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WIPO Arbitration and Mediation Center

The Complainant in this proceeding is Atlantic Recording Corporation ("Complainant"), a corporation incorporated in the State of Delaware, United States of America, having its principal place of business in New York, New York, U.S.A.

The Respondent in this proceeding is Paelle International ("Respondent") with its principal place of business located at Francisco Javier Mina 1551-1003, Tijuana, Baja California, Mexico.

This dispute concerns the domain name <atlanticrecords.com>

The registrar with which the domain name is registered is Network Solutions, Inc. ("NSI" or the Registrar) of Herndon, Virginia, USA.

On January 12, 2001 and January 15, 2001, Complainant submitted its Complaint through e-mail and hardcopy, respectively, with the required filing fee for a three-member Panel, to the World Intellectual Property Organization ("WIPO") Arbitration and Mediation Center (the "WIPO Center"), in accordance with the Uniform Domain Name Dispute Resolution Policy (the "Policy") adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) on August 26, 1999, the Rules for Uniform Domain Name Dispute Resolution Policy (the " Rules") approved by ICANN on October 24, 1999, and WIPO’s Supplemental Rules for Uniform Domain Name Dispute Resolution Policy ("WIPO’s Supplemental Rules).

An Acknowledgment of the Receipt of Complaint was sent to Complainant with e-mail copy to the Respondent, by the WIPO on January 22, 2001.

On January 23, 2001, WIPO sent a "Request for Registrar Verification" via email to NSI requesting, a confirmation that NSI had received a copy of the complaint from the Complainant; that the domain name under dispute is registered with NSI; that Respondent is the current registrant of such domain name and full contacts details available under the WHOIS database; that the Policy was in effect, and requesting advice as to the current status of the domain name. On January 24, 2001, WIPO received via e-mail from NSI the "Network Solutions’ Verification Response" confirming the above, as well as that the Domain Name is currently registered to Respondent and is in "active" status, and that a certain Network Solutions 5.0 Service Agreement is in effect.

WIPO completed a "Formal Requirements Compliance Checklist". It is worth mentioning that the undersigned Panel has independently determined and agrees with WIPO’s assessment that the Complaint is in formal compliance with the requirements of the Policy, the Rules, and WIPO’s Supplemental Rules.

On January 25, 2001, WIPO properly sent via e-mail and hardcopy through express mail to Respondent and to its administrative, technical and billing contacts, a "Notification of Complaint and Commencement of Administrative Proceedings" enclosing copy of Complainant’s complaint and confirming the formal initiation of this proceedings as of January 25, 2001, and granting a term for providing a response no later than February 13, 2001. Furthermore, hardcopy of such Complaint as confirmed by Complainant was also previously sent by Complainant to Respondent. A copy has also been communicated to the ICANN and to the Registrar. This Panel considers that the complaint was properly notified to the registered domain-name holder, the technical contact, and the administrative contact as provided for in paragraph 2 (a) of the Rules.

On February 13, 2001, Respondent failed to comply with the deadline to submit its response.

On February 16, 2001, WIPO sent via e-mail to Respondent and to its administrative, technical and billing contacts, with copy to Complainant, a "Notification of Respondent Default" confirming that Respondent had failed to comply with the deadline to submit its response.

Respondent failed to elect whether the dispute be decided by a single-member or by a three-member, and therefore a three-member Panel was appointed as proposed by the Complainant, as may be evidenced from section 14 of Complainant’s complaint.

The undersigned Panelists received invitations to participate as Panelists in the referred to domain name dispute proceeding. The undersigned signed sent to the WIPO signed Statements of Acceptance to participate as Panelists and Declarations of Impartiality and Independence.

On March 20, 2001, WIPO sent to Complainant and Respondent a "Notification of Appointment of Administrative Panel and Projected Decision Date", appointing the undersigned as members of the Administrative Panel and scheduling April 2, 2001, as the date for issuance of the Panel’s decision, notifying the above pursuant to paragraphs 6(f) and 15(b) of the Rules. On the same date, WIPO transferred the case file to the Panel, with copy being sent to Complainant and Respondent by e-mail.

On April 10, 2001 an extension was granted scheduling April 27, 2001, as the new date for issuance of the Panel’s decision.

On April 27, 2001 there was still no response from the Respondent and the decision was made.

The Panel has not received any further requests from Complainant or Respondent regarding other submissions, waivers or extensions of deadlines, and the Panel has not found it necessary to request any further information, statements or documents from the parties, nor the need as an exceptional matter, to hold any in-person hearings as necessary for deciding the complaint, as provided for in paragraphs 12 and 13 of the Rules. Therefore, the Panel has decided to proceed under the customary expedited nature contemplated for this type of domain name dispute proceedings.

