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WIPO Arbitration and Mediation Center

 

ADMINISTRATIVE PANEL DECISION

Shangri-La International Hotel Management Limited v. NetIncome Ventures Inc.

Case No. D2006-1315

 

1. The Parties

The Complainant is Shangri-La International Hotel Management Limited, Central, Hong Kong, SAR of China, represented by Richards Butler, Central, Hong Kong, SAR of China.

The Respondent is NetIncome Ventures Inc., Penticton, British Columbia, Canada, represented by John Berryhill, Media, Pennsylvania, United States of America.

 

2. The Domain Name and Registrar

The disputed domain name <shangrila.com> is registered with Moniker Online Services, LLC.

 

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on October 11, 2006. On October 13, 2006, the Center transmitted by email to Moniker Online Services, LLC a request for registrar verification in connection with the domain name at issue. On October 17, 2006, Moniker Online Services, LLC transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details for the administrative, billing, and technical contact. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on October 26, 2006. In accordance with the Rules, paragraph 5(a), the due date for Response was November 15, 2006. The Response was filed with the Center on November 15, 2006.

The Center appointed Alan L. Limbury, C. K. Kwong and Dennis A. Foster as panelists in this matter on December 15, 2006. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

On December 29, 2006, due to exceptional circumstances, the Administrative Panel extended the time for its decision by 2 weeks, to January 12, 2007.

On January 12, 2007, by Procedural Order No. 1, pursuant to the Rules, paragraph 12, the Panel requested further statements from the parties. The Procedural Order attached certain web pages as viewed by the Panelists on January 10, 2007. The Panel invited the parties to comment on these web pages. The Complainant was asked to comment first, by January 19, 2007, and the Respondent was invited, by January 26, 2007, to comment on the web pages and reply to anything the Complainant had said. The Panel further extended the time for a decision, initially until 7 days after receipt of the Respondent’s statement, namely February 2, 2007 and thereafter until February 25, 2007.

The Complainant made its further submission on January 19, 2007. The Respondent made its further submission on January 27, 2007, one day late. The Panel has nevertheless taken it into account.

 

4. Factual Background

The name Shangri-La was created by the author James Hilton in the legendary novel “Lost Horizon”, published in 1933.

Complainant and its predecessors-in-interest have used the name Shangri-La for hotel and restaurant services since 1971, when the first Shangri-La hotel was established in Singapore. Complainant now operates more than 30 deluxe hotels under the name Shangri-La in Asia, Australasia and the Middle East, 26 of which opened before the disputed domain name <shangrila.com> was registered by Respondent on May 9, 2000.

Since 1989, Complainant’s hotels have won numerous awards and have been extensively promoted by Complainant and reported upon by the travel press. For example, in 1998, the Condй Nast Traveler Top 100 Readers’ Choice Awards rated Complainant’s hotels in Hong Kong and Bangkok 11^th and 13^th equal (in each case immediately above a Four Seasons hotel) and rated 5 of Complainant’s hotels in the top 20 Pacific Rim hotels.

Also in 1998, Complainant’s Pacific Palisades Hotel in Vancouver was awarded a ‘Bronze Quality Award’ by The Quality Council of British Columbia, Canada, Respondent’s home province.

In 1999, the year before the disputed domain name was registered, amongst Complainant’s numerous publicized awards were:

- “Asia/Pacific’s Leading Hotel Group”, by World Travel Awards (USA);

- “One of the Top Deluxe Hotel Groups Worldwide”, by Business Travel News (USA);

- “One of the Best Hotel Chains, Overall”, by Euromoney, (UK); and

- “Best Hotel Chain, Overall”, by Asian Wall Street Journal (Asia).

Complainant has over 25 Shangri-La hotels under development and due to open between 2006 and 2011 in Canada, China, France, India, Macau, Maldives, Mongolia, Philippines, Qatar, Thailand, the United Kingdom and the United States. Complainant also operates offices under the Shangri-La name in Hong Kong, Beijing, Shanghai, Guangzhou, Singapore, Seoul, Tokyo, London, Los Angeles, New York, Grapevine (Texas), Sydney and Dubai.

Complainant is the proprietor of numerous registered trademarks comprising or including “SHANGRI-LA”, in word form or in stylized form, in many countries. Many of the applications for registration were made after the date on which the disputed domain name was registered, but many of the registrations were effected prior to that date. For the purposes of this determination, it is sufficient to list the following examples:

Australian trademark No. 950644 SHANGRI-LA registered for various services in classes 35, 43 and 44 on April 14, 2003.

Australian trademark No.A389224, SHANGRI-LA HOTELS (stylized) with stylized “S”, disclaiming “hotels” and “S”, registered in respect of hotel services in Class 42 on March 25, 1983, and assigned to Complainant on August 28, 1991.

Canadian trademark No.TMA634,207 registered on March 3, 2005. [The part of the certificate before the Panel does not disclose the services or class(es) involved].

OHIM trademark SHANGRI-LA registered on March 2, 2005, in respect of various services in Classes 35, 41 and 43.

Hong Kong trademark SHANGRI-LA with stylized “S” registered December 18, 1989, for various goods in Classes 16 (No.0556 of 1991), 29 (No. 0555 of 1991), 32 (No.0554 of 1991) and 33 (No.0553 of 1991).

Hong Kong trademark SHANGRI-LA registered March 2, 1992 for various services in classes 39 (No.02397 of 1994), 41 (No.02727 of 1993) and 42 (No.00061 of 1999).

