The Complaint was received by WIPO by e-mail on August 9, 2000, and in hard copy form on August 11, 2000. WIPO has verified that the Complaint satisfies the formal requirements of the Policy, the Rules and the Supplemental Rules and that payment was properly made. The Administrative Panel ("the Panel") is satisfied that this is the case.

The Complaint was properly notified in accordance with the Rules, paragraph 2(a). The Registrar has confirmed that the disputed Domain Name, "smartdesign.com" ("the Domain Name") was registered through BulkRegister.com and that Carolyn Hughes is the current registrant of the Domain Name. The Registrar has further confirmed that the Uniform Domain Name Dispute Resolution Policy ("the Policy") applies to the Domain Name.

On August 23, 2000,WIPO notified the Respondent of the Complaint in the usual manner and informed the Respondent inter alia that the last day for sending her response to the Complainant and to WIPO was September 11, 2000. The Respondent had problems with her computer and her Response was eventually received on September 14, 2000, and was accepted out of time by WIPO on the basis of "exceptional circumstances". The Response included a claim that the Complaint constituted a case of Reverse Domain Name Hijacking, as defined in paragraph 1 of the Rules.

The Panel was properly constituted. The undersigned Panelist submitted a Statement of Acceptance and Declaration of Impartiality and Independence.

No further submissions were received by WIPO or the Panel as a consequence of which the date scheduled for the issuance of the Panel’s Decision is October 11, 2000.

Subsequently, the Complainant lodged a Rebuttal to the Respondent’s claim of Reverse Domain Name Hijacking, which the Panel has read. WIPO has informed the Panel that on or about October 10, 2000, a further document was received from the Respondent dealing with the Rebuttal, but the Panel declined to accept it.

4. Factual Background

The Complainant was founded in 1985 for the purpose of designing and developing consumer products. The client base for the Complainant has been and continues to be Fortune 500 companies. The Complainant has received many industry awards. The Complainant has gained widespread recognition and publicity for, inter alia, its work developing the OXO GoodGrips line of kitchen utensils, a design for which the Complainant received a Patent in March 1990. In its June 12, 2000, issue Business Week magazine included the Complainant in its top ten list of design consultancies in the United States.

As an extension of the Complainant’s development expertise the Complainant is offering in addition strategic consulting services.

In about 1990 the Complainant applied for trade mark protection for its name in the United States but the application was abandoned, the Complainant having failed to respond to an Office action.

In August 1996 the Complainant registered the domain name "smartnyc.com" claiming that it had sought to register the Domain Name, but found that at that time it was not available for registration.

By May 26, 1997, the Domain Name must have become available for registration for it was on that day that the Respondent registered it.

In April 1999 the Complainant conducted a Whois Search and found that the Domain Name was registered to the Respondent. Not finding any site connected to the Domain Name the Complainant wrote to the Respondent. The Panel regards this letter as an important one. It reads in full as follows: -

"Dear Ms. Hughes,

We are a New York City based industrial design firm formed in 1979. Enclosed please find some brief materials about our work, which you may have seen.

It has come to our attention that your firm holds the rights to "smartdesign.com", but does not currently have a presence on the Internet. We currently operate our web presence under the name "smartnyc.com", but increasingly find that potential clients are unable to find us at an address that is less than intuitive.

I am writing to ask if you intend to use that registration indefinitely, or if at some point you would be willing to assign the name to our firm. At the least, I am writing to ask if you would be interested in posting a link from a non-existent "smartdesign.com" web address, to automatically forward clients to "smartnyc.com".

Any help you can offer in this matter would be greatly appreciated.

Sincerely

Greg Littleton

Vice President, Strategy & Operations"

The Respondent did not reply to this letter and the Complainant did not follow it up.

On May 21, 2000, the Respondent (said to be doing business as "smartdesign.com") first instructed Mr. Otto Lee, a US registered patent attorney, to assist her in relation to a patent application for an invention, being a business method to provide improvement to current e-commerce traffic. The basis for this is a letter from Mr. Lee dated September 8, 2000, which must have been written in the knowledge as to how the letter was going to be used, namely to support the Respondent’s case in this proceeding. The Panel knows of no reason why Mr. Lee’s word should be doubted and therefore treats the contents of the letter as fact.

At some stage prior to May 27, 2000, the Complainant noticed that the Domain Name registration was due to expire (unless renewed) on May 27, 2000. The Complainant hoped that the Domain Name would not be renewed with the result that it would become available for registration and the Complainant would be able to snap it up.

However, according to the Complainant, it was not until July 25, 2000, that the Complainant noticed that the Domain Name registration had been renewed by the Respondent.

On that day, July 25, 2000, Mr. Littleton of the Complainant telephoned the Respondent and engaged in a telephone conversation with the Respondent, which he timed as lasting for 56 minutes. There is a dispute between the parties as to precisely what was said during that conversation. Both parties rely upon what was said and what has been claimed by the other to have been said in the course of that conversation. It is convenient at this stage to relate the competing viewpoints.

