By Paul Keating
(paul@law.es)

A panel of respected WIPO arbitrators recently issued their decision in Airborne Systems North America and Airborne Systems Group, Ltd. v. Virtual Point, Inc. (“airbornesystems.com”). The decision represents a further erosion of fairness in the UDRP procedure and highlights the alarming tendency among panelists to ignore both the clear language of the UDRP and the applicable laws governing the validity of trademark rights.

As a threshold the UDRP Policy requires that a complainant prove that the domain name is identical or confusingly similar to a trademark in which the claimant has rights. (Policy, §4(a)(i)). If this threshold test is not met, the complaint must be denied.

Panels have all but ignored this first element finding that domain names are “identical or confusingly similar” to trademarks that do not legally exist. “Confusingly similar” is a concept borrowed from traditional trademark law. The test used to determine confusing similarity involves several factors, such as similarity in appearance, sound, connotation, and commercial impression, the nature of goods or services offered under the mark, trade channels used etc.

When confronted with the “identical or confusingly similar” language of the Policy, early panels simply refused to apply the applicable legal standards. In support they argued that the UDRP process was intended to be streamlined and that panels were not equipped to engage in the type of analysis required under traditional jurisprudence2. The developed UDRP panel view is now that the comparison between the trademark and the domain name is limited to a text vs. text comparison. While such a short-cut is bad enough when dealing with text-based marks, it yields impossible results when figurative3 marks are presented.

In dealing with figurative marks, panels argue that figurative elements may be ignored and the analysis then proceeds to compare the non-figurative text with the domain name. Even if the text of the mark and the domain are not identical, panels regularly opine that there can still be confusing similarity if the dominant textual element of the figurative trademark is reproduced.

UDRP panels applying the above4 frequently cite Borges, S.A., Tanio, S.A.U. v. James English5 (Borges.com). Borges stated that “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.” The decision argues that considering the figurative elements would “always place the owners of such marks at a significant disadvantage” and “[t]he terms of the Policy include no such limitation against owners of such marks.” The Borges panel concluded that “the more distinctive or particular the textual elements of the trademark, the greater the likelihood of it being identical or confusingly similar.” In the stroke of a pen, §4(a)(i) was rewritten.

Figurative marks are intentionally applied for and obtained. Sometimes the decision is to present a more colorful image. Often (as in this case) it is because the text itself cannot be registered - it cannot function as a trademark. There is nothing unfair about limiting claimants rights to what they are in fact entitled to under the applicable law. After all, the claimant voluntarily filed the figurative mark to begin with; they have intentionally limited themselves. One cannot obtain a figurative trademark, for example, in “§Cars” to sell automobiles and seek to ‘recover’ the domain cars.com because the dominant element of the mark is ‘cars’. A Panel considering such a claim would effectively recognize a trademark right that is prohibited by law.

The recent Airborne decision expands further upon Borges and in doing so compounds the error. In Airborne, the claimant sought the domain airbornesystems.com based upon a US registered trademark reproduced below.

The Panel quoted at length from Borges as authority for the “text-vs-text/dominant feature” test. It found that the dominant element “Airborne Systems” could be confusingly similar to the domain name depending upon the subjective intent of the respondent.

The shocking error in Airborne is the simple fact that the claimant had expressly and voluntarily disclaimed any rights to the phrase “Airborne Systems” apart from the actual figurative mark. This disclaimer was required by the USPTO as a condition to registration. Per the USPTO:

“The purpose of a disclaimer is to permit the registration of a mark that is registrable as a whole but contains matter that would not be registrable standing alone, without creating a false impression of the extent of the registrant’s right with respect to certain elements in the mark.” (USPTO Glossary)

Consequently, under the applicable US law under its registration6, complainant could claim no rights in AIRBORNE SYSTEMS outside of it being an integral part of the entire figurative mark shown above. In the absence of “rights”, the panel should have stopped there and denied the complaint. However, the panel did not stop there but rather continued to investigate the subjective intent of the respondent on the grounds that it was relevant to whether the domain was confusingly similar to the mark. Needless to say, the disclaimer includes no such reservation.

