Nike, Inc. v. Farrukh Zia

[Indexed as: Nike v. Zia]
[Indexed as: E-NIKE.COM, et al.]

WIPO Arbitration and Mediation Center 
Administrative Panel Decision

Case No. D2000-0167
Commenced:
Judgment: 27 April, 2000.

Presiding Panelist: Thomas D. Halket

Domain name - Domain name dispute resolution policy -U.S. trademark - Famous mark - Identical - Confusingly Similar - Registration with intent to resell - No website established.
Applicable law - Parties domiciled in U.S. - U.S. law applied

Complainant is the owner of U.S. trademark NIKE, which is well-known worldwide and owns the domain name NIKE.COM in connection with its very popular website. Respondent registered ENIKE.COM and E-NIKE.COM. The Respondent offered to sell the domain name to the Complainant for Nike stock worth over $100,000.

Held, Name Transferred to Complainant.

The domain names are identical or confusingly similar to the Complainant’s trademarks, the only difference being the addition of an “E” which is insignificant. The Respondent is not a licensee of the Complainant and has no permission or consent to use the mark.  The Respondent is not commonly known by the name “Nike” and has made no use of the domain names nor has the Respondent established websites using the domain names.

The offer to sell the domain names was for a price substantially in excess of the documented out-of-pocket expenses directly related to the domain names.  Because of this, since the domain name is substantially the same as the Complainant’s world famous mark, and since there is no evidence of a connection between the domain name and the Respondent, bad faith registration has been demonstrated.
 

Policies referred to

Uniform Domain Name Resolution Policy, adopted August 26, 1999.

Panel Decisions referred to

World Wrestling Federation Entertainment, Inc. v. Michael Bosman, Case No. D99-0001 (January 14, 2000).
 

Halket, Panelist -

1. The Parties
The Complainant is NIKE, Inc., an Oregon (U.S.) corporation with a principal place of business in Beaverton, Oregon. According to Network Solutions, Inc.’s WHOIS database, the Respondent is Farrukh Zia, 17899 Soth Susana Road, Compton, CA 90221 USA. However, according to Complainant, Respondent has more recently indicated that his current mailing address is: Farrukh Zia, 16027 Brookhurst Street, G238, Fountain Valley, CA 92708, Tel. (714) 531-2048, FAX (310) 962-7096, e-mail: zia786@aol.com.

2. The Domain Name(s) and Registrar(s)
The domain names at issue are {enike.com and e-nike.com} (as the analysis is the same for both domain names, they will be referred to collectively as the "Domain Name"), which Domain Name is registered with Network Solutions, Inc (the "Registrar").

3. Procedural History
A Complaint was submitted to the World Intellectual Property Organization Arbitration and Mediation Center (the "WIPO Center") on March 16, 2000. On March 20, 2000, a Request for Registrar Verification was transmitted to the Registrar. On March 20, 2000, the Registrar confirmed by reply e-mail that the Domain Name is registered with the Registrar, that the Respondent was the current registrant of the name and that the ICANN Uniform Domain Name Disputed Resolution Policy (the "Policy") is in effect. The reply also contained contact information for the Respondent.

The Panel finds that the Policy is applicable to this dispute.

A Formal Requirements Compliance Checklist was completed by the assigned WIPO Center Case Administrator on March 21, 2000 which shows that the Complaint is in material formal compliance with the requirements of the Policy, the Rules for Uniform Domain Name Dispute Resolution Policy, as approved by ICANN on October 24, 1999 (the "Uniform Rules"), and the WIPO Supplemental Rules for Uniform Domain Dispute Resolution Policy, in effect as of December 1, 1999 (the "WIPO Supplemental Rules"). 

No formal deficiencies having been recorded, on March 21, 2000, a Notification of Complaint and Commencement of Administrative Proceeding (the "Commencement Notification") was transmitted to the Respondent, setting a deadline of April 9, 2000, by which the Respondent could file a Response to the Complaint. The Commencement Notification was transmitted to the Respondent by e-mail to the e-mail address specified in the Registrar’ Whois confirmation, as well as to {postmaster@e-nike.com and postmaster@enike.com}. In addition, the Complaint was sent by facsimile to the listed fax numbers and express courier to all available postal addresses. Having reviewed the communications records in the case file, the Panel finds that the WIPO Center has discharged its responsibility under Paragraph 2(a) of the Uniform Rules "to employ reasonably available means calculated to achieve actual notice to Respondent."

On April 4, 2000, Respondent submitted his response. 

