Panel provides a solid, nuanced discussion of domain investing that doesn’t run afoul of UDRP.
A World Intellectual Property Organization panel has rejected (pdf) a cybersquatting claim for limble.com, and its rationale will be valuable for future cases involving brandable domain names.
Limble Solutions, Inc., a small company with a registered trademark for Limble, filed the dispute. Brandable domain investor Alter.com acquired the domain at a GoDaddy expired domain auction in 2021 for $1,711. This acquisition postdated Limble’s trademark.
This is a common scenario for domain investors. Limble.com is a great brandable domain. Like many made-up names, there are bound to be a company or two with a trademark matching it, whether registered or common law.
The panel of Scott Austin, Douglas Isenberg and Neil Brown discussed how this scenario doesn’t necessarily rise to the level of cybersquatting:
Asserting without evidence that Respondent has no legitimate interests because Complainant has a trademark and Respondent’s portfolio contains a domain name that is the same is not enough for this Panel to find Respondent had actual knowledge of Complainant’s LIMBLE Mark and targeted Complainant when it purchased the Disputed Domain Name. Although targeting is possible based on these facts, it is not probable or even more likely than not, and in reality it is sheer speculation until and unless supported by sufficient evidence to show it is probable that Respondent had Complainant’s LIMBLE Mark in mind when it purchased the Disputed Domain Name.
It discussed how investing in brandable domain names can be a legitimate business model that does not run afoul of UDRP. It also compared this case to one for another brandable domain, kubota.net. In that case, the Complainant was a large and well-known company, and the domain owner pointed the domain to a pay-per-click page with ads that competed with the trademark holder.
On the question of Registration and Use in Bad Faith, the panel explained the burden that Complainants need to show:
Any such finding [of registration in bad faith] would require not only that Respondent knew (or should be taken to have known) of a relevant trademark in which Complainant had rights, but also that it registered the Disputed Domain Name with the intention of benefitting unfairly from the goodwill attaching to those rights.
Respondent has plausibly denied that it knew of Complainant when Respondent registered the Disputed Domain Name. There is no evidence that Respondent had actual knowledge of Complainant or its LIMBLE Mark and it is clear from the record that factors such as Complainant’s small size, a single registration of its mark obtained relatively recently, use of a different mark on its website with no use of any symbols showing treatment of “Limble” or “Limblecmms” as trademarks, all support Respondent’s lack of actual knowledge of Complainant and weigh against such knowledge and against Complainant’s assertion that Respondent targeted Complainant or Complainant’s LIMBLE Mark in bad faith.
These are key statements for brandable domain investors.
The panel also validated the model of registering brandable domains made up of a combination of common words. And it expressly argued that panels should not get involved in determining the value of domain names on the secondary market.
It stopped short of finding reverse domain name hijacking, however:
Although Complainant may have been optimistic in bringing its case without further evidence in support of its claims, the Panel finds no RDNH given the Disputed Domain Name and Complainant’s registered mark are identical. Complainant was justified in bringing this Complaint based on a reasonable belief that it had a plausible legal basis and for the reasons set out above does not amount to a filing merely for the purpose of harassing Complainant.
Alter.com and its legal counsel, ESQwire.com, made a good case for finding “Plan B” reverse domain name hijacking. The Complainant originally made an offer for the domain that was rejected. After discovering how much Alter.com had paid for the domain, it then submitted a lower counteroffer and threatened to file a UDRP if its lower offer was not accepted.
But the lack of finding RDNH isn’t a huge blow here; the panel did a great job explaining the legitimacy of brandable domain investing and what’s required to show targeting. This case will be valuable for future challenges to brandable domain owners.