below the market value and as such was rejected. Complainant is using the UDRP as a “last resort” tactic as a less expensive means to obtain a domain name in an abuse of the UDRP process.
FINDINGS
Complainant is a Boulder, Colorado corporation and the owner of the U.S. trademark PEPPERCORN, registration no. 1959055, registration date February 27, 1996.
Respondent Tyson Brawley is the principle and representative of Goozmo Inc, a Boulder, Colorado based digital marketing and web design agency using the domain name goozmo.com to promote its business.
The Parties agree that they had a long-standing business relationship of around 15 years under which Respondent provided web design services to Complainant, and that Complainant gave notice to terminate Respondent’s services in January 2024.
Complainant originally registered the Domain Name in 1998, and since that year it resolved to a website promoting Complainant’s business. The Domain Name was transferred by Complainant to Respondent in 2008 in connection with their client/agency business relationship. The Domain Name continued to resolve to a website promoting Complainant’s business for the duration of the business relationship between the Parties and for some months following termination thereof. In July 2024 Respondent deactivated the DNS for the Domain Name causing the Complainant’s website and emails to go offline.
The Domain Name currently resolves to a page indicating that it is for sale. After Complainants’ website was taken offline, Complainant offered Respondent $5,000 for the transfer of the Domain Name. Complainant’s offer was rejected and Respondent is offering the Domain Name for sale for $25,000.
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.
The Panel has concentrated the following discussion on the facts and findings most relevant to this three-prong test under the Policy.
Identical and/or Confusingly Similar
Complainant has, to the satisfaction of the Panel, shown the Domain Name is identical or confusingly similar to a trademark or service mark in which Complainant has rights (within the meaning of paragraph 4(a)(i) of the Policy).
Sufficient evidence has been submitted by Complainant of its registered trademark rights in the term PEPPERCORN in the U.S. Such trademark rights were created and registered long prior to 2008 when the Domain Name was transferred to Respondent. A nationally or regionally registered trademark confers on its owner sufficient rights to satisfy the requirement of having trademark rights for the purposes of standing to file a UDRP case. It is generally irrelevant under this first element – which applies as a threshold for standing to file a complaint under the UDRP – whether other parties may also have trademark rights and whether the subject trademark is descriptive or generic. Therefore, the Panel finds that Complainant possesses rights in its registered PEPPERCORN trademark such that it has standing under the Policy.
In assessing identity or confusing similarity, the Panel finds the Domain Name is confusingly similar to the PEPPERCORN trademark in which Complainant has rights because it incorporates the entirety of the PEPPERCORN trademark with no alterations.
The TLD – in this case .com – may usually be ignored for the purpose of determination of identity or confusing similarity between a domain name and Complainant’s trademarks as it is technical requirement of registration (see Section 1.11.1 WIPO Overview 3.0).
Accordingly, the Panel concludes that Complainant has satisfied the requirement under paragraph 4(a)(i) of the Policy and the Domain Name is identical or confusingly similar to Complainant’s mark.
Rights or Legitimate Interests
Complainant has, to the satisfaction of the Panel, shown Respondent has no rights or legitimate interests in respect of the Domain Name (within the meaning of paragraph 4(a)(ii) of the Policy).
The second element of the Policy requires that Complainant establishes that Respondent has no rights or legitimate interests in the Domain Name.
The generally adopted approach, when considering the second element, is that if a complainant makes out a prima facie case, the burden of proof shifts to the respondent to rebut it; see, for example, Section 2.1 WIPO Overview 3.0, (“While the overall burden of proof in UDRP proceedings is on the complainant, panels have recognized that proving a respondent lacks rights or legitimate interests in a domain name may result in the often impossible task of ‘proving a negative’, requiring information that is often primarily within the knowledge or control of the respondent. As such, where a complainant makes out a prima facie case that the respondent lacks rights or legitimate interests, the burden of production on this element shifts to the respondent to come forward with relevant evidence demonstrating rights or legitimate interests in the domain name. If the respondent fails to come forward with such relevant evidence, the complainant is deemed to have satisfied the second element.”). However, the burden of proof still remains with the complainant to make out its prima facie case on a balance of probabilities.
