WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

PRADA S.A. v. Carlo Tafuri, IDT Spa

Case No. D2015-1421

1. The Parties

Complainant is PRADA S.A. of Luxembourg, represented by Studio Barbero, Italy.

Respondent is Carlo Tafuri, IDT Spa of Torino, Italy, represented by Cunescu, Balaciu & Associates, SCA, Romania.

2. The Domain Name and Registrar

The disputed domain name <wholesaleprada.com> (the “Domain Name”) is registered with GoDaddy.com, LLC (the “Registrar”).

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on August 12, 2015. On August 12, 2015, the Center transmitted by email to the Registrar a request for registrar verification in connection with the Domain Name. On August 13, 2015, the Registrar transmitted by email to the Center its verification response confirming that 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 and 4, the Center formally notified Respondent of the Complaint, and the proceedings commenced on August 24, 2015. In accordance with the Rules, paragraph 5, the due date for Response was September 13, 2015. The Response was filed with the Center on September 11, 2015.

The Center appointed Christopher S. Gibson as the sole panelist in this matter on October 6, 2015. 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.

4. Factual Background

Complainant is the owner of numerous trademark registrations for its PRADA mark, including marks registered in Italy, the European Union (as Community trademarks), and with the World Intellectual Property Organization as an International mark.

In light of Complainant’s substantial investments in advertising, its marketing and sales worldwide, and its consistent use of the PRADA mark for decades in relation to certain high-end consumer goods, PRADA is a well-known trademark in Italy and worldwide in relation to high-end luxury goods.

The PRADA brand dates back to the beginning of the last century. In 1913, Mario Prada opened a store in Milan, Italy, selling leather handbags, travelling trunks, leather accessories and beauty cases, and luxury accessories. Prada became a point of reference for European aristocracy; in 1919, Prada became an official supplier to the Italian royal family. The Prada group saw a turning point in the development of its activities at the end of the 1970s, when Miuccia Prada, Mario’s granddaughter, launched a partnership with Tuscan businessman, Patrizio Bertelli, which combined creativity and business ideas. In the following years, the activities of the two families were brought together within a single Prada group.

In 1983, the Prada family opened a second store on the Via della Spiga in Milan. During the late-1980s, new stores were also opened in New York and Madrid, followed by London, Paris and Tokyo. The first Prada women’s wear fashion show was held in Milan in 1988. In 1993, Miuccia Prada established a new brand ― MIU MIU― designed for women who are interested in sophisticated fashion and lifestyle. MIU MIU offers women’s ready-to-wear leather goods and shoes, and is an important component of the Prada group’s sales. The Prada “Linea Rossa” leisure range, with its “Red Line”, was launched in 1997. In 1999 Prada acquired control of CHURCH’S, a prestigious brand of English footwear. In 2001 Prada acquired control of CAR SHOE, an Italian brand known for driving shoes. In 2003, Prada entered into a licensing agreement with Italian eyewear manufacturer, Luxottica, which currently produces eyewear for the PRADA and MIU MIU brands. The Prada group also began a partnership with the Spanish cosmetics manufacturer, Puig Beauty & Fashion Group, which launched the Prada Woman fragrance at the end of 2004, while the first Prada by LG phone was launched in 2008.

Over the years, the Prada group has developed a network of directly operated stores in Italy (44), Europe (115), the Middle East (2), North America (47), Japan (65) and the Asia Pacific (115), accompanied by franchise stores and a significant presence in high-end multi-brand stores and luxury department stores.

Complainant has submitted evidence to show a large number of press publications were dedicated to Prada in Italy in 2011, when the Domain Name was registered. In addition, the trademark PRADA was and is supported by advertising campaigns worldwide, with advertisements appearing in international magazines with broad circulation such as Elle, GQ, Vogue and Vanity Fair.

Complainant has registered more than 170 domain names consisting of or comprising the trademark PRADA under several different TLDs, including <prada.com>, which was registered on June 9, 1997, and <pradagroup.com>, registered on December 21, 2001. Most of Complainant’s domain names are redirected to its website at “www.prada.com”.

Respondentis a business-to-business (“B2B”) distribution company established under Italian law and founded in 2009 by the Tafuri family, with headquarters in Torino. It was established as a niche market business for online selling of fashion stock.

The Domain Name <wholesaleprada.com> was registered by Respondent, without authorization of Complainant, on April 4, 2011. The Domain Name is pointed to a web page where the statement “WHOLESALE PRADA” is published, above the phrase “A wholesale distributor of Prada Jeans and clothing for men and women”. The website to which the Domain Name resolves states that Respondent offers “wholesale and stock by the biggest fashion worldwide brands such as Diesel, Fontana 2.0, Rochas, Versace 19.69 Abbigliamento Sportivo Milano, and many more”. Users visiting the website “www.wholesaleprada.com” are invited to subscribe to a form on Respondent’s website at “www.brandsdistribution.com” to receive Respondent’s catalogue and newsletters, and a link redirects to a web page providing further information on Respondent’s ecommerce services.

