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RapidRepel.com #UDRP: Five figure asking price not a sign of bad faith

Entrepreneurs seeking a sizeable return on their investment aren’t automatically found in “bad faith.”

The registrant of RapidRepel.com registered the domain in 2017 with a project in mind.  United Industries Corporation produces a series of pesticides and one of them is called RapidRepel and filed a UDRP to get the domain.

In 2017, the Respondent produced a product with the following description:

Rapid Repel is an All Natural Animal Repellent that Repels Raccoons, Opossums, Squirrels, Deer, Rabbits, etc from Gardens, Campsites, Garbage cans, RV’s & more!

In 2018, the Complainant became aware of Respondent’s use of the mark RAPID REPEL in connection with an insect repellant produce. Complainant contacted Respondent and demanded that Respondent cease and desist from using the Disputed Domain Name, which Respondent agreed to do, and Respondent disabled the website located at the Disputed Domain Name. However, Respondent refused to transfer the Disputed Domain Name to Complainant without receiving payment from Complainant, and Respondent subsequently offered the Disputed Domain Name for public sale through GoDaddy auctions for $12,000.

The Respondent presented a declaration in which he states that his out-of-pocket expenses in connection with the Disputed Domain Name have been $10,000 dollars.

Despite this asking price, the National Arbitration Forum panelist found no indication of bad faith in the Respondent’s conduct and ordered the domain RapidRepel.com to remain with them.

The domain transfer was denied.

United Industries Corporation v. James Katz

Claim Number: FA2103001936864

PARTIES

Complainant is United Industries Corporation (“Complainant”), represented by Mark J. Liss, Illinois, USA. Respondent is James Katz (“Respondent”), represented by Bernard L. Egozi of Egozi & Bennett, P.A., Florida, USA.

 

REGISTRAR AND Disputed Domain Name

The domain name at issue is <rapidrepel.com>, registered with GoDaddy.com, LLC (the “Disputed Domain Name”).

PANEL

The undersigned certifies that he has acted independently and impartially and to the best of his knowledge has no known conflict in serving as Panelist in this proceeding.

Kendall C. Reed as Panelist.

PROCEDURAL HISTORY

Complainant submitted a Complaint to the Forum electronically on March 16, 2021; the Forum received payment on March 16, 2021.

On March 17, 2021, GoDaddy.com, LLC confirmed by e-mail to the Forum that the <rapidrepel.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”).

On March 19, 2021, the Forum served the Complaint and all Annexes, including a Written Notice of the Complaint, setting a deadline of April 8, 2021 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@rapidrepel.com. Also on March 19, 2021, 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 April 8, 2021.

On or about April 12, 2021, Complainant submitted an additional submission, which been considered by the Panel.

On or about April 16, 2021, Respondent submitted an additional submission, including a motion to strike, a declaration, and a copyright certificate of registration, all of which have been considered by the Panel.

On April 13, 2021, pursuant to Complainant’s request to have the dispute decided by a single-member Panel, the Forum appointed Kendall C. Reed as Panelist.

Having reviewed the communications records, the Administrative Panel (the “Panel”) finds that the 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. Therefore, the Panel may issue its decision based on the documents submitted and in accordance with the ICANN Policy, ICANN Rules, the Forum’s Supplemental Rules and any rules and principles of law that the Panel deems applicable, without the benefit of any response from Respondent.

RELIEF SOUGHT

Complainant requests that the domain name be transferred from Respondent to Complainant.

PARTIES’ CONTENTIONS

A. Complainant

Complainant, United Industries Corporation, is a leading supplier of pesticides, insecticides, insect repellents, herbicides, and home pest control products. Complainant is the owner of well-known brands including, among others, SPECTRACIDE, GARDEN SAFE, HOT SHOT, BLACK FLAG, CUTTER, REPEL and RAPIDREPEL.

Complainant is the owner of several United States trademark registrations for the trademark REPEL.

Complainant also owns several trademark registrations for the trademark RAPIDREPEL in multiple countries outside the U.S., including in Mexico, Costa Rica, Jamaica, the Dominican Republic, the British Virgin Islands, and multiple South American countries.