Panels tend to assess claimed respondent rights or legitimate interests in the present, i.e., with a view to the circumstances prevailing at the time of the filing of the complaint, such that even if there was a previous legitimate interest due to the relationship between the parties, such previous legitimate interest does not necessarily equate to a finding of legitimate rights and interests in the domain name, at the time a decision is rendered. See e.g. Section 2.11 WIPO Overview 3.0.
To prove a respondent lacks rights or legitimate interests, a complainant generally establishes either: (i) that there was no business relationship between the parties nor authorization from the complainant; or (ii) if there was or is a relationship between the parties, the respondent’s conduct makes it clear that it lacks rights or legitimate interest according to the nature of the relationship3. The instant case clearly involves the second circumstance, because there is no dispute as to the existence of the Parties’ relationship.
Paragraph 4(a)(ii) of the Policy contemplates an examination of the available facts to determine whether a respondent has rights or legitimate interest in the domain name. Paragraph 4(c) sets out a list of circumstances through which a respondent may demonstrate that it does have such rights or interests.
The first circumstance, under Paragraph 4(c)(i), is where “before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services”. Here, the record shows that the Domain Name was used during the period 1998- July 2024 to promote Complainant. It was only in July 2024, after Respondent caused the Complainant’s website to go offline, that the Domain Name resolved to a page indicating that it was offered for sale. In these circumstances, Complainant successfully makes out its prima facie case that Respondent’s was not using or making demonstrable preparations to use the Domain Name in connection with Respondent’s bona fide offering of goods or services.
The second circumstance, under Paragraph 4(c)(ii), concerns cases where the respondent is commonly known by the domain name. Here, according to the registrar verification, Respondent’s name is “Tyson Brawley” of the organization “Goozmo Inc” which has no similarity or connection to the Domain Name. There is no evidence that Respondent is commonly known by the Domain Name. As such, this second circumstance of legitimate rights or interests under the Policy is not applicable to Respondent.
Regarding the third circumstance, under Paragraph 4(c)(iii) of the Policy, there is no evidence that Respondent is making a legitimate non-commercial or fair use of the Domain Name, without intent for commercial gain to misleadingly divert consumers or to tarnish Complainant’s PEPPERCORN trademark. Subsequent to the termination of the service relationship, the Parties agree that the Domain Name was being offered for sale by Respondent for $25,000. This act of placing of the Domain Name for sale after the termination of the relationship does not constitute a legitimate non-commercial or fair use of the Domain Name in these circumstances.
The facts in this proceeding bear similarities to those in Alaska Health Fair, Inc. v. Chris Jacobson FA 1500868 (Forum June 24, 2013) which also concerned a web developer / client arrangement (“it is also clear that the sole purpose of transferring the Domain Name to Respondent was to facilitate or promote his performance of the services he was obligated to render to and on behalf of Complainant as regards the website work.”). Like in Alaska Health Fair, here the record supports a finding that Respondent was transferred the Domain Name in its capacity as an agent for Complainant. In this regard the Panel finds Complainant’s statement on this point to be plausible and Respondent provided no evidence to rebut it. See e.g. Complainant’s Additional Submissions (“There is no way [underlined in the original] Complainant transferred the ownership of the domain name in 2008 to Respondent for Respondent to be the lawful owner of the domain name, to subsequently “lease” it to Complainant, and then to offer to sell the domain for $25,000 (after Complainant offered a generous $5,000, as discussed in Respondent’s response, which was far more than Respondent’s out of pocket expenses associated with the domain name). Furthermore, any assertion by Respondent that the $5,000 was below the average appraised value is absurd, as this is not a situation in which Respondent owned the domain prior to Complainant’s rights in the domain name. This is clearly a situation in which Complainant, who has owned and operated a brick and mortar retail store since 1977, unknowingly transferred the ownership of a domain it owned and used in 2008 for purposes of having the website developer have easier access to populate the site…”)
The use of the Domain Name to resolve to a website promoting Complainant’s business both during and after the duration of the business relationship between the Parties may be distinguished from UDRP cases concerning distributors, business partners, or the like, in which the distributor/ partner is using the domain name for its own business purposes and as such is found by the deciding panel to have a legitimate interest. See e.g. Alaska Health Fair (“This case thus is distinguished from the majority of UDRP cases, in which the respondent registers and uses a domain name for his own business purposes, as both the beneficial and registered owner of the domain name at issue. Here, in registering the Domain Name in his name, Respondent was acting only as agent for Complainant, in order to perform services for Complainant. Even under Respondent’s theory of the case, this agency relationship was not intended to be perpetual. Complainant could terminate it at any time, and upon such termination Respondent would be obligated to return the Domain Name to Complainant, all subject of course to the terms of their contract. In short, Respondent can claim no right or legitimate interest in the Domain Name for himself merely because, as part of his personal services contract with Complainant, he registered the Domain Name in his name. The record may support the concept of Complainant’s consent to register the Domain Name in Respondent for certain limited purposes but there is no evidence of any intent to transfer ultimate control over, or beneficial interest in the Domain Name to Respondent. He was at all times acting solely as agent for Complainant, and not as a transferee of the name in his own right.”). Similarly, here Respondent held the Domain Name in its own name but was acting as Complainant’s agent. As such, the Respondent’s registration of the Domain Name in Respondent’s name in 2008 was insufficient to create a legitimate interest thereto.