(i) The Complainant states that the Respondent admitted to having received the April 1999 letter from the Complainant and admitted that she had not responded. That is not contested. However, the Complainant states that the Respondent acknowledged that she had kept the brochure accompanying that letter on her desk since April 1999, because she had found it relevant to her line of work. The Complainant points to the fact that the Respondent had the brochure ready at hand during the conversation one year after she had received it. The Respondent says that this is untrue. She says that being able to lay her hands on the brochure quickly was simply the consequence of a good filing system.

(ii) The Complainant claims that the Respondent stated that she had registered the Domain Name in 1997 because she had intended to start a company called "Smart Design" at an undetermined point in the future, but that the company did not exist at that moment, nor had it ever existed. The Respondent says that she made it clear to the Complainant that her "Smartdesign.com" is a real entity and is a companion business to another part of her business. She says that she made it clear to the Complainant that "Smartdesign.com is the thinkubator, research and development lab in which patentable intellectual property used in [her] businesses is developed for market."

(iii) The Complainant says that the Respondent was unable to articulate her vision for Smart Design (Canada) other than to call it a "bridge" extending from her current operating entity, Idea Design. The Respondent’s position in relation to that is set out in the preceding paragraph.

(iv) The Complainant says that the Respondent described Idea Design as developing "strategic models and new venture models" for clients, for the business of helping clients create new business opportunities. The Respondent states that she made it clear to the Complainant during this telephone conversation that she was not in any way a competitor to the Complainant.

(v) The Complainant states that the Respondent volunteered that after having registered the Domain Name in 1997 she had received numerous emails from the Complainant’s employees. The Complainant goes on to say "the Respondent referenced the content of certain emails, thereby inferring that she had opened the emails and had read the contents despite knowing they were/had been intended for Complainant". The Respondent responds "Complainant accuses the Respondent of intercepting emails addressed to employees of the Complainant. This has never been true. This is a malicious endeavour to tarnish the character and reputation of the Respondent by implying that she engaged in the purposeful opening and reading of mail addressed to someone else. The Complainant knows that all mail addressed to anyone at "smartdesign.com" was directed to the Respondent’s mailbox and appeared in said inboxes mail addressed to: Carolyn Hughes "carolyn@coastnet". The Respondent goes on: "the Complainant’s allegation that the Respondent said she received an abundance of emails intended for Complainant’s firm is a falsehood. The Respondent did not say that, or anything similar. The Respondent received less than 10 pieces of mail total which were apparently intended for someone working at another Smart Design and it is not possible to know if they were intended for the Complainant or any other of the businesses who are known as Smart Design."

(vi) The Complainant states that the Respondent further stated that she had received so many emails intended for the Complainant that she had disabled the forwarding feature so she would no longer receive emails intended for the Complainant at her personal email account. Part of the Respondent’s response to that appears in the previous paragraph. The Respondent also states "as long as the Respondent had DNS connected, all mail that was wrongly addressed to an employee of the Complainant, or any other Smart Design, and arrived in her mailbox was returned to sender with a reply reading "this is not the Smart Design you are looking for. All mail addressed to "[email protected]" comes to me. Good luck." The Respondent said she stopped this process only when she began to receive pornography, which was apparently intended for someone at the Complainant but was clearly addressed to the Respondent. She states that the Complainant knew that the reason the DNS was disconnected was because she did not wish to receive pornography in her email whether intended for someone at the Complainant’s company or any other company.

(vii) The Complainant states that the Respondent acknowledged the confusion between her domain name and the Complainant’s domain name and during the conversation offered to post a website at "smartdesign.com" that would refer viewers seeking the Complainant to smartnyc.com. The Respondent replies that "because the Complainant presented his need in such a compelling way and because the Respondent is willing to help others when and where she can, she agreed to have the "smartdesign.com" website activated and place on it a link to smartnyc.com. She did not offer this first. She says she agreed to help the Complainant because it seemed that offering this "temporary, band-aid solution" was a nice thing to do.

(viii) The Complainant states that the Respondent said that she had originally registered the Domain Name through Network Solutions in 1997, but was dissatisfied with their service. The Complainant said that the Respondent stated she had instructed another domain name registrant to renew her registration. In the mass of material produced to the Panel, the Panel has not been able to find the Respondent’s response to this assertion, but it is a fact, apparently, that the registration was made through NSI and that the renewal was effected through BulkRegister.com.

(ix) The Complainant confirms that the Respondent stated that she had no intention of selling the Domain Name, despite having been offered several thousands of dollars from other suitors. This is not in dispute. The Respondent says that she made it very clear to the Complainant in this conversation that the Domain Name was not for sale.

