WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Shandong Lingong Construction Machinery Co., Ltd. v. Stanley Pace and Whois Privacy Service Pty Ltd.

Case No. D2012-1626

1. The Parties

The Complainant is Shandong Lingong Construction Machinery Co., Ltd. of Linyi Economic Development Area Shandong Province, China, represented by Wallberg IP Advice, Denmark.

The Respondent is Stanley Pace of Fairfield, California, United States of America (“US”) and Whois Privacy Service Pty Ltd. of Fortitude Valley, Queensland, Australia, represented by Rodenbaugh Law, US.

2. The Domain Name and Registrar

The disputed domain name <sdlg.com> is registered with Fabulous.com (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on August 14, 2012. On August 14, 2012, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On August 15, 2012, the Registrar transmitted by email to the Center its verification response:

(a) it is the Registrar for the disputed domain name;

(b) the language of the registration agreement is English;

(c) the disputed domain name was registered subject to the Uniform Domain Name Dispute Resolution Policy (the “Policy” or “UDRP”), and the UDRP applies to the disputed domain name;

(d) disclosing registrant and contact information for the disputed domain name which differed from the named Respondent and contact information in the Complaint.

The Center sent an email communication to the Complainant on August 17, 2012, providing the registrant and contact information disclosed by the Registrar, and inviting the Complainant to submit an amendment to the Complaint. The Complainant filed an amended Complaint on August 22, 2012.

The Center verified that the Complaint together with the amended Complaint (the “Complaint”) satisfied the formal requirements of 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 the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced August 23, 2012. In accordance with the Rules, paragraph 5(a), the due date for Response September 12, 2012. The Response was filed with the Center September 12, 2012.

The Center appointed Warwick A. Rothnie, Linda Chang and David E. Sorkin as panelists in this matter on October 12, 2012. 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 the Rules, paragraph 7.

In its Response, the first Respondent (“Respondent”) reported that he had commenced proceedings in the United States District Court for the Eastern District of Texas seeking a declaratory judgment of non-infringement in relation to the disputed domain name and requesting that the Panel terminate the dispute pursuant to paragraph 18 of the Rules. The Response did not address the substance of the dispute but requested an additional period of 10 days to provide a response on the substantive issues if the Panel did not accede to the request to terminate the proceeding.

On October 15, 2012, the Complainant submitted an unsolicited supplemental filing opposing the Respondent’s request for termination of the proceeding.

The Panel considered it would be assisted in deciding the Respondent’s request under paragraph 18 of the Rules by consideration of the Respondent’s substantive defence and, accordingly, issued Administrative Order No. 1 on October 19, 2012. By Administrative Order No. 1, the Panel invited the Respondent to submit his foreshadowed response by October 29, 2012 and extended the projected date for the Panel’s decision accordingly.

The Respondent submitted his further Response timely on October 29, 2012.

4. Factual Background

According to the Complaint, the Complainant is a manufacturer and supplier of engineering machinery, based in the People’s Republic of China and founded in 1972. The Complainant is one of the 100 largest enterprises in the Chinese machine industry with annual turnover in excess of 10 billion Yuan (approximately USD 1.6 billion at current exchange rates) and some 2,900 employees. According to the Complaint, the Complainant entered into a joint venture with the Volvo group in 2006. It appears from the Complainant’s Annual Report included as Annex 14 to the Complainant that companies controlled by AB Volvo hold some 70% of the share capital in the Complainant.

The Complainant’s products include wheel loaders, excavators, road rollers, backhoe loaders and other engineering equipment, supplied under the brandname SDLG which are derived from the initials of the four syllables in its company name.

The Complainant has submitted evidence that it has registered the trademark

in a number of countries including:

(a) US Trademark No. 3,771,817; and

(b) Australian Trademark No. 1308635;

in relation to a range of goods and services in International Classes 7, 12, 35 and 37.

These are derived from International Registration No. 1004853, registered on February 18, 2009. There are also black and white versions in some countries through International Registration No. 995751 registered on January 8, 2009.

The disputed domain name was first registered in 2001.

It would appear, however, that the Respondent acquired the disputed domain name in or about August 2011.

The Respondent states that he is in the business of registering, or acquiring the registration of, descriptive domain names and exploiting them for the value as descriptive domain names.

5. Discussion and Findings

The first issue which needs to be resolved is the Respondent’s request for the administrative proceeding to be terminated pursuant to paragraph 18 of the Rules.

