privateusa.com

WIPO Arbitration and Mediation Center

Complainant is Private Media Group, a Nevada corporation with its principal place of business in Barcelona, Spain. The Complainant's contact details are Johan Gillborg, Milcap Media Group S.L., Carretera de Rubi 22, 08190 St. Cugat del Valles, Barcelona, Spain. Complainant is represented in this administrative proceeding by Andrea Levitan Reeves of Stradling Yocca Carlson & Rauth, 660 Newport Center Drive, Suite 1600, Newport Beach, CA 92660, United States of America. Respondent is Anton Enterprises Inc., d/b/a/ Private USA, with its principal place of business at 8599 Venice Blvd., Suite C, Los Angeles, CA 90034, United States of America. Respondent is represented by Burton C. Jacobson and Harry O. Schenk, A Professional Corporation, Beverly Hills Building, 424 South Beverly Drive, Beverly Hills, CA 90212-4414, United States of America.

The domain name in issue is <privateusa.com>.

BulkRegister.com is the registrar for the domain name <privateusa.com>.

The WIPO Arbitration and Mediation Center (the "Center") received the Complaint on July 26, 2002, via email, and on July 23, 2002, in hard copy form. The Center verified that the complaint satisfies the formal requirements of the ICANN Uniform Domain Name Dispute Resolution Policy (the "Policy"), the Rules and the Supplemental Rules. Complainant has made the required payment to the Center.

On July 24, 2002, the Center transmitted via email to BulkRegister.com a request for registrar verification in connection with this case. On July 24, 2002, BulkRegister.com transmitted via email to the Center, its Verification Responses, (1) confirming that a copy of the Complaint had been received on 24 July 2002; (2) confirming that BulkRegister.com is the registrar of the domain name <privateusa.com>; (3) confirming that the Respondent is the registrant of the domain name; (4) advising that the registrant of the domain name is Private USA whose address is 8599 Venice Blvd, Suite C, Los Angeles, CA 90034, U.S.A.; (2) the named Administrative Contact is Bruce Haldeman, Private USA, P.O. Box 77597, Los Angeles, CA 90007-0597, USA; and that the Technical Contact is Data Return Corp., 222 W Las Colinas Blvd, Ste 450, Irving, TX 75039, USA (5)confirming that the Uniform Dispute Resolution Policy applies to the domain name; (6) advising that the status of the domain name is "currently locked"; (7) advising that the language of the registration agreement for the domain name is English; (8) confirming that BulkRegister.com's Service Agreement is in effect with respect to the domain name and that the agreement is subject to the laws of the State of Maryland.

On July 25, 2002, the Center advised the Complainant's representative that the Center had not received the Complaint in electronic format and also had not received four copies of the Complaint. The Center advised the Complainant that unless the deficiencies were cured within five days, the Complaint would be deemed withdrawn.

The Complainant forwarded the Complaint by email to the Center on July 26, 2002, and advised that it would send an additional four copies of the Complaint by overnight mail. The Complainant advised the Center that it previously sent four copies of the Complaint with the original.

On July 29, 2002, the Center completed a Formal Requirements Compliance Checklist.

On July29, 2002, the Center transmitted Notification of Complaint and Commencement of the Administrative Proceeding, together with a copy of the Complaint, to the Respondent via post and email to the addresses of the Respondent's contacts identified in the complaint and transmitted a copy by e-mail to the Complainant. The Center advised that (1) the Response was due by August 18, 2002, (2) in the event of default the Center would still appoint a Panel to review the facts and to decide the case, (3) the Panel may draw such inferences from Respondents’ default as it considers appropriate, (4) Complainant had elected for the matter to be decided by a single panelist, (5) the fees for the administrative proceeding will be paid in their entirety by Complainant unless the Respondent chooses to have the case decided by a three-person Panel, (6) the Panel will decide the case within 14 days of its appointment, and (7) the Center can be contacted at postal and email addresses, a stated telephone number and fax number.

On August 17, 2002, the Center received the Response by e-mail. The Center received the hard copy of the Response on August 21, 2002.

On August 19, 2002, the Center forwarded an Acknowledgement of Receipt of Response to the parties by e-mail.