(x) The Complainant says that Mr. Littleton and the Respondent then exchanged cursory information about the market positions and capabilities of their respective operating companies and that at the Respondent’s request, Littleton was to provide more detail about the Complainant’s service offerings. The Complainant states that the Respondent then stated that she saw potential for overlap, making reference to "overlapping concentric circles" between the services provided by the Complainant and her alleged future spin-off, Smart Design (Canada). The Complainant goes on to state that the Respondent said that she saw potential for partnership opportunity between the two companies, given the extent of overlap in services offered. According to the Complainant she suggested that conversations on that topic should continue through a more formal exchange of information and that Mr. Littleton should submit to her the Complainant’s business plan, outlining the Complainant’s (a) intentions for opening a new office in California (b) corporate culture (c) areas of current and intended service offerings and (d) cash availability to support the expansion effort. The Complainant says that the Respondent acknowledged the value of exchanging information of this nature and proposed that a non-disclosure agreement be signed between the parties. The Respondent says that late on in the conversation the Complainant sought to probe the Respondent for details about her life and business and that due to the sensitive nature of her business she suggested that a non-disclosure agreement was essential for any discussions beyond that point and she says that the Complainant agreed.

(xi) The Complainant says that the Respondent reiterated that she would not sell the Domain Name, but that should she find evidence of a potential for partnership after reviewing the Complainant’s confidential information, she would consider "sharing" the Domain Name on the basis of the two Smart Designs being a combined entity. The Respondent denies that she at any time offered to share the website with the Complainant. She offered a link. She says the claim that the Respondent sought a merger of her business and the Complainant’s business is another falsehood. She said that she suggested nothing of the sort.

(xii) The Complainant says that Mr. Littleton ended the conversation stating that he had consulted several attorneys regarding the Complainant filing an arbitration claim to secure the Domain Name, but preferred to work directly with the Respondent, citing the tone and content of his April 99 letter as evidence that he was in pursuit of a mutually beneficial agreement rather than pursuing an aggressive legal approach. He says that the Respondent replied that she did not believe that the Complainant would win in arbitration but if the Complainant were to file such a claim and lose, it would destroy the goodwill being developed between the parties. The Complainant says that this was followed by a threat that if that were to happen, the Complainant would never obtain the Domain Name from her.

On July 26, 2000, the Complainant sent the Respondent a follow up email sending her a draft non-disclosure agreement for review and asked her to let the Complainant have details of her business plans under the name Smart Design. The email went on to invite the Respondent’s suggestions for dealing with the errant emails.

The Respondent replied by email on July 31, 2000. Given that the Complainant places reliance upon this email as evidence of the Respondent’s willingness to sanction illegality, it is quoted in full (less the non-disclosure agreement): -

"Dear Greg

Thank you for your e-mail and fax. I apologize that my schedule is very full for the next several weeks – as I explained, I have a patent application I am hoping will be complete by the August 15^th launch day for a new business model. Nevertheless, I understand that this matter is a priority for you and will try to accommodate. Hopefully we can find a solution.

You wrote:

1) Attached please find our standard NDA. As I mentioned, it has not been written with the intent to share our internal operating plans. As we discussed, you will review the language and either sign or send me one you feel has more tooth.

I looked at all of my NDAs and this one below was easiest to modify for this situation. (Sorry about the lack of formatting.) Like yours, mine are mostly geared to specific situations that are not mutual disclosures. As for the "tooth" factor, I think that underneath the warm language yours has just as much tooth as any of mine – it just sounds friendlier:-) Please feel free to craft this one further and format it as you see fit.

You wrote:

2) You mentioned that you don’t have a wrtitten plan for Smart Design (Canada), but assuming we cover each other with mutual NDAs, I’m wondering if you would be willing to write a very brief description of the services you intend to offer and target market, so that I could share our conversation with my partners?

Yes. We certainly should have a mutual non-disclosure agreement and, this just forces me to do what I’ve needed to do anyway. My lack of time right now, however, could mean this won’t get done before early September.

You wrote:

3) Finally, it occurred to me that since you received emails from Smart Design (New York) employees, you might also have received emails from our clients or potential clients. I’m therefore re-considering your offer to post a link forwarding visitors to smartnyc.com, but am wondering what to do about errant emails from potential clients. Any thoughts?

I can’t say with certainty whether I received many errant e-mails from your clients or potential clients as I wasn’t interested in the content and, may not have been able to discern between an email between two co-workers or between a client and employee. Except for those which were glaringly inappropriate, and definitelynot from clients, I paid no attention to content.

If I posted two links on the website – one for your website and one for an email address at your company – anyone visiting the site can reach you but, that doesn’t solve the problem of someone trying to send an email to a specific address at SmartNYC and errantly sending it to [email protected].

My hunch is that prospective clients would first try to visit the website and if it didn’t exist they would send an e-mail. However, if they find link on the site, that would probably eliminate any such problem. As for clients who are communicating with your staff on jobs in progress, I think they would be quick to catch on when there is no timely reply. I suspect that the majority of errant e-mails have come from friends and relatives of your employees. The DNS has been disconnected for over 8 months now, so it could be that most of your employees, if you don’t have a high turn over there, have set their contacts straight on their address.

If I reconnect the DNS to make the site live, I will simply have all mail point to a designated address. This could be your address, in which case you would get all the mail, including any intended for me. That’s probably not a problem for me, because I don’t expect to get mail at that address near term. However, it may be a potential legal problem for you if you don’t disclose to your employees that you could be getting their e-mails. On the other hand, it might not be a bad idea for some people to know that someone else may be reading their mail.