Hong Kong trademark SHANGRI-LA (both word and stylized), registered for services relating to hotels and restaurants in Class 35 as of October 10, 1994 (No. 02240A-B of 1996); for various services in Class 36 as of December 2, 1997 (No. 01749A-B of 2000); for laundry services in Class 37 as of March 2, 1992 (No. 02396A-B of 1994) and for various services in Class 39 as of May 15, 1992 (No. 05536A-B of 1993).

Singapore trademark SHANGRI-LA registered on May 10, 1990, for goods in Classes 28 (No.3302/90), 30 (No.3303/90), 32 (No.3304/90) and 33 (No.3305/90) and for hotel-related services in Class 42 on March 1, 2001 (No.T91/01803D).

United States service mark SHANGRI-LA (No.1576957) registered on January 9, 1990, by a California company called Indus Investments, Inc. for hotel services in Class 42 (citing first use in commerce 0-0-1941), renewed for 10 years from January 9, 2000 and assigned to Complainant on September 30, 2005, the assignment being recorded on October 10, 2005.

Complainant has been promoting its services online since May 3, 1995, when it registered the domain name <shangri-la.com>. Complainant and its related companies have since registered over 90 additional domain names incorporating the SHANGRI-LA mark.

Since the disputed domain name was registered in 2000 it has been used by Respondent to provide paid search results relating to the term “Shangri La”. Entry of the address “www.shangrila.com” produces a web page that is composed at the time of the visit on the basis of advertisers who have used “shangrila” as a keyword to cause the display of their advertisements. The printout of Respondent’s website accompanying the Complaint has links to banks and insurance companies and does not have links to restaurant or hotel-related services.

On September 2, 1999, Respondent registered the domain name <fourseason.com>. Respondent is also the registrant of the domain names <menswear.com>, <bowlingballs.com>, <dirtbikes.com>, <bats.com>, <fountains.com>, <playgrounds.com>, <virus.com>, <currencyconverter.com>, <freegrants.com>, <offshore.com>, <tutors.com>, <transport.com>, <customhomes.com>, <floormats.com> and <beads.com>.

The web pages attached to the Procedural Order appeared when the <shangrila.com> website was viewed on January 10, 2007, by the Panelist from Australia, namely (1) the home page and (2) the page reached from a link on that home page entitled ‘Shangri La Hotel Sydney’, which listed hotels that compete with Complainant’s Sydney Shangri-La hotel. Also attached to the Procedural Order were the home page when reached on the same day by the Panelist from the United States, which did not have links of the same nature, and the homepage when viewed on the same day by the Panelist from Hong Kong, which did have links to hotels.

 

5. Parties’ Contentions

A. Complainant

Complainant says its SHANGRI-LA mark has reached a well-known and famous trademark status deserving of a substantial measure of protection, citing Six Continents Hotels, Inc., v. CredoNIC.com/Domain For Sale, WIPO Case Nos. D2005-0755 and D2004-0987 (regarding the mark HOLIDAY INN) and the decision on June 23, 2005 by the Trademark Assessment Committee of the State Administration of Industry and Commerce, People’s Republic of China, that Complainant’s SHANGRI-LA mark is a well-known trademark for hotel services in Class 42 in China.

Complainant submits the disputed domain name is identical and/or confusingly similar to its SHANGRI-LA mark because the domain name wholly incorporates the mark, save for the inconsequential omission of the hyphen.

Complainant says Respondent has no rights or legitimate interests in the disputed domain name. Respondent is not affiliated with Complainant, is not a licensee and is not authorized to use the SHANGRI-LA mark as a domain name or otherwise. Respondent is not commonly known by the domain name. Its website shows an active web page with a search engine, diverting Internet users to well-known banks or insurance companies having no relationship with Complainant or its hotel and restaurant services. Accordingly, Complainant says there is no legitimate use of the domain name and no intention to use it in connection with a bona fide offering of goods and services. Instead, Respondent prevents Complainant from making use of the domain name for its own offers.

Complainant says its mark is famous all over the world and is registered in different classes in Canada where Respondent is carrying on business. Respondent cannot have ignored that the domain name was infringing Complainant’s rights.

Complainant says the domain name was registered and is being used in bad faith: the mere fact that the domain name totally comprises Complainant’s mark constitutes in itself bad faith registration and demonstrates that Respondent has voluntarily tried to benefit unfairly from the reputation of Complainant’s mark by creating a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation or endorsement of the domain name and websites accessible under the domain name, or otherwise to divert attention and Internet traffic to Respondent via the domain name.

Complainant says Respondent specializes in domain name reselling, having been reported to have sold <refinance.com> for US$706,850 in 2005. Complainant submits Respondent registered the domain name primarily for the purpose of selling, renting or otherwise transferring the domain name registration to Complainant, who is the owner of the mark or to a competitor for valuable consideration in excess of its documented out-of-pocket costs directly related to the domain name.

Complainant also says Respondent has registered domain names based on other well-known trademarks of successful businesses. For example, <fourseasons.com> is registered by Four Seasons Hotels Limited for promoting its hotel services. However, <fourseason.com> is registered by Respondent (on September 2, 1999) and this domain shows an active web page with a search engine similar to the one reached via the disputed domain name <shangrila.com>. As at August 8, 2006, both web pages were similarly configured with a similar headline, a search facility and 20 “most popular links”.

In VENTURUM GmbH v. Coventry Investments Ltd., DomainCollection Inc., WIPO Case No. D2003-0405, bad faith was found where the respondent in that case was held to be in the business of selling domain names for profit.

