Meredith Corp. vs. CityHome, Inc.
Case No. D 2000-0223
- The Parties
Complainant is the Meredith Corp. (hereinafter "Meredith") an Iowa corporation located and doing business at 1716 Locust Street, Des Moines, Iowa 50336, U.S.A. Respondent is CityHome, Inc. (hereinafter "CityHome"), a corporation formed and existing under the laws of the State of Illinois, which, according to Complainant, has an address for mail and courier delivery at CityHome, Inc., Suite 822, 39 South LaSalle Street, Chicago IL 60603, U.S.A. The contact person according to the papers filed by CityHome for purposes of this administrative proceeding is Michael White, 22 East Jackson Boulevard, Chicago IL 60604, USA.
- The Domain Name(s) and Registrar(s)
The domain name at issue is COUNTRYHOME.COM registered with Network Solutions, Inc.
- Procedural History
The WIPO Arbitration and Mediation Center (the "Center") received the Complaint of Meredith on March 29, 2000 by e-mail and on March 31, 2000 in hard copy. The Complainant made the required fee payment. On March 30, 2000, the Center acknowledged the receipt of the Complaint to Meredith and assigned this matter Case No. D2000-0223.
Also on March 30, 2000, the Center requested Network Solutions, Inc. to verify the registration data. On April 3, 2000, Network Solutions, Inc. confirmed that it is the Registrar of the domain name registration and, inter alia, that City Home, Inc. is the current registrant of the COUNTRYHOME.COM domain name registration.
Having verified that the Complaint satisfies the formal requirements of ICANN Uniform Domain Name Dispute Resolution Policy (the "Policy"), the Rules, and the Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the "Supplemental Rules"), the Center on April 6, 2000 sent to Respondent, with a copy to the Complainant, a notification of the commencement of the administrative proceeding, together with a copy of the Complaint. The formal date of the commencement of this administrative proceeding is April 6, 2000.
On April 25, 2000, the Center received the Respondent's Response, which the Center acknowledged to the parties on April 26, 2000.
On May 4, 2000, after receiving a completed Statement of Acceptance and Declaration of Impartiality and Independence, the Center advised the parties that it had appointed Mr. Thomas L. Creel as a single panelist to resolve this dispute (the "Presiding Panelist").
- Factual Background
Complainant is the owner of the following U.S. Trademark Registrations:
- Registration No. 1,663,395 of the mark COUNTRY HOME, in Class 16, for "magazines and books on a variety of subjects," which issued November 5, 1991, stating a date of first use anywhere and in interstate commerce of October 1950;
- Registration No. 1,559,806 of the mark COUNTRY HOME, in Class 16, for "printed materials; namely, posters, calendars, note cards, Christmas cards, post cards, house plans, house study plans, gazebo plans and seed collection packets," which issued October 10, 1980, stating a date of first use anywhere and in interstate commerce of February 16, 1988; and
- Registration No. 2,199,088 of the mark COUNTRY HOME, in Class 31, for "flower, vegetable and grass seed," which issued October 20, 1998, stating a date of first use anywhere and in interstate commerce by Complainant’s predecessor in interest of November 3, 1997.
Respondent CityHome Inc. was incorporated in July, 1995. It is in the business of building construction and repair, real estate loan financing and real estate investment. From its incorporation until late 1997, it conducted its business in the real estate investment industry with an urban emphasis. In late 1997, Respondent first considered expanding the scope of its business to rural communities. It decided at that time that it needed a new name under which to conduct this new portion of its business. Accordingly, in January 1998, it registered a domain name reflecting its then current emphasis and corporate name, "CITY-HOME.COM" and also the domain name "COUNTRYHOME.COM." The latter was done in anticipation of Respondent's expansion of the real estate business to rural areas. At about this same time, Respondent incorporated affiliated entities under other names e.g. CityHome Property L.L.C. 1997 and CityHome Construction LLC.