Your thoughts from here?

I will be out of the office this week from Wed through Sun, but will get my e-mail and respond where urgent.

Best regards,

Carolyn"

This Complaint was launched on August 9 2000.

Following the Complaint the Complainant and the Respondent have both filed applications with various registries seeking to secure their claimed rights to the name Smart Design in various forms, but the Panel has ignored that post-Complaint activity as being irrelevant to the points in issue in this proceeding.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights. The Complainant contends that it has rights in the name Smart Design and that the name is identical to or confusingly similar to the Domain Name.

The Complainant goes on to contend that the Respondent has no rights or legitimate interests in the Domain Name and cites in support

● That "relevant searches" by the Complainant failed to reveal any trade mark or service mark rights to the Domain Name or similar names belonging to the Respondent.

● The Respondent has stated that she has not in the past nor currently operated under the name Smart Design. The Complainant points to its unsuccessful attempts to locate Smart Design (Canada) in any directories. The Complainant also points to the fact (if it be a fact) that the Respondent stated that she did not have any description of Smart Design (Canada)’s services nor would she be able to produce one within the next two months, nor was she expecting email to that address.

● Previous Panels have held that failure to make a bona fide use of the Domain Name during a two-year period following registration constitutes bad faith. The Complainant contends that the Respondent has failed to make a bona fide use of the Domain Name for three years and has not had any other legitimate interest in the name Smart Design beyond mere domain name registration.

The Complainant asserts bad faith in relation to the Respondent’s registration and use of the Domain Name.

The Complainant argues that sufficient evidence exists in this case to determine that the registration was undertaken in bad faith, when the facts are taken together. While Respondent may not have behaved in the manner expected of a classic cybersquatter, Complainant argues that when all the facts are considered, Respondent’s means are unique, but are ultimately designed to achieve the same end results that the Policy was designed to prevent. The Complainant cites case number D2000-0119, a case in which the Panel is said to have held that the Respondent had registered the Domain Name in bad faith solely on the basis that: "Respondent had constructive notice of Complainant’s registered service mark at the time that Respondent registered the domain name at issue." The Complainant argues that similarly, the Respondent in this case had received constructive notice of Complainant’s rights to the name prior to renewal in May 2000.

The Complainant cites case number D2000-0004, a case in which the Panel there is said to have held that "Respondent’s failure for a substantial period of time to make good faith use of the Domain Name for its business" along with other evidence of "failure of use" constituted bad faith use. The Complainant notes that the Respondent in this case has not made use of the Domain Name for over three years and offers as "other evidence" the Respondent’s registration of five inactive websites, her statement that the business has never existed nor is expected to exist in the near future, her statement that she does not expect email near term and Complainant’s inability to locate any legitimate reference to the Respondent’s other five businesses, for which Respondent has registered domain names.

The Complainant then goes on to argue that the facts support a finding of bad faith under the specific criteria set out in both 4(b)(i) and 4(b)(iii) of the Policy.

Paragraphs 4(b)(i) and 4(b)(iii) of the Policy read as follows: -

"Evidence of registration and use in bad faith. For the purposes of paragraph 4(a)(iii), 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

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

The word "you" in the above extract refers of course to the Respondent.

The Complainant concedes that "Respondent may have initially registered the Domain Name in 1997 with bona fide intent". However, the Complainant contends that it is nonetheless entitled to succeed in this Complaint on the basis that the renewal of the registration in May 2000 itself constituted a registration for the purposes of paragraph 4(a)(iii) of the Policy and that the renewal was made in bad faith.

The Complainant argues that the renewal was made in bad faith because it was made with knowledge of the Complainant’s April 1999 letter, which served as constructive notice of the Complainant’s rights to the name prior to the Respondent’s renewal in May 2000. The Complainant points to the fact that at no stage has the Respondent challenged the Complainant’s rights to the name Smart Design and that her willingness to consider a partnership agreement evidences her acknowledgement of the Complainant’s goodwill and reputation which form the basis of the Complainant’s assertion of rights to the name.

The Complainant complains that prior to renewal in May 2000, the Respondent received email destined for the Complainant and while being in possession of a contact name for the Complainant made no effort to alert the Complainant that she had received email in error. The Complainant notes that prior Panel Decisions have recognised inaction (as opposed to positive action) on the part of a Respondent to be considered evidence of bad faith. For reasons which will be apparent, the Complainant’s general style of approach to this Complaint is of relevance and for that purpose the following three paragraphs of the Complaint, which the Panel regards as typical of the Complainant’s style, are set out verbatim:

"Prior to renewal, Respondent opened and read the contents of certain email destined for Complainant. Respondent acknowledges in her July 31 correspondence that covert interception of email could be illegal (although Respondent had disconnected DNS server at the time of renewal, she claimed she did so because it overloaded her email account, not because it was illegal). Assuming that Respondent believed that covert interception may be illegal at the time of her renewal, despite that she was no longer receiving email at that account for reasons of convenience rather than unlawfulness, Respondent would have renewed the domain name in May 2000 with prior knowledge that doing so may have been illegal.