Given the reputation of Complainant’s mark, it is unlikely Respondent chose to register the domain name randomly without knowledge of the existence of Complainant’s trademark.

In response to Procedural Order No. 1, Complainant says as follows:

Viewed from Australia, the webpage at the disputed domain name shows a hyperlink entitled “Shangri La Hotel Sydney” which directs Internet users to hotels that compete with Complainant’s Sydney Shangri-La hotel, thereby taking unfair advantage of the reputation of Complainant’s mark. Other links, entitled “Shangri-La Hotel”, “Shangri La Hotel Dubai” and “Shangri La Hotel Bangkok” take Internet users to hotels or hotel search engines. Respondent is thus using the names of Complainant’s hotels to direct traffic away from Complainant’s hotels. Respondent is earning revenue from Google AdSense advertisements placed on the “www.shangrila.com” website when Internet users click on the hyperlinks using Complainant’s trademarks.

Viewed from Hong Kong, the webpage at the disputed domain name shows various hyperlinks being names of Complainant’s hotels directing Internet users to hotel search engines, some of which are not working properly. Further, Complainant’s hotel in Manila is misdescribed.

Viewed from the United States, the webpage at the disputed domain name shows hyperlinks to different topics, such as “Homes for Sale”, “Apartments”, Airline Tickets” and “Travel Guides” but each hyperlink in fact directs users to further hyperlinks of different hotels or hotel search engines which incorporate or use Complainant’s hotel names. Some of those hyperlinks incorporate Complainant’s “Shangri-La” trademark.

Respondent is using the disputed domain name to attract customers seeking Complainant’s hotels and misleadingly to divert them to hotels or search engines unrelated to Complainant. Respondent stands to make advertising profits thereby. Accordingly there is no legitimate or bona fide use of the disputed domain name. Indeed the website as viewed from Hong Kong has changed since the Complaint was filed, at which time it showed a webpage with links to well known banks and insurance companies.

Complainant seeks transfer of the disputed domain name to it.

B. Respondent

The term “Shangri La” has a defined meaning in common usage. It did not originate with Complainant and is not exclusively associated with Complainant. The Random House Unabridged Dictionary defines “Shangri La” as:

“1. an imaginary paradise on earth, esp. a remote and exotic utopia. 2. a faraway haven or hideaway of idyllic beauty and tranquility. [Origin: after the fictional Tibetan land of eternal youth in the novel The Lost Horizon (1933) by James Hilton]”.

Wikipedia contains an extensive entry for “Shangri La” which fails, in several pages of discourse on the subject of “Shangri La”, to mention the Complainant at all.

Complainant’s future plans are irrelevant to whether it has established a trade or service mark right, and its activities after the domain name was registered in 2000 and its future plans are irrelevant to whether the domain name was registered in bad faith.

Prior to this dispute, Respondent had not heard of Complainant, having never

travelled to the areas in which Complainant operates hotels called “Shangri-La”.

Since “Shangri La” is a common term susceptible of use having nothing to do with the Complainant, the question here is whether it is a legitimate use of a domain name to provide search results for advertisements based on the content of the domain name itself, and which do not relate to Complainant’s goods or services: The Landmark Group v. DigiMedia.com, L.P., NAF Case No. 285459.

Where the term at issue is inherently distinctive, operation of a paid search portal using that term would appear to have arisen from an illegitimate motivation to ride on the goodwill of the mark owner. That is simply not the situation relative to the term “Shangri La” which, as admitted by the Complainant, does not originate with the Complainant.

While a dictionary term may be arbitrarily applied to goods or services in a manner that is not descriptive, and thereby take on a secondary meaning of a trade or service mark, such secondary meaning does not prevent the term from retaining its generic dictionary meaning: Target Brands, Inc. v. Eastwind Group, NAF Case No. 267475.

Even when used as a trademark, the term “Shangri La” does not exclusively refer to Complainant, being the subject of United States trademark registrations (none of which are owned by Complainant) for ceiling fans, motion picture films, window blinds, pillows, skin care products, tea, ginko trees and charitable services.

In view of these multiple concurrent and non-infringing uses of the term “Shangri La”, Complainant’s allegation that its mark is “famous” is unsupportable, as is the notion that mere registration and use of the domain name for goods and services unrelated to those of Complainant constitutes “infringement” of Complainant’s mark or manifest bad faith use. Similar results hold true for Canada, and indeed many other countries, as “Shangri La” is much more well-known as a common term on its own, and apart from any particular claim of rights by Complainant. Complainant is but one of many users of a common expression.

Complainant expressly states that certain links provided on Respondent’s search portal have “no relationship with the Complainant or its hotel and restaurant services” and then asserts that “the Domain name was infringing Complainant’s rights”. Respondent has not used the term as a trademark, but merely as a search term, and Respondent does not operate hotels or restaurants. Combined with Complainant’s tautological observation that Respondent’s registration of the domain name prevents Complainant from using the domain name, this line of argument is an attempt to collapse all of the elements of the Policy into the first element. The Complaint asserts that the domain name itself, without more, is “infringing” its mark, while admitting that the domain name has been used to provide search results that do not relate to Complainant.

It is a well-established principle, demonstrated in the multi-part test of the Policy itself, that the mere registration of a domain name having an incidental trademark significance, is insufficient to establish lack of legitimate rights or bad faith. Otherwise, the additional criteria of the Policy beyond identity or confusing similarity would be superfluous.