In 2018, Complainant became aware of Respondent’s use of the mark RAPID REPEL in connection with an insect repellant produce. Respondent also used this expression as the name of his company, Rapid Repel, Inc, and as Respondent’s domain name, the Disputed Domain Name herein, <rapidrepel.com>.

Complainant contacted Respondent and demanded that Respondent cease and desist from using the Disputed Domain Name, which Respondent agreed to do, and Respondent disabled the website located at the Disputed Domain Name. However, Respondent refused to transfer the Disputed Domain Name to Complainant without receiving payment from Complainant, and Respondent subsequently offered the Disputed Domain Name for public sale through GoDaddy auctions for $12,000.

Respondent renewed the Disputed Domain Name on March 29, 2012, even though Respondent’s website remained disabled.

The Disputed Domain Name is identical or confusingly similar to both its REPEL and RAPIDREPEL marks, because, in the former instance, the Disputed Domain Name fully encompasses Complainant’s REPEL mark, and in the latter instance, the Disputed Domain Name is nearly identical to Complainant’s mark RAPIDREPEL.

The Respondent does not have rights or legitimate interests in the Disputed Domain Name for the following reasons:

– Complainant has not authorized Respondent to use any of its marks. And

– Respondent is no longer using the Disputed Domain Name in connection with a bona fide offering of goods or for a legitimate noncommercial or fair use. Respondent agreed to stop using the Disputed Domain Name, and as such, the Disputed Domain Name is now merely being used to make a profit from its sale.

The Respondent is acting in bad faith for the following reasons:

– Respondent had constructive knowledge of Complainant’s trademark rights at the time Respondent registered the Disputed Domain Name.

– Respondent had actual knowledge of Complainant’s rights when it renewed its registration of the Disputed Domain Name, and this from the discussions between the parties and from a U.S.PTO Office Action in which Complainant’s RAPID mark was cited against Respondent’s application for the applied for mark RAPID RESPONSE on the basis of a likelihood of confusion.

– Respondent is offering the Disputed Domain Name for sale by way of a public auction. And

– In response to Complainant’s demand that Respondent cease and desist, Respondent demanded payment to transfer of the Disputed Domain Name to Complainant.

B. Respondent

Respondent registered the Disputed Domain Name on March 28, 2017 for the purpose of marketing his product, Rapid Repel, in the United States.

At the time Respondent registered the Disputed Domain Name, Complainant had not registered the mark RAPID REPEL in the United States.

On July 25, 2018, Complainant contacted Respondent and requested that he cease and desist using the Disputed Domain Name. Whereas Respondent believed that Complainant’s claims were without merit, Respondent nevertheless agreed to stop using the Disputed Domain Name only to avoid costly litigation and offered to sell the Disputed Domain Name to Complainant for a fair price.

Complainant does not have rights in a trademark for Purposes of the Policy for the following reasons:

– Complainant does not have a U.S. trademark registration for the mark RAPIDREPEL, only foreign registrations for this mark, and as such has no trademark rights as against another United States citizen.

– Whereas Complainant does have a U.S. registration for the mark REPEL, Respondent’s inclusion of the word “rapid” in the Disputed Domain Name creates a sufficiently meaningful distinction for purposes of the Policy.

Respondent does have rights or legitimate interests with respect to the Disputed Domain Name for the following reasons:

– Respondent did not register or renew the Disputed Domain Name for the purpose of selling, renting, or otherwise transferring the Domain Name registration to the Complainant or a competitor for valuable consideration in excess of Respondent’s documented out-of-pocket costs directly related to the Disputed Domain Name.

– Respondent did not register or renew the Disputed Domain Name for the purpose of disrupting Complainant’s business.

– In registering and renewing the Disputed Domain Name, Respondent has not engaged in a pattern of registering domain names so as to prevent Complainant from reflecting its marks in a corresponding domain name.

– Respondent registered and used the Disputed Domain Name for purposes of his business before he had notice of Complainant’s trademark rights.