Finally, for Respondent, renewal of the domain name was not a careless financial transaction conducted without analysis. Respondent had time to consider the impact of her renewal, as evidenced by her statement that she disapproved of the services performed by Network Solutions during her prior 3-year registration of the domain name. Respondent presumably had time and ability to consider other registration services, analyzed her alternatives, and ultimately selected BulkDomains.com.

Complainant therefore asserts that Respondent had the time, ability, and willingness to consider the impact of the domain name renewal in 2000, and that renewal was made with full recognition that doing so would violate Complainant’s legitimate rights to the name, would perpetuate confusion with regard to errant emails, and that doing so might even be considered illegal."

For the purposes of its argument under paragraph 4(b)(i) of the Policy (and assuming for this purpose that "renewal" can equate to "registration") the Complainant acknowledges that it must also prove that the Respondent renewed the Domain Name primarily for the purpose of selling, renting or otherwise transferring the Domain Name …". In this context the Complainant states that a determination of the Respondent’s primary intent is difficult, since the Respondent has asserted that her primary intent was for legitimate business purposes. The Complainant cites a number of earlier Decisions, namely D2000-0003, 0004, 0025 and 0119 as support for the proposition that even where Respondents have asserted good faith intentions, in the absence of evidence in support of those assertions, Panelists have made a determination with regard to primary intent in bad faith.

For this purpose the Complainant points to the fact that although three years have elapsed since registration of the Domain Name, the Complainant has been unable to find any evidence that the company exists; the Complainant also points to the fact that it has been unable to find a telephone number for Smart Design (Canada); further there is no relevant trade mark right on record; furthermore the Respondent said that she was not expecting any email at that address in the near future. The Complainant points again to the Respondent not having a written description of the company available for perusal by a party whom she believed to be a potential business partner.

The Complaint continues "the argument that Respondent has registered "smartdesign.com" for legitimate [the Panel believes this must be a typographical error for "illegitimate"] purpose might be undermined if it could be demonstrated that Respondent were using her other domain names for legitimate purposes. Complainant’s efforts to find such legitimate purposes revealed no such evidence. In fact none of Respondent’s registered domain names resolve to active websites. Complainant argues that these facts, when taken together, contradict Respondent’s assertion that her primary intent was for the development of a business under Smart Design."

The Complainant also recognises that for the purpose of establishing bad faith registration and use pursuant to paragraph 4(b)(i) of the Policy it has to be able to establish that the Respondent was intending that the Domain Name should be sold, rented or otherwise transferred. The Complainant has already acknowledged that the Respondent was unwilling to sell the Domain Name and there has been no suggestion that she was intending to rent it. The Complainant argues that it is entitled to succeed because it can show that the Respondent renewed the Domain Name with a view to otherwise transferring it to the Complainant. For this purpose, the telephone conversation on July 25, and the Respondent’s email of July 31, are relevant.

It is important that the Complainant’s argument in this regard is not misunderstood and the Panel finds it convenient to put it in the precise form that the Complainant puts it in the Complaint namely:

"Respondent has denied a willingness to sell the Domain Name to Complainant or any other party. Respondent did however offer the potential of her sharing the Domain Name with Complainant if she found a partnership to be mutually beneficial.

Respondent prepared an NDA specifically for use with Complainant, which cites in its preamble the reasons for preparing the NDA between the parties: she defines Smart Design (NY) as the entity seeking an Internet moniker that identifies SmartDesign without regional qualification; Hughes is defined as the sole owner of the domain name SmartDesign.com. This statement evidences Respondent’s intent to exchange information for the purpose of sharing the domain name.

Complainant further offers as evidence Respondent’s willingness to share the domain name with Complainant during some interim partnership evaluation period. Respondent described, in great detail, the manner in which the name would be shared during this interim period in her 7/31/00 email.

The question unanswered is whether sharing of a domain name constitutes "otherwise transferring." In the absence of any prior ruling on the sharing of a domain name, Complainant argues that Respondent’s description of the interim domain name sharing period is elaborate and well-considered, and that it constitutes an offer to effectively transfer control of the domain name to Complainant despite Respondent maintaining de facto registration authority.

That is, Respondent acknowledges that Complainant would receive emails intended for Respondent during that interim period, in effect admitting the full transfer to Complainant of communications destined to the Respondent. Under the circumstances of a sale or renting of a domain name, the parties would make such reasonable considerations for errant emails, which is precisely the consideration being made by Respondent. As a result, her contingency plans for the management of the consequences resulting from such an "otherwise transference" of the domain name evidence her intention to "otherwise transfer" the domain name to Complainant."

Finally, for the purposes of paragraph 4(b)(i) of the Policy the Complainant has to establish "valuable consideration in excess of the Respondent’s documented out of pocket costs". The Complainant accepts that the Respondent said that she would never sell the name, but the Complainant argues that the Respondent attempted to induce the Complainant to reveal confidential business information, which was considered valuable by the Respondent. This was the information, which he said was to be transmitted under the non-disclosure agreement discussed in the July 25, 2000, telephone conversation.