Respondent submits that, prior to notification of a dispute, it was actively using the domain name in connection with a bona fide purpose. Complainant appears to allege that Respondent’s use of the domain name was unrelated to the specific context in which Complainant claims rights, and was thus non-infringing. Prior to this dispute, Respondent had never heard of Complainant. Accordingly, Respondent does not lack legitimate rights or interests in the domain name, under the accepted test for claims arising from dictionary terms.

The domain name was registered six years ago, and Complainant offers no evidence that is reasonably contemporaneous with registration of the domain name, let alone evidence that would suggest Respondent’s registration and use of the domain name was motivated by a specific ill intent directed toward Complainant: HP Hood LLC v. hood.com, NAF Case No. 313566.

Complainant asserts: “The mere fact that the Domain name totally comprises the trade mark belonging to the Complainant, constitutes bad faith....” In other words, any domain registration constituting a common dictionary word or phrase which happens to be a trademark is perforce a bad faith domain registration and the Policy may be telescoped into the first element alone.

The domain name <fourseason.com> is not the subject of this dispute. Third party advertisers of hotel booking services do use the keyword “four season” to advertise that hotel chain. A Yahoo! search on the term “four seasons” produces advertisements for two hotel booking services, both displayed as paid search results in the Yahoo! search, along with many other references to “four seasons” for unrelated goods and services. The reason for this is that these companies actually provide hotel booking services by which a visitor may book a stay at a Four Seasons hotel.

Such paid advertising listings at Yahoo! and elsewhere, are distributed by Yahoo!’s parent company to domain name registrants for the purpose of displaying similar search results. Hotel booking services are entitled to display their links in response to search queries containing the names of hotels for which they provide bookings, and they are entitled to participate in Internet search systems, including Yahoo!, which distributes the keyword-based advertisements to large numbers of third-party search sites. Hence, the authorization of booking agencies to advertise a trademark claimant’s hotel necessarily extends to the distribution of keyword-based advertisements generated by the booking companies. To the extent that any booking agency had exceeded its authority to advertise the hotels which it services, then the fault would lie with that booking agency’s use of the keyword, and not to a third-party operator of a website that aggregates such advertisements.

However, the present dispute relates to the domain name <shangrila.com>, and Complainant admits that Respondent is not infringing Complainant’s claimed rights in connection with hotel services:

“Moreover, even if it were a pattern, and even if Respondent was found to have been a cybersquatter in another case, the question in this case is whether Respondent has cybersquatted this Domain Name.” Displays Depot, Inc. v. GNO, Inc., WIPO Case No. D2006-0445.

Complainant offers no evidence, other than registration of the domain name itself, relating to Respondent’s intent in registering the domain name in 2000. Complainant must provide a reason why the bad faith intent and registration of the domain name were contemporaneous, as the panel in Intuit Inc. v. Nett Corp., WIPO Case No. D2005-1206, observed:

“The earliest evidence that could possibly amount to bad faith use is so long after registration that it cannot outweigh the evidence tending to show good faith registration: Passion Group Inc. v. Usearch, Inc., eResolution Case AF-0250 [<jobpostings.com>], followed in Viz Communications, Inc., v. Redsun dbawww.animerica.com and David Penava, WIPO Case No. D2000-0905, [<animerica.com>]. See also Yoomedia Dating Limited v. Cynthia Newcomer / Dateline BBS, WIPO Case No. D2004-1085.”

Here, Complainant’s bare allegation is that the Respondent’s website displays links that are unrelated to Complainant’s goods and services. Respondent does not compete with Complainant, nor does Respondent use “Shangri La” as a trade or service mark on infringing goods or services.

There is nothing about the sale of <refinance.com> that suggests Respondent has ever registered or used a domain name in bad faith. “Refinance” is a generic word to which no party could credibly claim a trade or service mark interest, and the sale of domain names is a perfectly legitimate activity: Echelon Corporation v. RN WebReg, a.k.a. Rarenames, LLC, WIPO Case No. D2003-0790.

Complainant does not allege that the disputed domain name has ever been offered for sale to Complainant or to a competitor of Complainant. The sale of <refinance.com> does not demonstrate a pattern of domain name registrations designed to prevent Complainant from reflecting its trademark in a domain name. Complainant has registered dozens of domain names. Respondent has not registered any other domain name comprising “Shangri La” or any variant thereof.

If there is a pattern of any kind among domain names registered by Respondent, the sort of “pattern” evident in Respondent’s registration of <menswear.com>, <bowlingballs.com>, <dirtbikes.com>, <bats.com>, <fountains.com>, <playgrounds.com>, <virus.com>, <currencyconverter.com>, <freegrants.com>, <offshore.com>, <tutors.com>, <transport.com>, <customhomes.com>, <floormats.com> and <beads.com> is that Respondent is motivated to register and use dictionary words for use in connection with paid referral advertising based upon the common ordinary meanings of such terms.

Accordingly, Complainant has failed to demonstrate registration in bad faith or subsequent use in bad faith.

In response to Procedural Order No. 1, Respondent says the footer data of the web pages annexed to Complainant’s supplementary submission show that these are pages operated by Google under a program that accepts “shangrila” as an input string and generates Google search results. If hotel booking agencies are using “shangri la” as a search term to turn up in search results, then the relevant issue is whether those agencies are using it to advertise that they provide bookings to the Complainant’s hotel (among other hotels they book), or whether competitive hotels are unfairly using “shangri la” to divert customers.