By paragraph 4 of the Policy, the Respondent is required to submit to mandatory administrative proceeding where a complainant asserts that:

(i) the disputed 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 disputed domain name; and

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

In filing a complaint, the complainant is required to submit to the jurisdiction of the court in at least one of the Mutual Jurisdictions (paragraph 3(b)(xiii) of the Rules). For this purpose, Mutual Jurisdiction means (paragraph 1 of the Rules):

“a court jurisdiction at the location of either (a) the principal office of the Registrar (provided the domain-name holder has submitted in its Registration Agreement to that jurisdiction for court adjudication of disputes concerning or arising from the use of the domain name) or (b) the domain-name holder’s address as shown for the registration of the domain name in Registrar’s WhoIs database at the time the complaint is submitted to the Provider.”

By clause 4.2 of the Registration Agreement, the Respondent agreed, without prejudice to other potentially applicable jurisdictions, to the jurisdiction of the courts both at his domicile and where the Registrar is located.

In submitting its Complaint, the Complainant submitted to the jurisdiction of the courts where the Registrar is located.

Paragraph 4(k) of the Policy states that the commencement of an administrative proceeding under the Policy does not prevent either party to the proceeding from submitting the dispute to a court of competent jurisdiction either before the administrative proceeding commenced or after the proceeding has concluded.

It might be thought that paragraph 4(k) of the Policy contemplates that the parties will initiate legal proceedings only before the administrative proceeding has commenced or after it has concluded. Paragraph 18(a) of the Rules, however, confers on the Panel a discretion to suspend or terminate the administrative proceeding in the event (as has happened here) that one of the parties has initiated court proceedings in respect of the disputed domain name during the administrative proceeding.

The Panel notes that the Respondent successfully obtained an order for termination, without prejudice to the Complainant’s rights to refile, recently in ATRYA v. Stanley Pace / Whois Privacy Services Pty Ltd,WIPO Case No. D2012-0946.

The present case is different, however, to the first of the decisions relied on by the Respondent: Yellow Pages Group Co./Groupe Pages Jaunes Cie v. Thomas Moll/Yellow Page Marketing B.V., WIPO Case No. D2011-1833 as the court litigation between the parties had commenced well before the administrative proceeding and also involved a regulatory agency.

In the second case, DNA (Housemarks) Ltd. v. Tucows.com Co., WIPO Case No. D2009-0367, the learned panelist noted that paragraph 18 of the Rules confers a discretion which should be exercised according to the particular circumstances of the particular proceeding. The learned panelist recognized that, in exercising that discretion, prompt and efficient resolution of disputes were important considerations under the Policy and, further, that the timing of a post-complaint filing could be used to delay or otherwise manipulate the Policy. See also Tiara Hotels & Resorts LLC v. John Pepin, WIPO Case No. D2009-0041.

In the DNA (Housemarks) Ltd. case, the respondent commenced the court proceedings after the complaint had been filed, but in the court to whose jurisdiction the complainant had submitted pursuant to paragraph 3(b)(xiii) of the Rules. Accordingly, the panelist considered that no expedition or efficiency would be achieved by proceeding to a substantive decision in that case as it was unlikely the dispute would be resolved any earlier.

The present case is different to the DNA (Housemarks) Ltd. case in that the Respondent has chosen not to commence his proceedings in the courts to which the Complainant has submitted.

That is highly significant in the present case where the Respondent has chosen to register a domain name in a generic top-level domain (gTLD) which is open to anyone around the world, which is capable of being used and is in fact being used to attract browsers from around the world and has chosen to use a Registrar located in Queensland, Australia.

In addition, the Complainant has filed a Supplemental Filing objecting to the Respondent’s request for termination. Although the Policy and the Rules do not provide a right to make supplemental filings, the Panel exercises its discretion to admit the Supplemental Filing into the record in this case as it addresses matters that have arisen after the Complaint was filed and, given the nature of the Respondent’s request, was not something that could reasonably be addressed in anticipation. In the Supplemental Filing, the Complainant points out that it is by no means clear that the Respondent’s civil proceeding in the District Court for the Eastern District of Texas, US, will go forward, or go forward expeditiously, given the time limits for service under the Federal Rules of Civil Procedure and the requirements for service of foreign proceedings on Chinese companies in the People’s Republic of China.