The Complainant concludes that this valuable confidential business information of the Complainant, which was to have been transmitted to the Respondent, is the valuable consideration in excess of the Respondent’s out of pocket expenses.

As to paragraph 4(b)(iii) of the Policy, the Complainant is arguing that the Respondent renewed the Domain Name primarily for the purpose of disrupting the business of the Complainant, the Complainant being a competitor of the Respondent. The business disruption argument is based on the emails, which the Complaint says the Respondent acknowledged receiving from the Complainant’s employees. The Complainant goes on to say "while Respondent does not admit receiving emails from clients, she cannot deny it by saying she can’t say with certainty whether she received any or not." The Complainant states that by failing to forward those emails and by failing to contact the Complainant, the Respondent perpetuated the disruption through inaction. The Complainant states that the Respondent’s offer to enter into an interim domain name sharing period evidences her willingness to eliminate that disruption and therefore represents her acknowledgement that there was ongoing disruption that needed to be stopped. The Complainant concludes, "further, Respondent acknowledges that the receipt of errant emails is disruptive as evidenced by her recognition that interception could be considered illegal, as stated in her July 31, 2000, email."

The Complainant concludes that the Respondent is a competitor because of her attempt to secure the Complainant’s confidential business information and also because she retained the Complainant’s brochure on hand after receiving it in 1999. The Complainant also cites what the Respondent is alleged to have said in the July 25, 2000, telephone conversation.

On this aspect the Complainant concludes: "although Respondent cannot deny the possibility of having received email from the Complainant’s clients, she contradicts her denial by implying that she did, in fact, pay particular attention to the contents of emails received from clients: "except for those which were glaringly inappropriate and definitely [sic] not from clients I paid no attention to content." Complainant allows for the confusion brought on by Respondent’s use of the double negative, but notes Respondent’s ambiguous syntax with concern."

This again was typical of the style of much of the Complaint.

B. Respondent

The Respondent asserts that the evidence supports her contention that the Complainant acted in bad faith in launching this proceeding against her and asks that the Panel make a finding of reverse domain name hijacking.

The Respondent expresses outrage that she should be accused of having acted in bad faith. She says, "the Complainant’s claims are not supported by facts. His claim is peppered with: fallacious innuendoes; unlikely hypotheses, irrelevant splitting of hairs; and, statements ascribed to the Respondent which are so twisted that they have been made into outright falsehoods, both in literal meaning and in the spirit of the meaning. And, the Complainant seeks to present these to the WIPO Panel as facts."

Later on the Respondent says, "the Complainant repeatedly implies that he wanted to believe the Respondent but then, because of his "hypotheses" he began to doubt the Respondent’s integrity. His use of this aspersion-casting style is particularly troublesome to the Respondent who has by principled living and sound business ethics earned and maintained an excellent reputation for integrity and good faith business dealings."

The Respondent states that she has been doing business in Victoria BC and Seattle WA since 1984 and that contrary to the Complainant’s assertion, the absence of record in the BC Corporation’s Directory does not mean anything. She says that it is lawful in BC to operate under a trading name without registration. She says that she is the Chief Executive Officer of Learning Works, Inc which she founded in Seattle in June of 1991. She said that Learning Works enrolled its first pupils in July of 1991. The corporation claims two common law trade marks beyond its trading name, namely "Kids Learning To Love Learning" and "People Learning to Love Learning".

It is unnecessary to relate her arguments in detail. All the relevant arguments are apparent from her version of what she said in the July 25, 2000, telephone conversation. She reaffirms that her intention at all times in relation to the Domain Name has been in good faith. She registered it in good faith and she says that she renewed it in good faith with a continuing intention of developing a business under that name. She produces the letter from Mr. Lee, which purports to confirm her position. In particular, she says that it supports her claim to having rights and legitimate interests in respect of the Domain Name, prior to receiving notice of the Complaint.

6. Discussion and Findings

According to paragraph 4a of the Uniform Dispute Resolution Procedure Policy, the Complainant must prove that

(i) The Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights; and

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

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

If the Complaint fails, the Panel has to have regard to paragraph 15(e) of the Rules and in particular the following sentence namely: -

"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 and abuse of the Administrative Proceeding."

Reverse Domain Name Hijacking is defined in paragraph 1 of the Rules as meaning "using the Policy in bad faith to attempt to deprive a registered domain name holder of a domain name."

Identical or confusing similarity

It is abundantly clear from the evidence filed that the Complainant has established a substantial goodwill under and by reference to the name Smart Design, a name which is a common law trade mark or service mark and which is identical or confusingly similar to the Domain Name. It is also abundantly clear from the evidence filed by the Respondent that there are literally dozens of other entities trading under and by reference to precisely the same name. Accordingly, the Complainant’s rights in respect of the name are by no means exclusive.