Respondent does not know how Google’s program works, and does not know how Google’s geo-targeting system works. “Geo-targeting” is a method which Google uses to provide different search results to visitors in different geographic locations, based on detection of the visitors’ IP addresses.

Respondent uses its domain names for “domain monetization” or “direct navigation”, based upon services competitively provided by Yahoo/Overture and Google, which enable advertisers to cause paid advertising links to be displayed together with search results provided to users of these search engines.

In “direct navigation”, the paid links are aggregated by the search engines and provided as a “feed” to domain registrants desiring to place such links on web pages. In “domain monetization”, the domain registrant may automatically direct its domain names to transmit visit requests to the search engine, which then performs a search based upon the term and returns a list of search results and/or a set of advertising links. This arrangement is contractually established between the search engine and the domain registrant, who is paid a share of the resulting traffic revenue paid by the advertisers.

A common abusive problem in paid search advertising is that trademark infringers will use the marks of others to misleadingly cause links to the infringers to appear in response to a trademark search term. Respondent would have no way of either knowing or controlling that behavior, because the Respondent would only be able to see the links as displayed to the Respondent in western Canada. This precise sort of situation occurred in Admiral Insurance Services Limited v. Mr. Adam Dicker, WIPO Case No. D2005-0241. Mr. Dicker, a Canadian, was using the Google Adsense program to display advertisements at the domain name <elephant.com>. Unknown to Mr. Dicker, a United Kingdom insurance company possesses a trademark in “ELEPHANT” for insurance services. Also then unknown to Mr. Dicker, other insurance companies in the United Kingdom were bidding on “elephant” as a search term in Google, with the result that United Kingdom visitors to <elephant.com> were receiving advertisements for insurance. All Mr. Dicker ever saw were links relating to animal products. The Panel concluded:

“It is unnecessary to decide whether any intentional display by the Respondent of insurance advertisements on his website after becoming aware of the Complainant’s mark could render illegitimate that which was previously legitimate because the Panel accepts that the terms under which Google makes its Adsense advertisements available do not permit the Respondent to control them and that the Respondent cannot be aware of their content as displayed in any particular country. In Experimental Aircraft Association (EAA) v. EAA.COM, NAF Case No. FA0310000206309, the Panel found that the brief appearance of aviation links on the respondent’s web sites was automatically provided by a pay-per-click search engine provider and was not intended by the respondent. Since there was no evidence that the respondent’s business was in connection with aviation, the respondent had no duty to be aware of the complainant’s mark. Those findings are applicable here.”

As stated by Google, a “feature” of the advertising links it generates is that “advertisements are also targeted by geography, so global businesses can display local advertising with no additional effort.” When the web visit request is transmitted to Google, a rough approximation of the visitor’s location is determined on the basis of the visitor’s IP address. Google then retrieves advertisements corresponding to those requested by advertisers in that region.

Complainant notes that some of the auto-generated links in the Asian region are to hotel booking agencies which are not associated with any particular hotel, but which offer bookings to many hotels including the Complainant’s hotel. The use of trademark keywords by such hotel booking agencies differs from the infringement situation described above, because an agency which provides bookings at several chains of hotels is normally entitled to advertise the hotels or chains for which it provides bookings. Accordingly, searches which include well-known hotel chains will commonly result in paid links appearing for booking services such as Hotels.com, Expedia.com, and other Internet travel agencies. Responsibility for the fairness of these advertisements lies with the parties which are bidding on the terms - and not with Google, and certainly not with a domain name registrant who might have the word “Holiday” in a domain name that results in some search links showing

up to advertise the “Holiday Inn” hotel chain.

The situation described above, involving third-party legitimate advertising of brands on sale by those third parties, was encountered in Mariah Media Inc. v. First Place® Internet Inc., WIPO Case No. D2006-1275, in which the domain name registrant had registered the domain name <outside.com> because it was a common word. It turned out that OUTSIDE is also a trademark for a particular magazine, and the paid search links were populated by businesses which sell magazine subscriptions - fairly including subscriptions to OUTSIDE magazine. The Panel’s holding is applicable here:

“The mark consists of a common English word that appropriately describes many goods and services. The evidence in the record does not persuade the Panel that the mark is so famous that it is “inconceivable that Respondent did not know about Complainant’s OUTSIDE family of marks,” as the Complainant asserts, or that the name “has no value apart from Complainant’s marks.” Indeed, the word appears in many other trademarks and domain names, as the Respondent demonstrates. Thus, even if the Panel accepted the doctrine of constructive notice based on the Complainant’s United States trademark registrations, it could not conclude that the Respondent’s choice of the Domain Name was most probably motivated by an intention to target the Complainant’s marks. See EMAP USA, Inc. v. Dick Jurgens d/b/a Mobile Dick’s Cycle Clinic, WIPO Case No. D2001-0311 (even where the respondent knew of the complainant’s MOTORCYCLIST mark, this was not enough to establish bad faith where there was no pattern of abusive registrations and the respondent had a legitimate reason for selecting the generic name); Ultrafem Inc. v. Warren R. Royal, FA97682 (NAF) (<instead.com> employs a commonly used word to which the complainant cannot claim exclusive rights; “the first to register a domain name containing a generic or descriptive mark should prevail absent bad faith and a lack of legitimate interest”); Energy Source Inc. v. Your Energy Source, FA96364 (NAF) (respondent entitled to use domain name comprising generic or descriptive terms that are not exclusively associated with the complainant’s business).

