WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

LEGO Juris A/S v. Domain Admin: Damon Nelson ─ Manager, Quantec, LLC/Novo Point, LLC / Domain Hostmaster

Case No. D2015-0555

1. The Parties

The Complainant is LEGO Juris A/S of Billund, Denmark, represented by CSC Digital Brand Services AB, Sweden.

The Respondent is Domain Admin: Damon Nelson – Manager, Quantec, LLC/Novo Point, LLC of Dallas, Texas, United States of America (“United States”) / Domain Hostmaster of Fortitude Valley, Queensland, Australia.

2. The Domain Name and Registrar

The disputed domain name <legosshop.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 March 30, 2015. On March 30, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On April 2, 2015, the Registrar transmitted by email to the Center its verification response 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 April 7, 2015 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 amendment to the Complaint on April 8, 2015 naming as the Respondent the registrant disclosed by the Registrar that is: Domain Admin: Damon Nelson – Manager, Quantec, LLC/Novo Point, LLC of Dallas, Texas, United States.

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” 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 proceeding commenced on April 9, 2015. In accordance with the Rules, paragraph 5(a), the due date for Response was April 29, 2015.

On April 13, 2015, the Center received an email communication from the individual named Damon Nelson. Mr. Nelson identified himself as court appointed manager of the portfolio of domain names controlled by the receivership whose position was vacated by a United States District Court on February 28, 2014.

Mr. Nelson notified the Center that he no longer represents the disputed domain name and that all future correspondence regarding the disputed domain name should be sent to Ms. Lisa Katz and Mr. Gary Schepps at contact addresses he provided. On April 23, 2015, the Center received another email communication from Mr. Nelson, who advised that the receivership itself, which controlled the portfolio of domain names, was discharged on March 27, 2015. Mr. Nelson copied both Ms. Katz and Mr. Schepps on this email communication.

On April 14 and 24, 2015 the Center sent email communications to Mr. Nelson advising that “any consideration of the Respondent’s identity / pending court case (for any Receivership issues) shall be for the Panel to determine, in accordance with its discretion under the UDRP Rules”. The Center sent these email communications to both Ms. Katz and Mr. Schepps to their email addresses advised by Mr. Nelson.

The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on April 30, 2015.

On May 1, 2015, the Center received an email communication from Mr. Schepps, who identified himself as attorney representing Quantec, LLC regarding domain name claims. He objected to not receiving hard copy of the Complaint and requested the opportunity to receive the full set of materials in order to be able to prepare and submit a response to the Complaint. Mr. Schepps stated that the WhoIs information with regard to the disputed domain name has been locked and points to the previous registrant, as well as that this has been caused because the Complaint was filed during the wind-down process of the receivership, even though the receivership order prohibited the filing of such actions.

On May 1, 2015, the Center sent an email communication to Mr. Schepps advising that in compliance with the Rules, Notification of Complaint and Commencement of the Administrative Proceeding had been sent on April 9, 2015 to all addresses shown in the domain name registration data disclosed by the Registrar, as well as the fact that he had been copied on communications of the Center dated April 14 and April 24, 2015.

On May 2, 2015, the Center received an email communication from Mr. Schepps who again stated that the previous correspondences of the Center were sent to a wrong party and that until the wind-down process of the receivership is complete, this action should be stayed.

On May 4, 2015, the Center sent an email communication to Mr. Schepps advising that all communication from the parties will be transmitted to the Panel who will have the discretion to determine the admissibility, relevance, materiality and weight of the evidence pursuant to paragraph 10(d) of the Rules.

On May 6, 2015 the Center appointed Zoltán Takács as the sole panelist in this matter. 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.

On May 15, 2015 the Panel issued Procedural Order No. 1 requesting that Mr. Schepps provide evidence of his authorization to represent the Respondent as well as to submit his Response to the Complaint. Further to the issuance of the Procedural Order No. 1, the Panel extended the due date for rendering its decision until May 27, 2015.