While the Panel is aware that certain previous Panels have taken the view that in these circumstances the Complaint must fail at the first hurdle, this Panel does not take that view. In this Panel’s view the test under paragraph 4(a)(i) of the Policy, which makes no mention of "exclusive rights" is or ought to be a relatively easy test for a Complainant to satisfy, its purpose simply being to ensure that the Complainant has a bona fide basis for making the Complaint in the first place.

Accordingly, the Panel finds that the Domain Name is identical or confusingly similar to a trade mark or service mark in which the Complainant has rights.

Rights or legitimate interest of the Respondent

The Complainant’s allegations under this head stem almost exclusively from: -

(i) its failure to identify any sign of the Respondent trading under the name Smart Design, whether as a trading name or a domain name or in any other manner;

(ii) its version of what was said by the Respondent in the July 25, 2000, telephone conversation and inferences that the Complainant draws from that and the ensuing exchanges of emails.

The Panel is able to deal with this aspect of the Complaint relatively easily. The Complainant concedes that the Respondent may have registered the Domain Name in good faith i.e. with the bona fide intention of using the Domain Name in bona fide fashion. The Complainant appears to have accepted that the Respondent had or may have had bona fide business plans, because on the day following the July 25, 2000, telephone conversation he asked the Respondent to provide a written description of her plans. Then in September, Mr. Otto Lee, a United States registered patent attorney, writes a letter confirming that the Respondent, doing business as SmartDesign.com, had been consulting him in relation to patent matters in relation to that business since May 21, 2000. While it is possible to argue that there are certain ambiguities in Mr. Lee’s letter, he clearly knew the purpose for which the letter was required and the message it gives is clear, namely that the Respondent trades as "smartdesign.com" and has done so since at least May 2000 and has been consulting him in that regard since May 2000. If that is not the case, the letter is a dishonest letter, but the Panel has no reason to doubt the honesty of Mr. Lee. It also happens to be consistent with both the Complainant’s April 1999 letter, which expressly acknowledges that the Respondent holds the rights to the Domain Name, and the Complainant’s concession that the Respondent may have registered the Domain Name in good faith.

The Complainant relies upon the length of time that it has taken the Respondent to get her business up and running under the name. If and to the extent that previous Panels have held that mere non-use constitutes bad faith use and can therefore be construed as meaning that the registrant has no legitimate interest in the name in question, this Panel feels unable to follow that line of authority. In the Panel’s view, the Policy is designed to deal with a relatively narrow and straightforward category of case, namely cybersquatting. Constructive bad faith, which is what the Complainant seeks to argue on a number of fronts, is a far from straightforward concept. In any event, the Panel is aware of the delays that can elapse in the course of the patenting process and has seen nothing to suggest that the delays here should result in a bad faith finding against the Respondent.

The Panel sees no reason to doubt that the Respondent registered the Domain Name in good faith, renewed it in good faith and has sought to develop a bona fide business for its use. The Panel holds that the Complainant has failed to prove that the Respondent has no rights or legitimate interests in respect of the Domain Name.

Bad Faith

In light of the above, it is unnecessary so far as the Complaint is concerned to consider in any further detail the allegations of bad faith which the Complainant makes against the Respondent. Consistent with the Panel’s finding in relation to the Respondent’s rights and legitimate interests, the Panel finds that the Complainant has failed to prove that the Respondent registered the Domain Name in bad faith and is using the Domain Name in bad faith.

Reverse Domain Name Hijacking

On the other hand, given the need for the Panel to assess whether or not the Complaint has been made in bad faith, the Complainant’s allegations of bad faith against the Respondent do need to be looked at.

The Panel does not propose to address all the issues. The flavour of them is apparent from what is set out in paragraphs 4 and 5 above.

The Panel regards the following points, when taken together, as being of significance, namely: -

(i) Smart Design is a name likely to be used by a wide variety of entities in the field of design. The Complainant was well aware that it was in fact in use by a wide variety of such entities. In consequence, to the Complainant’s knowledge, it was unlikely to follow as night follows day that a user of the name was ‘targeting’ the Complainant.

(ii) According to the Complainant, when it first sought to register the Domain Name, it found that it was not available. In other words, somebody else must have registered it. What, if any, complaint was leveled at that registrant? If no complaint was leveled at the registrant, why not? Because it was a lawful user of the name? At all events, it appears that the Complainant acknowledged at an early stage that it was not the sole proprietor of the name Smart Design in the context of domain names.

(iii) When the Complainant first wrote to the Respondent in April 1999, the letter (quoted in full above) was calm, unthreatening and in no way hostile. There was no suggestion in that letter that the Respondent was doing anything wrong. On the contrary, as already indicated, the letter expressly acknowledges that the Respondent holds the rights to the Domain Name.

(iv) Had there been a suspicion that the Respondent was doing anything wrong, the Complainant would have followed up that letter with alacrity. However, while the Complainant now makes much of the Respondent’s failure to reply, the Complainant made nothing at the time of the failure to reply. The Complainant did nothing.

(v) The Complainant states that in early 2000 it was waiting for the renewal date to pass in the hope that the Respondent would not renew the Domain Name and thereby enable the Complainant to snap it up. One would have expected the Complainant in those circumstances to have researched the position on the day following the date for renewal. Did the Complainant do so? No. The Complainant waited for 8˝ weeks before checking the position.