On August 27, 2002, the Center transmitted to the parties via email Notification of Appointment of Administrative Panel and Projected Decision Date. The notification advised that Mr. Ross Carson had been appointed as the single panelist, and the decision was due September 10, 2002. Also on August 27, 2002, the Center transmitted the file in the case via e-mail and courier to Mr. Carson.

Complainant submits that since 1965, Private Media Group (PMG) has been a worldwide leader in premium quality adult entertainment content, products and services. PMG acquires still photography and motion pictures and processes these images into media formats such as print publications, DVDs, videotapes and electronic media content for Internet distribution. PMG also markets and distributes branded leisure and novelty products oriented to the adult entertainment lifestyle. Since 1997, PMG expanded its presence in emerging electronic markets for adult media content, such as the Internet, DVDs and broadcasting. It launched its first Internet website, "www.private.com", in 1997.

In 1999, PMG became the first adult entertainment company to be listed on the Nasdaq National Market in the United States. In business for over 35 years, PMG’s worldwide traditional distribution network had the potential to reach nearly 500,000 points of sale in over 35 countries.

PMG presently distributes products in more than 35 countries and has a worldwide presence on the Internet. PMG’s brand name, "Private" enjoys worldwide notoriety and strong brand recognition in the adult entertainment industry. PMG has in excess of forty-one (41) registered trademarks throughout the world which protect its goods and services.

PMG’s trademarks and trade names include: PRIVATE, PRIVATE MEDIA, THE PRIVATE LOGO, PIRATE, PRIVATE BLACK LABEL, PRIVATE XXX, PRIVATE SEX, PRIVATE LIFE, PRIVATE STYLE, WWW.PRIVATESPEED.COM, PRIVATE GOLD, PRIVATE BLUE, WWW.PRIVATE.COM, WWW.PRVT.COM, WWW.PRIVATECINEMA.COM, WWW.PRIVATELIVE.COM, WWW.PRIVATE.COM.AR, WWW.PRIVATE.COM.AU, AND WWW.PRIVATEGOLD.COM.

PMG registered its <private.com> domain name on February 27, 1997. PMG also has numerous other domain names using the "Private" trademark which specifically incorporate the country to which the domain name relates –i.e., <privatecountryname.com>. Some examples of those domain names are as follows: <privateasia.com>; <privateaustralia.com>; <privateaustralia.net>; privateaustralia.org>; privatebenelux.com>; <privatebrazil.com>; <privatebrazil.ne>; privatecanada.com>; <privatedutch.com>; <privatefrance.com>; <privategermany.com>; <privategermany.net>; <privategreece.com>; <privateitaly.com>; <privateitaly.net>; <privatejapan.net>; <privatemexico.com>; <privateportugal.com>; <privatescandinavia.com>; <privatescandinavia.net>; <privatespain.com>; <privatespain.net>; <privateuk.com>; <privateuk.net>; <privateuk.org>; <privateusa.net>; <privateusa.org>.

This Complaint is based on the "Private", "Private International" and "privateusa.com" trademarks and service marks. Complainant submits that PMG has acquired trademark, trade name, and other intellectual property rights in the mark "Private" as used in connection with adult entertainment. PMG has used its "Private" mark in connection with the adult entertainment industry since 1968.

On June 18, 1973, PMG filed for registration of its "Private" trademark. On July 1, 1975, the "Private" trademark was registered (Registration Number 1014957) with the United States Patent and Trademark Office ("PTO"). The mark was first used in commerce by PMG in 1968, and has been used in connection with magazines, newspapers, books, and photographs since that time. A copy of a printout from the United States PTO website indicating the history and status of this trademark is attached to the Complaint as Annex 3.

On July 26, 1993, PMG’s wholly-owned subsidiary Cine Craft Ltd., Co., filed for registration of its "Private International" trademark. On November 3, 1998, "Private International" was registered with the United States PTO. "Private International" was first used by PMG in commerce in 1993, and is used in connection with pre-recorded motion picture films and pre-recorded video tapes featuring adult entertainment. A copy of a printout from the United States PTO website indicating the history and status of this trademark is attached to the Complaint as Annex 4.