The language of the proceeding is English, as being the language of the domain registration and Service Agreement, pursuant to paragraph 11 (a) of the Rules.

The Complainant is a member of the Time Warner family of companies, and claims that it is among the world's foremost producers of pre-recorded media featuring entertainment, including audio and video records, tapes and compact discs.

The Complainant has continuously used the trademarks and trade names ATLANTIC, ATLANTIC RECORDS and ATLANTIC RECORDING CORPORATION (collectively, the "ATLANTIC RECORDS Mark and Name") in connection with its pre-recorded media products since at least as early as 1949.

The Complainant is the owner of United States Trademark Registration Nos. 1,535,113 and 1,116,322 for the marks ATLANTIC and A ATLANTIC, respectively, covering pre-recorded media products. In addition, the Complainant owns more than 100 registrations for the various forms of the ATLANTIC mark in other countries.

The Complainant has also been the owner of the domain name registrations for <atlanticrecords.net> and <atlanticrecords.org>.

The Complainant says that it has extensively marketed and promoted its products bearing the ATLANTIC RECORDS Mark and Name through well-known trade and consumer publications as well as on the Internet, since November 1994, through the Complainant's <atlantic-records.com> web site, as well as a variety of other commercial web sites, such as <amazon.com>.

The Complainant claims that its pre-recorded media products marketed under the ATLANTIC RECORDS Mark and Name feature the performances of many of the most famous entertainers and musical groups.

The Complainant's pre-recorded media products are sold throughout the world, through record clubs, music specialty stores, large department stores and music cable channels.

The Complainant claims that it currently spends in excess of $50 million per year on promotional efforts in the United States alone, and U.S. sales of the Complainant's pre-recorded media products bearing the ATLANTIC RECORDS Mark and Name exceeded $320 million in 1999.

In or about January 2000, the Complainant learned that an individual named Randle Schumacher had registered with NSI the domain name <atlanticrecords.com>. The Complainant protested Mr. Schumacher's registration of such domain name. In response, Mr. Schumacher asked for a monetary payment of between USD 35,000-40,000 to transfer the <atlanticrecords.com> domain name to the Complainant. It is alleged that when the Complainant rejected that demand and threatened to take legal action, Mr. Schumacher transferred the domain name to an entity called Paelle International, the Respondent herein.

The Complainant thereupon notified the Respondent, in writing, that the Respondent's acquisition of the domain name <atlanticrecords.com> was in violation of the Complainant's rights and that the Respondent's apparent assignor, Mr. Schumacher, maintained no lawful rights in that domain name. The Complainant requested that the Respondent promptly transfer to the Complainant the domain name registration for <atlanticrecords.com>. To date, the Respondent has neither responded to the Complainant's demand letter nor transferred to the Complainant the domain name registration.

No response was received from the Respondent.

The Panel considers that the Respondent by registering the contested domain name with Network Solutions, Inc. (an ICANN accredited domain name registrar), agreed to be bound by all terms and conditions of Network Solutions’ Service Agreement, and any pertinent rule or policy, and particularly to be bound by the Policy (incorporated and made a part of the Service Agreement by reference), which requests that proceedings be conducted according to the Rules and the selected administrative-dispute-resolution service provider's supplemental rules, in the present case being the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy. Therefore, the dispute subject matter of this proceeding is within the scope of the above mentioned agreements and policy, and this Panel has jurisdiction to decide this dispute.

Furthermore, the Panel considers that in the same manner by entering into the above mentioned Service Agreement, the Respondent agreed and warranted that neither the registration of its domain name nor the manner in which it may intend to use such domain name will directly or indirectly infringe the legal rights of a third party, and that in order to resolve a dispute under the Policy, Respondent’s domain name registration services may be suspended, cancelled or transferred.

The Panel also particularly considers that it is essential to dispute resolution proceedings that fundamental due process requirements be met.

Such requirements include that the parties and particularly the Respondent in this case be given adequate notice of proceedings initiated against them; that the parties may have a fair and reasonable opportunity to respond, exercise their rights and to present their respective cases; that the composition of this Panel be properly made and the parties be notified of the appointment of this Panel; and, that both parties be treated with equality in these administrative proceedings.

In the subject matter of these proceedings, the Panel is satisfied that these proceedings have been carried out by complying with such elemental due diligence requirements, and particularly contemplating the notification of the filing of the Complaint and the initiation of these proceedings giving the Respondent a right to respond; that the default of the Respondent to submit a response is not due to any omission under these proceedings; and that there is sufficient and adequate evidence confirming the above.

Paragraph 4 (a) of the Policy directs that the Complainant must prove the presence of each of the following elements: (i) that the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; and, (ii) that the Respondent has no rights or legitimate interests in respect of the domain name; and, (iii) that the Domain Name has been registered and is being used in bad faith.

