The Complainant is Bouncing Bear Botanicals, Inc. of Kansas, United States of America, represented by Stevens & Brand, LLP of United States of America (the “United States” or “US”).

The Respondent is International Domain Name and Protection, LLC. of El Dorado, Panama, represented by César A. González R. of Honduras.

2. The Domain Names and Registrar

The disputed domain names, <k2incenseblend.com>, <k2-incense.com>, <k2incense.org>, <k2verified.org> and <k2wholesale.com> (the “Domain Names”) are registered with 1API GmbH (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on July 21, 2011. On July 22, 2011, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Names. On July 26, 2011, the Registrar transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details.

The Center verified that the Complaint satisfied the formal requirements of the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), 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 the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on July 27, 2011. In accordance with the Rules, paragraph 5(a), the due date for Response was August 16, 2011. On August 23, 2011, the Center, due to an administrative oversight, resent the email communication of July 27, 2011 containing the Notification of Complaint and Commencement of Administrative Proceeding to the Respondent and extended for five additional days the due date for Response. The Response was initially filed with the Center through three informal communications dated August 23, 2011, August 26, 2011 and August 27, 2011. However, these communications demonstrated some confusion on the part of the Respondent and/or the Respondent’s representative as they indicated that the Respondent’s representative’s instructions were to respond to the Center’s request for Registrar verification, something which the Registrar had dealt with on July 26, 2011.

The Center appointed Tony Willoughby as the sole panelist in this matter on September 15, 2011. The Panel finds that it was properly constituted. The Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the Rules, paragraph 7.

Given the evident confusion on the part of the Respondent and/or the Respondent’s representative and the absence of any substantive Response, the Panel issued a procedural order giving the Respondent until September 26, 2011 to file a Response. The Response was filed with the Center on September 22, 2011 and this led to an unsolicited Reply from the Complainant on September 26, 2011. The Panel accepts the Reply because it corrects misunderstandings on the part of the Respondent as to some domain name registration dates. On the same day the Respondent requested permission to file a response to the Reply and the Respondent subsequently filed a further submission. Not to be outdone, the Complainant then filed an affidavit from one of its directors. The Panel has looked at those further submissions, but they have not added anything of substance in the way of evidence.

4. Factual Background

The Complainant is a Kansas corporation, which has been engaged in the sale of incense under the brand name K2 since March 2009. Between May and November 2009 the Complainant either itself or through a licensee has registered several domain names featuring the brand name K2, namely <k2smokeblend.com> (May 3, 2009), <k2blend.com> (May 3, 2009), <k2botanicals.com> (May 15, 2009), <k2blends.com> (July 17, 2009) and <k2incense.com>, registered by the Complainant’s licensee, (November 1, 2009).

On August 6, 2010 the Complainant applied for a United States federal trade mark registration of the mark K2.

On October 1, 2010 the Complainant obtained a Kansas State trade mark registration of the mark K2 in class 3 for incense. The certificate indicates a first use claim of March 31, 2009.

The Respondent, which operates under a privacy shield, registered the Domain Names as follows: <k2wholesale.com> (November 11, 2009), <k2incense.org> (November 13, 2009), <k2-incense.com> (December 12, 2009), <k2verified.org> (May 13, 2010) and <k2incenseblend.com> (May 15, 2010).

However, the Respondent had also registered an earlier domain name, <k2cafe.org>, on July 3, 2009.

The Respondent’s websites offer the Respondent’s K2 incense for sale and warn off visitors to its sites from dealing with what it categorises as counterfeit K2 products, which are to be found on a number of competing ‘K2’ websites. Among those websites they include the Complainant’s website connected to the Domain Name, <k2incense.com>.

On June 8, 2010 KTW Enterprises Ltd., an entity apparently unconnected with the parties, applied for a federal trade mark registration of K2 (two months prior to the Complainant’s federal application). That application is under opposition from the Complainant.

On November 10, 2010 the Complainant commenced a civil action in the United States District Court for the District of Kansas against KTW Enterprises Ltd. and others alleging inter alia that the defendants have infringed the Complainant’s Kansas trade mark rights by their use of the Domain Names.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the Domain Names are identical or confusingly similar to its K2 trade mark and its various “k2” pre-fixed domain names (see above).

The Complainant further contends that the Respondent has no rights or legitimate interests in respect of the Domain Names and that the Domain Names were registered and are being used in bad faith.

B. Respondent

The Respondent denies the Complainant’s allegations. It asserts that a licensee of the Respondent is selling K2 branded incense and has been doing so from July 2009. It asserts that none of the domain names registered by the Complainant (as opposed to that registered by the Complainant’s licensee) are in use.

It asserts that it registered the Domain Names “for the express purpose of licensing them to advance a commercial enterprise selling K2 marked incense as it has since July 2009 …”.

