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WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

BWT Brands, Inc and British American Tobacco (Brands), Inc v. NABR

Case No. D2001-1480

 

1. The Parties

The First Complainant is a company incorporated in the state of Delaware, whose registered office and principal place of business is situated at Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware, United States of America 19801.

The Second Complainant is a company incorporated in the state of Delaware, whose registered office and principal place of business is situated at 401 South Fourth Avenue, Suite 1800, Louisville, Kentucky 40202, United States of America.

The Complainants are represented by Ms. Julia Kay Akers, BatMark Limited, London, United Kingdom.

The Respondent, NABR, is located at 7770 Regents Road, Suite 113194, San Diego, CA 92122, United States of America.

 

2. The Domain Name and Registrar

The domain name at issue is <kool.com>.

The Registrar with which the disputed domain name is registered is Network Solutions, Inc, 505 Huntmar Park Drive, Herndon, Virginia 20170, United States of America.

 

3. Procedural History

On December 21, 2001, a Complaint was received by the WIPO Arbitration and Mediation Center ("WIPO Center") for decision in accordance with the Uniform Policy for Domain Name Dispute Resolution ("the Policy"), adopted by the Internet Corporation for Assigned Names and Numbers ("ICANN") on August 26, 1999.

On January 3, 2002, the Registrar responded to a request for verification of the disputed domain name <kool.com> confirming:

- That the Complainant had sent Network Solutions, Inc a copy of the Complaint

- The details of the Respondent

- That the Policy applied to the disputed domain name

- That the Respondent is the current registrant of the disputed domain name

- That the disputed domain name is in active status

On January 22, 2002, the WIPO Center transmitted a Notification of Complaint and Commencement of Administrative Proceeding to the Respondent. The Respondent was advised that a response to the Complaint was required within 20 calendar days i.e. by February 11, 2002.

On February 11, 2002, a Response was received from the Respondent.

On March 13, 2002, the WIPO Center advised the parties that an Administrative Panel had been appointed, consisting of a single member. The Panelist finds that the Administrative Panel was properly constituted in accordance with the Rules and the Supplemental Rules.

The Panel has independently determined and agrees with the assessment of the WIPO Center that the Complaint meets the formal requirements of the Rules for Uniform Domain Name Dispute Resolution Policy as approved by ICANN on October 24, 1999, ("the Rules") and the Supplemental Rules.

 

4. Factual Background

The Complainants state that they are members of the British American Tobacco Group of companies ("BAT Group"), which they claim is one of the United Kingdom’s leading business enterprises with operations in more than 80 countries and employing over 80,000 people worldwide.

The Complainants state that the BAT Group is principally engaged in the manufacture and sale of cigarettes, selling over 300 brands in 180 different countries. The Complainants state that the BAT Group through its various subsidiaries, including the Complainants, is the owner of numerous trademarks, including the registered trademark KOOL.

The Complainants state that the First Complainant is the owner of the registered trademark KOOL for use in connection with cigarettes and tobacco products in the United States of America and that the Second Complainant is the owner of the same trademark in many other countries of the world.

The Complainants state that the First Complainant acquired its right to the various KOOL trademark registration in the United States from its affiliated BAT Group company, B&W, in 2001. The Second Complainant acquired its rights to the various KOOL trademark registrations from its affiliated BAT Group company, B&W, in 1995. The Complainants state that they, or their affiliated BAT Group companies, have secured trademark protection for more than 500 registrations for the trademark KOOL in over 20 countries. Extensive evidence of these trademark registrations was annexed to the Complaint.

The Complainants claim that the KOOL trademark is very well-known. The Complainants claim that the trademark KOOL was first introduced in the United States in 1933, and that since then cigarettes and tobacco products bearing the KOOL trademark have been sold in more than 180 countries throughout the world. The Complainants state that by 1937 the brand had grown to account for 2.5% of the US market and that by 1964 this had increased to 3.8%.

Additionally, the Complainants state the KOOL trademark has been used by the Toyota Indy Car Motor Racing Team as livery for its racing cars and drivers’ overalls. The Complainants claim that as a result of the media attention attracted by Indy Car racing in many countries, the KOOL trademark has been further exposed to many people throughout the world.

In May 1997, the Respondent registered the disputed domain name, amongst many others. The Respondent’s principal, Mr. Van R Whiting, Jr., claims that the domain names were registered with the intention that these be developed and operated as part of a larger network of websites. This network of websites would constitute what the Respondent describes as its "reverse portal" strategy.

Mr. Van R. Whiting, Jr. describes the "reverse portal" as essentially the opposite of the common portal strategy exemplified by Yahoo and similar websites where users are pushed through a single point of entry, or portal. He states that by comparison, under the "reverse portal" strategy, once at each site that is part of the network, a unique navigation bar would take users through the rest of network. He explains that the "reverse portal" pools users into the network through many addresses, rather than pushing users through a single address.

