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WIPO Arbitration and Mediation Center
ADMINISTRATIVE PANEL DECISION
Ermenegildo Zegna Corporation v. Estco Enterprises Ltd
Case N° D2000-0395
The Complainants are three companies :
- the US corporation Ermenegildo Zegna Corporation;
- the Italian company Lanificio Ermenegildo Zegna & Figli S.p.A.;
- the Swiss company Consitex SA.
Represented by Dr. Massimo Introvigne and Dr. Fabrizio Jacobacci of Jacobacci & Perani.
The Respondent is the US corporation Estco Enterprises Ltd., 5101 River Road, Suite 1009, Bethesda, MD 20816 USA.
2. The Domain Name and the Registrar
The domain name at issue is "zegnafashion.com".
The registrar is Network Solutions, Inc.
3. Procedural History
The WIPO Arbitration and Mediation Center (the Center) received the complaint in hard-copy on May 16, 2000, and notified it on the same day.
The complaint was filed in accordance with the requirements of the Rules and the Supplemental Rules.
Payment has been properly made and the Panel agrees with the Center’s assessment concerning the complaint’s compliance with the formal requirements.
The complaint was properly notified in accordance with the Rules and the response was timely filed.
The administrative Panel was properly constituted and all panelists submitted a Statement of Acceptance and Declaration of Impartiality and Independence.
The Panel met by telephone conference call on July 11, 2000.
4. Factual Background
The complaint is based on the American, Italian and British registrations of the trademark ZEGNA which is protected for clothing and fashion:
- American trademark ZEGNA n° 1,258,643 registered in class 25 for clothes on November 22, 1983, for a term of 20 years in the name of Ermenegildo Zegna Corporation,
- Italian trademark ZEGNA n° 0562561 filed in 1969 in classes 23, 24 and 25 for thread, fabrics and clothes, owned by Lanificio Ermenegildo Zegna & Figli S.p.A.
- British trademark ZEGNA n° 973946 filed on April 21, 1971, in class 25 for clothes, valid until April 21, 2006, owned by Consitex SA.
On May 13, 1999, the Respondent registered "zegnafashion.com".
On December 1, 1999, the attorney representing Estco wrote to Dr. Massimo Introvigne, who is the counsel of the Complainants, to answer a complaint letter dated August 6, 1999, and to assert that her client was not using the domain name "zegnafashion.com" and had no intention to sell it and that the mere registration of a domain name "does not constitute use of a trademark".
She specified that her client "will not use the domain name it has registered unless given permission by your client or unless a license has been purchased".
5. Parties’ Contentions
5.1 The domain name is identical or confusingly similar to the trademark
"zegnafashion" is presented as confusingly similar to the trademark ZEGNA.
5.2 The Respondent has no rights or legitimate interests in respect of the domain name
The Complainants maintain that the Respondent has no rights or legitimate interests in the domain name. In support of this allegation, the Complainants have submitted Exhibit 5, which they describe as proof that a website exists,"although the page [is] without contents and entirely black." According to the Complainants, this demonstrates that the Respondent has no real interest in the domain name.
5.3 The domain name has been registered and is being used in bad faith
The Complainants consider that the registration of "zegnafashion.com" by the Respondent prevents them from obtaining this domain name and developing a website of their own at the address "zegnafashion.com".
5.3.1 To the question: the domain name is identical or confusingly similar to the trademark
The domain name is not used. The site is called "designerglobe.com", it will serve as an information portal, offering style and fashion commentary.
The users will enter the portal by various addresses and all of the addresses end in "fashion".
5.3.2 To the question : the Respondent has no rights or legitimate interests in respect of the domain name
The Respondent states that he has a very real need and legitimate business plan for the "zegnafashion.com" and other "fashion" domain names that it has been actively pursuing for a year.
The site is not launched because the project is not finalized, but the fashion portal will be run in connection with the fashion domains, and among them with "zegnafashion.com".
The concept of the portal is to enter the site in a variety of ways (for instance through the designer specific address [designer] fashion.com) in order to obtain all information about this designer and about its authorized retailers.
The corresponding business plan is the exhibit n° 1.
The Respondent explains that since the project is still in the financing stage, it has not contacted the relevant designers.
The Respondent considers that these preparations justify its legitimate interest.
5.3.3 To the question : the domain name has been registered and is being used in bad faith
The Respondent criticizes the argument of the Complainants according to which the Complainants say that the registration of "zegnafashion.com" prevents them from developing a website of their own at the address "zegnafashion.com".
Since the complainants have already registered the domain names "zegna.com", "oasizegna.com" and "zegnaermenegildo.com", it does not need to have a website at every domain including ZEGNA.