Further, there is no legal basis for turning the clear language of §4(a)(i) into another version of bad faith (§4(a)(iii)). Confusingly similar is an objective test to measure the consuming public. It also has nothing to do with what the respondent did or did not intend.

By ignoring established law and moving focus to the respondent in this way, the panel has expanded trademark rights to infinity. Granting trademark holders protection for rights they do not otherwise hold is clearly against the purpose of the Policy. The UDRP was never intended to create new rights of intellectual property, nor to accord greater protection to intellectual property in cyberspace than that which exists elsewhere. (Final Report of the WIPO Internet Domain Name Process, April 30, 1999)7.

In the end, the panel in Airborne Systems made the “right” decision and ruled against the complainant under the third element as there was no evidence that the respondent could have known of the claimant’s trademark when the domain was registered8. One may think ‘no big deal’ because the complaint was denied. However, the complaint in Borges (and the cases it relied upon9) was also denied. Yet those very cases represent the foundation for the rule at issue. The Airborne Systems Panel consisted of three respected and experienced individuals, and the decision will most likely be relied upon by claimants to expansively establish trademark rights in UDRP complaints, thus allowing them to “recover” domains based upon rights they do not legally possess.

Perhaps the most disturbing aspect of all however is the simple fact that panelists are beholding to no one. There is no appellate authority. The right of respondents to “contest” a panel decision in a real court house is not universal. In many jurisdictions a proper cause of action to support the respondent’s challenge is often non-existent. Even when judicial review is available (such as in the US) the courts routinely hold that neither panel decisions nor the UDRP itself is relevant. Thus, even where available, judicial action provides no precedent. Given the clear statements of WIPO in the creation of the UDRP and given the lack of judicial oversight, panelists should be allthe- more careful to limit themselves to the words of the Policy and not embark on judicial drafting expeditions. Otherwise, we will see continued unchecked expansion of trademark rights at the expense of the valuable property rights reflected in a domain name.

* © Paul Keating, 2009. The kind assistance of Ms. Maria Bergsten is greatly acknowledged.

1 WIPO D2008-1669
2 AltaVista Company v. S.M.A., Inc. D2000-0927; “The determination of whether the requirement of ¶4.a.(1) of the Policy is satisfied is based solely on a comparison of Complainant’s mark(s) and the domain name(s) in dispute. This is not a trademark infringement or unfair competition lawsuit in which liability in predicated upon a finding of likelihood of confusion, which, in turn, is based, in part, on a comparison of the parties’ goods and/or services.” See also Movado LLC v. Titan Net D2006-0824; The test of confusing similarity under the Policy is confined to a comparison of the disputed domain name and the trademark alone, independent of the other marketing and use factors usually considered in trademark infringement or unfair competition cases. See BWT Brands, Inc. and British American Tobacco (Brands), Inc v. NABR, WIPO Case No. D2001-1480; Britannia Building Society v. Britannia Fraud Prevention, WIPO Case No. D2001-0505 Vivendi Universal v. Mr. Jay David Sallen and GO247.COM, Inc., WIPO  Case No. D2001-1121, and the cases there cited. The panels misunderstand that although a monetary judgment is not possible, a very valuable property right held by the respondent is in fact being taken. Domains lost in UDRPS are not limited to inexpensive typos but rather include domains having been only recently acquired for 6 figures or more.

3 Figurative marks are “Device” marks and intentionally incorporate a design or other non-text elements.
4 Including the Airborne panel.
5 WIPO (D2007-0477).
6 Complainant provided no evidence of common law rights (which would be dubious in light of the disclaimer).
7 WIPO was requested by its member states, including the US to research and derive conclusions to influence the UDRP drafting process.
8 The mark was registered after respondent registered the domain name.
9 MAHA Maschinenbrau Haldenwang Gmbh & Co. KG v. Deepak Rajani, WIPO Case No. D2000-1816 and Sweeps Vacuum & Repair Center, Inc. v. Nett Corp., WIPO Case No. D2001-0031.