It is not the Panel’s place to speculate on how the requirements of service and due process will be satisfied in the Respondent’s civil proceeding. The matters highlighted in the Supplemental Filing, however, emphasize that the Respondent has chosen for his own reasons not to bring proceedings in the jurisdiction to which the Complainant has voluntarily submitted. The jurisdiction chosen by the Respondent may qualify as a Mutual Jurisdiction under the Rules. However, the Policy gives the Complainant a choice in which jurisdiction it chooses to fulfill its obligations and the venue chosen by the Respondent is not the jurisdiction the Complainant has chosen. It is plain that the Complainant does not consent to transfer of the dispute to the venue the Respondent wishes to adopt.

In these circumstances, the Panel declines to terminate this administrative proceeding and will proceed to deal with the dispute on its merits under the Policy.

Accordingly, paragraph 15(a) of the Rules directs the Panel to decide the Complaint on the basis of the statements and documents submitted and in accordance with the Policy, these Rules and any rules and principles of law that it deems applicable.

A. Identical or Confusingly Similar

The first element that the Complainant must establish is that the disputed domain name is identical with, or confusingly similar to, the Complainant’s trademark.

There are two parts to this inquiry: the Complainant must demonstrate that it has rights in a trademark and, if so, the disputed domain name must be shown to be identical or confusingly similar to the trademark.

The Complainant has proven ownership of, at least, the two registered trademarks referred to in section 4 above: US Trademark No. 3,771,817 and Australian Trademark No. 1308635, which consist of the letters “sdlg” and a split arrowhead device.

The Complainant relies on the correspondence between the letters “sdlg” in its trademark and the disputed domain name (apart from the gTLD, “.com”).

On the other hand, the Respondent advances three main arguments to displace a finding of confusing similarity. First, relying on the proportions in the Complainant’s trademark of the split arrowhead device to the letters, the Respondent contends that the letters are a subordinate and non-dominant component of the Complainant’s trademark.

Secondly and related to the first argument, the Respondent also contends that the letters “sdlg” are a common descriptive shorthand for “seedling” and are also used by a number of other entities as their acronym, citing a number of other uses such as a US governmental program “Strengthening Democratic Local Government” and other uses cited on “www.acronymgeek.com”. According to the Respondent, this reinforces the lack of potential for confusion.

Thirdly, the Respondent challenges the validity of the Complainant’s trademarks. While the Complainant has claimed ownership of a large number of registered trademarks and domain names, the Respondent submits evidence showing that some are in fact owned by other entities. For example, the Respondent points to evidence that Volvo Do Brasil Veiculos Ltda owns exclusive rights in Mexico, Argentina and Brazil for a trademark identical to the trademarks referred to above. Accordingly, the Respondent submits:

“although the [disputed domain name] is similar to the Mark, Respondent has demonstrated it is not clear that Complainant holds rights in its Mark given that Volvo is claiming to be Complainant, and Complainant claims to own the mark globally yet the public records in various countries clearly demonstrate another Volvo entity is the owner, and domain names using the Mark, which Complainant represented it owns, are clearly owned by other parties. The ultimate decision as to whether Complainant does or does not have proprietary rights, relevant in the United States where Respondent is located and conducts business, is better left to an appropriate court in the United States ….”

There are a number of reasons why the Panel does not accept this submission.

First, the Policy operates in a multinational sphere and is not necessarily tied to the specifics of any particular national jurisdiction. Thus, where all the parties are not from the one jurisdiction and their respective activities are not confined just to the one jurisdiction, it is not appropriate to apply purely national law to the dispute: e.g. Fox News Network L.L.C. v. C&D International Ltd. and Whois Privacy Protection Service,WIPO Case No. D2004-0108. Moreover, the Panel does not accept that the Respondent is just conducting its business solely in the US. In this connection, the Panel notes that the Respondent has chosen to register, or acquire the registration of, a domain name in the gTLD, “.com”, which is open to businesses all around the world. The Panel notes that the disputed domain name is accessible to people browsing on the Internet from anywhere around the world and the website the disputed domain name resolves to is plainly not limited only to targeting people in the US. In this connection, the Panel notes that Annex XVII to the Complaint for example is in a Scandinavian language, no doubt reflecting that it results from browsing undertaken by the Complainant’s lawyers based in a Scandinavian country. Thirdly, the Respondent has chosen to register the disputed domain name through a Registrar located outside the US.

The Panel notes it is not an uncommon practice for intellectual property rights including trademarks to be held by a special purpose entity within the corporate group other than the ultimate holding company. It is also not uncommon for such rights to be held for different countries by different entities. Accordingly, the Panel would not be inclined to place the significance on these matters that the Respondent invites the Panel to do. However, it is ultimately unnecessary for the Panel to resolve this issue since, as already noted, the Complainant has clearly established its ownership of the registered trademarks referred to above. They are themselves sufficient foundation for the Complainant’s claims under the Policy. It is no part of a Panel’s role to assess the validity of those registrations.

