drugstoretm.com

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Drugstore.com, Inc. v. Nurhul Chee / Robert Murry

Case No. D2008-0230

1. The Parties

The Complainant is Drugstore.com, Inc. of United States of America, represented by Cabrelle Abel, United States of America.

The Respondent is Nurhul Chee of Singapore, Robert Murry of Philippines, represented by ESQwire.com Law Firm, United States of America.

2. The Domain Name and Registrar

The disputed domain name <drugstoretm.com> is registered with eNom.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on February 14, 2008. The Respondent named in the Complaint was Robert Murry. On February 18, 2008, the Center transmitted by email to eNom a request for registrar verification in connection with the domain name at issue. On February 19, 2008, eNom transmitted by email to the Center its verification response stating that the Respondent Nurhul Chee is listed as the registrant and providing the contact details. In response to a notification by the Center that the Complaint was administratively deficient, the Complainant filed an amendment to the Complaint on February 28, 2008, naming Nurhul Chee as Respondent and also filed a further submission on March 3, 2008. The Center verified that the Complaint together with the amendment to the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy”), the Rules for Uniform Domain Name Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with paragraphs 2(a) and 4(a) of the Rules, the Center formally notified the Respondent of the Complaint, and the proceedings commenced on March 4, 2008. In accordance with paragraph 5(a) of the Rules, the due date for Response was March 24, 2008. The Response was filed with the Center on March 24, 2008.

On March 28, 2008, the Complainant filed a supplemental submission with the Center which was transmitted to the Panel on April 18, 2008 as per the Panel’s request. The Panel also allowed the Respondent to file a reply to the Complainant’s supplemental filing and this was communicated to the Respondent by the Center on April 21, 2008. The Respondent filed such reply with the Center on April 26, 2008 and it was transmitted to the Panel on April 27, 2008.

The Center appointed Brigitte Joppich, Richard W. Page and David E. Sorkin as panelists in this matter on April 10, 2008. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with paragraph 7 of the Rules.

4. Factual Background

The Complainant, founded in 1998, is a leading online provider of health, beauty, vision and pharmacy products. Its business at <drugstore.com> and associated websites is licensed and able to dispense prescription medicine in all states of the United States of America, also offering more than 25,000 over-the-counter, beauty and pharmacy products. The Complainant’s products are also available toll-free by telephone at 1-800-DRUGSTORE.

The Complainant owns trademark number 2,592,013 in the United States of America for DRUGSTORE.COM and design (the “DRUGSTORE.COM Mark”), which was registered on July 9, 2002 in the principal register of the United States Patent and Trademark Office (with the disclaimer that “no claim is made to the exclusive right to use “drugstore” apart from the mark as shown”) and has been used and promoted extensively since at least 1999. Net Sales through the Complainant’s web store at <drugstore.com> and associated websites amounted to approx. UD$ 220,000,000 in 2007, previously having risen from approximately US$ 35,000,000 in 1999 to approximately US$ 416,000,000 in 2006 with advertising expenditures up to a maximum of approximately US$ 33,000,000 in 2005.

The Respondent first registered the disputed domain name on February 27, 2007 on behalf of Evergreen Technologies, Inc. Such company is using the disputed domain name for its online pharmacy, offering also the possibility to consult physicians online.

5. Parties’ Contentions

A. Complainant

The Complainant contends that each of the three elements specified in paragraph 4(a) of the Policy is given in the present case:

(1) Next to its registered DRUGSTORE.COM trademark (the “Registered Mark”) the Complainant claims common law rights in the trademark DRUGSTORE.COM (the “Common-Law Mark”), which is supposed to have acquired secondary meaning through use in commerce, through the Complainant’s pending trademark applications with the United States Patent and Trademark Office (filed on an intent to use basis), and through the Complainant’s extensive sales under the mark and its extensive advertising expenditures as well as substantial media recognition. Moreover, the Complainant contends that the domain name <drugstoretm.com> is essentially identical to the Complainant’s company name and the Registered as well as the Common-Law Mark DRUGSTORE.COM as it incorporates the Complainant’s distinctive Marks in their entirety with the descriptive symbol “TM” for “trademark”. The Complainant finally contends that, given its notoriety, the disputed domain name is likely to confuse consumers.