The first element that the Complainant must prove under Paragraph 4 (a) of the Policy is that the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights.

This Panel recognizes the universal principle that a trademark in general is considered as that visible sign that distinguishes products or services from others of the same species or class in the market. That the previous and continuous use of such distinctive visible sign by anyone generates certain rights and particularly certain legal expectations. That the right to the exclusive use of a trademark is obtained through the registration of such trademark before the relevant Intellectual Property Authorities.

That it is a fact that has not been contested by Respondent, that the Complainant has used the ATLANTIC RECORDS mark and brand name since 1949 and since November 1994 on the Internet. That the ATLANTIC RECORDS mark is notoriously known. That such mark is clearly related to pre recorded media products and particularly to Complainant’s well known business activities. That the previous use of such mark must be notoriously known by Respondent.

That it is imperative to distinguish the rights that are generated from a trademark registration, from those that are born and generated from the repetitive use of a distinctive sign that identifies the holder of such trademark. That it is unquestionable that the trademark legislation recognizes rights over a mark which are definitively based on previous use.

This Panel considers that even if a trademark is not yet approved by the authorities and the relevant certificate is not yet granted, this does not mean that such a trademark does not exist, with substantial goodwill generated on someone’s businesses, with name and brand recognition, and with certain expectation rights that may become reality as soon as the authority grants such recognition and validates such prior use as constitutive of the right to such trademark.

ATLANTIC RECORDS is not a registered mark that may entitle its owner to its exclusive use in the general business arena.

However, ATLANTIC RECORDS definitively constitutes a mark to which the Complainant has rights. Its previous long term use entitles the Complainant to request the national and international registration of such mark. It also grants the Complainant the right to object and request the nullification of other similar marks, even if previously registered. It definitively grants the Complainant the right to use such mark and to receive other benefits derived from such mark. Furthermore, the ATLANTIC RECORDS mark is not and has not been registered by Respondent, nor Respondent demonstrated to have any right or title upon such mark, prior to the rights, that to such mark, have been evidenced by Complainant.

The registration provides the "exclusive right" to the use of a trademark within a specific line of business activity. The Panel considers that this proceeding does not pretend to determine who has the right to the exclusive use of a mark within a specific line of business activity, but only to determine who has the priority and right to use a domain name in the Internet.

It is clear from the evidence, and not disputed by the Respondent that, in its various manifestations, ATLANTIC, ATLANTIC RECORDS and ATLANTIC RECORDING CORPORATION are marks and brand names well recognized and famous both in the United States and internationally. It is also asserted and not disputed that such marks and brand names represent goodwill of substantial value.

The Complainant uses ATLANTIC with a range of other descriptive or generic terms to identify various aspects of its business, for example ATLANTIC RECORDS. Furthermore, the addition of the phrase ".com." is non-descriptive and does not alter the value of the mark represented in the domain name. In addition, the ".com" is a necessary element required for registration of any domain name, and not voluntary and arbitrarily chosen additions to be included by registering parties. Likewise, the Complainant registered and used a number of domain names in the same fashion, namely <atlanticrecords.net> and <atlanticrecords.org>.

The domain in dispute is clearly a combination of a generic word "Records" (identifying the business of the Complainant) and the trademark ATLANTIC. It is confusingly similar to various names used by the Complainant in the course of its business and identical to the trademark ATLANTIC.

This Panel also considers that it is within the spirit of the Internet as well as within that of International Agreements such as the Paris Convention for the Protection of Industrial Property, to prohibit unfair competition, considering as such those acts that are capable of creating confusion with respect to the establishments, products or activities of a competitor. The Paris Convention considers as such, any competitive act which is contrary to the honest uses on industrial or commercial matters. Under such Convention it is sufficient to provide evidence that the competitor may subtract for its benefit, the attention from the clientele of a competitor, without compromising or making use of its own forces, resources or invention, but simply by performing imitative acts, to be considered as carrying on unfair competition practices.

This Panel considers, that by registering the disputed domain name under the well known mark and brand name of the Complainant, the Respondent was seeking to unfairly compete with the Complainant by diverting the attention of its clientele. The Respondent has done so without making use of its own forces, resources or invention, but simply by performing such imitative acts in the same line of business activities and within the same regional market from which both parties operate.

This Panel considers that Complainant has rights over the ATLANTIC RECORDS mark, and that the domain name that has been registered by the Respondent is identical to the ATLANTIC RECORDS mark and confusingly similar to the ATLANTIC mark composed by the very well known ATLANTIC mark and records business of Complainant, as may be unmistakably identified by the consumers.