The Respondent and the Complainants are not competitors and the site will redirect the users towards authorized retailers of Complainants’ products.
6. Discussions and Findings
6.3.1 To the question: the domain name is identical or confusingly similar to the trademark
ZEGNA is a very strong trademark protected amongst other for products in the area of fashion and the panel is of the opinion that there is a confusing similarity between this mark and the domain name "zegnafashion.com".
6.3.2 To the question: the Respondent has no rights or legitimate interests in respect of the domain name
The Respondent recognizes the previous rights on ZEGNA trademarks.
In "zegnafashion.com", the distinctive word is ZEGNA, i.e. former trademark, and the term FASHION is only the description of the goods for which the trademarks are used.
The Respondent does not run any business in the real world and the panel is of the opinion that in order to serve the business interests of the Respondent, there is no need to register all these domain names "designerfashion.com", and especially "zegnafashion.com" next to or in addition to the domain name "designerglobe.com" that is proposed to serve as the portal name of the Respondent.
The letter dated December 1, 1999, gives evidence of some acknowledgement that it was not allowed to register the domain name.
For these reasons, the Respondent has no right or legitimate interest in respect of the domain name "zegnafashion.com"
6.3.3 To the question : the domain name has been registered and is being used in bad faith
According to the Complainants, the domain name is registered in bad faith since it prevents the Complainants from acquiring the website with the address "zegnafashion.com". The Panel is of the opinion that this does not constitute a ground for bad faith. None of the circumstances mentioned in art. 4(b) which shall be evidence of bad faith are present in this case. Although these circumstances are not meant to be exhaustive, the Complainants did not present any argument or circumstance which establishes bad faith. If, once the domain name are used by the Respondent, it appears that likelihood of confusion arises with the trademarks of the Complainants, the Complainants could of course start legal action on the basis of trademark infringement.
Furthermore, there is until now, neither any effective use of the trademark ZEGNA under "zegnafashion.com", nor any clear intention to use "zegnafashion.com" without a license agreement.
For all the foregoing reasons, the Panel decided that the domain name is confusingly similar to the trademark, that the Respondent has no right or legitimate interest in respect of the domain name at issue, but that the Complainants did not give evidence that the domain name at issue has been registered and used in bad faith.
As a consequence, the remedy requested by the complainant is denied and the Respondent shall not be required to cancel the domain name "zegnafashion.com".
Dated: July 27, 2000
Dissent of David H. Bernstein
In my opinion, the facts of this case support a finding that Respondent’s registration of zegnafasion.com violates the Uniform Domain Name Dispute Resolution Policy (the "Policy"). Accordingly, I would order cancellation of the domain name registration, and therefore dissent from the majority’s opinion.
1. Further Discussion of Factual Background.
Two facts that I believe are significant to the proper analysis of this case are (a) Respondent’s assurances provided in its correspondence with the Complainant, and (b) its intentions as articulated in its business plan. Because of the importance of these facts, I hereby expand on the discussion contained in the majority opinion.
Following Respondent’s registration of zegnafashion.com, attorneys for Zegna wrote to Respondent to object to its registration of the domain name. After an exchange of letters (which has not been submitted by either party into the record), Respondent’s counsel wrote to Complainant’s counsel on December 1, 1999. In the December 1, 1999, letter (which was attached to the Complaint), Respondent’s counsel asserted that his client "is not using the name on any website, and has no intention to sell the domain name to third parties." Respondent’s counsel further argued that mere registration of a domain name does not constitute use of a trademark, and assured Complainants that Respondent would "not use the domain name it has registered unless given permission by your client or unless a license has been purchased." The instant dispute followed.
In its response to the Complaint, Respondent concedes that its "registration of the ZEGNAFASHION.COM domain name appears somewhat suspect." Nevertheless, the Respondent explains that its registration is legitimate based on the business plan that it began to develop in May 1999. The plan, written in connection with an academic seminar at Georgetown Law School, "calls for the creation of an Internet directory for authorized high-end designer fashion retailers. The site, called ‘DesignerGlobe.com,’ also will serve as an information portal, offering style and fashion commentary, reviews of designer lines, introductions of new designers, etc." The zegnafashion.com domain name would be one of many designer-specific domain names linked to the DesignerGlobe.com portal.
Respondent’s proposed website would feature lists of authorized fashion retailers, searchable by brand or by geographic location. A user could access the database through the DesignerGlobe.com portal, or could enter through a domain name that would indicate the brand or location the user is interested in (e.g., zegnafashion.com, armanifashion.com, atlantafashion.com, seattlefashion.com). Respondent explains that, by providing users with these alternate entrances to its website, it allows the site to know what brand or geographic location the user is interested in searching.