The Respondent states that the reverse portal strategy was formulated after the Respondent had engaged in an extensive study of business models and technology strategies, together with his business associate, Mr. Andrew Hillhouse.

Mr. Van R. Whiting, Jr. claims that he and Mr. Hillhouse formed a corporation, Global Convergence, Inc, ("GCI") based on the strategy and developed a business plan to engage in web-based commerce by means of a network of interlinked Internet sites. Mr. Van R. Whiting, Jr. states that he and Mr. Hillhouse invested significant amounts of time and more than $100,000 into developing the reverse portal strategy.

Mr. Van R. Whiting, Jr. states that at the time the Respondent registered the disputed domain name, he was aware that "kool" was a term in common usage among young people and especially on the Internet, and thus would be especially attractive for the youth segment of the planned network.

Mr. Van R. Whiting, Jr. states that on or about January 10, 1998, his business associate, Mr. Hillhouse produced a color illustration of "Global Convergence, Inc network of websites", which includes <kool.com> as one of the domain sites under the general section <OneFun.com>. A copy of that illustration was annexed to the Response.

Mr. Van R. Whiting, Jr. states that during the summer of 1998, he and Kerry Takenaka, an engineer, began to design the network and the core services. He states that, together with his associates, he formulated a design of core services for <kool.com> on July 18, 1998. He states that at this time Mr. Takenaka submitted to him a document setting out a "list of core services for <kool.com>, a free email and hosting service". A copy of this document dated July 18, 1998, was also annexed to the Response.

Mr. Van R. Whiting, Jr. states that in the Fall of 1998, he retained the services of Caio James. Mr. Van R. Whiting, Jr. states that he held regular meetings with Kerry Takenaka and Caio James, planning the design and implementation of the network. Contemporaneous notes made by Mr. Van R. Whiting, Jr. and annexed to the Response, show <kool.com> as part of those discussions.

Mr. Van R. Whiting, Jr. claims that in the Spring of 1999, GCI sought and obtained the services of a graphic designer, Berne Smith, to work on the network navigation system and the logos for GCI and the network of sites. From May 1999, Berne Smith worked with the team in supervising the design aspects of the development.

Mr. Van R. Whiting, Jr. claims that <kool.com> was a part of this design planning from the beginning. Mr. Van R. Whiting, Jr. states that the group discussed the characteristics of the youth market and the "edgy" nature of "kool" v. "cool". He states that they also discussed the prospects <cool.com>, a competing site under development at the same time (as a youth portal).

Mr. Van R. Whiting, Jr. states that during the planning, the group were cognizant of the evolution of Internet jargon and the evolving use of short cuts among young people on the Internet. He states that expressions such as "ur kool" or "u r kool" were, and are, in widespread use as part of Internet vernacular. Examples of the use of such expressions on the Internet, particularly by young people, were annexed to the Response.

Mr. Van R. Whiting, Jr. states that in August 1999, he attended the national Comic Book Convention ComicCon, with his son. He said that he asked the famous comic designer, Neal Adams, to render <kool.com>. He annexed a copy of those renderings (signed by Neal Adams) to the Response.

Mr. Van R. Whiting, Jr. states that the Neal Adams’ versions were not in fact used by the Respondent as Berne Smith undertook to complete the network design. This was completed in December 1999. (Berne Smith also provided a statement in support of the Response confirming this.)

It is unclear from the Complaint exactly when the Complainants became aware that the Respondent had registered the disputed domain name, however, in June 1999, BATMark Limited, on behalf of the Complainants, instructed an agent to make a "no names" approach to the Respondent to inquire as to the selling price of the domain name. The Respondent’s email response to that inquiry was annexed to the Complaint:

"... To your second question, yes, we own <kool.com>, although we cannot warrant it for any particular use. Trademark trumps, but only for specific product classes. Thus, we would never use the site for anything related to tobacco products.

Would we sell, and if so, at what price? We are planning a service at <kool.com> as part of a network of sites. Before the launch we might consider a sale, but as you surmised, it would be expensive. In recent sales of ‘bare’ domains (no site) with ‘good’ short domains, ‘baltimore.com’ sold for $100,000 to an Irish group (narrow demographic) while WallStreet.com sold for US$1 million two weeks ago (high income demographic). So: we would not sell for $100,000, we would sell for $1 million, and in between we would probably auction the name to determine the market value.

We are actively seeking content and service partners. If your client would be interested in partnering with us, that is also a possibility. I would be glad to speak with a principal of the firm if you would be good enough to send name and contact information."

