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Sally’s Apizza .com : Personal #domain registration leads to #UDRP after biz fallout

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The registrant of SallysApizza.com stated that the domain was registered in her name, and not in the name of the business that contested it via the UDRP process.

The Respondent stated that she was never employed by the LLC managing the intellectual property of the restaurant, such as a trademark for SALLY’S APIZZA, and that her personal credit card was used to register the domain in 2010. The Complainant’s mark dates back to 2018.

But the sole panelist stated that the UDRP should fail, as business disputes are not part of the UDRP process, and ordered the domain to remain with the Respondent.

The domain transfer was denied.

Full details of this cheesy case follow:

Lineage Brands LLC v. Deborah Consiglio
Case No. D2019-2240

1. The Parties

Complainant is Lineage Brands LLC, United States of America (“United States”), represented by Fox Rothschild LLP, United States.

Respondent is Deborah Consiglio, United States, self-represented.

2. The Domain Name and Registrar

The disputed domain name <sallysapizza.com> is registered with Domain.com, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on September 13, 2019. On September 16, 2019, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On September 16, 2019, the Registrar transmitted by email to the Center its verification response confirming that 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 Respondent of the Complaint, and the proceedings commenced on September 23, 2019. In accordance with the Rules, paragraph 5, the due date for Response was October 13, 2019. The Response was filed with the Center on October 12, 2019.

The Center appointed Robert A. Badgley as the sole panelist in this matter on October 18, 2019. 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.

On October 22, 2019, Complainant submitted to the Center an unsolicited Supplemental Filing. On November 1, 2019, the Panel issued Procedural Order No. 1 which allowed Respondent to submit a Supplemental Filing on or before November 8, 2019, in response to Complainant’s Supplemental Filing. On November 8, 2019, Respondent submitted to the Center her Supplemental Filing.

4. Factual Background

This background summary will be stripped of all extraneous facts and allegations put forth by the Parties in this hotly contested dispute.

Sally’s Apizza (the “Restaurant”) has been a restaurant in New Haven, Connecticut, United States, since 1938. Complainant currently owns and operates the Restaurant, having purchased the assets of the Restaurant on December 7, 2017. The sellers of the Restaurant were Sally’s Apizza, LLC (“LLC”), a firm incorporated June 24, 2015, and the Estate of Flora Consiglio (“Estate”). The manager and principal owner of the LLC was Respondent’s husband, Robert Consiglio (“Robert”). Robert was also Executor of the Estate. In their capacity as sellers of the Restaurant, the Estate and the LLC will be referred to collectively as the “Sellers.”

The Asset Purchase Agreement between Complainant and Sellers defined the “Acquired Assets” to include “all Intellectual Property owned by the Seller, including the Intellectual Property set forth on Schedule 5.16(b).’ (Emphasis added.) Schedule 5.16(b) states in full:

“There is no Intellectual Property that is registered, issued or the subject of appending application. ‘Sally’s Apizza, LLC’ is a limited liability company that is registered with the Secretary of State in Hartford, CT. ‘Sallysapizza.com’ is the business website.”

The Asset Purchase Agreement contains an integration, or “entire agreement”, clause stating that the Asset Purchase Agreement and related documents executed at the closing constituted the entire agreement between the Sellers and Complainant (and that any prior understandings not reflected in the Agreement are a nullity). There is nothing in the record indicating that there was a registered trademark for SALLY’S APIZZA prior to the asset sale, and there is no reference to common law trademark rights in the Asset Purchase Agreement.

On January 25, 2018, Complainant applied to register two trademarks for SALLY’S APIZZA with the United States Patent and Trademark Office (“USPTO”) in connection with restaurant services and pizza. The applications listed the date of first use in commerce of December 31, 1938. The USPTO granted the registrations (Nos. 5,694,758 and 5,694,759) on March 12, 2019.

The Domain Name was registered on April 8, 2010, by Respondent. According to Respondent, her husband Robert had nothing to do with her registration of the Domain Name. Respondent states that she paid for the Domain Name registration with a credit card that she owned and controlled exclusively. Respondent states that she was never an owner, employee, or officer of the LLC, and the Domain Name was never an asset of the LLC or Robert.

Respondent states that “the purpose and use of [the Domain Name] is to provide a historical record of the legacy Sally’s Apizza which has been a New Haven landmark since 1938 and is rich in the city history of New Haven, CT”. According to Respondent, the website to which the Domain Name resolves “featured the history of the business, photos and links to articles, television shows and accolades that the business received”.

By contrast, Complainant states that, until the asset sale in 2017, the website primarily contained operational information that was helpful to the Restaurant’s business, such as menus and prices, hours of operation, the address, directions, and so forth. Complainant states that the pre-closing content shows that the primary purpose of the site was to promote the Restaurant’s current business, not to regale the reader with the history of the Restaurant.

Respondent states that Flora Consiglio (whose estate was one of the Sellers) did not favor the Internet and opposed Respondent’s establishment of a website focused on the Restaurant. Respondent also alleges that “the domain was referred to as Debbie’s website by family members.” Respondent also notes that the bottom of the website bore the copyright notice “© Debbie Consiglio”. (This point presumably is raised in aid of Respondent’s position that she was not an agent of the Restaurant, since if she were an agent the copyright holder more likely would have been expressed as the Restaurant.)