2. Respondent’s Contentions
In defense of the Complainants’ allegations, the Respondent first argues that the domain name is not confusingly similar to the Complainants’ ZEGNA trademarks. Although Respondent concedes that the domain name incorporates the ZEGNA mark, it argues that no confusion will occur because Respondent does not and will not compete with the Complainant. In fact, the Respondent asserts that having consumers confuse its domain names with official sites of the designers would be "antithetical to Respondent’s purpose" because the Respondent would not be able to hold its service out to consumers as "the portal to unbiased information on a host of designers and their authorized channels of distribution."
The Respondent contends that it has a legitimate interest in the domain name zegnafashion.com because the domain name serves an important interest: "it allows users to bypass the search engine available at the main site ‘DesignerGlobe.com’ to access information regarding their favorite designer’s products directly." The Respondent thus argues that its substantial demonstrable preparations establish its legitimate interest in the domain name and that its intended purpose for the domain name constitutes fair use.
Finally, the Respondent argues that the Complainants failed to prove bad faith. According to the Respondent, the Complainants are not prevented from using a corresponding website simply because they cannot use the domain name at issue; to the contrary, the Complainants already have a number of ZEGNA-related websites. Moreover, Respondent argues, if Complainants truly wanted to use this domain name, they would have requested a transfer rather than a cancellation of the registration.
3. Application of the Policy to the Facts.
Under Paragraph 4(a) of the Policy, the Complainants must prove each of the following three factors to prevail in this matter:
(i) The domain name in issue is identical or confusingly similar to Complainant’s ZEGNA trademark,
(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.
Paragraph 4(b) of the Policy sets out four illustrative (but not exclusive) circumstances that, for purposes of Paragraph 4(a)(iii), shall be evidence of the registration and use of a domain name in bad faith; paragraph 4(c) of the Policy sets out three illustrative circumstances (again, not exclusive) that, if proved by Respondent, shall demonstrate Respondent’s rights or legitimate interests to the domain name for purposes of Paragraph 4(a)(ii).
A. The domain name is confusingly similar to the trademark
I agree with the majority opinion that the domain name zegnafashion.com is confusingly similar to the Complainant’s protected mark. The wholesale incorporation of the distinctive ZEGNA mark into the domain name creates sufficient similarity between the mark and the domain name to render it confusingly similar. See Eauto L.L.C. v. Triple S. Auto Parts, Case No. D2000-0047 (finding confusing similarity when registered mark is incorporated in its entirety within the domain name).
Respondent’s argument that no confusion will develop in the marketplace is besides the point. In evaluating this first factor, the question is not whether confusion is likely. Rather, the issue is whether there is identicality or confusing similarity between the domain name and the mark. To make this determination, the Panel need only look at the mark and the domain name; if they are sufficiently similar, the first factor is satisfied. The existence or absence of a likelihood of confusion in the marketplace is more appropriately considered under the legitimacy of interest and bad faith factors. See Policy ¶¶ 4(b)(iv), 4(c)(iii).
B. The Respondent has no rights or legitimate interests in the domain name
I also agree with the majority that Respondent does not have a legitimate interest in the domain name.
Unlike the cases cited by the Respondent in which the respondents had prior actual business use of the mark at issue (e.g., Kittinger), the Respondent in this case has no history upon which to base its defense of fair use or legitimacy. The Respondent is not an authorized retailer of ZEGNA fashion goods; in fact, the Respondent does not yet operate any fashion business. Moreover, Respondent does not need to make use of this domain name in order to pursue its business plan of providing a database of authorized fashion retailers through its DesignerGlobe.com website. Thus, Respondent’s use of the zegnafashion.com domain name cannot be said to constitute a fair use.
Further undermining Respondent’s argument that its use is fair is the likelihood that Respondent’s use of the domain name would confuse consumers into believing that the site is authorized by Complainants. Not only does Respondent intend to attract traffic by use of the zegnafashion.com domain name, but it also intends to play off of that domain name to ensure that its site prominently is listed in the results of search engine queries for "zegna." This prominent use of the ZEGNA mark to attract consumers to the site may very well misleadingly divert consumers from Zegna’s official sites. This diversion will be for Respondent’s commercial gain given that Respondent intends to profit by charging for the right to be listed on its site, by allowing advertising on its site, and by selling fashion accessories in the future (products that also are sold by Complainants themselves). Because Respondent’s plans are likely to result in customer confusion and trademark infringement, it cannot characterize its intentions as the bona fide offering of goods, nor can it rely on the assertion that it is making a fair use without intent for commercial gain or to misleadingly divert consumers. See Policy ¶¶ 4(c)(i), (iii).