On May 20, 2015, Mr. Schepps sent an email communication to the Center stating that a receivership was imposed over the disputed domain name and that the court which imposed the receivership entered an order staying all actions involving the assets placed into receivership. However, since the imposition of the receivership was reversed on appeal, the district court began an orderly wind-down process which resulted in termination of Quantec, LLC/Novo Point, LLC which was the title of the receivership estate. In that, the Respondent, as identified by the Registrar no longer exists. Mr. Schepps finally stated that he only represents Quantec, LLC with respect to this administrative proceeding.

The Complainant did not respond to Mr. Schepps’ submission.

The language of this administrative proceeding is English, that being the language of the registration agreement.

4. Factual Background

The Complainant, a privately held company based in Billund, Denmark, is the owner of the LEGO trademark, and all other trademarks used in connection with the famous LEGO brands.

The Complainant began manufacturing interlocking toy bricks in 1949 and has since developed substantially, selling its LEGO products in more than 130 countries all over the world.

The disputed domain name was registered on December 11, 2004, by which time the Lego Group had 33 brand retail stores worldwide, most of them were primarily located in the United States.

The Complainant owns numerous trademarks for LEGO around the world, including United States Trademark Registration No. 1026871, registered on December 9, 1975 for toy building blocks and in relation to goods within class 28 of the Nice Agreement Concerning the International Classification of Goods and Services for the Purpose of the Registration of Marks (“Nice Agreement”).

The Complainant owns extensive number of domain name registrations worldwide, including <lego.com> registered since August 22, 1995, as well as <legos.com> since May 11, 2004 which simply redirects the domain name to the Complainant’s official website under the domain name <lego.com>.

Both at the time of filing the Complaint and rendering of this decision the disputed domain name was active, resolving to a parking website featuring a number of pay-per-click sponsored links to other commercial websites offering mostly products in direct competition with those of the Complainant.

5. Parties’ Contentions

A. Complainant

The Complainant contends that the disputed domain name is confusingly similar to its LEGO trademark in which it has exclusive rights worldwide through trademark registration and use. The dominant part of the disputed domain name incorporates the term “lego”, identical to the Complainant’s LEGO trademark, followed by the letter “s” which refers to the plural of “lego” and the descriptive term “shop”.

The Complainant alleges that the Respondent has no rights or legitimate interests in respect of the disputed domain name and is unable to rely on any of the circumstances set out in paragraphs 4(c)(i), (ii) and (iii) of the Policy.

The Complaint alleges that the Respondent has registered and is using the disputed domain name in bad faith.

The Complainant claims that its LEGO trademark became widely known well before the Respondent obtained the disputed domain name and that the Respondent’s motivation to register the disputed domain name was to unlawfully benefit from its recognition.

The Complainant also claims that the disputed domain name is connected to a parking website which generates traffic and income through sponsored links, which is clear indication of bad faith use.

B. Respondent

The Respondent did not reply to the Complainant’s contentions.

6. Discussion and Findings

A. Identity of the Respondent and Notice of Receivership

The original Complaint identified Domain Hostmaster as the registrant of the disputed domain name and the Respondent in this administrative proceeding.

In its verification dated April 2, 2015 the Registrar revealed the identity of the registrant, it being: Domain Admin: Damon Nelson – Manager, Quantec, LLC/Novo Point, LLC.

As outlined in details in the Procedural History of this decision, on April 13, 2015 Mr. Nelson notified the Center that he no longer represents the disputed domain name, and on April 23, 2015 advised the Center that the receivership itself that controlled the portfolio of domain names was discharged on March 27, 2015.

After the Center’s notification on the Respondent’s default on April 30, 2015 Mr. Schepps claiming to be acting on behalf of Quantec, LLC has contacted the Center and, among others, stated that despite the receivership order prohibited the filing of such actions the Complainant filed its Complaint during the wind-down process of the receivership. Mr. Schepp also stated that he was unable to prepare and submit a response to the Complaint because the WhoIs information regarding the disputed domain name has been locked and pointed to a previous registrant and requested an opportunity to prepare and submit a response to the Complaint.

