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WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Airborne Systems North America and Airborne Systems Group, Ltd. v. Virtual Point, Inc.

Case No. D2008-1669

1. The Parties

The Complainants are Airborne Systems North America of Santa Ana, California, United States of America, and Airborne Systems Group, Ltd. of Llangeinor Bridgend, United Kingdom of Great Britain and Northern Ireland, jointly represented by Crowell & Moring, LLP, United States of America.

The Respondent is Virtual Point, Inc. of Irvine, California, United States of America, represented by Brett P. Wakino, United States of America.

2. The Domain Name and Registrar

The disputed Domain Name <airbornesystems.com> is registered with eNom, Inc.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on October 31, 2008. On November 3, 2008, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Name. On November 3, 2008, the Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details. The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), 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 November 14, 2008. In accordance with the Rules, paragraph 5(a), the due date for Response was December 4, 2008. The Response was filed with the Center on December 4, 2008.

The Center appointed W. Scott Blackmer, M. Scott Donahey and David E. Sorkin as panelists in this matter on February 2, 2009. 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.

4. Factual Background

The Complainants are Airborne Systems Group, Ltd., a company established in the United Kingdom, and it’s wholly owned, California-based subsidiary Airborne Systems North America. The group chiefly manufactures military parachutes, aerial delivery systems, oxygen systems, inflatable structures, space and recovery systems, and airbags. The Complainants operate a website at “www.airborne-sys.com”.

The Complainant Airborne Systems Group, Ltd. holds two relevant trademarks, United States of America Trademark Registration No. 3425722 (registered May 13, 2008) and Community Trade Mark (CTM) No. 6065411 (registered August 14, 2008). The United States trademark registration claims first use in commerce in the United States on January 1, 2003.

Both registrations are for a design mark comprised of a device, initials, and words. The mark features a stylized bird’s wing and the large initials “AS”, with “Airborne Systems” following in smaller type. The Complaint does not furnish evidence of any registered or common-law AIRBORNE SYSTEMS standard-character mark. Indeed, the United States trademark registration includes the following disclaimer:

“No claim is made to the exclusive right to use �AIRBORNE SYSTEMS’, apart from the mark as shown.”

The Response identifies the Respondent Virtual Point, Inc. as a California corporation established on January 22, 2007 and wholly owned by an individual named David (Dave) Lahoti. The Respondent and Mr. Lahoti operate several commercial websites concerning electronic games and entertainment DVDs.

The Response states that before the incorporation of Virtual Point, Inc., Mr. Lahoti “individually held and registered” the Domain Name on October 4, 2005. The Response recounts that Mr. Lahoti acquired the Domain Name after purchasing another domain name, <purifier.com>, with the intention of using both to point to a website on which Mr. Lahoti would sell air purifiers. Mr. Lahoti subsequently transferred all rights in the Domain Name to the Respondent Virtual Point, Inc. However, the Response repeatedly refers to the “Respondent” interchangeably as Mr. Lahoti or Virtual Point, Inc.

It is undisputed that the Domain Name has never been used in connection with an air purifier website. Instead, the Domain Name has for some time resolved to a website at “www.hddvd.com”, which displays information and advertising concerning high definition digital video discs and HD DVD players. The Response refers to this as the “Respondent’s website.”

The Complainants assert, and the Respondent does not deny, that the registration and ownership of the Domain Name passed through the hands of two other California entities controlled by Mr. Lahoti, “Crosspath” and “SpectraMedia”, before the Domain Name was assigned to the current registrant, the Respondent Virtual Point, Inc.

In March 2007, a representative of the Complainant Airborne Systems Group, Ltd. communicated with Mr. Lahoti (apparently representing Crosspath at that time), in an attempt to purchase the Domain Name. Printouts of emails furnished by the parties indicate that the exchange was essentially amicable, although it did not culminate in the sale of the Domain Name. None of the emails in the record refers to an asserted trademark or makes a demand that Mr. Lahoti cease and desist from trademark infringement. It appears from the emails that Mr. Lahoti was initially agreeable to selling the Domain Name for USD USD 28,300 but later suggested a price “around the mid $40s”. The Complainants’ representative replied that “our window of time has passed” and stated that the Complainants “are no longer interested in pursuing this domain and have withdrawn our offer”. More than eighteen months later, the Complainants initiated the current UDRP proceeding.

5. Parties’ Contentions

A. Complainants

The Complainants argue that the Domain Name is “essentially identical and/or confusingly similar to Complainants’ AIRBORNE SYSTEMS Mark”, and that the Respondent has no rights or legitimate interests in the Domain Name.