Having received this Panel’s Statement of Acceptance and Declaration of Impartiality and Independence, on April 14, 2000, the WIPO Center transmitted to the parties a Notification of Appointment of Administrative Panel and Projected Decision Date was April 28, 2000. The Sole Panelist finds that the Panel was properly constituted and appointed in accordance with the Uniform Rules and WIPO Supplemental Rules.

4. Factual Background
The Panel finds that the following facts appear from the Complaint and documents submitted with the Complaint and, except where noted, have not been disputed by that the Respondent. 

Complainant is a very well known sports and fitness company. Since 1971 Complainant has used and promoted its "NIKE" trademark worldwide in connection with footwear, apparel, equipment, electronics and related retail, web-based communication and other services. 
Complainant owns numerous trademark registrations worldwide for its famous "NIKE" trademark, including United States registrations nos. 978,952, 1,153,938, 1,243,248, 1,277,066 and 1,214,930 covering a broad range of goods and services. At least some of these registrations are from as early as 1981. Complainant has also registered and uses the domain name "nike.com" in connection with its very popular web site, which typically receives an average 60,000 to 80,000 visits per day.

On November 7, 1998, Respondent obtained domain name registrations for the Domain Name which the Complainant submits are two close variations of Complainant's "NIKE" trademark and "nike.com" primary domain name. The Respondent argues, primarily based on the length of the names that they are distinct from Complainant’s mark. As the Domain Name consists only of Complainant's trademark preceded by the letter "e," an increasingly common prefix indicating the electronic or Internet-based version of something (e.g., e-commerce; e-business), the Panel concludes that the Respondent’s position is mistaken. 

Complainant also argues that Respondent has not used the Domain Name except to attempt to sell them to Complainant. In response, Respondent alleged that, prior to 1996 Respondent planned to enter the Indian Entertainment business, but because Internet was still in its infancy, Respondent’s launch of a Web based business had been slow. According to Respondent, as of early 2000, he had made significant strides in that direction, was ready to launch and now intends to use the Domain Name in conjunction with other owned domain names such as IndianMusic.com, HindiMusic.com and HindiFilms.com.

What is clear is that Respondent did offer to sell the Domain Name to Complainant in exchange for stock of Complainant worth over $100,000. As Respondent himself admits,
"Respondent faced a critical financial decision, which persuaded him to sell his property (the disputed domain name) to the Claimant. Respondent offered to the Complainant in good faith to sell the domain name ENIKE.COM in exchange for 5,000 shares. Respondent’s short-term business capital needs of approximately $150,000 were taken into consideration in making a legitimate business proposal to the Complainant. Respondent’s intentions were clearly to reach a mutually beneficial solution."

Complainant states, and this Panel sees no reason to disagree, that on the day of the offer, the value of these shares was approximately $140,000.00 - a sum considerably in excess of Respondent's out-of-pocket costs directly related to the domain name.

5. Parties’ Contentions
A. Complainant
Complainant contends that Respondent has registered as a domain name a mark which is identical or confusingly similar to the trademarks registered and used by Complainant, that the Respondent has no rights or legitimate interests in respect to the Domain Name, and that the Respondent has registered and are using the Domain Name in bad faith.

B. Respondent
Respondent has responded (Respondent’s response is set forth below in its entirety):
"Respondent pleads the Administrative panel to take into consideration his interest in the domain names, which were acquired for specific business purposes.

Complainant asserts: "domain names are identical or confusingly similar to a trademark or service mark in which Complainant has rights":

Respondent Pleads:

1. This is not true. Complainant’s domain name comprises of four letters, whereas Respondent’s domain names have five and six characters and letters; 

2. Respondent’s business acronyms equate exactly to the domain names owned by the Respondent; 

3. Respondent or his affiliates are not engaged in any business, which remotely compares to Complainant’s line of business; 

4. Respondent’s logos and marketing strategy does not create any confusion with that of the Complainant’s. 

Complainant asserts: "The Respondent has no rights or legitimate interests in respect of the domain names"

Respondent Pleads:

Respondent has been pursuing legitimate Internet based business interest in Indian Entertainment and believes the domain names serve his interests. 

Complainant asserts: "domain names were registered and being used in bad faith":
Respondent Pleads:

Prior to 1996 Respondent planned to enter the Indian Entertainment business. Because Internet is still in its infancy and for other valuable consideration, Respondent’s launch of a Web based business has been slow. As of early 2000, Respondent has made significant strides in the aforementioned business interest and ready to launch. Respondent intends to used the disputed domain name in conjunction with other owned domain names such as IndianMusic.com, HindiMusic.com and HindiFilms.com.