– When Respondent renewed the registration of the Disputed Domain Name, Respondent’s purpose was to publicly auction the Disputed Domain Name for a fair market price after Complainant had already declined to purchase it under similar terms. And

– At no time has Respondent intentionally attempted to attract, for commercial gain, Internet users to its website or other online location by creating a likelihood of confusion with the Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s web site or location or of a product or service on Respondent’s web site or location. Respondent’s intention was to use the Disputed Domain Name in connection with marketing his products, and since Complainant demanded that Respondent cease and desist using the Disputed Domain Name in this way, Respondent has stopped doing so even though Respondent disagrees that such created a risk of confusion.

– Respondent’s public offer to sell the Disputed Domain Name at auction does not create a risk of confusion with Complainant’s marks.

C. Complainants Additional Submissions

Foreign trademark registrations do count for purpose of Policy ¶ 4(a)(i).

The Disputed Domain Name is confusingly similar to Complainant’ RAPID mark because the Disputed Domain Name fully incorporates the mark.

Given that Respondent had agreed to stop using the Disputed Domain Name, he had no rights or legitimate interests therein when he renewed it.

Respondent’s demand for payment in excess of his out-of-pocket costs is not a legitimate interest. Respondent’s likely out-of-pocket costs for maintenance of the registration would be nominal and significantly less than both what was initially demanded during the discussion between the parties in July 2019 ($4,500) and the $12,000 currently being asked by Respondent in the public auction.

Respondent’s renewal of the Disputed Domain Name after acquiring actual knowledge of Complainant’s trademark rights establish bad faith.

Respondent’s demand for $12,000 for the Disputed Domain Name establishes Respondent’s bad faith.

D. Respondent’s Additional Submission.

Respondent’s additional submission is in the form of a motion to strike. Respondent objects to Complainant’s mention of the parties’ discussions about a possible voluntary transfer of the Disputed Domain Name to Complainant in exchange for a payment. This objection is based on Rule 408 of the Federal Rules of Evidence, which precludes the introduction of certain evidence related to settlement discussions, and the chilling effect the introduction of such evidence could have on settlement discussions generally.

Respondent also presents a declaration in which he states that his out-of-pocket expenses in connection with the Disputed Domain Name have been $10,000.

Respondent also presented a copy of a U.S. Copyright Certificate dated April 26, 2017 in Respondent’s favor for a “Rapid Repel Logo.”

FINDINGS

Complainant is the owner of several registered trademarks for the mark RAPIDREPEL, the nine referenced by Complainant all having been registered before the Disputed Domain Name was registered.

Respondent is James Katz.

Respondent registered the Disputed Domain Name on or about March 28, 2017 and renewed the Disputed Domain Name on or about March 29, 2019.

As of the date the Disputed Domain Name was registered, Respondent was not aware of Complainant or Complainant’s trademark RADIPREPEL.

Respondent used the Disputed Domain Name to direct to a website that Respondent used to market his products.

Respondent used Rapid Repel, Inc. as his business name.

Respondent’s products were not completive with Complainant’s products.

Respondent agreed to stop using the Disputed Domain Name and discontinued his associated website prior to the date on which he renewed the registration of the Disputed Domain Name.

PRELIMINARY ISSUE: RESPONDENT’S MOTION TO STRIKE
Respondent’s Motion to Strike is denied.

This Panel respectfully disagrees with the decisions of other panels cited by Respondent to the extent that such decisions hold that Federal Rule of Evidence Rule 408 applies to and controls in administrative proceedings under the Policy.

Further, whereas this Panel generally agrees with the policy of protecting settlement discussions, the issue of the amount demanded by Respondent in exchange for transferring the Disputed Domain Name is made expressly relevant by the language of Policy ¶ 4(b)(i), and as such it would not make sense to exclude evidence about it.

DISCUSSION

Paragraph 15(a) of the Rules instructs this Panel to “decide a complaint on the basis of the statements and documents submitted 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

In order to establish the first element of the Policy, the Complaint must demonstrate that it has rights in a trademark and that the Disputed Domain Name is identical or confusingly similar thereto.