The Complainants state that they did not enter into negotiations with the Respondent as the selling price was "too high". Instead, the Complainants sought suspension of the disputed domain name through Network Solutions, Inc. The disputed domain name was suspended until Network Solutions, Inc reinstated all suspended domain names when ICANN’s UDRP procedure was launched.

The Complainants claim that BATMark implemented internal monitoring of the domain name upon its reinstatement. They state that the intention was that BATMark would register the disputed domain name if it became available by virtue of non-renewal and that they would take appropriate action should the disputed domain name be put into use.

On September 17, 2001, BATMark Limited, on behalf of the Complainants, instructed an agent to make a further "no names" approach to the Respondent enquiring as to the current status and selling price of the disputed domain name.

The Respondent replied as follows:

"Please excuse the delay in replying to your inquiry on <kool.com>. <Kool.com> is not for sale. It is under development as a site for kids. Thank you for your inquiry."

The Complainants claim that they were concerned about a well-known brand of tobacco being associated with minors. The Complainants state that they therefore took the decision to cease merely monitoring the disputed domain name and instead to institute proceedings to recover or cancel the disputed domain name.

 

5. Parties’ Contentions

A. The Complainant

The Complainants state that they concluded, from the circumstances, that the Respondent’s primary purpose in registering the disputed domain name was either to:

(a) Sell, rent or otherwise transfer the domain name registration to them or a competitor of theirs for valuable consideration in excess of the Respondent’s out-of-pocket costs directly related to the domain name; and/or

(b) Prevent the Complainants from reflecting their mark in a corresponding domain name; and/or

(c) To attract for financial gain, Internet uses to the Respondent’s website or other on-line location, by creating a likelihood of confusion with the Complainants’ marks, as to the source, sponsorship, affiliation or endorsement of the Respondent’s website or location of a product or service on the Respondent’s website or location.

The Complainants state that the disputed domain name is identical to the Complainants’ registered trademark. The Complainants also claim that the disputed domain name is confusingly similar to numerous registered trademarks of the Complainants.

The Complainants confirm that the Respondent is not an authorised licensee of either the First or Second Complainant, nor is the Respondent authorised to use the Complainants’ trademark.

B. The Respondent

The Respondent claims that its registration and use of the disputed domain name has at all times been legitimate and in furtherance of its business strategy to develop and operate a network of linked websites. The Respondent claims that it has expended substantial time, money and effort into that strategy and has a legitimate interest in the disputed domain name. The Respondent claims that although the selling of the disputed domain name is identical to the spelling of the Complainants’ trademark, the concept of "confusingly similar to a trademark" can only be understood in the context of specific products or services. The Respondent claims that the Complainant has failed to demonstrate that the Respondent used or planned to use the disputed domain name in any way which it is "confusingly similar to the Complainants’ trademark".

The Respondent states that its investment both in the network of interlinked Internet sites, and the Respondent’s specific development, expense and effort in the development and design of <kool.com>, show the rights and legitimate interest in the disputed domain name by the Respondent. The Respondent claims that after the registration of the disputed domain name in May 1997, it promptly began building the infrastructure for its business, leading to the incorporation of GCI in January 1998.

The Respondent claims that it never knowingly had any contact of any kind with the Complainant or the Complainant’s representatives.

The Respondent denies that it is a cybersquatter and states that it has acted in good faith in operating and using the disputed domain name. The Respondent reiterates that the purpose of the registration of the disputed domain name and the other domains was to draw traffic to the network from different sites. It claims that the intent was never to sell the disputed domain name or the other domains, but rather to develop them.

 

6. Discussion and Findings

Paragraph 15(a) of the Rules instructs the Panel to:

"decide a complaint on the basis of the statements and documents submitted in accordance with the policy, these rules and any rules and principles of law that it deems applicable".

The burden for the Complainants, under paragraph 4(a) of the Policy, is to show:

- That the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainants have rights; and

- That the Respondent has no rights or legitimate interests in respect of the domain name; and

- That the domain name has been registered and is being used by the Respondent in bad faith.

Domain name is confusingly similar or identical to a trademark or service mark in which the Complainants have rights

The Complainants have provided extensive evidence of the trademark registrations for the trademark KOOL in the United States of America and in other countries around the world. The Respondent does not dispute the fact that the Complainants own certain trademarks related to their KOOL brand of cigarettes.

The Respondent claims that although the trademark KOOL is identical to the Complainants’ registered trademarks, the concept of "confusingly similar to a trademark" can only be understood in the context of specific products or services. The Respondent states that the Complainants have failed to demonstrate that the Respondent used or planned to use the mark in a "confusingly similar" manner.

With respect, the Panel does not accept this part of the Respondent’s analysis. The burden on the Complainant under this head is merely to demonstrate that the disputed domain name is similar or identical to the Complainants’ trademark, without reference to the way in which the domain name is being used. Plainly enough, the disputed domain name <kool.com> is identical to the Complainant’s registered trademark.