Other panels have similarly held that when a respondent registers a domain name under instructions from a complainant, such conduct does not give rise to a legitimate rights or interest. See, e.g. Bob Anderson v. DAVE BANCROFT / BRANSON MEDIA FA 1638376 (Forum Nov. 3, 2015) (“The question is: Can Respondent claim having legitimate interests in registering the domain name in question in his own name instead of registering it in the name of Mr. Bob Anderson? Nothing explains to this Panel why the registration was made in such a manner, and moreover, how can legitimate interests be claimed from such behavior.”) See e.g. Blue On Highland LLC v. Matthew Sullivan WIPO Case No. D2021-3168 (“Any authorization to register the disputed domain name for use of such with a website promoting Complainant’s restaurant was done on behalf of Complainant and its restaurant and bar and not for any legitimate business interest of Respondent. The fact that Respondent registered the disputed domain name under his personal name and has failed to transfer the disputed domain name to Complainant, even after being requested to do so on multiple occasions, underscores the lack of any legitimate interest that Respondent could conceivably have in the disputed domain name. The disputed domain name was registered and used for the benefit of Complainant and its restaurant and not in furtherance of any bona fide use or legitimate interest of Respondent.”). Likewise, in this case the Domain Name was not used for a legitimate business interest of Respondent but rather was always used for Complainant’s website and benefit. The use of the Domain Name to benefit Complainant bolsters Complainant’s contentions that Respondent lacked rights or legitimate interests thereto.
Accordingly, Panel finds Complainant has sufficiently made out its prima facie case that Respondent lacks rights or legitimate interests in the Domain Name.
A respondent’s rebuttal to a complainant’s prima facie case of lack of rights or legitimate interests must be supported by evidence, mere assertions of fact are insufficient. See, e.g. Section 2.1 WIPO Overview 3.0, (“where a complainant makes out a prima facie case that the respondent lacks rights or legitimate interests, the burden of production on this element shifts to the respondent to come forward with relevant evidence demonstrating rights or legitimate interests in the domain name. If the respondent fails to come forward with such relevant evidence, the complainant is deemed to have satisfied the second element.”).
Here, Respondent asserts that, since 2002, leasing domains has been part of its business but provides no evidence of such business practices. Further, there is no evidence that the Domain Name was transferred from Complainant to Respondent in 2008 for valuable consideration, nor of any agreement between the parties concerning a lease, a service agreement, or the beneficial ownership, of the Domain Name. This lack of evidence supporting Respondent’s claim of a lease arrangement distinguishes the instant case from Staten Island Oral and Maxillofacial Surgery, PC v. Jamie Licznerski Case No. D2024-0961([in which the panel declined to find a lack of legitimate interests and bad faith on the part of the respondent and in which invoices mentioning a lease were submitted as evidence], “Respondent denies any such fraudulent conduct and emphasizes that Complainant paid invoices for the “lease” of the Disputed Domain Name.”). Here, Respondent failed to come forward with relevant evidence sufficient to support its rebuttal case, and as such Complainant’s prima facie case prevails.
The Panel therefore concludes that neither Respondent nor the evidence establishes that Respondent has any right or legitimate interest in the Domain Name. Complainant has therefore also satisfied the requirement under paragraph 4(a)(ii) of the Policy.
Registration and Use in Bad Faith
Complainant has, to the satisfaction of the Panel, shown that Respondent registered and used the Domain Name in bad faith (within the meaning of paragraph 4(a)(iii) of the Policy).