Nor is the Panel persuaded that the presence of advertising links to alternative sources of OUTSIDE magazine subscriptions (among hundreds of unrelated links) implicates the Respondent’s knowledge of the Complainant’s marks and intent to confuse Internet users. The Respondent denies such knowledge and intent. There is no evidence in the record that casts doubt on the Respondent’s claim that the advertising links are served automatically by a third-party advertising feed provider using keyword search techniques rather than human selection. The automated advertising feed arrangements are such that it cannot be assumed that the Respondent requested such links or was even aware of them before receiving notice of this dispute. In the face of the Respondent’s denials and the automated nature of the advertising links, the Panel considers these particular links insufficient to prove the Respondent’s intent to mislead Internet users by means of the Domain Name itself. In short, the Panel is unwilling to attribute bad faith to this search software. And it does not feel warranted in presuming bad faith on the part of a company using such software when the “keywords” it provides are merely dictionary words.”

Several of the hotel booking services identified by the Asian panelist among search results shown in the Procedural Order were inspected by the Respondent, and were found indeed to provide bookings at one or more of the Complainant’s hotels. Hence, the appearance of such advertisements among results for “Shangri La” is no more offensive to traditional trademark principles than the fact that a retail store selling several brands of televisions may publish, for example, advertisements that it has attractive prices on “Sony” brand televisions. A consumer seeking the advertised “Sony” television at an electronics store would not be deceived by the presence of “Philips”, “RCA” or other models at the store. Indeed, that is the normal state of affairs in such stores. On the Internet, businesses do the same thing - i.e. advertise the availability of particular brands of goods or services by utilizing paid search advertising placements. The line between fair and unfair use of paid advertising by retailers may be debatable. It is, however, not subject to debate that the Respondent does not control the selection or arrangement of search results generated by either Google or Yahoo, and which are displayed at the Respondent’s web sites.

It is clear that if there are parties who are abusing the Yahoo or Google search systems unfairly to use “SHANGRI LA” to advertise hotel services or booking services that do not provide bookings for the Complainant’s hotel, the Respondent firmly agrees that the Complainant’s mark is being violated by those parties. However, addressing that abuse of paid search advertising systems which are not even controlled by the Respondent, by alleging that it was the Respondent’s intention to abuse the Complainant’s mark, and thus transferring the domain name, is misdirected. Not only is it an action taken against a party not having the requisite intent under the Policy to dictate such a transfer, but it is an action that would ultimately not cure the underlying problem, since the infringing advertisements would continue to be displayed in search engine results at Yahoo and/or Google, along with countless other web sites utilizing the Yahoo or Google PPC feeds. Transfer of the domain name only provides an illusion of relief against the genuine harm - abusive use of advertising systems by trademark infringers.

By way of analogy, if a thief steals my wallet and runs into my neighbor’s house, I can surely exact revenge on the thief by setting fire to my neighbor’s house and burning it to the ground. It is unlikely, however, that my neighbor would agree with my strategy.

Here, Respondent registered the domain name for the reasons sworn to in the Response. Complainant suggests that Asian trademark infringers are abusing paid advertising systems by causing objectionable advertisements to be displayed on Respondent’s web page. Those facts are not in dispute. What is in dispute here is whether this situation constitutes a conscious intent on the part of Respondent when Respondent originally registered the domain name. Respondent strenuously contends that there was and is no such bad faith intent in its registration and use of the domain name. These conclusions do not provide a “safe harbor” for cybersquatters. In situations where the domain name consists of an inherently distinctive or otherwise notorious term of the type characterized in the UDRP as “having no inconceivable good faith use”, then it may be inferred that Respondent’s intent in using PPC was to attract infinging advertisements. Likewise, if it were shown that Respondent had registered a large number of domain names of that type, had been subject to multiple adjudications of cybersquatting, was attempting to conceal its identity, or similar circumstances suggesting Respondent were anything other than it claims to be, then a Panel could properly and reasonably infer bad faith intent. The fact that “Shangri La” has a number of connotations other than Complainant’s hitherto unknown hotel chain (at least to Respondent), Respondent’s demonstrated registration and use of common terms and expressions, and the absence of prior adverse determinations or any other common indicator of cybersquatting (offers to sell, etc.) suggest that an inference of “bad faith” on the facts present here would not be reasonably based upon the evidence.

In brief, Respondent has used the Google Adsense program which, under the decision rendered in the <elephant.com> UDRP dispute, is known to provide different results to viewers in different geographic regions, wholly beyond the control or knowledge of the domain registrant. Hence, the particular advertisements displayed are not probative in connection with Respondent’s intent in registering or using the domain name, as was found in Admiral Insurance and in Mariah Media, both of which decisions under the Policy closely relate to the facts here.

 

6. Discussion and Findings

Paragraph 15(a) of the Rules requires the Panel to decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, the Rules and any rules and principles of law that it deems applicable.

To qualify for cancellation or transfer, Complainant must prove each element of paragraph 4(a) of the Policy, namely:

i. the disputed domain name is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and

ii. Respondent has no rights or legitimate interests in respect of the domain name; and

iii. the disputed domain name has been registered and is being used in bad faith.

The Panel accepts that Complainant’s future plans are irrelevant to whether it has established a trade or service mark right and that its activities after the domain name was registered in 2000 and its future plans are irrelevant to whether the domain name was registered in bad faith.

