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1.1 The Complainant is Irvine Eurocars LLC dba Irvine BMW. Complainant failed in its filings to explain its status but the Panel has independently determined that it is a limited liability company organized under the laws of the State of Delaware, United States of America. with its principal place of business being 9881 Research Drive, Irvine, CA 92618, United States of America. ("Irvine Eurocars" or "Complainant").

1.2 The Respondent is Web Advance & Media, a sole proprietorship of Ms. Gina Borchers, whose principal place of business is 27 Cartagena, San Clemente, CA 92672 United States of America. ("Web Advance" or "Respondent").

The domain name upon which this Complaint is based is <irvinebmw.com> (the "Domain Name"). The Registrar of the Domain Name as at the date of the Complaint is Network Solutions. ("Network Solutions" or "Registrar").

The Complaint submitted by Complainant was received on July 9, 2002, by e-mail and in hardcopy on July 11, 2002, by the WIPO Arbitration and Mediation Center ("WIPO Center"). The WIPO Center has determined that the Complaint satisfies the formal requirements of the Uniform Domain name Dispute Resolution Policy approved by the Internet Corporation for Assigned Names and Numbers on October 24, 1999 (the "Policy"). Further, the WIPO Center has verified that the Complaint also satisfies the formal requirements of the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") as well as the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the "Supplemental Rules"). The Complainant made payment to the WIPO Center in the required amount.

On July 10, 2002, the WIPO Center notified the Registrar that the Complaint had been filed. In response, on July 12, 2002, the Registrar confirmed to the WIPO Center that, inter alia, the Domain Name was registered with the Registrar, the Respondent was the registrant of the Domain Name at issue, the Policy applies to the dispute at issue, and that the language of the registration agreement and hence the dispute is English.

In accordance with Paragraph 2 (a) of the Rules, the WIPO Center notified the Respondent formally on July 12, 2002, of the filing of the Complaint and the commencement of the Administrative Proceeding. This Notice advised the Respondent that Respondent had until August 1, 2002, to respond to the Complaint. On August 6, 2002, the WIPO Center transmitted the case to the Administrative Panel consisting of a single member, James H. Grossman of San Francisco, California, United States of America. The panelist submitted a Statement of Acceptance and Declaration of Impartiality and Independence in accordance with the Rules and agreed to forward a decision in accordance with Paragraph 15 of the Rules on or before August 20, 2002.

Respondent requested certain information in an e-mail on July 30, 2002, and filed a response with the WIPO Center on July 31, 2002, by e-mail and a hardcopy was filed on August 2, 2002.

Except for the above, there have been no additional submissions by either party.

The following is asserted as fact by the Complainant:

Complainant is an authorized dealer of Bayerische Motoren Werke Aktienggesellschaft ("BMW"), an internationally recognized manufacturer of BMW automobile vehicles. BMW is the owner of an extensive list of registered trademarks and Complainant is an authorized distributor of those goods. The goods are world famous and sold throughout the world. Complainant and its predecessor in interest have sold BMW automobiles at locations in Orange county, California under the name Irvine BMW since "no later than September, 1988". The contested Domain Name is virtually identical to the mark Complainant uses under authority of BMW and incorporates one or more of BMW's highly distinctive and famous BMW marks which Complainant is licensed to use. The Domain Name is also virtually identical to Complainant's fictitious business name "Irvine BMW".

On September 25, 1998, Complainant sent a cease and desist letter to Respondent demanding Respondent immediately discontinue its infringement of Complainant's trademarks and that Respondent transfer the Domain Name to Complainant within 15 days or else Complainant would proceed with litigation. On October 12, 1998, Respondent replied denying the allegations and setting forth its own analysis of the history of the filing and use of the Domain Name.

The following is asserted as fact by the Respondent:

Respondent explains that it purchased the Domain Name as well as the domain name <saddlebackbmw.com> ("Other Site") in April, 1997 with its credit card for the benefit of Saddleback BMW, the predecessor of Complainant. Thereafter Mr. Claus Lischer, the owner of Saddleback BMW on September 17, 1997, pursuant to a letter attached to Respondent's Response, advised Respondent that "While I believe your design of your website would be very beneficial to Saddleback BMW, I regret that I can not buy in to it at this time. I understand that the website and address is exclusively yours." On September 19, 1997, Respondent advised the Registrar that it would continue to act as billing agent and also requested the transfer of ownership of the Domain Name and the Other Site and stated that it understood there would be a re-registration fee involved for both sites. In May, 1998 Respondent alleges it met with the general manager of Complainant who stated the Complainant had not interest in the website. Only in September of 1998, according to Complainant, did the new owner of Complainant decide that Complainant did want the Domain Name and the other site. In December, 1998 Respondent states that it agreed with a representative of BMW to remove the BMW logos from the site. At the same time, according to Respondent all content was removed from both sites, leaving them blank. In March 2000 Respondent agreed to remove access to the sites from the Internet so that the sites are not longer visible to the public. Respondent advises that it has considered selling at least one of the sites to a BMW Parts & Service center or another BMW related business.

Complainant argues that the Domain Name should be transferred to Complainant because all of the three elements required by Paragraph 4 (a) of the Policy are present, namely, (i) Respondent’s Domain Name is virtually identical or confusingly similar to Complainant’s highly distinctive registered marks, (ii) Respondent has no rights or legitimate interest in respect of the Domain Name and does not use the Domain Name to sell any products and (iii) Respondent has registered the contested Domain Name for the sole purpose of extorting money from Complainant, to misleadingly divert consumers from locating Complainant on the internet, and to tarnish and bring into disrepute the registered trademarks by maintaining an empty web site at which consumers would expect to find a reputable dealership. All of this plus Respondent's attempt to extort from Complainant a price for relinquishing the Domain Name far beyond the out-of-pocket costs directly related to the Domain Name demonstrate Respondent's bad faith registration and use of the Domain Name.