(1) The domain name <privateusa.com> is identical or confusingly similar to a trade mark in which the Complainant has rights;

(2) The Respondent has no rights or legitimate interests in respect of the domain name;

(3) The domain name was registered and is being used in bad faith.

Complainant submits that Respondent’s use of the www.privateusa.com domain name is confusingly similar to PMG’s "Private" marks. The markets in which PMG and Anton are involved are substantially related and similar, and involve generally the adult entertainment industry. In fact, Anton actually sells PMG’s products. Additionally, PMG is also presently engaged in the sale of its own products in the United States. As such, the channels of distribution between PMG and Anton are identical.

Complainant submits that Respondent's use of the domain name <privateusa.com> is likely to cause, and has in fact caused, confusion, mistake, and/or deception among consumers. As a direct and proximate result of this confusion, deception and mistake caused by Anton’s wrongful use of the "PrivateUSA" name, Anton has made sales and profits at the expense of PMG. Additionally, as a proximate result of the confusion, deception and mistake caused by Anton’s wrongful use of the "PrivateUSA" name, PMG has been deprived of substantial sales of its goods and services.

Complainant submits that in 1995, Milcap Publishing Group entered into a Distribution Agreement with Sundance Associates, Inc. ("Sundance"). Milcap Publishing Group is a wholly owned subsidiary of PMG. Complaint believes that Sundance is an alter-ego of Anton. Sundance and Anton have the same registered agent for service of process, the same mailing address, and share the same officers and directors. Complainant submits that both companies are merely shells for a larger holding company called O.G.V., Inc.

Complainant submits that there exists a unity of ownership and interest between Anton and Sundance such that any individuality and separateness between them has ceased. Further, upon information and belief, these two corporate entities are controlled, dominated and operated by the same individuals such that the activities and businesses of these corporate entities are carried out without the indicia of separateness.

Complainant advises that pursuant to a 1995 Distribution Agreement between Milcap/PMG and Sundance/Anton, the parties entered into an exclusive arrangement under which Sundance/Anton would "distribute and exploit [PMG’s] products, name, and good will throughout North America in all forms of media and otherwise." A copy of the Distribution Agreement is attached to the Complaint as Annex 5.

In connection with the Distribution Agreement, PMG requested that Anton establish a website in the United States, using Private’s name, in order to distribute Private’s products. The parties agreed that "privateusa.com" would be an appropriate domain name for the distribution of PMG’s products. This format was similar to PMG’s other domain names both inside and outside of the United States which also use the format <privatecountryname.com>.) Pursuant to the Distribution Agreement, Anton registered the domain name <privateusa.com> in 1997. Anton was only permitted to use the "PrivateUSA" name in connection with the Distribution Agreement. Once that Agreement terminated in 2001, Anton no longer was permitted to distribute PMG’s products and no longer had any rights to the "privateusa" name.

Complainant submits that in or about February 27, 2001, PMG and Anton terminated the 1995 Distribution Agreement. At the same time, PMG entered into an Asset Purchase Agreement with Anton whereby PMG paid $875,000 to Anton to purchase certain assets of Anton. Among the assets purchased by PMG were all of Anton’s trade names, including the name "Private USA", the name under which Anton was then doing business.

Complaint submits that Section 1.4 of the Asset Purchase Agreement stated that PMG purchased, among other assets, the following: "all relevant trade-marks, trade-names, copyrights, know-how, customer lists, supplier lists used in connection with or relating to the Purchased Assets." A copy of the Asset Purchase Agreement is attached to the Complaint as Annex 6.

PMG and Anton have no current business relationship. Anton is not authorized to sell or distribute PMG’s products, or to use PMG’s trademarks, trade name, intellectual property, or to otherwise represent or suggest that it is affiliated in any way with PMG.

Based on the foregoing, and based on the Asset Purchase Agreement whereby PMG explicitly purchased the rights to the "PrivateUSA" name, respondent Anton should be considered as having no rights or legitimate interests with respect to the <privateusa.com> domain name.

Complainant submits that Anton’s continued use of the "PrivateUSA" domain name constitutes a breach of the Asset Purchase Agreement which explicitly gave PMG all rights to the trade name "PrivateUSA." Additionally, Anton’s use of this name directly infringes upon PMG’s various trademarks, trade names and other intellectual property rights.