The Complainants assert that the Respondent and Mr. Lahoti are “adjudicated cybersquatters” in other UDRP and judicial proceedings, and that this Domain Name was similarly registered and used in bad faith. The Complainants contend that each of three entities controlled by Mr. Lahoti, in turn, continued such bad-faith use of the Domain Name. In any event, the Complainants argue, it is clear that the current Respondent registered the Domain Name in 2008, after the 2007 discussions between the Complainants and Mr. Lahoti, and therefore with actual knowledge of the Complainants’ mark.

The Complainants conclude that the Respondent (and its predecessors) registered and used the Domain Name in bad faith, (a) primarily for the purpose of selling it to the Complainants for an excessive price, (b) to prevent the Complainants from reflecting their mark in a corresponding domain name, as part of a pattern of engaging in such conduct, and (c) to attract Internet users for commercial gain by creating a likelihood of confusion with the Complainants’ mark.

B. Respondent

The Respondent observes that the Complainants do not own an AIRBORNE SYSTEMS trademark and expressly disclaimed exclusive rights to that descriptive phrase, which is used in the names of other companies and their products.

The Respondent claims that its intended use of the Domain Name for an air purifier website is legitimate, and that its actual use of the Domain Name in the interim to redirect Internet users to the Respondent’s HD DVD website is not prohibited by the Policy. The Respondent denies any intent to capitalize on the Complainants’ trademark and states that it was unaware of the trademark when the Domain Name was registered. The Respondent states that the two judicial cybersquatting decisions cited in the Complaint have been appealed.

The Respondent suggests that a finding of reverse domain name hijacking may be appropriate.

6. Discussion and Findings

Paragraph 4(a) of the Policy provides that in order to divest the Respondent of a disputed domain name, the Complainants must demonstrate each of the following:

(i) the Domain Name is identical or confusingly similar to a trademark or service mark in which the Complainants have rights; and

(ii) the Respondent has no rights or legitimate interests in respect of the Domain Name; and

(iii) the Domain Name has been registered and is being used in bad faith.

Under paragraph 15(a) of the Rules,

“A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.”

A. Multiple Complainants

Where multiple parties are named as complainants, their respective interests in the mark at issue must be established. Moreover, the complaint should indicate to which party the domain name should be transferred in the event that the complaint succeeds.

Here, the trademark registrations are in the name of the Complainant Airborne Systems Group, Ltd. Presumably, there is a licensing agreement with the Complainant Airborne Systems North America, but this is neither described nor documented in the record of this proceeding. The Complaint merely asserts that both Complainants are “the owners” of the mark and have used it. This assertion is insufficient to establish the interests of the Complainant Airborne Systems North America for purposes of the Policy.

The Panel does not find that the Respondent has been prejudiced by the inclusion of the Complainant Airborne Systems North America in this proceeding. However, any order directed to the Registrar would refer only to the registered trademark holder, the Complainant Airborne Systems Group, Ltd.

B. Supplemental Filings

The Complainants filed a Reply for the purpose of submitting an additional email in the thread furnished with the Response, and the Respondent submitted a “Sur- Reply” in response to the Complainants’ supplemental filing, taking issue with the Complainants’ characterization of the email exchange and their discussions regarding the proposed purchase of the Domain Name.

Because the prior correspondence between the Complainants and Mr. Lahoti is arguably relevant to the issue of bad faith, the Panel accepts these supplemental filings for the limited purpose of reviewing the correspondence in its entirety.

C. Identical or Confusingly Similar

The Complainant Airborne Systems Group, Ltd. indisputably holds trademark registrations for a figurative mark that includes the words comprising the Domain Name, along with a bird-wing device and the initials “AS”. Hence, the Domain Name is not literally identical to the mark, and the parties dispute whether the Domain Name is “confusingly similar” to the mark.

The Panel finds persuasive the reasoning of the panel in Borges, S.A., Tanio, S.A.U. v. James English, WIPO Case No. D2007-0477, with respect to marks that incorporate both a device and words:

“it is open to a Panel to make a finding under the first element of the Policy, based on the �dominant [word] elements’ of a mark. There are two reasons for this.

Firstly, it is obvious that a mark, to the extent that it includes a device, cannot be reproduced in a domain name. To require some similarity with a device itself, for a finding under this first element of the Policy, would always place the owners of such marks at a significant disadvantage. The terms of the Policy include no such limitation against owners of such marks.

Secondly, it follows from the above that whether a domain name is identical or confusingly similar to a mark, is to be judged against the dominant textual elements of a complainant’s mark. This approach is supported by a series of prior panel decisions. (See e.g. Sweeps Vacuum & Repair Center, Inc. v. Nett Corp., WIPO Case No. D2001-0031, and the cases cited in that one.) In that case, the panel noted that: “… graphic elements, such as the Sweeps design, not being reproducible in a domain name, need not be considered when assessing identity or confusing similarity”). The nature of a design mark may be relevant to whether its textual components are sufficiently dominant. But this is something that can only be judged on a case by case basis according to the nature of the mark in question. Put in other words, the more distinctive or particular the textual elements of the trademark, the greater the likelihood of it being identical or confusingly similar.”