In his response dated May 20, 2015 to the Panel’s Procedural Order No. 1 of May 15, 2015, Mr. Schepps further stated that the wind-down process that has been completed resulted in termination of Quantec, LLC/ Novo Point, LLC, which was the title of the receivership estate and in consequence of that the Respondent as identified by the Registrar no longer exists. Mr. Schepps also stated that he only represents Quantec, LLC with respect to this administrative proceeding.

The only evidence available with regard to the above mentioned issues was provided by Mr. Nelson, in his email communication of April 23, 2015 to the Center. In it Mr. Nelson stated: “My position as court appointed manager of the portfolio of domain names controlled by the Receivership was vacated by the US District Court on 2/28/14. See Case: 3:09-cv-00988-L-Document 1368 Filed 02/28/14 IN THE UNITED STATES DISTRICT COURT, FOR THE NORTHERN DISTRICT OF TEXAS, DALLAS DIVISION”. Mr. Nelson also stated that “The receivership itself was discharged March 27, 2015. See Case 3: 09-cv-00988-L-Document 1447 Filed 03/27/15 IN THE UNITED STATES DISTRICT COURT, FOR THE NORTHERN DISTRICT OF TEXAS, DALLAS DIVISION”.

The Panel has reviewed these documents, namely the Court Order dated February 28, 2014 and the Memorandum Opinion and Order of March 27, 2015 in the Civil Action No. 3: 09-CV-0988L of Netsphere, Inc; Manila Industries, Inc; and Munish Krishan against Jeffrey Baron and Ondova Limited Company before the United States District Court for the Northern District of Texas, Dallas Division.

The Panel establishes that none of these documents referred to by Mr. Nelson provide any evidence that the disputed domain name constituted part of the portfolio of domain names being held in the name of the receivership. On the contrary, according to the above mentioned Court Order dated February 28, 2014 “the Receiver expresses concern regarding the true ownership of the Novo Point and Quantec receivership assets and therefore requests the court to conduct a conference and set a schedule for hearings to determine the ownership of these assets prior to the receivership being wound down” (page 2, Section II, paragraph A. point 1). The Court rejected this request of the receiver (page 9, Section III, point 1).

The Panel also establishes that none of these documents provide any evidence that the disputed domain name was ordered by a court to be returned to Quantec, LLC. None of such statements, allegations of Mr. Schepps have been substantiated.

The Panel finds that the Center has discharged its obligations under the Rules, paragraph 2(a) “to employ reasonably available means calculated to achieve actual notice to Respondent”.

The facts are that at the time of rendering this administrative decision the WhoIs record lists Domain Admin: Damon Nelson – Manager, Quantec, LLC/Novo Point, LLC as the registrant of the disputed domain name and the disputed domain name resolves to a parking website “ww42.legosshop.com” featuring a number of pay-per-click sponsored links. At the bottom of the page there is the following information: “2015 Copyright. All Rights Reserved. The Sponsored Listings displayed above are served automatically by a third party. Neither the service provider nor the domain name owner maintain any relationship with the advertisers. In case of trademark issues please contact the domain owner directly (contact information can be found in whois)”.

Absent any contrary evidence, the Panel has no other option but to proceed against the Respondent as identified by the Registrar, that WhoIs status being valid also at the time of rendering this administrative decision. The Panel notes, however, that this decision is without prejudice to any court actions which have been or may be rendered in connection with the disputed domain name.

Paragraph 15(a) of the Rules requires that the Panel’s decision be made “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”.

It has been a consensus view in UDRP panel decisions that a respondent’s default does not automatically result in a decision in favor of the complainant. See paragraph 4.6 of WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”).

A complainant must evidence each of the three elements required by paragraph 4(a) of the Policy in order to succeed on the complaint, namely that;

(i) the disputed domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights;

(ii) the registrant of the disputed domain name 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.