In the Response the Respondent goes on to assert that as at July 2009 when the Respondent commenced trading in K2 branded product, none of the Complainant’s domain names were in use. The Respondent contends that the Complainant is guilty of Reverse Domain Name Hijacking.

6. Discussion and Findings

A. General

According to paragraph 4(a) of the Policy, for this Complaint to succeed in relation to the Domain Names, the Complainant must prove each of the following, namely that:

(i) The Domain Names are 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 interests in respect of the Domain Names; and

(iii) The Domain Names have been registered and are 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 an abuse of the Administrative Proceeding.”

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

B. Identical or Confusingly Similar

The Complainant is the proprietor of a Kansas trade mark registration for the mark K2 in class 3 for incense. The Domain Names all feature the Complainant’s trade mark in combination with dictionary words, namely ‘incense’, ‘blend’, ‘verified’ and ‘wholesale’. None of those words is sufficient to distance any of the Domain Names from the principal element of each of the Domain Names, namely the prefix K2, the Complainant’s trade mark.

Accordingly, and having regard to the fact that it is permissible to ignore the generic top level domain suffix for this purpose, the Panel finds that the Domain Names are all confusingly similar to the Complainant’s K2 trade mark.

However, the Complainant’s trade mark registration is a state registration, not a federal registration. Paragraph 1.1 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”) is on point. It reads as follows:

“1.1 Does ownership of a registered trademark to which the domain name is identical or confusingly similar automatically satisfy the requirements under paragraph 4(a)(i) of the UDRP?

See also the relevant section in the WIPO Legal Index.

Consensus view: If the complainant owns a trademark, then it generally satisfies the threshold requirement of having trademark rights. The location of the trademark, its date of registration (or first use) [see also paragraph 1.4 below], and the goods and/or services for which it is registered, are all irrelevant for the purpose of finding rights in a trademark under the first element of the UDRP. However, such factors may bear on a panel’s determination whether the respondent has registered and used the domain name in bad faith under the third element of the UDRP.

[case citations excluded]

In certain, highly limited circumstances, some panels have opted to examine the circumstances of trademark registration in considering whether the registration satisfies UDRP requirements. In such cases, panels have typically found trademark registrations that are automatic or unexamined (such as US state registrations as opposed to US federal registrations) are not owed the same deference under the UDRP as examined registrations. In certain cases some panels have declined to consider trademark registrations listed solely on a supplemental register, at least where the validity of or deference due to such listed mark under applicable national law (i.e., the law applicable to the concerned register) is in genuine doubt. Where a trademark includes a word or textual component which has been entirely disclaimed (indicating the complainant has no exclusive rights in such word or text) within the relevant registration, or of a word plus design element in which the design element is found to be the sole source of distinctiveness, such registration alone may be insufficient to enable the complainant to establish relevant rights for standing purposes under the UDRP, absent a showing of acquired distinctiveness through use of the relevant mark. In practice, the latter would typically entail establishing a case for common law or unregistered rights in the mark. [See further paragraph 1.7 below regarding what needs to be shown for common law or unregistered marks under the UDRP. See also paragraph 1.11 below regarding the effect of trademark disclaimers and design elements on assessment of identity or confusing similarity under the UDRP.]”

[case citations excluded]

Given that the Complainant’s trade mark registration is a US state registration, the passage of particular relevance here is that reading “In such cases, panels have typically found trademark registrations that are automatic or unexamined (such as US state registrations as opposed to US federal registrations) are not owed the same deference under the UDRP as examined registrations.”

Ordinarily, this Panel would be slow to question the rights, the subject of what is, on the face of it, a properly registered trade mark. However, prior to receiving this case, the Panel was under the impression that, in the context of the product area in question, ‘K2’ was a generic term to describe synthetic cannabis. The fact that it was the subject of a trade mark registration surprised the Panel.

Moreover, it appears from the Kansas trade mark registration certificate that the registration was granted on the same day that the application was made, namely October 1, 2010, which would seem to bear out that little or no examination can have taken place. The registration certificate concludes “Said mark is registered for a period of five years from the date of original filing, or renewal, October 1, 2010 …. IN TESTIMONY WHEREOF: I hereto set my hand and cause to be affixed my official seal. Done at the City of Topeka, this 1^st day of October A.D. 2010 [signed] CHRIS BIGGS Kansas Secretary of State.”

With that in mind, while the Panel does not propose to ignore the registration altogether, the rights afforded to the Complainant by that registration appear to the Panel to be weak.

Another problem with the Kansas trade mark registration is that it post-dates registration of the Domain Names, the last of which was registered on May 15, 2010. That is not of relevance under paragraph 4(a)(i) of the Policy, but can have significant implications under the next two heads.

Subject to those qualifications, the Panel finds that the Domain Names are confusingly similar to K2 a trade mark in which the Complainant has rights by virtue of its Kansas State registration, details of which are set out in section 4 above.