At about the same time, Respondent requested a trademark search for the proposed mark Country Home, Inc. to be used in connection with a mortgage banking business. On January 22, 1998 (shortly after registration of the COUNTRYHOME.COM domain name on January 8, 1998) its then counsel provided CityHome with the results of a preliminary trademark search for this mark. In the cover letter, the attorney stated that she was enclosing the search for this mark to be used in connection with a mortgage banking service and that she had highlighted the marks which appeared most likely to pose a risk of potential conflict, for CityHome's review. Only the cover letter was produced in this proceeding. The trademark search report itself was not.
Network Solutions, Inc. placed the COUNTRYHOME.COM domain name on hold on September 4, 1998. Between the registration of the domain name on January 8, 1998 until it was placed on hold eight months later, Respondent never commenced use of the domain name COUNTRYHOME.COM in connection with actual offering of any goods or services. There is no evidence that Respondent is commonly known by the term COUNTRY HOME, nor that it is currently using this domain name.
Respondent "submits that it was not aware of a magazine named ‘Country Home’ at the time it registered the domain name and requested the trademark search and, indeed, was not aware of the magazine or Complainant until Complainant contacted them after the subject domain name was registered and the search was performed."
Meredith approached CityHome about the COUNTRYHOME domain name. Complainant asserts that during the negotiations Complainant was told by Respondent that if Meredith would obtain the domain name CityHome.com from a third party, Respondent would consider a trade. In April 1999, Complainant acquired that domain name from a third party registrant for $2,500. At that same time, Complainant offered to transfer the purchased CityHome.com name to Respondent in even exchange for transfer of the COUNTRYHOME.COM mark. Complainant asserts that Respondent rejected that offer and informed Complainant they would only be willing to sell COUNTRYHOME.COM for $225,000. Thereafter, in about September, 1999, Complainant offered Respondent $5,000. CityHome countered with an offer of $175,000 for the assignment of COUNTRYHOME.COM.
- Parties’ Contentions
Complainant has requested that the domain name be transferred to Complainant because:
(1) the domain name COUNTRY HOME.COM is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;
(2) Respondent has no rights or legitimate interests in respect of the domain name; and
(3) the domain name was registered and is being used in bad faith.
Respondent contends that Complainant has failed to demonstrate the elements required by Paragraphs 4.a.(ii) and (iii) of the Policy.
- Discussion and Findings
Paragraph 4 of the Policy states that Complainant must prove each of three elements:
(i) that the domain name is identical or confusingly similar to the trademark or service mark in which the complainant has rights;
(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.
Each of these three elements will be considered separately below.
The Domain Name
The evidence presented by the parties demonstrates that the domain name COUNTRYHOME.COM. is identical or confusingly similar to Complainant's registered trademarks. Therefore, the requirement of Paragraph 4.a.(i) is met.
Rights or Legitimate Interests in Respect of the Domain Name
The evidence presented by the parties demonstrates that Respondent did have rights or legitimate interests in respect to the domain name at issue.
Complainant proffered evidence on this element includes that Respondent never commenced use of the domain name from the time it was registered on January 8, 1998 to the time that it was placed on "hold" by Network Solutions, Inc. eight months later on September 4, 1998. It also asserts that during negotiations, Respondent never provided Complainant with any evidence of demonstrable use of the domain name COUNTRYHOME in connection with a mortgage banking subsidiary, which usage CityHome was alleging at that time. Also, Complainant asserts that Respondent is not commonly known by the COUNTRY HOME.COM domain name.
Paragraph 4.c.(i) of the Policy instructs that evidence of use or demonstrable preparations to use with a bona fide offering of goods or services prior to notice of dispute is sufficient to establish rights or legitimate interests as referred to in paragraph 4.a.(ii). Respondent had used the term City-Home for its urban real estate services since 1995. When Respondent contemplated expanding into the rural real estate market, the registration of CountryHome in 1998 was a natural and legitimate preparation to extend its then name, "CityHome" to reflect this new business area. It has shown demonstrated preparations to use the domain name. Moreover, the non-use of the domain name for eight months is not determinative. This seems a reasonable time for Respondent to engage in research and development of its rural expansion plan.
