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‘Beyond the Scope’ of the UDRP

Not all domain name disputes are appropriate for resolution under the Uniform Domain Name Dispute Resolution Policy (UDRP).

While the UDRP is clearly the “go-to” legal tool for trademark owners pursuing cybersquatters, some disputes are about larger—or different—issues than the UDRP was designed to address.

As stated in WIPO’s Overview:

Depending on the facts and circumstances of a particular case, and irrespective of whether the parties may also be engaged in court litigation, in some instances (e.g., complex business or contractual disputes) panels have tended to deny the case not on the UDRP merits but on the narrow grounds that the dispute between the parties exceeds the relatively limited “cybersquatting” scope of the UDRP, and would be more appropriately addressed by a court of competent jurisdiction.

‘Contractual and Trademark Dispute’

A UDRP panel addressed this exact issue in a dispute over the domain name <lamborghini-store.com>. The UDRP complaint was filed by the owner of the trademark TONINO LAMBORGHINI “in numerous countries all over the world” for use in connection with, among other things, cell phones, according to the decision.

The respondent in the case claimed, “that he is an official dealer of the Complainant through an authorization letter from the Complainant’s licensee.”

While the panel had no problem finding the disputed domain name <lamborghini-store.com> confusingly similar to the TONINO LAMBORGHINI trademark (the first element of the UDRP), the panel had concerns about even addressing the second and third elements of the UDRP (that is, whether the registrant had rights or legitimate interests in the domain name; and whether the registrant registered and used the domain name in bad faith).

As a result, the panel wrote:

The Panel notes that this dispute seems to be part of a contractual and trademark dispute that is outside the scope of the Policy. In this case, it is not clear whether or not the Respondent was an authorized agent of the Complainant or of a licensee of the Complainant when it registered the disputed domain name in 2015. The Respondent has submitted several contract and authorization letters which do not clarify this. It is beyond the scope of the Policy to interpret agreements between the Parties or to determine whether they have breached the Complainant’s trademark.

Therefore, the panel dismissed the complaint, allowing the registrant to retain the domain name.

Complex Facts, Breaches of Contract, and Business Relationships

The conclusion in the LAMBORGHINI case—that the dispute was “beyond the scope” or “outside the scope” of the UDRP—has appeared repeatedly in UDRP decisions through the years.

For example:

  • A very early UDRP decision raised interesting issues, including a discussion about two criminal cases in Estonia related to a possible unlawful transfer of the disputed domain name <aquastel.com>. “Under these proceedings the complete correct facts can probably not be proved,” the panel wrote, also noting that it “cannot know on this record the full extent of the relationship between the parties.” Thus, the panel allowed the registrant to keep the domain name because the “case is much more complex, factual and judicial than the domain name disputes suitably solved under the Policy.”
  • In another early UDRP decision, involving the domain name <thethread.com>, the respondent was actually a co-founder of the company that filed the UDRP complaint and purchased the domain name “on the Complainant’s behalf” but in the respondent’s own name. The dispute arose after the respondent resigned. “[T]his is not a garden-variety cybersquatting case,” the panel wrote. “In fact, it is not a cybersquatting case at all. Rather, this appears to be a breach of contract and breach of fiduciary duty dispute between former partners.”
  • Similarly, another UDRP decision referred to “a long term business relationship” between the complainant and respondent, which “has evidently now unravelled,” resulting in other (non-UDRP) proceedings between the parties. So, the panel terminated the case, writing: “In light of the existence of the parallel litigation, and the complex factual matrix which underlies the dispute and which has not been fully disclosed, the Panel finds that this Complaint is beyond the scope of the Policy at the present time.”

Think Before Filing

Of course, just because a dispute is complicated doesn’t necessarily mean that it’s not suitable for the UDRP. But, as these cases demonstrate, when the issues between the parties involve criminal allegation, contractual disputes or other litigation, a UDRP panel may decline to issue a decision on the merits of the case. (The parties may then choose to go to court for a legal resolution.)

Importantly, complicated cases of any kind are typically not appropriate for disputes under the Uniform Rapid Suspension System (URS), a different dispute policy that applies primarily to the “new” gTLDs. The URS itself makes clear that it is “not intended for use in any proceedings with open questions of fact, but only clear cases of trademark abuse.”

A trademark owner thinking about filing a UDRP complaint should consider whether the issues in dispute are “beyond the scope” of the policy, to ensure that its time and financial resources are spent in the proper forum.

By Doug Isenberg, Attorney & Founder of The GigaLaw Firm

Learn more by visiting The GigaLaw Firm website. Doug Isenberg also maintains a blog here.

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