Further, Paragraph 4(b) of the Policy sets out a non-exhaustive list of four circumstances, any one of which may be evidence of the registration and use of a domain name in bad faith. The four specified circumstances are:
(i) circumstances indicating that the respondent has registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of the respondent’s documented out-of-pocket costs directly related to the domain name; or
(ii) the respondent has registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the respondent has engaged in a pattern of such conduct; or
(iii) the respondent has registered the domain name primarily for the purpose of disrupting the business of a competitor; or
(iv) by using the domain name, the respondent has intentionally attempted to attract, for commercial gain, Internet users to the respondent’s website or other on-line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the respondent’s website or location or of a product or service on the site or location.
However, these four above-mentioned circumstances are not the only grounds for finding bad faith under the Policy. See, e.g. Do The Hustle, LLC v. Tropic Web, WIPO Case No. D2000-0624 (“[T]he examples [of bad faith] in Paragraph 4(b) are intended to be illustrative, rather than exclusive.”). As such, Panel considers below other case-specific indicia of bad faith beyond the four circumstances listed Paragraph 4(b).
In 2008, the Domain Name was transferred from Complainant – who had registered it around ten years prior – to Respondent. Respondent claims there was no need for Complainant to transfer the Domain Name to it in for the performance of website design services. However, Respondent offers no explanation or evidence refuting Complainant’s claim that this transfer was understood by Complainant to be necessary for this very purpose. There is no question Respondent knew Complainant and of its rights in the PEPPERCORN mark at the time Respondent became the registrant on record of the Domain Name – Respondent was Complainant’s web agency. A prior panel has held that where an agent knowingly and unnecessarily registers a domain name in its’ own name – against the interest its principle – such conduct can be an indication of bad faith. See, e.g. Bob Anderson v. DAVE BANCROFT / BRANSON MEDIA FA 1638376 (Forum Nov. 3, 2015) (“The Panel considers that registering the domain name bobanderson.com in the name of someone other than Bob Anderson, who asked Respondent to make the registration, is in itself a bad faith registration.”). The same logic applies to the present proceedings, because Respondent asserts it knew at the time of transfer that it was not necessary for the domain name to be transferred to it for the purposes of its work with Complainant yet enabled this transfer. Due to the subsequent refusal of Respondent to return the Domain Name to Complainant, the Respondent’s conduct in facilitating the 2008 transfer demonstrates that, in the circumstances, this transfer was against Complainant’s interests. As such, the Panel concludes that Respondent registered the Domain Name in bad faith.
Further, in Craft Multimodal LTDA. v. Alexandre Guandalini, ALGX CORP WIPO Case No. D2023-169, the panel held that a IT service provider who had put up a disputed domain name for auction following the termination of the service agreement was acting in bad faith ([referring to the circumstances that led to the panelists finding of bad faith registration and use, the panel noted, among others, the following factors] “the Respondent serviced the Complainant having taken advantage of its position to transfer the disputed domain name from the Complainant to its own name, therefore being undoubtedly aware of the Complainant and its trademark at the time it acquired the disputed domain name; upon termination of the service relationship between the Parties the Respondent placed the disputed domain name for auction seeking to unduly profit from the Complainant’s trademark and goodwill expressed in the disputed domain name;”). Here, similarly, Respondent was a service provider to Complainant who proposed to sell the Domain Name following termination of the service agreement between the Parties, and as such the Panel finds this conduct supportive of the finding of bad faith.
Respondent’s claim that it was “leasing” the Domain Name to Complainant is unsupported by any evidence to that effect. As noted above, there is no evidence in the record indicating that the transfer of the Domain Name from Complainant to Respondent in 2008 was for valuable consideration, nor of any written agreement between the parties concerning a lease, a service agreement, or intended beneficial ownership, of the Domain Name. Because of the lack of evidentiary support, the Panel is not persuaded that Complainant’s use of the Domain Name to resolve to Complainant’s website was subject to a lease arrangement.