Respondent has no rights or legitimate interests in respect of the domain name

The second burden on the Complainant is to establish that the Respondent has no rights or legitimate interest in the disputed domain name. The Policy outlines (paragraph 4(c)) circumstances which, if found by the Panel to be proved, shall demonstrate the Respondent’s rights or legitimate interest in the domain name. These circumstances are:

(i) Before any notice to the Respondent of the dispute, the Respondent’s use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with the bona fide offering of goods or services; or

(ii) The Respondent (as an individual, business or other organisation) has been commonly known by the domain name, even if the Respondent has acquired no trademark or service mark rights; or

(iii) The Respondent is making a legitimate non-commercial 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.

The Respondent has provided evidence of its demonstrable preparations to use the disputed domain name prior to any notice of the dispute by the Complainants. The Respondent alleges that it has expended considerable time and money developing the network of sites of which the disputed domain name forms part.

At least as early as July 18, 1998, prior to any notification of the dispute from the Complainant, the Respondent formulated a design of core services for <kool.com>. By April 1999, again prior to any notification from the Complainant, the Respondent contracted with a senior graphic designer to begin design of the network of interlink Internet sites, including <kool.com>. The Respondent has provided documents which evidence this preparatory work.

In these circumstances, the Panel finds that the Complainants have failed to show that the Respondent had no legitimate rights or interest in respect of the disputed domain name.

Domain name has been registered and is being used in bad faith

Paragraph 4(b) of the Policy states:

"For the purposes of Paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith:

(i) Circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or

(ii) You have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or

(iii) You have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) By using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website or other on-line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location or of a product or service on your website or location."

The Complainants allege that the circumstances indicate that the Respondent’s primary purpose in registering the disputed domain name was to sell, rent or otherwise transfer the disputed domain name registration to them or a competitor of theirs for valuable consideration in excess of the Respondent’s out-of-pocket costs directly related to the domain name.

The email from the Respondent in June 1999 certainly indicates that the Respondent was prepared to sell the disputed domain name for the right price. However, that email communication also indicated that the Respondent was planning to provide a service at <kool.com> as part of a network of sites. The email merely states "before the launch we might consider a sale ...".

The Panel does not consider that this is sufficient evidence to demonstrate that the Respondent’s primary purpose in registering the domain name was to sell the domain name for in excess of its out-of-pocket expenses. Indeed the evidence which the Respondent tendered as to its plans for the site (and referred to under the previous heading) shows that there was a legitimate purpose – namely the construction of a network of interlinked Internet sites.

Additionally, when the Complainants’ agents next contacted the Respondent, the Respondent confirmed that the disputed domain name was not for sale. The Panel considers that this is inconsistent with the Complainants’ contention that the primary purpose of registration was to sell the disputed domain name to the Complainant or its competitors.

Paragraph (ii) above can be of no application as there is no evidence that the Respondent has engaged in a pattern of such conduct. Additionally, the Panel accepts that the Respondent’s primary purpose in registering the site was in order to use it as part of its "reverse portal" network of sites and not to prevent the Complainants from reflecting the mark in a corresponding domain name.

Paragraph (iii) above is also of no application as there is no suggestion that the Respondent is a competitor of the Complainants.

The Complainants have alleged that in registering the disputed domain name, the Respondent intended to attract for commercial gain, Internet users to its website or other on-line location, by creating a likelihood of confusion with the Complainants’ mark in terms of paragraph (iv) above.

Without further evidence, the Panel is unable to accept this assertion. The Complainants’ registered trademark is a misspelling of the word "cool". The Respondent has provided evidence that in Internet vernacular, this deliberate misspelling is common, particularly amongst teenagers and pre-teens. There is no evidence to suggest that the registration of the disputed domain name was a deliberate ploy to trade off the reputation of the Complainants. Rather, it appears from the evidence that the word "kool" is being used as a variant of "cool" used by the Respondent’s target market.

The onus of proof lies with the Complainant to demonstrate that the disputed domain name was registered and is being used in bad faith. The Panel does not consider that the Complainant has discharged this onus of establishing that the disputed domain name was registered or is being used by the Respondent in bad faith.

 

7. Decision

For the foregoing reasons, the Panel decides that:

(a) the domain name <kool.com> is identical to a trademark or service mark in which the Complainants have rights;

(b) the Complainants have failed to establish that the Respondent does not have a legitimate right or interest in respect of the domain name <kool.com>;

(c) the Complainants have failed to establish that the domain name <kool.com> has been registered and is being used in bad faith.

Accordingly, the Panel refuses to order that the disputed domain name <kool.com> be transferred to BWT Brands, Inc.

 

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Andrew Brown
Sole Panelist

Dated: March 26, 2002