(2) The Complainant states that the Respondent has no rights or legitimate interests in respect of the disputed domain name as the Complainant’s exclusive rights in the Registered as well as the Common-Law Mark DRUGSTORE.COM predate the registration of the disputed domain name, and the Complainant has not authorized the Respondent to use its trademark. In addition, the Respondent has not been commonly known by the domain name and has not made any legitimate use of the domain name in connection with any bona fide offering of goods and services nor could it have done so in light of the Complainant’s rights. Finally, the Respondent is not making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert customers or to tarnish the trademark or service mark at issue. As a result, the Respondent, who is offering a competitive online pharmacy at the website under the disputed domain name, is not making a legitimate non-commercial or fair use of the domain name.

(3) The Complainant also contends that the domain name was registered and is being used in bad faith. With regard to bad faith registration, the Complainant states that the Respondent registered the disputed domain name without any bona fide basis, but rather with specific intent to cause consumer confusion and to free ride on the vast goodwill associated with the Complainant’s trademark. This is said to be reinforced by false contact data provided by the Respondent on its website. With regard to bad faith use, the Complainant contends that the Respondent’s use of the domain name in connection with services identical to those of the Complainant is likely to confuse consumers and that the Respondent thereby acts in bad faith.

B. Respondent

The Respondent contends that none of the three elements specified in paragraph 4(a) of the Policy is given in the present case:

(1) The disputed domain name is not identical or confusingly similar to a mark in which the Complainant has rights as the Complainant’s suspended and refused trademark applications provide no enforceable rights, as the Complainant does not have enforceable trademark rights to the common word “drugstore” and cannot establish a secondary meaning to such term, and as the Complainant’s mark differs dramatically and meaningfully from the disputed domain name because of the weakness of the Complainant’s descriptive design plus words mark.

(2) The Respondent further contends that it has rights and a legitimate interest in the disputed domain name. The Respondent registered such domain name about two years prior to the initiation of this dispute. The Respondent claims that the registration and use of a domain name like the one at issue here, which incorporates descriptive and generic terms and is used for a business described by the domain name, establishes the Respondent’s legitimate interest. The Respondent is using the disputed domain in connection with the bona fide distribution of products and services in the nature of its online pharmacy. Finally, the disputed domain resolves to the Respondent’s web site at “My RX United”, which is similar to its “myrxunited.com” web site, and redirecting a domain name to another bona fide web site operated by a respondent satisfies a respondent’s legitimate interest.

(3) Finally, the Respondent contends that there is no evidence of registration and use of the disputed domain name by the Respondent in bad faith. The Respondent simply registered the domain name because it incorporated an undeniably common descriptive term, for which the Complainant does not have an identical trademark. Moreover, the Complainant presented no evidence that the Respondent intended to create consumer confusion as required under paragraph 4(b)(iv) of the Policy.

The Respondent also warrants a finding of Reverse Domain Name Hijacking as the Complainant knew or should have known at the time it filed the Complaint that it could not prove that the domain name was registered in bad faith.

6. Discussion and Findings

The first point to be dealt with is the admissibility of the Complainant’s supplemental submission. The Rules do not allow the parties to file supplemental submissions on their own volition, and paragraph 12 of the Rules provides that a panel may in its sole discretion request further statements or documents from either of the parties. Thus, no party has the right to insist upon the admission of additional arguments or evidence. Grounds justifying new submissions are above all the existence of new pertinent facts that did not arise until after the complaint was filed. In particular, if the respondent raises objections that could not have been anticipated when the complaint was filed, a panel can give the complainant a right to reply to the submission or may accept the complainant’s unsolicited additional submission (see Universal City Studios, Inc. v. G.A.B. Enterprises, WIPO Case No. D2000-0416; QNX Software Systems Ltd. v. Future Media Architects, Inc. and Thunayan K AL-Ghanim, WIPO Case No. D2003-0921; Goldline International, Inc. v. Gold Line, WIPO Case No. D2000-1151).