Here, the dictionary words “airborne systems” are descriptive and not especially distinctive. They are also not featured as prominently in the mark as are the large initials “AS”, which might therefore be considered part of the “dominant” textual element. As the Respondent points out, “airborne systems” is found in a number of company and product names, and the United States trademark registration expressly disclaims exclusive rights to those words. These facts tend to militate against the confusing similarity of the Domain Name.

The Panel would consider it relevant, however, if the evidence established that the Respondent itself selected the Domain Name because of its likelihood of being confused with the Complainants’ mark, as the Complainants contend. Hence, the Panel defers its finding on confusing similarity until taking up that argument below in connection with the issue of bad faith.

D. Rights or Legitimate Interests

It is undisputed that the Complainants have not authorized the Respondent to use their mark in a Domain Name.

The Policy, paragraph 4(c), provides a non-exhaustive list of other circumstances in which the Respondent could demonstrate rights or legitimate interests in the Domain Name, including the following:

“(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”.

The Respondent has offered little to demonstrate preparations to use the Domain Name for an air purification website, apart from registering another domain name for such potential use. However, the Respondent’s historical and current use of the Domain Name, to redirect Internet visitors to the Respondent’s HD DVD website, entails advertising products offered by third parties. In at least some circumstances, this could be considered use in connection with a bona fide offering of goods or services but not if the likely intent was to mislead Internet users seeking the Complainants’ products.

The question is whether the Respondent is making commercial use of the Domain Name for its trademark value. That question is at the heart of the discussion of bad faith, addressed in the following section.

E. Registered and Used in Bad Faith

The Policy gives several examples of bad-faith registration and use, three of which are cited in the Complaint:

“(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

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your web site 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 web site or location or of a product or service on your web site or location.”

The predicate for each of these, as applied to the present case, is the Respondent’s awareness of the Complainants’ mark. There cannot be bad faith, for purposes of the Policy, unless the Respondent had the mark in contemplation and sought to take illicit advantage of it.

The Complaint is not persuasive on this point. The Complainants had not even applied for trademark registration at the time they sought to purchase the Domain Name from Mr. Lahoti in 2007. The Complainants claim first use of their design mark in 2003, but the record includes no evidence concerning pre-registration use apart from the assertion that the Complainants had sales of approximately USD $70 million in 2006. The Complaint does not indicate what portion of these sales were associated with the mark, and in what markets. It appears from the Complainants’ website that its sales are largely made in the defense, aerospace, and automotive industries. There is no indication that the Complainants’ unregistered mark was widely advertised in media reaching a general audience that might reasonably be expected to include persons such as Mr. Lahoti.

Instead, the Complainants ground their argument for the Respondent’s actual knowledge of their mark on their representative’s discussions with Mr. Lahoti in February and March 2007 concerning the possible purchase of the Domain Name (discussions that the Complainants evidently initiated). This proves that Mr. Lahoti, who acknowledges his control of the Respondent, was at least aware of the Complainant Airborne Systems Group, Ltd. But nothing in the record indicates that the Complainants asserted to Mr. Lahoti their claims of common-law trademark rights in the words “airborne systems”, either in those discussions or at any time before the Domain Name registration was transferred to the Respondent.

In 2008, the Respondent was clearly aware that the Domain Name had value to the Complainants and may even have harbored the hope that it could eventually sell it to them. But in the circumstances this is not per se sufficient to prove bad faith under the Policy unless the Respondent was also aware that the Domain Name was identical or confusingly similar to a mark held by the Complainants. The Respondent denies such knowledge, and the Complainants have not overcome this denial with persuasive evidence that they had a protected mark when they discussed purchasing the Domain Name and made that fact known to Mr. Lahoti.

The Panel, therefore, finds that the Complainants have not established the third element of the Complaint. Their arguments under the first and second elements, which are based on a similar analysis of the same facts, similarly fail.

F. Reverse Domain Name Hijacking

The Respondent suggests that a finding of reverse domain name hijacking is appropriate in this case. This is defined in the Definitions section of the Rules as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name”.

Paragraph 15(e) of the Rules provides as follows:

“If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.”

While the Complainants have ultimately failed to establish the required elements of the Complaint, the Panel does not find persuasive evidence of their intent primarily to harass the Respondent or abuse the UDRP process. Accordingly, the Panel denies the Respondent’s request to make a finding of attempted reverse domain name hijacking.

7. Decision

For all the foregoing reasons, the Complaint is denied.

Dated: March 6, 2009