Complainant submits that Respondent’s use of the <privateusa.com> domain name is confusingly similar to PMG’s "Private" marks. The markets in which PMG and Anton are involved are substantially related and similar, and involve generally the adult entertainment industry. In fact, Anton is actually engaged in the unauthorized sale of PMG’s products. Additionally, since the termination of the Distribution Agreement, PMG has been engaged in the sale of its own products in the United States. As such, the channels of distribution between PMG and Anton are identical.

Anton’s use of the domain name <privateusa.com> is likely to cause, and has in fact caused, confusion, mistake, and/or deception among consumers. As a direct and proximate result of this confusion, deception and mistake caused by Anton’s wrongful use of the "PrivateUSA" name, Anton has made sales and profits at the expense of PMG. Additionally, as a proximate result of the confusion, deception and mistake caused by Anton’s wrongful use of the "PrivateUSA" name, PMG has been deprived of substantial sales of its goods and services.

Complainant submits that by using the <privateusa.com> domain name, Anton has intentionally attempted to attract, for commercial gain, Internet users to its website or other on-line location, by creating a likelihood of confusion with PMG’s mark as to the source, sponsorship, affiliation or endorsement of Anton’s website. Anton has wrongfully used its <privateusa.com> domain name in order to distribute PMG’s products, to PMG’s customers, using PMG’s domain name. As a result of this wrongful conduct, Anton’s use of the <privateusa.com> domain name should be considered as being used in bad faith.

In the Response the Respondent objects to the proceedings before the World Intellectual Property Organization Arbitration and Mediation Center on the following grounds:

1. The Parties object to the jurisdiction of this forum.

2. The Parties by separate agreement and contract, have selected the State of Nevada, United States of America, as the forum whose law shall be governing.

3. The Parties also by separate agreement and contract have agreed that any dispute arising over the asset Purchase Agreement, attached to the Complaint on file herein, specifically appoints the American Arbitration Association as the Arbiter.

Respondent submits that the asset purchase agreement between Private Media Group and Anton which is attached to Complainant’s Complaint forms the basis of the Complaint before WIPO. Pursuant to that agreement, jurisdiction has been exclusively conferred to another entity. (Asset Purchase Agreement, Paragraph 11, et seq.)

Respondent further submits that the Asset Purchase Agreement does not prohibit the Respondent from using the domain name of <privateusa.com>.

Without waiving the objection to jurisdiction, Respondent alleges that Complainant insisted that Respondent use the name "privateusa.com" rather than "private.com" so that, in fact, there would be no confusion between the two names. The two names were in fact created to avoid confusion, contrary to the argument in the Complaint.

Respondent submits that Complainant should not be allowed to complain of that which it insisted upon. In other words, Complainant should not now be able to argue that the two names are confusing since it was at Complainant’s insistence that the two names were created to avoid confusion.

Further, the Asset Purchase Agreement, (in para. 11.2) provide conditions precedent to the bringing of any action. Respondent submits that none of these conditions precedent has been met.

The Domain names are not confusingly similar. See Respondent's explanation contained hereinabove.

Respondent submits that the Respondent uses the domain name to sell products that it has purchased from Complainant. It registered the domain name legitimately and legally and continues to have the exclusive right to that name. The Respondent’s business has been or is commonly known by the domain name and issue

The Respondent objects to the jurisdiction of the Internet Corporation for Assigned Names and Numbers (ICANN). The Respondent submits that pursuant to the Asset Purchase Agreement between Private Media Group, Inc. and Anton Enterprises, Inc. d.b.a. Private USA the Parties selected the State of Nevada, United States of America, as the forum whose law shall be governing. Respondent further submits that the Asset Purchase Agreement entered into on the 27^th day of February, 2001, forms the basis of the Complaint before WIPO. The Respondent submits that pursuant to Paragraph 11 of the Asset Purchase Agreement the Parties specifically appoint the American Arbitration Association as the Arbiter of any disputes arising out of the Agreement.