The Complainant does not cite any exceptional circumstances necessitating further submissions, nor does the Reply itself disclose any new facts or new legal authority not available at the time the Complaint was submitted. Instead, the Complainant appears to have made the supplemental filing solely to reply to the Response and to deal with the nature of its DRUGSTORE.COM Mark. Such a reply is not justified under the Rules (see AT&T Corp. v. WorldclassMedia.com, WIPO Case No. D2000-0553; Universal City Studios, Inc., supra; AIB-Vincotte Belgium ASBL, AIB-Vincotte USA Inc./Corporation Texas v. Guillermo Lozada, Jr., WIPO Case No. D2005-0485). Therefore, the Panel elects not to accept the Complainant’s supplemental submission and has not relied on it in reaching this decision and, consequently, not on the Respondent’s reply thereto either.

The second point to be dealt with is the question as to who is the proper respondent in this case. Originally, the Complainant named Robert Murry as sole Respondent, and then, in the amended Complaint, Nurhul Chee. In its Response, the Respondent’s legal representative identified Robert Murry as Respondent and presented a declaration by Robert Murry, who personally referred to himself as (sole) Respondent in this administrative proceeding on March 24, 2008. Consequently, the Panel is convinced that the Respondent Robert Murry still has an interest in the disputed domain name. Moreover, the layout of the web store at <drugstoretm.com> has remained unchanged from the day of the filing of the Complaint until now. The Panel will therefore treat both Nurhul Chee and Robert Murry as Respondents in this administrative proceeding and will refer to Nurhul Chee and Robert Murry collectively as the Respondent except as noted otherwise. The fact that the Respondent Robert Murry registered the disputed domain name on behalf of his employer, Evergreen Technologies, Ltd., is not relevant with regard to the (formal) identification of the Respondent as registered owner of the disputed domain name.

Under paragraph 4(a) of the Policy, the Complainant must prove that each of the following three elements is present:

(i) the domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights, and

(ii) the Respondent has no rights or legitimate interests in respect of the domain name, and

(iii) the domain name has been registered and is being used in bad faith.

A. Identical or Confusingly Similar

The Respondent contends that the Complainant does not own rights in a trademark that is identical or confusingly similar to the disputed domain name for various reasons. However, it is consensus view among Panelists that if a complainant owns a registered trademark it satisfies the threshold requirement of having trademark rights. A decision on whether the Complainant can also claim rights in the Common-Law Mark is not necessary, as the Complainant undisputedly owns the Registered Mark, and the strength of such mark is not relevant in this regard either.

The disputed domain name fully incorporates the Complainant’s DRUGSTORE.COM mark. The mere addition of the generic abbreviation “TM” for “trademark” (or “telemedication” as the Respondent suggests) within the trademark does not eliminate the similarity between the Complainant’s marks and the domain name. It is also well established that a domain name that wholly incorporates a trademark may be confusingly similar to such trademark for purposes of the Policy despite the addition of common or generic words (cf. Dr. Grandel GmbH v. Drg Randel Inc, WIPO Case No. D2005-0829; Microsoft Corporation v. J. Holiday Co., WIPO Case No. D2000-1493; RRI Financial, Inc., v. Ray Chen, WIPO Case No. D2001-1242).

Therefore, the Panel finds that the Complainant has satisfied the requirements of paragraph 4(a)(i) of the Policy.

B. Rights or Legitimate Interests

Paragraph 4(c) of the Policy sets out three illustrative circumstances as examples which, if established by a respondent, shall demonstrate its rights to or legitimate interests in a domain name for purposes of paragraph 4(a)(ii) of the Policy, i.e.

(i) before any notice to the respondent of the dispute, the use by the respondent of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) the respondent (as an individual, business or other organization) has been commonly known by the domain name, even if the respondent has acquired no trademark or service mark rights; or

(iii) the respondent is making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert customers or to tarnish the trademark or service mark at issue.

Even though paragraph 4(c) of the Policy requires the Complainant to prove that the Respondent has no rights or legitimate interests in the disputed domain name, it is consensus view among Panelists that the Complainant has to make a prima facie case to fulfill the requirements of paragraph 4(c) of the Policy. The burden of proving that the Respondent has rights or legitimate interests in the disputed domain name then shifts to the Respondent to come forward with concrete evidence of its rights or legitimate interests.