Complainant advises that in August, 1998 the President of Complainant discovered that Respondent had registered the Domain Name. Complainant alleges that Respondent would only relinquish the Domain Name for one-half million dollars although the demand was later reduced to $100,000.

Respondent's argument relating to the issue of the fact that the Domain Name is confusingly similar is that it registered and used the name with the full knowledge and permission of the former owner. When requested by representatives of BMW, Respondent removed the logo and finally all content and thus there was no intent to mislead or divert prospective customers according to Respondent.

With regard to bad faith, Respondent points out that the Domain Name and other site were registered and used with full knowledge and permission of the former owner and held legitimate content approved by that owner. Respondent claims there is no evidence that it ever made a demand for payment and that Complainant has made no offer to it either. The transfer of the Domain Name from the former dealership to Respondent took place prior to the sale of the dealership. It is Respondent's contention that there was no Irvine BMW until February 4, 1999, while it had registered the Domain Name in April, 1997.

The Panel is of the view that the Domain Name when used with the BMW logo obviously creates consumer confusion. Respondent has removed the logo at the behest of BMW and now the website has been taken down. Nevertheless, at any point in the future when the Domain Name is used, the Panel is of the view that it is confusingly similar to the business of Complainant, unless it is used by another similar business which would justify the use of such a name. As used by Respondent, the Panel finds that the Complainant has proven that the Domain Name is confusingly similar in accordance with Paragraph 4(a)(i) of the Policy.

Paragraph 4 c. of the Policy explains how a Respondent can demonstrate its rights to and legitimate interests in the Domain Name. Respondent has described in detail the legitimacy of its registration; however, there is a serious question as to its continued use in the form prior to its being taken off the Internet. With regard to use of the Domain Name (as opposed to registration), the Panel agrees with prior decisions to the effect that the Respondent must be considered to have constructive knowledge of the trademarks available to Complainant and, further, that Respondent has no license or other permission to use the Domain Name from Complainant. Further, the Panel has confirmed for itself that the Domain Name used for the benefit of Respondent is no longer in use as of the date of this opinion. Respondent has stated its intent to sell the Domain Name to other BMW affiliated businesses; however, for some reason, this has not occurred over the past several years. A party who sits on the Domain Name with the purpose of preventing its use cannot sustain the legitimacy of interest by a more legitimate user. The Panel does not agree that this lack of use should be considered in this instance as a factor in favor of Respondent's prior or current legitimate use of the Domain Name. The Panel finds that the Complainant has proven Paragraph 4(a)(ii) of the Policy.

It is the issue of bad faith however that is the critical problem with Complainant's case. In making a determination on the issue of bad faith the Panel has looked carefully into the decision rendered in Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003. The Panelist in that case went to great lengths to explain the need to prove the domain name "has been registered and is being used in bad faith" by Respondent. Most importantly, the Panel in that case points out the use of the conjunction "and" thereby requiring the Complainant to prove registration in bad faith as well as use in bad faith. That is to say that bad faith use alone or the registration in bad faith alone is insufficient to meet the test required by the Policy. Looking first to the question of whether the Domain Name "is being used in bad faith", the Domain Name is not currently being used at all nor is there any evidence that any on-line use is contemplated. Further although there is mention by Respondent of intent to sell to other similar businesses, the Panel sees no action being taken in that regard. The Panel cannot imagine any use by Respondent of the Domain Name that would a legitimate use and not an infringement of the rights of Complainant. Thus, while the Panel finds that the Complainant has proven the "use in bad faith," the more difficult issue relates to whether the Domain Name "has been registered" in bad faith. The Panel has reviewed the criteria contained in Paragraph 4 b. of the Policy regarding evidence of bad faith and is persuaded that, in fact, the Respondent did register the Domain Name with the permission and knowledge of the prior dealership's management. Further, the letter from Mr. Liescher of September 17, 1997, is clear as to the transfer of the ownership of the Domain Name to Respondent. The registration of the Domain Name and its transfer to Respondent occurred before Complainant took steps to protect the name. There was no intent in the registration to disrupt the business of a competitor or to attract Internet users to the site to create any confusion as to source or affiliation.

With regard to evidence of bad faith where a domain name was registered primarily for the purpose of selling it for valuable consideration in excess of out of pocket costs, in this case, Respondent was given the Domain Name freely by someone who did not consider it to be of value. Although Complainant refers to excessive demands as to price for the sale of the Domain Name, there is no written evidence of any price for sale by Respondent to Complainant. It is also likely that Complainant when purchasing the dealership did not consider the value of the Domain Name and the Other Site. Complainant, as part of its due diligence, should have insisted that the Domain Name and Other Site be transferred as part of the transfer of ownership, in which case the prior owner undoubtedly would have negotiated the transfer of the Domain Name to Complainant and not given it to Respondent. Whether Respondent accepted the Domain Name from the former dealership primarily with the intent to sell it to the Complainant has not been adequately proven by the evidence before the Panel.

The Panel is of the view that as of this date Respondent's actions in registering the Domain Name and taking ownership from the prior dealership does not meet the test of having been registered in bad faith, even though the test of the use in bad faith has been satisfied. Since the Policy requires that the domain name "has been registered and is being used in bad faith, the requirements of Paragraph 4. (a)(iii) have not been met.

For all of the foregoing reasons, the Panel decides that the Domain Name registered by Respondent is confusingly similar to the trademark in which the Complainant has rights, that the Respondent has no legitimate interests in respect of the Domain Name at issue, but that Complainant has failed to prove that the Domain Name has been registered and is being used in bad faith. Accordingly, the Panel finds in favor of the Respondent.