A. Rights in a mark

Although some of Complainant’s trademark registrations post-date Respondent’s registration of the domain name, paragraph 4(a)(i) of the Policy embodies no requirement that the trademark rights must have arisen before the domain name registration: Valve Corporation v. ValveNET, Inc., ValveNET, Inc., Charles Morrin WIPO Case No. D2005-0038.

Complainant has established that, as at the filing of the Complaint, it has registered trademark rights in many countries in SHANGRI-LA in connection with restaurant and hotel-related services.

B. Identical or Confusingly Similar

In considering this element, the “.com” gTLD may be disregarded: VAT Holding AG v. Vat.com, WIPO Case No. D2000-0607.

The omission of the hyphen from the domain name does nothing to avoid the virtual identity and confusing similarity between the domain name and Complainant’s SHANGRI-LA trademark: for similar examples see HUK-COBURG haftpflicht-Unterstьtzungs-Kasse kraftfahrender Beamter Deutschlands A.G. v. DOMIBOT (HUK-COBURG-COM-DOM), WIPO Case No. D2006-0439 and the cases there cited.

Complainant has satisfied the requirements of paragraph 4(a)(i) of the Policy.

C. Rights or Legitimate Interests

Paragraph 4(c) of the Policy lists three circumstances that can demonstrate a registrant’s rights or legitimate interest in the disputed domain name:

(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services;

(ii) you (as an individual, business or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights;

(iii) you are 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.

Once a complainant establishes a prima facie case against a respondent in relation to this element, the burden is on the respondent to provide concrete evidence of its right or legitimate interests under paragraph 4(c) of the Policy: Cassava Enterprises Limited, Cassava Enterprises (Gibraltar) Limited v. Victor Chandler International Limited, WIPO Case No. D2004-0753.

It is common ground that Respondent is not affiliated with or a licensee of Complainant; is not authorized by Complainant to use the SHANGRI-LA mark as a domain name or otherwise; and, is not commonly known by the domain name. Respondent’s website shows an active web page with a search engine, displaying advertising links to Internet users. Those apparent to Complainant at the time of the Complaint were links to well-known banks or insurance companies having no relationship with Complainant or its hotel and restaurant services. Those apparent to the members of the Panel during their consideration of this Complaint did display, either initially or after clicking on otherwise apparently unrelated links, advertising links to hotels, including those of Complainant and those of its competitors, and to hotel booking agencies, the precise mix depending on the country from which the attempt was made to gain access to Respondent’s website.

The Panel considers that these circumstances constitute a prima facie case of absence of rights or legitimate interests on the part of Respondent, to whom the onus therefore shifts to establish, by concrete evidence, its rights or legitimate interests in the disputed domain name.

Respondent seeks to demonstrate circumstances within the Policy, paragraph 4(c)(i).

The Panel in Media General Communications, Inc. v. Rarenames, WebReg, WIPO Case No. D2006-0964 held that using domain names for advertising links can in certain circumstances represent legitimate interests for the purposes of paragraph 4(c) of the Policy, such as when:

- the respondent regularly engages in the business of using domain names to display advertising links;

- the respondent makes good-faith efforts to avoid registering and using domain names that are identical or confusingly similar to marks held by others;

- the domain name in question is a “dictionary word” or a generic or descriptive phrase;

- the domain name is not identical or confusingly similar to a famous or distinctive trademark; and

- there is no evidence that the respondent had actual knowledge of the complainant’s mark.

Here Respondent has shown that he regularly engages in the business of using domain names to display advertising links. However, not all the other elements just mentioned are present here.

This case is distinguishable from the <elephant.com> case, Admiral Insurance Services Limited v. Mr. Adam Dicker, WIPO Case No. D2005-0241, both as regards the character of the expression comprising the domain name at issue and as regards Respondent’s knowledge of Complainant and its mark at the time of registration of the disputed domain name.

Although the expression ‘Shangri La’ originated in the 1933 novel and has a dictionary meaning, it also has internationally recognized trademark significance. Despite Respondent’s carefully worded submission: “Wikipedia contains an extensive entry for “Shangri La”, which fails, in several pages of discourse on the subject of “Shangri La” to mention the Complainant at all”, the Wikipedia entry contains, on page 4 of 5, the statement: “Shangri-La is an international chain of luxury hotels”.

The Panel finds the mark SHANGRI-LA to be well-known in relation to hotels and to have been well known internationally at the time of the registration of the disputed domain name in 2000, particularly in Asia but also elsewhere, by reason of Complainant’s own activities and of the international publicity those activities attracted, including publicity in North America. Although Respondent denies having traveled to countries in which Complainant has hotels, it is not necessary to travel to a country having luxury hotels that are advertised internationally in order to be aware of them by name.

There is evidence from which the Panel infers that Respondent did know of Complainant’s hotels when he registered the disputed domain name: he had registered ‘fourseason.com’ some eight months earlier and has used that domain name to display advertising links to hotels. The ungrammatical nature of that domain name, resulting from the omission of the final ‘s’, enabled Respondent to register <fourseason.com> despite the registration on February 3, 1997, of <fourseasons.com> by the hotel company of that name. This indicates that the <fourseason.com> domain name was registered in order to attract traffic seeking Four Seasons hotels and had nothing to do with the music of Vivaldi nor with the seasons of the year.

In like manner, the omission of a hyphen from the disputed domain name enabled Respondent to register the domain name <shangrila.com> despite the earlier registration of the domain name <shangri-la.com> by Complainant on May 3, 1995. This and the previous registration of <fourseason.com> indicate that the <shangrila.com> domain name was registered in order to attract traffic seeking Shangri-La hotels and had nothing to do with the novel in which the expression was coined nor with the dictionary meaning of the expression.