In keeping with the borderless nature of the Internet, a trademark registration anywhere in the world is generally seen as sufficient for establishing the threshold element of the Policy. See Koninkljke KPN N.V. v. Telepathy Inc., D2001-0217 (WIPO May 7, 2001) (The Policy does not require that the mark be registered in the country in which the Respondent operates; therefore it is sufficient that complainant can demonstrate a mark in some jurisdiction). See also, Rockefeller & Co. Inc. v. William Foo, D2014-1886 (WIPO December 17, 2014) (“The Panel notes that the Complaint’s trademarks have not been registered in Malaysia, the Respondent’s country. However, the Panel also notes that the Policy does not require the trademark s of the Complainant to be protected in the Respondent’s country.”)

In the present matter, Complainant has demonstrated that it owns several registrations for the mark RAPIDREPEL in several foreign countries, and this is sufficient to establish rights in the mark for purposes of the Policy.

The Disputed Domain Name <rapidrepel.com> is identical to Complainant’s mark RAPIDREPEL but for the top-level domain, and a top-level domain is generally seen as insufficient to create a meaningful distinction. See Microsoft Corporation v. Thong Tran Thanh, FA 1653187 (Forum Jan. 21, 2016) (determining that confusing similarity exists where [a disputed domain name] contains Complainant’s entire mark and differs only by the addition of a generic or descriptive phrase and top-level domain, the differences between the domain names and its contained trademark are insufficient to differentiate one from the other for the purposes of the Policy)

Given that Complainant’s RAPIDREPEL marks establish this element, it is not necessary to analyze whether the Disputed Domain Name is identical or confusingly similar to Complainant’s mark RAPID.

Complainant has established the first element of the Policy.

Rights or Legitimate Interests

Because Complainant must establish all three elements of Policy ¶ 4(a) in order to succeed, and in light of the comments below about bad faith, it is not necessary to analyze this element.

Registration and Use in Bad Faith

For purposes of the analysis of bad faith, Complainant must establish Respondent’s bad faith at both the time the Disputed Domain Name was registered and when Respondent subsequently used the Disputed Domain Name; one without out the other is insufficient. See Testra Corporation, Ltd. v. Nuclear Marshmallows, D2000-0003 (WIPO Feb. 18, 2000) (“The significance of the use of the conjunction “and” is that paragraph 4(a)(iii) requires the Complainant to prove use in bad faith as well as registration in bad faith. That is to say, bad faith registration alone is an insufficient ground for obtaining a remedy under the Uniform Policy.”). See also BioClin B.B. v. MG U.S.A, D2010-0046 (Mar. 22, 2010) (“The Panel accepts the Respondent’s submission that a complainant under the Policy must prove both bad faith registration and bad faith use.”).

Understanding it is not Respondent’s burden to establish his good faith, Respondent has demonstrated, and the Panel finds, that:

– Respondent’s purpose in registering the Disputed Domain Name was to use it in connection with the sale of his products (admitted by Complainant).

– The name of Respondent’s company was Rapid Repel, Inc. (admitted by Complainant).

– Respondent filed for a trademark for the mark RAPID REPEL.

– Respondent filed for and received a copyright registration for a “Rapid Repel Logo.”

– The products Respondent sold though his website were not completive with the products of Complainant. And

– Respondent did not have knowledge of Complainant’s rights in Complainant’s mark at the time Respondent initially registered the Disputed Domain Name.

With respect to the issue of competition, Complainant suggests that the parties were competitors. Complainant stated: “The mark [Respondent’s mark RAPID REPEL] was used in connection with animal repellent that contained a label suggesting the product would also function as an insect repellent.” However, a copy of the noted label was not provided. Further, Respondent states that his business involved an animal repellant, not an insect repellant or poison. This statement is supported by Respondent’s identification of goods as stated by the U.S.PTO examining attorney in the noted Office Action, being “all natural, plant derived nuisance animal repellent.” Whereas this may raise an issue under trademark law, it is not indicative of competition for purposes of the Policy.