B. Identical or Confusingly Similar

Under paragraph 4(a)(i) of the Policy, there are two requirements which the Complainant must establish, first that it has rights in a trademark or service mark, and second that the disputed domain name is identical or confusingly similar to the trademark or service mark.

It has been a consensus view among the UDRP panels that if the complainant owns a trademark, then it generally satisfies the threshold requirement of having trademark rights.

The Complainant produced evidence that it holds registered rights in the trademark LEGO including in Australia, where the initial Respondent was based. The LEGO word mark had been registered in Australia in the name of the Complainant since September 17, 1956 for toys, parts thereof and accessories thereto of class 28 of the Nice Agreement.

According to paragraph 1.1 of the WIPO Overview 2.0 it has been a consensus view among the UDRP panels that if the complainant owns a trademark, then it generally satisfies the threshold requirement of having trademark rights, irrespective of the location of the trademark. However, the location of the trademark 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.

When the Registrar disclosed the identity of the Respondent behind the privacy service, it became apparent the Respondent is located in the United States.

According to paragraph 4.5 of the WIPO Overview 2.0, a panel may undertake limited factual research into matters of public record if it deems this necessary to reach the right decision.

In line with this consensus view of the UDRP panels, the Panel checked the Trademark Database of the United States Patent and Trademark Office (“USPTO”) and established that the Complainant – among others – is the owner of United States Trademark Registration for the mark LEGO under number 1026871 for toy building blocks and in relation to goods within class 28 of the Nice Agreement. This LEGO trademark of the Complainant was registered by USPTO on December 9, 1975, almost 30 years prior to the Respondent’s registration of the disputed domain name.

For the purpose of this proceeding, the Panel establishes that the Complainant’s United States Trademark Registration No. 1026871 and Australian Trademark Registration 129258, both for the mark LEGO amply satisfy the requirement of having trademark rights.

Having determined that the Complainant has trademark rights in the LEGO mark, the Panel next assesses whether the disputed domain name <legosshop.com> is identical or confusingly similar to the LEGO mark of the Complainant.

According to paragraph 1.2 of the WIPO Overview 2.0, the threshold test for confusing similarity under the UDRP involves a comparison between the trademark and the domain name itself to determine Internet user confusion. In order to satisfy this test, the relevant trademark would generally need to be recognizable as such within the domain name, with the addition of common, dictionary, descriptive, negative terms in the domain name typically being regarded as insufficient to prevent threshold Internet user confusion. In addition, the applicable top-level suffix in the domain name would also be usually disregarded under the confusing similarity test, as it is a technical requirement of registration.

The only distinctive element of the disputed domain name <legosshop.com>, other than, in the context of the disputed domain name, simple letter “s” which refers to the plural of LEGO, descriptive term “shop”, and the “.com” generic Top-Level Domain (gTLD) suffix, is the inherently distinctive LEGO trademark of the Complainant.

The descriptive term “shop” in the disputed domain name closely relate, in fact describe places where the Complainant is selling its products, either online or offline. This, in the Panel’s view, further increases the confusing similarity between the disputed domain name <legosshop.com> and the Complainant’s LEGO trademark.

The Panel finds that the disputed domain name <legosshop.com> is confusingly similar to the LEGO trademark of the Complainant and that the requirement of paragraph 4(a)(i) of the Policy is satisfied.

C. Rights or Legitimate Interests

Under paragraph 4(c) of the Policy, a respondent may demonstrate its rights or legitimate interests in a domain name by showing any of the following circumstances, in particular but without limitation:

(i) its use of, or demonstrable preparation 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) it has been commonly known by the domain name; or

(iii) it is making a legitimate noncommercial 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.

In the present case, the Complainant has submitted sufficient and uncontested evidence that it holds well-established rights in the trademark LEGO.

The Complainant has never authorized the Respondent to use its LEGO trademark in any way, and the Complainant’s prior rights in the LEGO trademark long preceded the date of registration of the disputed domain name.