Complainant asserts that Respondent, whether or not formally employed and paid by the Restaurant, did perform “administrative and bookkeeping functions” for the Restaurant. According to Complainant, Respondent benefitted financially from the Restaurant’s success (presumably because her husband’s income rose with the Restaurant’s success) and that she was essentially a de facto agent of the Restaurant.

After the December 2017 closing of the asset sale, the dispute over ownership of the Domain Name evidently emerged, though the record is not altogether clear about how and when this happened. In any event, Complainant and Respondent discussed an amicable resolution. According to Respondent, she preferred a clean agreement to transfer the Domain Name for a price to reflect “compensation to reflect the loss of the domain, the reimbursement of previous costs associated with domain name management and years of time and energy spent on upkeep of the Respondent’s historical site.” According to Respondent, Complainant sought a consulting agreement. In any event, the Parties never reached a post-closing accord for the transfer of the Domain Name.

While the Parties tried to negotiate for the transfer of the Domain Name, Respondent evidently gave the website access information to Complainant in April 2018 so the latter could market the Restaurant’s business. Respondent alleges that Complainant promptly changed the access information and locked Respondent out of the website.

5. Parties’ Contentions
A. Complainant

Complainant asserts that it has satisfied the three elements required under the Policy for a transfer of the Domain Name. According to Complainant, the Domain Name was always an asset of the Restaurant (even prior to the LLC’s formation in 2015), and that Complainant purchased that asset in December 2017 along with the other Restaurant assets conveyed in that transaction.

Because, Complainant asserts, Respondent benefitted from (and worked for) the Restaurant, and because the website’s contents (such as the menu) enhanced the Restaurant’s business, Respondent was acting on behalf of the Restaurant when she registered the Domain Name. On this basis, Complainant asserts, the Domain Name was in fact the property of the Restaurant (and the LLC, once it was formed in 2015), and that Respondent knew this.

B. Respondent

Respondent’s central contention is that the Domain Name was registered by her on her own behalf, and was never an asset of the Restaurant. She asserts that she was never an agent of the Restaurant or any of the Sellers. According to Respondent, Complainant failed to perform due diligence vis-à-vis the asset purchase, and that she never did or said anything that could have given Complainant the false impression that the Domain Name was an asset of the Restaurant.

6. Discussion and Findings

Paragraph 4(a) of the Policy lists the three elements which Complainant must satisfy with respect to the Domain Name:

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

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

(iii) the Domain Name has been registered and is being used in bad faith.
A. Identical or Confusingly Similar

The Panel concludes that Complainant has rights in the mark SALLY’S APIZZA through registration and use demonstrated in the record. The Panel also finds that the Domain Name is confusingly similar to that mark. The only difference between the mark and the Domain Name is the lack of an apostrophe in the Domain Name (and domain names cannot have apostrophes due to technical restrictions of domain name registration).

Complainant has established Policy paragraph 4(a)(i).

B. Rights or Legitimate Interests

Pursuant to paragraph 4(c) of the Policy, Respondent may establish its rights or legitimate interests in the Domain Name, among other circumstances, by showing any of the following elements:

(i) before any notice to you [Respondent] 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; or

(ii) you [Respondent] (as an individual, business, or other organization) has been commonly known by the Domain Name, even if you have acquired no trademark or service mark rights; or

(iii) you [Respondent] are making a legitimate noncommercial or fair use of the Domain Name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

In view of the Panel’s conclusion below on the “bad faith” element, the Panel need not decide the “rights or legitimate interests” issue.
C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy provides that the following circumstances, “in particular but without limitation,” are evidence of the registration and use of the Domain Name in “bad faith”:

(i) circumstances indicating that Respondent has registered or has acquired the Domain Name primarily for the purpose of selling, renting, or otherwise transferring the Domain Name registration to Complainant who is the owner of the trademark or service mark or to a competitor of that Complainant, for valuable consideration in excess of its documented out of pocket costs directly related to the Domain Name; or

(ii) that 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 Respondent has engaged in a pattern of such conduct; or

(iii) that Respondent has registered the Domain Name primarily for the purpose of disrupting the business of a competitor; or

(iv) that by using the Domain Name, Respondent has intentionally attempted to attract, for commercial gain, Internet users to Respondent’s website or other online location, by creating a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s website or location or of a product or service on Respondent’s website or location.

The Panel does not find any bad faith registration or use of the Domain Name by Respondent within the meaning of the Policy.

There is no clear and undisputed evidence in the record that Respondent made the Domain Name an asset of the LLC, such that it could have been sold to Complainant. Nor is there any evidence that Respondent took any action that could reasonably be construed as misleading Complainant into believing that the Domain Name was an asset of the LLC. Respondent was not a party to the asset sale transaction, and there is no evidence in the record that she read the agreement before it was executed.

It is not clear whether this dispute arises from a simple misunderstanding, an oversight, sharp practices, or something else, and it is unclear whether Complainant has any legal recourse in another forum, but this dispute is not a good candidate for disposition under the Policy. The UDRP is ill equipped to get to the bottom of this dispute, including the relationship among the various actors, their interactions, their communications, and their credibility. Rather, the UDRP is designed to address clear cases of cybersquatting, and this case is not such a case. The Complaint fails.

7. Decision

For the foregoing reasons, the Complaint is denied.

Robert A. Badgley
Sole Panelist
Date: November 14, 2019


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Comments

One Response to “Sally’s Apizza .com : Personal #domain registration leads to #UDRP after biz fallout”
  1. Mike Sallese says:

    They have great pizza there- domain notwithstanding!

    Cheers,

    Mike

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