Thirdly, on the question of identity or confusing similarity, what is required is simply a comparison and assessment of the disputed domain name itself to the Complainant’s proved trademarks: see for example, Disney Enterprises, Inc. v. John Zuccarini, Cupcake City and Cupcake Patrol,WIPO Case No. D2001-0489; IKB Deutsche Industriebank AG v. Bob Larkin, WIPO Case No. D2002-0420. This is different to the question under trademark law which can require an assessment of the nature of the goods or services protected and those for which any impugned use is involved, geographical location or timing. Such matters, if relevant, may fall for consideration under the other elements of the Policy.

In undertaking that comparison, in the present circumstances it is permissible to disregard the “.com” component of the disputed domain name as a functional aspect of the domain name system: Telstra Corporation Limited v. Ozurls, WIPO Case No. D2001-0046; Ticketmaster Corporation v. DiscoverNet Inc., WIPO Case No. D2001-0252.

The Panel agrees that the split arrowhead device is a significant component of the Complainant’s trademark. That does not mean, however, that the literal string “sdlg” is a subordinate or “non-dominant” part of the trademark. If nothing else, the letters “sdlg” are a component of the trademark which is likely to be a natural point of reference for notional users of the Internet.

Accordingly, the Panel finds that the disputed domain name is confusingly similar to the Complainant’s trademark and the requirement under the first limb of the Policy is satisfied.

B. Rights or Legitimate Interests

The second requirement the Complainant must prove is that the Respondent has no rights or legitimate interests in the disputed domain name.

Paragraph 4(c) of the Policy provides that the following circumstances can be situations in which a respondent has rights or legitimate interests in a disputed domain name:

(i) before any notice to you of the dispute, your use 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) you (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

These are illustrative only and are not an exhaustive listing of the situations in which a respondent can show rights or legitimate interests in a domain name.

The onus of proving this requirement, like each element, falls on the Complainant. Panels have recognized the difficulties inherent in disproving a negative, however, especially in circumstances where much of the relevant information is in, or likely to be in, the possession of the respondent. Accordingly, it is usually sufficient for a complainant to raise a prima facie case against the respondent under this head and an evidential burden will shift to the respondent to rebut that prima facie case. See e.g., paragraph 2.1 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”).

In the present case, the Complainant contends that it has not licensed or otherwise consented to the Respondent’s registration and use of the disputed domain name. The Respondent is not in anyway associated with the Complainant or the Complainant’s business. Nor is the disputed domain name derived in anyway from the Respondent’s name.

The Complainant has also submitted two printouts of pages said to be from the website to which the disputed domain name resolves. According to the Complainant, these printouts show that the Respondent is using the disputed domain name to generate revenue from click-through advertising. In addition, the Complainant has submitted evidence that the Respondent is offering the disputed domain name for sale.

Typically, these matters are sufficient to raise a prima facie case that a respondent does not have rights or legitimate interests in a disputed domain name in circumstances where the complainant has proven ownership of trademark rights.

Subject to one significant point discussed further below, the Respondent does not dispute the factual accuracy of most of the matters the Complainant relies on. The Respondent points out, however, that the Complainant’s trademarks are relatively narrow in focus. He also relies heavily on the range of potential uses of the acronym “sdlg” other than as a badge of origin of the Complainant. He then argues, first, that the use of a domain name comprising four letters which could stand for anything without targeting the Complainant’s business is itself sufficient to constitute rights or legitimate interests under the Policy.

Secondly, the Respondent states that he invests in domain name property. He says he owns “tens of thousands of descriptive, generic, dictionary word, keyword and/or geographic domain names including approximately three or four thousand other three or four letter “.com” names as they are typically acronyms or abbreviations, or can be used to create new brands”. As a result, the Respondent contends “he registered the disputed domain name as part of his strategy to register, prime, inherently valuable domain names of as few characters as possible”. He claims he has used it for online search and navigation services. Accordingly, he says he has a legitimate interest in the inherently valuable disputed domain name.

The Panel agrees with the Respondent that the Policy does not impose a general prohibition on the registration and use of domain names either to resell them or to generate click-through advertising revenues. Such purposes and use can be legitimate under the Policy. What the Policy does proscribe, however, is registration and use of domain names to take advantage of their significance as another person’s trademark.