As often happens when a domain name incorporates an expression that is both a dictionary word and a trademark, the outcome of an administrative proceeding under the Policy depends on the intent with which the domain name was registered and is being used.

This case is also distinguishable from the <outside.com> case, Mariah Media Inc. v. First Place® Internet Inc., WIPO Case No. D2006-1275, in which what appears to have been the same paid advertising links program was used as here. The respondent there had taken steps to block OUTSIDE “magazine” as a keyword. Here, no steps have been taken to block SHANGRILA “hotel” as a keyword.

The use of the Internet is worldwide and knows no boundaries. This should be well known to the Respondent who has very considerable experience in the registration of domain names and the use of the Internet.

Knowing of the trademark significance of Shangri-La in relation to hotels, and in light of Respondent’s understanding of the way in which (if not the mechanism by which) the Google and Yahoo/Overture paid advertising links programs operate and of the way in which such programs may be used by competitive hotels unfairly to divert customers, and in light of Respondent’s failure to take steps to block SHANGRILA “hotel” as a keyword, the Panel finds that Respondent expected, when he registered the disputed domain name, that some advertisements that would be displayed at his website using ‘Shangrila’ as a search term would be advertisements about hotels, including hotels other than those of Complainant.

This leads the Panel to conclude that Respondent registered and has used the disputed domain name in order to receive a share of advertising revenue derived from advertisements, some of which were designed by the advertisers to trade off Complainant’s SHANGRI-LA mark, even though Respondent did not himself place the advertisements on his website.

Accordingly, the circumstances identified in Media General Communications, Inc. v. Rarenames, WebReg, WIPO Case No. D2006-0964 in which the use of domain names for advertising links can represent legitimate interests for the purposes of paragraph 4(c) of the Policy are not present in this case.

Respondent has not demonstrated rights or legitimate interests in the disputed domain name and Complainant has established this element of its case.

D. Registered and Used in Bad Faith

The Panel rejects Complainant’s submission that the mere fact that the domain name comprises Complainant’s entire mark constitutes in itself bad faith registration and demonstrates that Respondent has tried to benefit unfairly from the reputation of Complainant’s mark. Bad faith registration and use are additional factors to be proved even where the domain name and the trademark are identical.

Respondent’s sale of <refinance.com> cannot support the proposition that Respondent registered the domain name presently in issue primarily for the purpose of selling, renting or otherwise transferring the registration to Complainant or one of its competitors for profit. In the case cited by Complainant, VENTURUM GmbH v. Coventry Investments Ltd., DomainCollection Inc., WIPO Case No. D2003-0405, the domain name was offered for sale on the respondent’s website. Here there is no evidence from which any inference may be drawn that Respondent has ever intended to sell, rent or otherwise transfer the disputed domain name.

However, the Panel finds that Respondent registered the disputed domain name with actual knowledge of Complainant and its SHANGRI-LA mark and entered into arrangements with Google and Yahoo/Overture to share advertising revenue derived from use of the search term ‘shangrila’, in the expectation that some revenue would flow from hotel-related advertisements, not confined to advertisements for Complainant’s hotels, aimed at Internet users arriving at Respondent’s website seeking Complainant’s hotels. Accordingly, by using the domain name, Respondent has intentionally attempted to attract, for commercial gain, Internet users to his website by creating a likelihood of confusion with Complainant’s mark as to the endorsement of his website and of services on his website. This constitutes evidence of both bad faith registration and bad faith use under the Policy, paragraph 4(b)(iv).

Respondent notes that the web pages containing hotel-related advertising links on which it was asked to comment were seen only after the filing of the Complaint. It relies on Intuit Inc. v. Nett Corp., WIPO Case No. D2005-1206 and the cases there cited, saying the earliest evidence that could possibly amount to bad faith use is so long after registration that it cannot outweigh the evidence tending to show good faith registration. However, here there is evidence of bad faith registration and it is also common ground that the website has been used for sponsored advertising links since the disputed domain name was registered in 2000. Although, when viewed by Complainant from Hong Kong, no hotel-related links appeared on Respondent’s web site until after the commencement of this Administrative Proceeding, and the links identified by the members of the Panel were also seen by them only after the commencement of this Administrative Proceeding, the Panel is prepared to draw the conclusion that, at times since its inception, the website has displayed hotel-related links to some Internet users, depending on their location at the time of their visit.

It is true that the revenue-sharing arrangements made by Respondent left him with no way of knowing in full what advertisements would appear on his website in response to any given visit. He nevertheless failed to take steps to exclude ‘hotel’ as a search term in connection with ‘shangrila’, knowing, as the Panel has found, of Complainant and its mark when he registered the disputed domain name and made those arrangements. It may well be that the advertisers seeking to divert customers from Complainant to other hotels are the principal culprits responsible for the diversion of Internet traffic intended for Complainant. But Respondent was knowingly complicit, for commercial gain, in the arrangements whereby such diversion took place and did nothing to stop it. Adapting Respondent’s analogy: if a thief steals my wallet and shares the proceeds with my accommodating neighbour, I can recover the amount paid to my neighbour.

Complainant has established this element of its case.

 

7. Decision

For all the foregoing reasons, in accordance with Paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the domain name, <shangrila.com> be transferred to Complainant.

Alan L. Limbury Presiding Panelist
C. K. Kwong Panelist	Dennis A. Foster Panelist

Dated: February 25, 2007