The Respondent has argued in favor of a use of the domain name in connection with a bona fide offering of services before any notice to the Respondent of this dispute under paragraph 4(c)(i) of the Policy. The question to be decided by the Panel in this case therefore is whether the activities of the Respondent, i.e. using a domain name (allegedly made up of descriptive and generic terms) by linking to the Respondent’s competitive website, are to be considered as having been carried out in good faith and conveying rights or legitimate interests on the Respondent. However, the Respondent can only claim rights or legitimate interests if it has been acting bona fide, i.e. in good faith. In the present case, the false contact data given by the Respondent casts substantial doubt upon the Respondent’s claim. The Panel is also skeptical of the legality of Respondent’s business. Furthermore, it is not even clear that Respondent is actually conducting any business whatsoever.

Accordingly, the Respondent has not demonstrated rights or legitimate interests in the disputed domain name under paragraphs 4(a)(ii) and 4(c) of the Policy. The Panel therefore concludes that the Respondent has failed to make a sufficient showing under paragraph 4(c)(i) of the Policy to rebut the Complainant’s prima facie case that the Respondent lacks rights or legitimate interests in the disputed domain name and the Complainant has met its burden of proof on this issue.

C. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy sets out four illustrative circumstances which are evidence of the registration and use of the domain name in bad faith for purposes of paragraph 4(a)(iii) of the Policy, i.e.

(i) circumstances indicating that the respondent has registered or 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 the respondent’s documented out-of-pocket costs directly related to the domain name; or

(ii) the respondent has 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 the respondent has engaged in a pattern of such conduct; or

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

(iv) by using the domain name, the respondent 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 the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the respondent’s website or location or of a product or service on its website or location.

The circumstances mentioned in paragraph 4(b) of the Policy are not exclusive, while the two elements of the third requirement of the Policy are cumulative conditions: the Complainant must show that the domain name was registered in bad faith and is being used in bad faith.

As to bad faith registration, the majority of the Panel finds that, more likely than not, the Respondent did not register the disputed domain name in bad faith:

- The words “drugstore”, the acronym “tm” and the combination of both are common words or descriptive terms which are as such – provided at least that they are not specifically registered with another’s trademark in mind – legitimately subject to registration as domain names on a “first come, first served” basis (cf. Asphalt Research Technology, Inc. v. National Press & Publishing, Inc.,WIPO Case No. D2000-1005).

- Net sales and advertising expenditure as described by the Complainant, while they may (in combination with the disclaimed Registered Mark) be sufficient to overcome the threshold requirement for trademark rights, are not on the record in this particular case sufficient to overcome the lack of distinction of the disputed domain name to an extent that the Panel could find the reason for registration of the disputed domain name was to trade on the goodwill and recognition of the Complainant.

- The Respondent’s selection of the disputed domain name was as likely motivated by the fact that it contains the word “drugstore” and the top-level domain “.com” as by any similarity to the Complainant’s name or mark. The domain name registration must be targeted at the Complainant or its mark to be in bad faith under the Policy (cf. Terana, S.A. v. RareNames, WebReg,WIPO Case No. D2007-0489; Gold Medal Travel Group plc v. Damir Kruzicevic,WIPO Case No. D2007-1902).

In the view of the majority of the Panel, the Complainant has not established, by a preponderance of the evidence, that the Respondent registered the domain name primarily for the purpose of selling it to the Complainant or a competitor (paragraph 4(a)(i) of the Policy); nor that the Respondent registered the domain name to prevent the Complainant from reflecting its mark in a corresponding domain name (paragraph 4(a)(ii) of the Policy); nor that the Respondent registered the domain name primarily for the purpose of disrupting the business of a competitor (paragraph 4(a)(iii) of the Policy); nor that the Respondent has intentionally created a likelihood of confusion with the Complainant’s mark (paragraph 4(a)(iv) of the Policy). To the contrary, it seems more likely than not that the Respondent registered and is using the disputed domain name to promote an online drugstore for reasons entirely unrelated to the Complainant and its mark rather than for any of the bad faith reasons previously set out, and it is merely coincidental that the Complainant also happens to have adopted a name, domain name, and trademark based upon the word “drugstore” rather than “pharmacy,” “apothecary,” “chemist,” “dispensary,” or some other term that describes the nature of its business. The Complainant’s expenditure promoting its DRUGSTORE.COM marks and the media recognition reflected in Exhibit 8 to the Complaint are not sufficient to justify bad faith registration of a domain name consisting of the generic term “drugstore” together with the acronym “tm” and the top level domain name “.com” by the Respondent who is located in South East Asia.