The Complainant submitted two sets of printouts purporting to show the website to which the disputed domain name resolved: Annex XI and Annex XVII.

The printouts in both Annexes state that the disputed domain name is for sale. That is not in dispute between the parties.

The Respondent objects to the admissibility of Annex XI, but appears to accept Annex XVII as a legitimate illustration of the website to which the disputed domain name resolves.

Annex XI shows the disputed domain name resolving to a page which shows, amongst other things, used excavating equipment. The Respondent raises two objections to this Annex. First, the URL of the website is not simply “http://www.sdlg.com”, unlike Annex XVII. The Respondent claims the URL shows that the Complainant has engaged in some sort of manipulated searching to produce the result generated. As it is unclear to the Panel how the printout in Annex XI has been generated, the Panel has not taken it into account in reaching its conclusions.

In relation to Annex XVII, the Respondent points out that many of the click-through links under the heading “Sponsored links” shown on this link are to products or services provided by “LG” which the Respondent attributes to the inclusion of those two letters as the last two letters of the acronym “sdlg”.

The Panel accepts that many of the click-through links do appear to be to “LG” products or services. However, this does not assist the Respondent. First, the Respondent does not purport to claim any right or authority from “LG”. He contends he registered and uses the disputed domain name for its inherent descriptive significance.

The Panel considers it most unlikely that anyone would use the acronym “sdlg” in looking for “LG” products or services.

Secondly, the first click-through link under the heading “related searches” is to “Excavator Sales”. The acronym “sdlg”, however, is associated with such products and services only by reason of its association with the Complainant and the Complainant’s products.

Thirdly, none of the click-through links appear to have anything to do with the descriptive nature of the acronym that the Respondent invokes such as “seedling” or “Strengthening Democracy in Local Government” or the owners of other trademarks for SDLG the Respondent invokes.

In these circumstances, the Panel concludes that the Respondent has not rebutted the prima facie case the Complainant has established that the Respondent does not have rights or legitimate interests in the disputed domain name. As both paragraphs 4(c)(i) and (iii) illustrate, a positive assertion of a right or legitimate interest usually must be supported by good faith use (or demonstrable preparations for use) and panels have consistently held that use which takes advantage of the complainant’s trademark is not use in good faith for the purposes of the Policy.

The Respondent states that the click-through links are arranged by Sedo, the service provider he uses to park and monetize domain names pending their sale. The extent to which the Respondent is able to control or qualify the click-through links Sedo provides is unclear from the record in this case. Even if the Respondent has no such control, however, the Respondent cannot avoid his obligations under the Policy by his choice of provider.

Accordingly, the Panel finds that the Complainant has established the second requirement under the Policy.

C. Registered and Used in Bad Faith

Under the third requirement of the Policy, the Complainant must establish that the disputed domain name both has been registered and is being used in bad faith by the Respondent.

In the Panel’s view, and for reasons explained above under the second requirement of the Policy, the website, or websites, to which the disputed domain name resolve as exemplified in Annex XVII to the Complaint clearly constitute use in bad faith under the Policy since the Panel finds that it takes unfair advantage of the Complainant’s trademark.

As indicated before, the disputed domain name was first registered in 2001. It would appear, however, that the Respondent acquired the disputed domain name in or about August 2011, after the Complainant had secured its International Registration for its trademark. It is that later date that is relevant for determining registration and use in bad faith under the Policy: See e.g. Ticketmaster Corporation v. Global Access, WIPO Case No. D2007-1921.

The Respondent denies that he had any knowledge of the Complainant’s trademark when he registered the disputed domain name. The way in which the Respondent uses the disputed domain name, however, permits an inference to be drawn to the contrary of that denial. Although the acronym does consist of four letters, they do not form a pronouncable word themselves. Nor, as noted above, does the Respondent use the website for any of the descriptive or generic uses he claims motivated his acquisition of the disputed domain name. The Panel is reinforced in this conclusion by the Respondent’s failure to provide any evidence of any reasonable or other steps he took to avoid use of the disputed domain name to take advantage of other person’s trademarks which previous panels have identified as a significant factor in considering a respondent’s claim that the domain name in question was not registered or used in bad faith. See e.g. Media General Communications, Inc. v. Rarenames, WebReg, WIPO Case No. D2006-0964.

6. Decision

For the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the disputed domain name <sdlg.com> be transferred to the Complainant.

Warwick A. Rothnie
Presiding Panelist

Linda Chang
Panelist

David E. Sorkin
Panelist

Dated: November 12, 2012