Given the substantial exposure, registration and use of the ATLANTIC Marks, this Panel finds that there is no indication that the Respondent has any rights or legitimate interests in respect of the domain name as it has not used or prepared to use the <atlanticrecords.com> domain name in connection with any bona fide offering of goods or services as contemplated under Paragraph 4 (c) (i) of the Policy; nor that the Respondent is commonly known by the domain name as contemplated under Paragraph 4 (c) (ii) of the Policy; nor that the Respondent is making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue as contemplated under Paragraph 4 (c) (iii) of the Policy.

When the domain name <atlanticrecords.com> was first registered, it seems on April 26, 2000, the international reputation in ATLANTIC and ATLANTIC RECORDS was well established. In light of the above findings, it is found that the registration was, on the face of it, made in bad faith.

It appears that there has been no use of the domain name by the Respondent. However, it is now well established that such use is not necessary.

However, it is clear from the correspondence that the original registrant Mr. Schumacher offered to sell the domain name to the Complainant. It is found that the amount sought was in excess of the out of pocket expenses of Mr. Schumacher, absent any explanation as to where these costs might have been incurred. It is also clear that the Respondent was put on notice of the Complainant’s allegations against Mr. Schumacher, but has failed to explain its position or offer an explanation as to how and/or why it acquired the domain name.

We find that the transfer and retention of a domain name with knowledge that such conduct may offend another’s rights cannot be construed as use in good faith, particularly in the absence of a satisfactory response. In the panel’s view this conduct amounts to or evidences use of the domain name in bad faith. Further, there is no evidence that the domain name was registered and transferred in good faith. Indeed, given the Respondent’s silence the inference has to be drawn that the opposite applies.

In this case it is clear that no positive action has been undertaken by Respondent in relation to the domain name. Since the hypotheses identified in paragraph 4(b) are not limitative, it is possible to say that Respondent’s inactivity, or passive holding of the domain name, may prove that the domain name has been registered and is being used in bad faith.

The Respondent’s passive use of the domain names together with the questionable attitude evidenced by the irregular change of ownership has given this Panel an impression of the Respondent’s violation of standards of reasonableness and have also pointed towards the Respondent’s questionable conduct based on a lack of good faith operation of a business through the Internet.

In view of the above mentioned, in association with all the reasons enunciated by the Complainant, the Panel finds that Respondent registered and has used the Domain Name in bad faith, also in particular but without limitation, pursuant to Paragraph 4 (b) (i) of the Policy, in view that there are circumstances indicating that Respondent registered the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration for valuable consideration in excess of Respondent’s documented out-of-pocket costs directly related to the domain name; that pursuant to Paragraph 4 (b) (iii) Respondent registered the domain name primarily for the purpose of disrupting the business of Complainant; and pursuant to Paragraph 4 (b) (iv) of the Policy, in view that Respondent may in the future intentionally attempt to attract, for commercial gain, Internet users to its website or other on-line location, by creating a likelihood of confusion with Complainant’s mark, as to the source, sponsorship, affiliation, or endorsement of Respondents’ website.

Lastly, it is hereby noted that no settlement has been reached by the Parties and made known to this Panel prior to the rendering of this Panel’s decision, which may eventually affect or give ground for termination of this administrative proceedings as provided for under paragraph 17(a) of the Rules, nor is this Panel aware of the existence or initiation of any other type of legal proceedings before a court of competent jurisdiction for independent resolution, regarding the domain name dispute as contemplated under paragraph 4 (k) of the Policy.

Therefore, and in consideration to the Complaint’s compliance with the formal requirements for this domain dispute proceeding, to the factual evidence and legal contentions that were submitted, to the conclusive confirmation of the presence of each of the elements contemplated in Paragraph 4 (a) (i), (ii), and (iii) of the Policy, and on the basis of the statements and documents submitted and in accordance with the Policy, the Rules and other applicable rules and principles of law, as directed by paragraphs 14 (a) and (b) and 15 (a) of the Rules, this Panel decides:

(1) that the Domain Name registered by Respondent is identical and confusingly similar, respectively, to the name of Complainant’s ATLANTIC RECORDS and ATLANTIC marks.

(2) that Respondent has no rights or legitimate interests in respect of the <atlanticrecords.com> Domain Name; and

(3) that the <atlanticrecords.com> Domain Name has been registered and is being used in bad faith by the Respondent.

Therefore, the Panel requires, pursuant to what is provided for under Paragraphs 3 (c) and 4 (i) of the Policy, that the domain name <atlanticrecords.com> be transferred to Atlantic Recording Corporation, Complainant.

Clive L Elliott
Presiding Panelist

Richard W Page
Panelist

Pedro W. Buchanan Smith
Panelist

Dated: April 28, 2001