After the Respondent caused the Domain name to go offline in July 2024, Respondent indicated its intention to sell the Domain Name for $25,000. Respondent claims in its Additional Submissions that Complainant failed to pay for services associated with the Domain Name subsequent to Complainant’s termination notice, noting, “[f]or over five months following the termination of services, the Complainant received the benefit of free services without fulfilling any obligations or payments.”. However, Respondent does not provide an estimate for the costs of these post-termination services nor asserts that the cost for such services exceeded Complainant’s offer of $5,000 for the transfer of the Domain Name. Nor is there any assertion by Respondent that Complainant had failed to pay for services prior to the termination notice such that Complainant was in debt to Respondent. Respondent – a digital marketing and web design agency – should have understood the importance and value of the Domain Name to Complainant. Respondent rejected the Complainant’s offer of $5,000 for the peaceful transfer of the Domain Name without asserting that $5,000 was insufficient to meet Respondent’s documented out-of-pocket costs directly related to the Domain Name. Based on the limited record provided on this point, the Panel finds it more likely than not that $5,000 would have sufficiently compensated Respondent for any out-of-pocket costs related to the Domain Name in the period following the termination notice in January 2024 until July 2024 when Complainant made the $5,000 offer. Accordingly, the Panel finds that Respondent’s conduct in offering the Domain Name for sale for $25,000, understanding the importance and value thereof to the Complainant, indicates – as borne out by the conduct of Respondent – that that Respondent acquired the Domain Name for the purpose of selling it to Complainant upon dissolution of the business relationship in excess of documented out of pocket costs. Such conduct falls within the circumstance described in Paragraph 4(b)(i) of the Policy as constituting bad faith registration and use.
As mentioned above, the instant proceedings have similarities to the facts concerning a client complainant and website designer respondent in Alaska Health Fair, Inc. v. Chris Jacobson FA 1500868 (Forum June 24, 2013) (“there is no evidence anywhere of discussion among them before the work began about Respondent taking a lien or security in the Domain Name. In the absence of any such evidence, and in the absence of any other basis, i.e., statutory or common law, for Respondent to claim an enforceable lien against the Domain Name, the Panel concludes that Respondent has no right or claim of right to withhold it from Complainant. His attempt to do so without any lawful basis constitutes a breach of fiduciary duty and manifest bad faith.”). Here the Panel also finds no evidence that Respondent had a lien or other right such that it could properly withhold the Domain Name and as such the failure to transfer the Domain Name upon Complainant’s request constitutes bad faith.
Similarly, in Blue On Highland LLC v. Matthew Sullivan WIPO Case No. D2021-3168, the panel held that where a domain name was registered in the personal name of respondent but actually intended for and used for the benefit of the complainant, the subsequent failure to transfer the domain name constituted bad faith (“[The] failure or refusal to transfer the disputed domain name which clearly belongs to Complainant and was used at all relevant times to promote Complainant’s restaurant and bar suggests that Respondent knew what he was doing when he registered the disputed domain name under his own name and not under the name of his employer.”). The Domain Name in the instant case was also used at all relevant times to promote Complainant – until Respondent caused the website to go offline. Accordingly, the Panel finds the Domain Name was intended for and used for the benefit of Complainant, and in these circumstances Respondent’s refusal to transfer the Domain Name to Complainant is in bad faith.
As a final point confirming bad faith on the part of Respondent, a prior panel has held – in similar circumstances – that a respondent’s conduct in taking a complaint’s website offline and considering to offer it for sale can demonstrate bad faith usage. See, e.g. Bob Anderson v. DAVE BANCROFT / BRANSON MEDIA FA 1638376 (Forum Nov. 3, 2015), (“It appears clear that reserving the domain name for himself with the possibility of letting it “go dark and sell the domain on the open market” does demonstrate a bad faith usage of the domain name bobanderson.com by Respondent.”) Here, Respondent caused Complainant’s website to “go dark” and communicated to Complainant an intention to sell the Domain Name which Complainant had used for more than 25 years to promote its business, including with the support of Respondent as its web design agency for around 15 of those years. The Panel follows the logic of the Bob Anderson case and finds such conduct demonstrates bad faith usage.
In light of the above analysis, the Panel concludes that the Complainant has made out its case that the Domain Name was registered and is being used in bad faith, and thus has satisfied the requirements under paragraph 4(a)(iii) of the Policy.
DECISION
Having established all three elements required under the ICANN Policy, the Panel concludes that relief shall be GRANTED.
Accordingly, it is Ordered that the peppercorn.com domain name be TRANSFERRED from Respondent to Complainant.
Claire R. Kowarsky, Panelist
Dated: September 11, 2024
greed at its finest. Shoulda taken the $5k and been happy.