C. Rights or Legitimate Interests

In light of the Panel’s finding under D below, it is unnecessary for the Panel to address this issue.

D. Registered and Used in Bad Faith

The Complainant contends that the Respondent registered the Domain Names with the intention of disrupting the Complainant’s business. In support of that contention the Complainant exhibits to the Complaint a number of webpages from the Respondent’s websites, which lambast in unrestrained fashion a number of sellers of what the Respondent categorises as counterfeit K2 product. One of the Complainant’s websites is mentioned and the Respondent warns Internet visitors to its sites against purchasing K2 product from the Complainant.

Clearly, the Respondent is intent on damaging the businesses of all K2 sellers (several others are identified) other than itself and its licensees. However, it is also true to say that the Complainant and those behind the Complainant are singled out for very serious allegations including allegations of horrendous criminal activity, such as causing death by the sale of dangerous substances.

The problem with all this evidence is that it comes from webpages printed out in July 2011. None of it helps to identify what the Respondent’s intentions were back in 2009 and 2010 when the Respondent registered the Domain Names. The Respondent’s websites also promote the sale of its own K2 products, which are apparently manufactured by a licensee. Neither party has put before the panel webpages from the Respondent’s websites dating back to 2009 and the first half of 2010. It is possible, for example, that, as the Complainant alleges in its civil action in the United States District Court for the District of Kansas against KTW Enterprises Ltd. and others, the defendants in that action are in some way associated with the Respondent and the content of the Respondent’s websites, insofar as it is targeted at the Complainant, is a riposte to that action. The Panel has no way of knowing.

The Respondent’s websites are clearly directed to selling the Respondent’ K2 product and ‘rubbishing’ a number of other competing products including those of the Complainant. Whether those allegations are fairly directed, again the Panel has no means of knowing. Neither party in the submissions before the Panel has commented on the accuracy of those allegations.

While there were no registered trade mark rights in respect of K2 in existence in 2009, it is not inconceivable that the Complainant might have acquired unregistered rights in that year. However, the Complainant claims to have commenced use of its mark in March 2009 and the first of the Respondent’s ‘k2’ pre-fixed domain names to be registered, <k2cafe.org> (not one of the Domain Names), was registered on July 3, 2009. For the Complainant to have built up unregistered rights in that short period would have required some substantial sales and expenditure on advertising and promotion. Save for details of a sale totaling USD 38 on March 31, 2009, the Panel has no evidence as to the extent of the Complainant’s sales of the Complainant’s K2 products in 2009 or 2010 nor does the Panel have any details of the Complainant’s expenditure on advertising and promoting its K2 products in 2009 or 2010.

In the absence of any evidence it is not open to the Panel to conclude that the Complainant had unregistered trade mark rights at the date or dates upon which the Domain Names were registered in 2009 and 2010. Nor is there anything by way of evidence to support the contention that as at the dates of registration of the Domain Names the Respondent knew of the Complainant, still less that the Complainant claimed trade mark rights in respect of the K2 name. True, one might have expected the Respondent as registrant of the Domain Name, <k2incense.org>, on November 13, 2009 to have been aware of the Complainant’s registration of <k2incense.com> on November 1, 2009, but there is no documentary evidence demonstrating when and how the Complainant or its licensee first started using that domain name. The only webpage of the Complainant that the Panel has been able to find in the evidence is one page from the Complainant’s licensee’s website connected to the domain name <k2incense.com> and dated July 8, 2011.

In summary, there is insufficient evidence before the Panel to conclude that on the various dates in 2009 and 2010 when the Respondent registered the Domain Names:

1. the Complainant had any relevant trade mark rights in respect of K2; or

2. if the Complainant had any such rights, the Respondent would have been aware of their existence on those dates.

Accordingly, the Panel is unable, on the evidence before him, to find that the Domain Names were registered in bad faith.

As to the use that the Respondent is making of the Domain Names, the Panel is unable, on the evidence before him, to form a concluded view; nor does the Panel need to do so, given the finding that the Complainant has failed to persuade him that the Domain Names were registered in bad faith.

E. Reverse Domain Name Hijacking

The Panel is not persuaded that the Complainant filed the Complaint with abusive intent. The Complainant has a registered trade mark and if the Complainant’s first use claim is correct, the Complainant commenced use of its K2 brand ahead of the Respondent. Moreover, the content of the Respondent’s websites is plainly calculated to damage the Complainant’s business.

Additionally, if, as the Respondent has chosen to do, one publishes serious allegations of the kind alleged against the Complainant and those behind the Complainant, it is somewhat unsatisfactory (to put it neutrally) to do so from behind a privacy shield.

7. Decision

For all the foregoing reasons, the Complaint is denied.

Tony Willoughby
Sole Panelist
Dated: September 29, 2011