Without waiving the objection to jurisdiction the Respondent submits that the Asset Purchase Agreement does not prohibit the Respondent from using the domain name in dispute <privateusa.com>. the Respondent further submits that when the Respondent was the Distributor for Complainant the Complainant insisted that Respondent use the domain name <privateusa.com> rather than Complainant's domain name <private.com> and such insistence leads to the conclusion that the domain names <privateusa.com> and <private.com> are not confusing.

The Panel will first consider the Respondent's submission relating to forum and jurisdiction.

The Respondent registered the domain name in dispute while the Respondent was the exclusive Distributor in the United States of America under Complainant's copyright and trademarks. (Exhibit 5, Distribution Agreement).

The Complainant submits that Respondent was only entitled to use <privateusa.com> in connection with its Distribution Agreement. Complainant submits that upon termination of the Distribution Agreement the Respondent no longer had any right to use the <privateusa.com> domain name.

The Complainant registered its <private.com> domain name on February 27, 1997. The Complainant also has numerous other domain names using the "Private" trademark which specifically incorporate the country to which the domain name relates i.e. <privatecountryname.com>. Examples of those domain names include: <privateasia.com>; <privateaustralia.com>; <privateaustralia.net>; <privateaustralia.org>; proceeding alphabetically to <privateuk.org>; privateusa.net>; and <privateusa.org>.

The Respondent was permitted to register the domain name in dispute <privateusa.com> which is confusingly similar to Complainant's Private trademark and Complainant's privatecountryname.com names for use while an exclusive licensee of the Complainant under the Distribution Agreement. The Distribution Agreement was terminated on or about February 27, 2001. Upon termination of the Distributor Agreement the Respondent's exclusive license in the United States of America to distribute Complainant's products under Complainant's trademark names Private, Triple X, Pirate, and others and in association with <privateusa.com> was terminated.

The Panel finds that it is not necessary to consider the Asset Purchase Agreement (Exhibit 6) as the license to use the domain name in dispute <privateusa.com> expired upon termination of the Distribution Agreement.

The recitals in the Distribution Agreement recite that the Complainant was the owner of the trademarks PRIVATE, TRIPLE X, PIRATE and others. The Respondent was at and prior to the execution of the Distribution Agreement aware of the Complainant's ownership of the trademark PRIVATE and the domain name "private.com". Accordingly the Respondent could only have sought to register the domain name in dispute <privateusa.com> on behalf of the Complainant as part of the overall distribution agreement. While the Respondent may have had a legitimate interest in securing the domain name as a licensee, in view of the ownership by the Complainant of the trademarks and domain names commencing with PRIVATE the Respondent must have been aware that beneficial ownership of the domain name in dispute resided in the Complainant. (Nike Inc. v Granger and Associates, WIPO Case No. D2000-0108).

The dispute is properly within the scope of the UDRP Policy and the Administrative Panel has jurisdiction to decide the dispute. The registration agreement, pursuant to which the domain name that is the subject of this Complaint is registered, incorporates the Policy. A copy of the BulkRegister.com, Inc. Registration Agreement 4.0 that applies to the domain name in dispute is attached as Annex 2 to the Complaint. Paragraph 3 of the Policy provides: "You agree to be bound by our Domain Name Dispute Policy ("Dispute Policy") which is incorporated into this Agreement by reference, as in effect from time to time…. Any disputes regarding the right to use your SLD names will be subject to the Dispute Policy".

According to paragraph 4(a) of the 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.

The Complainant distributes adult entertainment products in more than 35 countries and has a worldwide presence on the internet. The Complainant's trademark PRIVATE is well known and enjoys strong brand recognition in the adult entertainment industry. The Complainant has in excess of forty-one registered trademarks throughout the world. United States Trademark Registration No. 1014957 has been registered in the United States of America since July 1, 1975 in U.S. Class 38. The Complainant registered its private.com domain name on February 27, 1997. The Complainant is also the owner of numerous other domain names which incorporate the trademark PRIVATE in association with the name or abbreviation of the country to which the domain name relates such as <privateaustralia.com>; <privateaustralia.net>; <privateaustralia.org>; <privatebenelux.com>; <privatebrazil.com>; <privatebrazil.net>; <privatecanada.com>; and continuing alphabetically to <privatespain.com>; <privatespain.net>; <privateuk.com>; <privateuk.net>; <privateuk.org>; <privateusa.net>; and <privatusa.org>. The Respondent submits that the domain name in dispute <privateusa.com> is not confusingly similar to the Complainant's trademarks because the Respondent alleges that the Complainant insisted that the Respondent use the domain name <privateusa.com.