Most telling is Respondent’s counsel’s admission in the December 1, 1999 letter that Respondent "respects the intellectual property rights of others" and that Complainant should "be assured that [Respondent] will not use the domain name it has registered unless given permission by your client or unless a license has been purchased." This acknowledgement is a concession that Respondent does not have rights in the domain name, and that the domain name only could be used with Complainant’s permission.
For these reasons, I agree with the majority that the Respondent has not demonstrated rights to or legitimate interests in the domain name zegnafashion.com.
C. Respondent registered and is using the domain name in bad faith
The third prong set forth in paragraph 4(a) of the ICANN Policy requires the Complainants to prove that the domain name was registered and used in bad faith. As noted above, Paragraph 4(b) of the Policy outlines four examples of circumstances in which the registration and use of a domain name may be found to be in bad faith: (i) the Respondent has registered or acquired the domain name primarily for the purpose of selling it to the complainant or to a competitor of the Complainant at a profit; (ii) the Respondent registered the domain name to prevent the Complainant from reflecting its trademark in a corresponding domain name and has engaged in a pattern of similar conduct; (iii) the Respondent registered the domain name primarily to disrupt a competitor’s business; and (iv) the Respondent’s use of the domain name intentionally attempts to attract Internet users for commercial gain by creating a likelihood of confusion with the Complainant’s trademark. The Policy expressly provides that these circumstances are illustrative of bad faith, but are not exclusive.
As an initial matter, I reject Complainants’ argument that it has proven bad faith under Paragraph 4(b)(ii) of the domain name. Complainants argued that Respondent’s use of the domain name will "surely prevent Complainant [sic] from having a web site on its own at the address zegnafashion.com." On this record, there simply is no evidence that Complainants have any real desire to have a website at that address. Not only do Complainants have a number of ZEGNA-related websites already, but also, their request that the registration be cancelled rather than transferred belies any real interest in owning this domain name and using it for their own purposes.
This holding does not, however, end this analysis. Although Complainants have not advanced other theories for a finding of bad faith, I believe it appropriate to consider whether other facts exist in the record to support such a finding. This sua sponte review of the record is particularly appropriate in the context of proceedings under the Policy given that Complainants do not have an opportunity to submit a reply, and thus did not have the benefit of reviewing Respondent’s business plan at the time of its Complaint.
As discussed in section 3(B) above, a careful review of Respondent’s business plan shows that there is a real risk of customer confusion should Respondent execute its business plan. Respondent’s proposed use of the ZEGNA mark appears designed not to facilitate its ability to allow consumers to search for authorized retailers of ZEGNA products (a search capability that could exist directly on the DesignerGlobe.com website even without use of the zegnafashion.com domain name), but rather to attract consumer attention to Respondent’s sites both through the domain name itself and by its prominent placement in search engine results. This unauthorized use of a trademark is classic trademark infringement, and surely will cause "initial interest confusion," if not full blown confusion as to the source, sponsorship or authorization of Respondent’s services.
That potential confusion is even worse when one considers that Respondent intends in the future to sell fashion accessories on its site. Complainants also sell fashion accessories, and any sale of competing items by Respondent through the zegnafashion.com domain name is very likely to cause consumer confusion. This is sufficient to constitute bad faith under Paragraph 4(b)(iv) of the Policy because Respondent appears to be planning to use the domain name intentionally to attract, for commercial gain, Internet users to its web site by creating a likelihood of confusion with the Complainants’ mark.
Even if this case did not easily fit within Paragraph 4(b)(iv), bad faith still can be found if a review of the complete record showed a nefarious purpose on Respondent’s behalf. Here, bad faith can be inferred from the Respondent’s correspondence with Complainants in which it "assured" them that it would not use the zegnafashion.com domain name without permission because it recognized its need to purchase a license. Despite that "assur[ance]," Respondent now appears to intend to use the name without permission on the ground that it is a fair use. Respondent’s repudiation of its earlier promise not to use the name without permission creates concerns about Respondent’s trustworthiness and its good faith, and is alone enough to support a finding of bad faith.
For all the foregoing reasons, I would conclude that the domain name zegnafashion.com is confusingly similar to the ZEGNA trademark, that the Respondent has no rights or legitimate interests in respect of the domain name, and that the Respondent registered and intends to use the domain name in bad faith. Accordingly, I respectfully dissent.
David H. Bernstein
Dated: July 27, 2000