In the final part of this 3-part series article, the issue of UDRP in proving bad-faith domain registrations that are held passively is examined with respect to the trademark’s characteristics. Here is the first and second part of this article.

The registrant’s attitude could in some circumstances also be regarded as evidence of bad faith use of a domain name that is held passively. Panels often infer evidence of bad faith of the registrant from an unsatisfactory response or an absence of response to the complainant or if it is impossible to contact the respondent.

The respondent’s response

Notwithstanding that the registrant does not technically use the disputed domain name, the fact of attempting to gain valuable consideration for its out-of-pocket costs by offering to sell the disputed domain name could be held to constitute evidence of bad faith registration and use.

In SNCF.org, the Panel concluded that the fact of offering to sell the disputed domain constituted a bad faith use by the registrant as follows:

“The disputed domain name does not currently resolve to an active website however as held in Telstra Corporation Ltd v. Nuclear Marshmallows, WIPO Case No. D2000-0003, and upheld in numerous other UDRP decisions, non-use of a domain name can constitute passive bad faith in certain circumstances…. Whilst the Respondent has not technically used the disputed domain name, it has used it in the sense of attempting to gain valuable consideration in excess of its out-of-pocket costs” (WIPO administrative panel decision of 26 August 2002, Case No. 2002-0603, Soci?t? Nationale des Chemins de Fer Fran?ais (SNCF) v. Queilles Philippe).

Equally, an excessive counteroffer made by the domain name registrant to the complainant could be regarded as evidence of bad faith use (WIPO administrative panel decision of 14 March 2002, Case No. 2001-1416, Expedia, Inc v. Miles Pennella).

As paradoxical as it may seem, the absence of any response from the respondent could also be regarded as evidence of bad faith use.

The absence of respondent’s response

The respondent’s failure either to reply to the complainant’s correspondence before the proceedings or to provide a response during the proceedings could be interpreted as evidence of bad faith registration and use of the disputed domain name.

In PRADASPORTS.com, from the absence of respondent’s answer to the complainant’s correspondence the Panel deduced a sign of bad faith use by the respondent:

“The Respondent also failed to respond to the Complainant’s letters and emails. Failure to respond is another sign of bad faith use” (WIPO administrative panel decision of 10 September 2002, Case No. 2002-0674, Six Continents Hotels, Inc. v. Damir Kruzicevic).

Similar assumptions had previously been made in a number of previous WIPO administrative panel decisions (WIPO administrative panel decisions of 13 November 2000, Case No. 2000-1273, Pharmacia & Upjohn AB v. Dario H. Romero; of 24 January 2001, Case No. 2000-0515, Advanced Micro Devices, Inc. v. [No Name] ; of 7 June 2000, Case No. 2000-0330, Encyclopaedia Britannica, Inc. v. Zuccarini et al.; of 18 January 2001, Case No. 2000-1633, eBay Inc. v. Sunho Hong; of 29 August 2002, Case No. 2001-1461, Ellerman Investments Limited and The Ritz Hotel Casino Limited v. Antonios Manessis).

Additionally, provision of incorrect or false contact details by the domain name registrant could also constitute evidence of bad faith registration and use.

The respondent’s contact details

Providing incorrect or false contact details is usually considered as a sign of bad faith. Indeed, Panels will often see in the inability to contact a disputed domain name registrant an obvious attempt to remain unidentifiable. A good illustration occurs in the case of POKEMON-CENTER.com in which the Panel concurred with the complainant’s statements regarding the respondent’s the false contact details as an indication of the registrant’s bad faith:

“The Panel wholly agrees with Complainant that Respondent’s providing false contact information, in an obvious attempt to remain elusive, is an indication of bad faith” (WIPO administrative panel decision of 29 October 2000, Case No. 2000-1121, Nintendo of America Inc. v. Berric Lipson).

Analogous reasoning was applied in the following passive domain name holding cases; the Panels inferred from the respondent’s incorrect or false contact details that the respondent intended to conceal its true identity in order to prevent communications or writs being served on it, and/or that the respondent was not actually present or had no commercial activities at the address stated (WIPO administrative panel decisions of 7 December 2000, Case No. 2000-1232, DCI S.A. v. Link Commercial Corporation, of 6 July 2001, Case No. 2001-0643, Designor OY AB v. Bamse Enterprises, of 10 April 2002, Case No. 2002-0131, Ladbroke Group Plc v. Sonoma International LDC, of 29 August 2002, Case No. 2002-0564, CDW Computer Centers Inc v. Hostmaster).

In light of these illustrations, it can be concluded that passive holding of a domain name may amount to use in bad faith, particularly when the expected use of the domain name by the respondent inevitably will lead people to believe that the respondent and the respondent’s website were in some way associated with the complainant. For this purpose potential use is equivalent to actual use.

The consideration of passive holding of domain names as evidence of bad faith use, however, is applied only in exceptional circumstances. Complainants should not lose sight of the burden of proof that is on them in particular with the bad faith requirement. In actual fact, the majority of refusals to cancel or to transfer the domain name in issue continue to be based on the failure to deduce evidence that the domain name had been registered and was being used in bad faith, even in cases in which the registrant held the disputed domain name without making any active use (WIPO administrative panel decisions of 18 September 2000, Case No. 2000-0629, Consorzio del Prosciutto di Parma v. Domain Name Clearing Company, LLC).

Due to the tenuous nature of the evidence of bad faith registration and use submitted by the complainant, a Panel has recently dismissed the complaint relating to a passive domain name holding by stating:

“The Complainant has provided no evidence that its mark is so well known that any registration (without use) of a domain name cannot help but lead to the conclusion that the Respondent registered with male fides. And, unlike the mark in Telstra, the mark and the domain names here are the concatenation of two generic English words. I conclude therefore that the Telstra passive holding principle does not apply to the facts in this case” (WIPO administrative panel decisions of 7 October 2002, Case No. 2002-0757, Alberto-Culver Company v. Pritpal Singh Channa).

In passive domain name holding cases, complainants still must comply with the bad faith requirement under the Policy. The recognition that passive holding of a domain name in some circumstances may satisfy the requirement for bad faith registration and use thus does not constitute an exception to the Policy.