Respondent’s intent to exchange domain names for Respondent’s Stock: 
Respondent faced a critical financial decision, which persuaded him to sell his property (the disputed domain name) to the Claimant. Respondent offered to the Complainant in good faith to sell the domain name ENIKE.COM in exchange for 5,000 shares. Respondent’s short-term business capital needs of approximately $150,000 were taken into consideration in making a legitimate business proposal to the Complainant. Respondent’s intentions were clearly to reach a mutually beneficial solution.

Respondent prays to God and pleads to the Arbitrator(s) to consider Respondent’s appeal and disclosures of facts stated herein and make the right decision Respondent’s favor."

6. Discussion and Findings
Paragraph 15(a) of the Rules instructs the Panel as to the principles the Panel is to use in determining the dispute: "A Panel shall decide a complaint on the basis of the statements and documents submitted in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable." Since all parties are domiciled in the United States, to the extent that it would assist the Panel in determining whether the Complainant has met its burden as established by Paragraph 4(a) of the Policy, the Panel will look to the principles of the law of the United States.

Paragraph 4(a) of the Policy directs that the Complainant must prove each of the following: "(i) that the domain name registered by the respondent is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and, (ii) that the respondent has no legitimate interests in respect of the domain name; and, (iii) the domain name has been 
registered and is being used in bad faith."
The Domain Name violates Paragraph 4(a)(i) of the Policy in that it is identical or confusingly similar to trademarks marks in which the Complainant has prior rights. The only difference between the Domain Name and Complainant’s mark is the "e", a difference that the Panel holds in this case to be insignificant. Complainant’s trademark registrations precede by many years the registration of the Domain Name.

The Domain Name also violates Paragraph 4(a)(ii) of the Policy in that (i) Respondent is not a licensee of Complainant and has not received any permission or consent to use the trademark Nike; (ii) Complainant has prior rights in that trademark which precede Respondent’s registration of the Domain Name; (iii) Respondent is not (either as an individual, business or other organization) commonly known by the name "Nike" and (iv) Respondent has made no use of the Domain Name and no web site exists for it. Respondent claims he intends to use the Domain Name in conjunction with other domain names owned by him such as IndianMusic.com, HindiMusic.com and HindiFilms.com. But the Respondent has offered no evidence, indeed no allegations at all, as to how the Domain Names would be connected to the business he purports to be in the process of starting. According to Webster’s New Collegiate Dictionary, Nike is the Greek god of victory; the word would seem to have little or no meaning in the context Respondent claims to intend to use it.

Finally, the Domain Name violates Paragraph 4(a)(iii) of the Policy. To violate Paragraph 4(a)(iii) of the Policy the Respondent must both register and use the domain name in question in bad faith. See, e.g., World Wrestling Federation Entertainment, Inc. v. Michael Bosman, Case No. D99-0001 (January 14, 2000). Paragraph 4(b) of the Policy provides some guidance on Paragraph 4(a)(iii) of the Policy. It provides:

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

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

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

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

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your 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."
Subparagraph (i) is applicable. There is no question that an offer to sell the Domain Name to the Complainant was made for a price substantially in excess of the documented out-of-pocket costs directly related to the Domain Name, no such costs being alleged by Respondent. The only question is whether circumstances exist that indicate that the Respondent registered the Domain Name primarily for the purpose of selling, renting, or otherwise transferring it to the Complainant. Respondent claims that he registered the Domain Name for his own use. Yet the Domain Name is essentially exactly the same as Complainant’s mark, a mark which was world famous at the time the Domain Name was registered. The Panel also notes that Respondent has made no use of the Domain Name and there does not appear to be any connection between the Respondent (or any of his businesses) and the Domain Name. Under these circumstances, the Panel feels that on balance the circumstances support the conclusion that subparagraph (i) is applicable. 

Accordingly, the Panel finds that the Domain Name violates paragraph 4(a)(iii) of the Policy.

7. Decision
For all of the foregoing reasons, the Panel decides that the Domain Name registered by Respondent is identical or confusingly similar to the trademark and service marks in which the Complainant has rights, that the Respondent have no rights or legitimate interests in respect of the Domain Name and that the Respondent’s Domain Name has been registered and is being used in bad faith. Accordingly, pursuant to Paragraph 4(i) of the Policy, the Panel requires that the registration of the Domain Name {enike.com} and {e-nike.com} be transferred to the Complainant.

Thomas D. Halket
Presiding Panelist
Dated: April 27, 2000

Domain Name Transferred