Accordingly, the majority of the Panel finds that the Complainant did not on the record in this case succeed in proving the third element of the Policy, i.e. that the Complainant registered and used the disputed domain name in bad faith.

7. Reverse Domain Name Hijacking

The Respondent requests a finding of reverse domain name hijacking. This is defined in the Rules as “using the Policy in bad faith to attempt to deprive a registered domain-name holder of a domain name.” Moreover, paragraph 15(e) of the Rules provides as follows: “If after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.”

The Panel declines to find reverse domain name hijacking in this case.

8. Decision

For all the foregoing reasons, the Complaint is denied.

Dated: May 9, 2008

DISSENTING OPINION

I would find for the Complainant.

The present case is a companion case to Drugstore.com, Inc. v. Kevin Andrews., WIPO Case No. D2008-0231. In both cases the Complainant and Respondent are substantially identical. The named individual Respondents are admittedly employees of Evergreen Technologies, Inc. and are acting on behalf of their employer. The cases are being administered by different Presiding Panelists, but the co-Panelists are the same. While the Presiding Panelist in this case was aware of the salient facts in the companion case, she did not have access to the complete factual record in the companion case. Respondent has registered the domain names <drugstoretm.com> and <mydrugstore1.com>. Both domain names are subject to challenge in the two companion cases.

The dissent is aware that a different conclusion was reached by a differing majority in the companion decision of Drugstore.com, Inc. v. Kevin Andrews,WIPO Case No. D2008-0231. This may in part simply reflect the Presiding Panelists incomplete access to the facts in the companion case or to a differing assessment of facts and likely motive given the examined record in each case, rather than any underlying divergence of opinion as to applicable principles under the Policy.

Respondent is either a competitor of Complainant or is the registrant of various domain names. Under either circumstance, a direct economic interest exists to either divert Internet traffic or to increase the market price for purchase of the disputed domain name(s).

The Panel in this proceeding has found that the Complainant has the requisite trademark rights in DRUGSTORE.COM, that the disputed domain name <drugstoretm.com> is confusingly similar thereto, and that Respondent has no legitimate rights or interest in the disputed domain name. To this point, the analysis of this Panel is adequate.

However, the conclusion that Respondent has not registered or used the disputed domain name in bad faith is improper. The majority of the Panel finds that the components of the disputed domain name are descriptive, that the advertising revenues expended by Complainant are not sufficient and that Respondent was “likely motivated” by the descriptive nature of the disputed domain name.

My co-panelists made a subjective determination regarding the Respondent’s intent without any analysis of the nonexclusive, objective criteria of bad faith set forth in paragraphs 4(b)(i)-(iv) of the Policy. Once this failure was called to their attention, they simply added language that they had considered paragraphs 4(b)(i)-(iv) without conducting any evidentiary analysis.

There is no provision under paragraphs 4(b)(i)-(iv) to diminish the “enforceable” trademark rights which have been found to exist in this proceeding, because certain of the arbitrators feel that the trademark rights are descriptive or generic.

There is compelling evidence before this Panel that Respondent has registered and is using the disputed domain name in bad faith pursuant to paragraphs 4(b)(i), 4(b)(iii) and 4(b)(iv). Respondent has filed two domain names utilizing the entirety of Complainant’s mark during the year 2007. Complainant has expended hundreds of millions of dollars over the last ten years promoting its mark and has received significant market recognition. Whether Respondent is a direct competitor of Complainant in the niche market of online pharmaceuticals and beauty products or a trader as the registrant of various domain names, the only logical inference is that Respondent knows of Complainant’s online presence and has engaged in a pattern of domain name registrations targeting Complainant.

I do not believe that the arbitrators in a UDRP proceeding can ignore the objective criteria of paragraphs 4(b)(i)-(iv) and substitute their subjective determination or personal motivations that a claimed mark is generic or is weak as descriptive, then proceed to find a lack of bad faith and deny relief to the Complainant.

On a procedural point, I asked to accept the supplemental filing of Complainant and Respondent’s reply. Any decision not to consider additional information was by a majority of the Panel, over my objection.

Richard W. Page
Panelist (Dissenting)