With respect to the issue of notice as of the time Respondent registered the Disputed Domain Name, Complainant argues that Respondent had constructive notice by virtue of Complainant’s trademark registrations, at least insofar as its U.S. registration of its RAPID mark. Setting aside whether the Disputed Domain Name is confusingly similar to this mark, constructive notice does not apply in the context of the Policy.

Complainant argues that Respondent’s demand for more than his out-of-pocket expenses in connection with the Disputed Domain Name is evidence of bad faith; and Complainant is correct in that such a fact can be a significant factor in finding bad faith. See A. Nattermann & Cie. GmbH and Sanofi aventis v. Watson Pharmaceuticals, Inc., D2010-0800 (“In many cases an offer by a respondent to sell a domain name for an elevated price indicates that it registered or acquired the domain name wholly or primarily for that purpose. This inference may readily be drawn where the offer for sale is made shortly after the domain name is registered or acquired, or where there is no other credible reason why the respondent registered the domain name.”).

However, this inference is not automatic and such a demand in isolation is not dispositive. See, ib.(“By contrast, in this case, the offer for sale was made more than ten years after the Respondent registered the Domain Name and the Respondent had a very credible reason for registering the Domain Name in 1999, namely to promote the legitimate sale of the FERRLECIT product under its agreements with the first Complainant or its predecessor.”). See also Virutex Ilko S.A. v. Dynadot, LLC (Super Privacy Service LTD c/o Dynadot) / Embrand, Michael Bilde, D2020-3379 (WIPO April 9, 2021) (“The Complainant’s core argument on bad faith is that the Respondent offered the disputed domain name for sale to the general public for in excess of U.S.D 20,000, an amount far greater than the going rate charged for registration of an available domain,” but the Complainant did not offer any proof that the respondent’s conduct otherwise fell within any of the circumstances contained in Policy ¶ 4(b).).

Complainant further argues that for purpose of establishing bad faith, it is sufficient for Respondent to have acted in bad faith in respect to the renewal of the Disputed Domain Name, and this because at the time of the renewal Respondent was well aware of Complainant’s trademark rights and Complainant’s objections thereto. However, to hold that a renewal is equivalent to a new registration for purposes of the establishing of bad faith would not be in keeping with the plain language of Policy ¶ 4(a)(iii), would obviate the conjunctive requirement, and would improperly shift the focus of inquiry away from the time of the initial selection of the Disputed Domain Name. See BioClin B.B. v. MG U.S.A, D2010-0046 (Mar. 22, 2010) (“It seems to this Panel that there are difficulties with the interpretation adopted by the panel in Eastman Sporto, not least that paragraph 2 of the Policy appears to treat registration and renewal of a domain name as separate and distinct concepts. And the Panel is not sure where the adoption of the approach applied in Eastman Sporto might lead – for example, would a respondent’s previous bad faith use be “cured” if a complainant could not prove that the respondent acted in bad faith at renewal time? Numerous “registrations” by the same registrant is a difficult concept, which would bring with it a new set of interpretation problems. But the major problem this Panel sees with the “renewal theory” is that, like the approach adopted by the panels in the Octogen line of cases, it seeks to provide a remedy in circumstances where the framers of the Policy appear to have intended that there should be none. To this Panel it seems that, if the intention of the framers of the Policy was that subsequent bad faith use of a domain name which had been registered in good faith was not to be caught by the Policy (as appears to this Panel to have been the case), an interpretation of the Policy which would eventually catch all such registrants (when they renewed their registrations) is to be avoided. Given the clear intention expressed in the Second Staff Report…, it seems to the Panel that the bad faith registration requirement was intended to catch a respondent’s bad faith in the choice of the disputed domain name. That choice is of course made at the time of the original registration or acquisition, not at renewal time.” Emphasis supplied).

Complainant has failed to establish the third element of the Policy.

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 <rapidrepel.com> domain name REMAIN WITH Respondent.

Kendall C. Reed, Panelist

Dated: April 28, 2021


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