The Panel finds that the use of the domain name <privateusa.com> is a use of a confusingly similar trademark to the Complainant's registered trademark PRIVATE.

At the date of registration of the domain name in dispute the Respondent was the exclusive distributor of the Complainant for North America. The Distribution Agreement is attached to the Complaint as Annex 5. One recital of the Distribution Agreement states : "WHEREAS, Producer (Complainant) is in the business of producing high quality adult entertainment (hereinafter the "Products") under the trademark names Private, Triple X, Pirate, and others, which are distributed in all forms of media throughout the world;". A second recital relates to the license granted and the Distributor's responsibilities under the Distribution Agreement as follows: "WHEREAS, Distributor (Respondent) and Producer (Complainant) desire to enter into an exclusive arrangement under which Distributor will distribute and exploit Producer's Products, name, and goodwill, throughout North America in all forms of media and otherwise". Upon execution of the Distribution Agreement on August 1, 1995, the Respondent became the exclusive distributor of certain of Complainant's products in North America with the right to exploit Complainant's name and goodwill during the term of the Distribution Agreement. The Distribution Agreement continued in effect until February 27, 2001, when the Distribution Agreement was terminated. The Respondent was aware that PRIVATE was an important trade-mark of the Plaintiff which the Respondent was entitled to exploit during the term of the Distribution Agreement.

The Respondent submits in paragraph 7B. of the Response that the Respondent uses the domain name <privateusa.com> to sell products that it has purchased from the Complainant. The Complainant states that the Respondent registered the domain name <privateusa.com> in 1997, pursuant to the Distribution Agreement. Complainant states that once the Distribution Agreement terminated in 2001, Anton was no longer an exclusive distributor and no longer had any rights to the <privateusa.com> domain name.

The Respondent states that the Respondent registered the domain name legitimately and legally and continues to have the exclusive right to the domain name <privateusa.com>.

As well as the contractual dispute about the interpretation of the Distribution Agreement the Complainant states that ownership of the domain name in dispute <privateusa.com> was acquired by the Complainant under the Asset Purchase Agreement dated the 27^th day of February, 2001, between the parties. (Annex 6 to the Complaint). The Complainant states that pursuant to the Asset Purchase Agreement specifically, Section 1.4, the Complainant purchased among other assets "all relevant trade-marks, trade-names, copyrights, know-how, customer lists, supplier lists used in connection with the Purchased Assets.

In similar situations where rights are dependent on interpretation of contracts, other Panels have found the dispute to be outside the scope of the Policy. In Hachette Filipacchi Media U.S., Inc. d/b/a Show Boats International and Eyeball International Inc. v URTHERE Productions, Inc. and Brad Nolan, WIPO Case No. D2002-0143, the Panel referred to a number of previous decisions supporting its finding that disputes which turn on contractual interpretations are outside the scope of the policy.

The Respondent states that the Complainant insisted that the Respondent use the domain name <privateusa.com> rather than the domain name <private.com> owned by the Complainant. The Complainant states that "pursuant to the Distributorship Agreement the parties agreed that <privateusa.com> would be an appropriate name for the distribution of Complainant's products in North America. The Complainant states that once the Distributorship Agreement terminated in 2001, the Respondent was no longer permitted to distribute Complainant's products and no longer had any rights to the domain name, <privateuse.com>. The issues relating to Registration and Use in Bad Faith depend on interpretation of the Distribution Agreement and the Asset Purchase Agreement. For the reasons expressed above the Panel finds that the dispute involves contractual issues outside the scope of the Policy.

Complainant's request for transfer of the domain name <privateusa.com> is denied on the basis that two of the issues are based on contractual interpretation. Such issues are outside the scope of the policy.

Ross Carson
Sole Panelist

Dated: September 10, 2002