(vi) The Respondent renews the Domain Name on or before May 27, 2000, having no reason to believe that the Complainant was going to follow up its letter of 13 months earlier.

(vii) There then follows the July 25, 2000, telephone conversation and a subsequent exchange of emails. Had the Complainant been seriously concerned as to the bona fides of the Respondent, it could have investigated the position in far greater depth. Instead, it undertook various cursory searches, which, unless they turned up something positive, were bound to be inconclusive, and the Complainant drew a number of tortuous adverse inferences as to the bona fides of the Respondent from what was alleged to have been said in the course of the telephone conversation.

(viii) The Complainant makes much of the Respondent’s email of July 31, 2000, and concludes that in that email the Respondent acknowledges illegality. The email and the Complainant’s allegation are quoted in full above. The Panel does not comprehend the argument.

(ix) The lengths to which the Complainant has had to go in order to seek to establish bad faith registration and use have been extraordinary. It could not establish bad faith registration, so it argued bad faith renewal. It could not establish the requisite "primary purpose" by reference to direct evidence, so it had to rely inter alia on apparent non-use and some inconclusive investigations of its own. It could not establish an intent to sell/transfer the Domain Name, so it sought to do so by reference to an alleged willingness to share the website. It could not establish the conventional demand for an excessive sum of money for the sale/transfer, so it relied upon an alleged willingness on the part of the Respondent to consider entering into partnership with the Complainant having received valuable confidential information from the Complainant. Finally, the "business disruption" and "competitor" claims for the purposes of paragraph 4(b)(iii) of the Policy were, to say the least, very weak and relied upon the Complainant’s version of the July 25, 2000, telephone call, which the Respondent roundly disputes.

Allegations of bad faith are serious allegations. They should not be made lightly. That Complaints under the Policy can only succeed in cases of bad faith registration and use demonstrates the narrow ambit of the Policy. Doubtful disputes have to be resolved elsewhere. The Panel is well aware that there is a tendency for some trade mark owners to hold extravagant views as to their legitimate rights and to hold excessive views as to the motives of those whom they believe to be infringers, but that is no excuse for making wild allegations of bad faith.

The allegation of Reverse Domain Name Hijacking is also an allegation of bad faith and therefore needs to be looked at very carefully. What is meant by "bad faith" in this context? Clearly, the launching of an unjustifiable Complaint with malice aforethought qualifies, as would the pursuit of a Complaint after the Complainant knew it to be insupportable. This Panel takes the view that "bad faith" in this context extends also to a person who, while maybe not knowing an allegation to be insupportable, makes the allegation reckless as to whether it is supportable or not.

The Panel is unable to assess the Complainant’s state of mind when the Complaint was launched, but in the view of the Panel the Complaint should never have been launched. Had the Complainant sat back and reflected upon what it was proposing to argue, it would have seen that its claims could not conceivably succeed. Even assuming that its potpourri of constructive and quasi-constructive bad faith arguments were valid, they all start from the renewal, the renewal being treated for these purposes as a re-registration. For any of those claims to succeed the Complainant had to prove that the renewal was made in bad faith. The renewal was made on or before May 27, 2000. The only hint that the Respondent might have had at that date that the Complainant was the remotest bit interested in the Domain Name was the Complainant's unthreatening letter of some 13 months earlier to which the Respondent had not replied and which the Complainant had not seen fit to follow up. Whatever one might think of the general rationale behind the renewal/registration argument, the circumstances at the time of the renewal in this case were such that the argument was bound to fail here and it ought to have been obvious to the Complainant.

Nothing in the Rebuttal deals with this fundamental issue. Indeed, the Rebuttal is concerned mainly with the paragraph 4(a)(i) claim upon which the Panel finds in favour of the Complainant. The rest concerns matters arising after the renewal.

Having regard to the fact that the Complainant is said to be one of the top ten design consultancies in the United States, it cannot be regarded as a misguided innocent.

Putting this in the kindest light that the Panel can, the Panel believes that in its eagerness to obtain the Domain Name the Complainant lost all sense of proportion. It took on the guise of a third rate barrack room lawyer and advanced arguments that were tortuously artificial in the extreme, reckless both as to as to the justification for making those arguments and the seriousness of the overall charge against the Respondent, who was manifestly no cybersquatter. This Complaint was a clear abuse of the Policy designed to deprive the Respondent of her domain name. The allegations of bad faith were without substance and should never have been made.

7. Decision

In light of the findings set out above, namely that, notwithstanding that the Domain Name is identical to or confusingly similar to a trade mark or service mark in which the Complainant has rights, the Complainant has failed to prove that the Respondent has no rights or legitimate interests in respect of the Domain Name and has also failed to prove that the Domain Name was registered and is being used in bad faith, the Complaint fails and is dismissed.

Further, for the reasons given above, the Panel declares that the Complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.

Tony Willoughby
Sole Panelist

Dated: October 18, 2000