Respondent also notes that there are at least seven United States trademark registrations for Country Home by others for diverse uses and "hundreds" for common variations thereof, e.g., Home Country. Furthermore, Complainant's trademark registrations are in classes 16 and 31 for such things as printed materials, magazines and seed. On the other hand, Respondent's potential use in connection with real estate and mortgage services would be in International Classes 35 and 36. Additionally, to use the name CountryHome for real estate services is possibly descriptive of such services. On the current record, Respondent has the right to use such a possibly descriptive term for services quite different from the goods for which Complainant owns trademark registrations.
It is also noted that Respondent, as part of its business practice, has at other times modified its name to reflect expanded areas of business, e.g., to City Home Property 1997 LLC and City Home Construction LLC. This also tends to confirm a legitimate interest in use of CountryHome as an extension of Respondent's then-existing urban business.
Therefore, the requirement of paragraph 4.a.(ii) has not been proved by Complainant.
The third element Complainant must prove is in the conjunctive: the domain name "has been registered" and "is being used in bad faith." The evidence presented by the parties demonstrates that the Respondent did not register and use the domain name in bad faith.
As to the original registration, Complainant has not shown that the registration was made in bad faith. It states that Respondent had "constructive notice" of Complainant's claim of ownership and that, therefore, under the circumstances "it is clear that Respondent registered the domain name with full knowledge of Complainant's rights and primarily for the purpose of selling or otherwise transferring the domain name registration to Complainant for valuable consideration well in excess of Respondent' s out-of-pocket costs directly related to the domain name." Constructive notice does not support a finding of bad faith at the time of registration. Indeed, Respondent has stated it was not aware of Complainant's magazine or Complainant at that time.
Likewise, considering all of the evidence, I do not find that Complainant has shown that Respondent is using the domain name in bad faith. The fact that Respondent is seeking substantial money for what it believes to be a valuable asset is not tantamount to bad faith. Rather, it tends to show a reasonable business response to an inquiry about purchasing a business asset where Respondent had already expended time and money to develop a new part of its business, including the sums it spent on an outside law firm to search the possible trademark and in obtaining the domain name registration. Respondent was naturally reluctant to sell its domain name at that stage of its planning. Nor is the fact that Complainant acquired the domain name CityHome.com for $2,500.00 evidence of bad faith. While it is unfortunate that Complainant acquired the domain name from a third party, according to Complainant's own words in the Complaint, Respondent only said that it would "consider" the trade.
Respondents proffered evidence is persuasive of lack of bad faith. It shows that concurrently with registering the subject domain name, respondent also ordered a trademark search on Country Home, Inc. This is strong evidence of good faith in preparing to use this name in Respondent' s business. Furthermore, Respondent has not attempted to "shop" this domain name to anyone, has not attempted to use the name in anyway that would be construed as an infringement of Complainant's trademark registrations, nor otherwise in a manner which is detrimental to Complainant's trademark rights and it never contacted Complainant seeking any remuneration. As noted above, the non-use of the name for eight months is not an unduly long time for a new business in the planning stage of expansion.
Therefore, the requirement of paragraph 4.a.(iii) has not been proved by Complainant.
Claimant has failed to prove the necessary elements that the Respondent has no rights or legitimate interests in the domain name and that Respondent registered the domain name in bad faith and is using it in bad faith. Therefore, the remedies requested by Complainant are denied. Respondent should not be required to transfer to Complainant the domain name COUNTRY HOME.COM. Rather, the dispute involves the competing rights and legitimate interests of two parties in the domain name COUNTRYHOME.COM. Given the nature of this dispute, it is properly resolved by a mediation or arbitration before this Center or elsewhere or by litigation in a forum of competent jurisdiction.
Thomas L. Creel