It has been a consensus view among UDRP panels, that although the burden of proof rests with the complainant, this could result in the often impossible task of proving a negative, requiring information that is often primarily within the knowledge of the respondent. If a complainant makes out a prima facie case that the respondent lacks rights or legitimate interests, the burden of production then shifts to the respondent.

The Respondent defaulted and failed to respond, and by doing so failed to offer the Panel any type of evidence set forth in paragraph 4(c) of the Policy, or otherwise counter the Complainant’s prima facie case.

On the basis of all these facts and circumstances, the Panel finds that the Respondent has no rights or legitimate interests in the disputed domain name in accordance with paragraph 4(a)(ii) of the Policy.

D. Registered and Used in Bad Faith

Paragraph 4(b) of the Policy lists a number of factors which, if found by the Panel to be present, shall be evidence of registration and use of a domain name in bad faith. This non-exclusive list include:

“(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website or other online location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location or of a product or service on your website or location.”

In view of the Panel, it is highly probable that the Respondent – whether it originally registered the disputed domain name or obtained it later – knew about the well-known LEGO trademark of the Complainant and had incorporated it in the disputed domain name to unlawfully exploit the recognition and reputation of the LEGO mark.

At the time of registration of the disputed domain name the LEGO trademark was already well-established in the United States, and as the company grew and the United States business developed, it became more and more famous nowadays overtaking Ferrari as the world’s most powerful brand (Press Release dated February 17, 2015 of BrandFinance Plc, London, United Kingdom of Great Britain and Northern Ireland, regarded as the world’s leading brand valuation consultancy).

At the time of filing of the Complaint, as well as the date of rendering this administrative decision the disputed domain name was active, resolving to a parking website featuring a number of pay-per-click sponsored links to other commercial websites. At the time of rendering this administrative decision these sponsored links were: “All Lego Star War Toys”, “Discount Weekly Hotel Rates”, “Lego Batman”, “Lego train shop”, “Lego star war mini figure”, “Lego monster sets”, “All lego star war toys”, “Shop building”, “Lego star wars droid sets”, and “New lego ninjago”, eight out of ten of these links containing the LEGO trademark of the Complainant.

Where the related links are based on trademark value, UDRP panels have tended to consider such practices generally as unfair use resulting in misleading diversion (paragraph 2.6 of the WIPO Overview 2.0). In the Panel’s view this is exactly the case here. The majority of links contain the well-established LEGO trademark of the Complainant, and the advertisers pay the publisher, typically the website owner when the link is clicked on. This is unlawful misappropriation of the Complainant’s well established LEGO trademark, and as such clear indication of bad faith use.

The website at the disputed domain name contains a message which disclaims responsibility for these sponsored listings on the website under the disputed domain name, claiming that they are served automatically by a third party.

However, UDRP panels have found that a domain name registrant will normally be deemed responsible for content appearing on a website at its domain name, even if such registrant may not be exercising direct control over such content − for example, in the case of advertising links appearing on an “automatically” generated basis. To the extent that the presence of certain advertising or links under such arrangement may constitute evidence of bad faith use of the relevant domain name, such presence would usually be attributed to the registrant unless it can show some good faith attempt toward preventing inclusion of advertising or links which profit from trading on third-party trademarks.

The majority of related sponsored links at the website under the disputed domain name clearly target the well-established LEGO trademark of the Complainant and benefit from trading on it. There has been no evidence whatsoever presented to the Panel that the Respondent or whoever might be behind the Respondent ever attempted to prevent such links appearing on its website under the disputed domain name.

In view of the Panel, these facts and circumstances are clear indication of bad faith registration and use under paragraph 4(b)(iv) of the Policy and the Panel finds that paragraph 4(a)(iii) of the Policy is satisfied.

7. 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 <legosshop.com> be transferred to the Complainant.

Zoltán Takács
Sole Panelist
Date: May 27, 2015