5. Parties’ Contentions

A. Complainant

Complainant contends that a review of Respondent’s website at “www.wholesaleprada.com” makes clear that Respondent is using it to promote its wholesale distribution of PRADA and competitors’ clothing and accessories, through the publication of information and links leading to its website at “www.brandsdistribution.com”. While the domain name <brandsdistribution.com> is registered in the name of a privacy service, the contact details displayed on that site are those of Respondent. In addition, the link “Stocklot” redirects users to Respondent’s website at “www.stocklot.com”, promoting the sale of branded products, including goods manufactured and sold by Complainant’s competitors.

When Complainant became aware of Respondent’s registration and use of the Domain Name, it sent a cease and desist demand letter to Respondent. The letter was addressed to Respondent on April 5, 2011, but apparently Complainant did not receive a reply. Since Respondent did not cease its use of the Domain Name following receipt of the letter, a new request to disable all content hosted at the Domain Name and let it expire was addressed to Respondent on March 30, 2015. Respondent replied to this communication stating:

“We replied years ago.
The domain is totally legal.
If you want to have we can value your purchase offer.”

Subsequent to Complainant’s request to specify what the purchase offer would be, Respondent replied:

“20.000 euro.”

Complainant submits that in light of Respondent’s request of an amount well in excess of the out-of-pocket costs related to the Domain Name, Complainant instructed its representative to file a UDRP Complaint. Before proceeding with the filing, Complainant’s representative sent, on April 24, 2015, a request for disclosure of Respondent’s data to Domains by Proxy, Inc., which was providing proxy service in connection with the Domain Name registration. After sending that request, Complainant’s representative received, on April 28, 2015, an email communication from Respondent, who claimed not to be infringing Complainant’s trademark rights but indicated its availability to consider the sale of the Domain Name. It copied in its communication its representative, with whom the subsequent correspondence concerning the present matter was held. Complainant’s representative sent an email communication to Respondent’s representative on the same day, explaining the reasons why the registration and use of the Domain Name amounted to an infringement of Complainant’s rights and requesting that Respondent transfer the Domain Name free of charge to Complainant. Respondent’s representative replied, on May 8, 2015, denying any violation of Complainant’s rights and asserting that Respondent is a wholesale distributor of Prada and other branded products and is using the website linked to the Domain Name to advertise the sale of products regularly purchased from authorized resellers. He also affirmed that Respondent was available to evaluate different options to settle the matter. Complainant’s representative answered, on the same day, indicating Complainant’s availability to reimburse the out-of-pocket costs of the Domain Name but, following a subsequent exchange of correspondence and telephone conversations, Respondent’s representative confirmed that Respondent would not accept this offer.

In view of the above, Complainant proceeded with the filing of the Complaint.

(i) Identical or confusingly similar

Complainant contends that the Domain Name is confusingly similar to trademarks in which Complainant has rights. The Domain Name incorporates the whole of Complainant’s trademark PRADA. That the Domain Name includes the non-distinctive element, the word “wholesale”, does not affect the confusing similarity. Complainant states it is a well-established principle that a domain name that wholly incorporates a trademark, in particular one as famous as PRADA, is found to be confusingly similar for purposes of the Policy, despite the fact that the domain name may also contain another trademark. In Hoffmann-La Roche Inc. v. Charlie Kalopungi,WIPO Case No. D2010-1826, the panel found that “the inclusion of the trademarks of other parties in the disputed domain name does not detract from the confusing similarity”. Further, in a case where generic terms were used in combination with trademarks, Prada S.A. v. Ms. Jenny Saputo, WIPO Case No. D2003-0895, the panel found that the domain name at issue <boutiqueprada.net> was a combination of the distinctive word “prada” and the descriptive word “boutique”. The panel therefore concluded that the domain name was confusingly similar with the trademark PRADA.

Complainant also cites cases where the word “wholesale” was used in combination with a trademark in the disputed domain name, and the domain names were found to be confusingly similar. Complainant states that in comparing Complainant’s trademark with the Domain Name, the suffix “.com” should be disregarded as being merely instrumental to use of the Internet.

In light of the above, Complainant asserts that the Domain Name is confusingly similar to the prior registered trademarks in which Complainant has rights pursuant to paragraph 4(a)(i) of the Policy.

(ii) Rights or legitimate interests

Complainant contends that the mere registration of a domain name does not establish rights or legitimate interests in it. Respondent is not a licensee or authorized agent of Complainant or in any other way authorized to use Complainant’s trademarks. Specifically, Respondent is not an authorized reseller of Complainant and has not been authorized to register and use the Domain Name.

Complainant asserts that, upon information and belief, Respondent is not commonly known by the Domain Name as an individual, business or other organization and “Wholesale Prada” is not Respondent’s family name. As highlighted in the WhoIs records concerning the Domain Name and the screenshots of Respondent’s websites, Respondent’s company name is IDT S.p.A. and it operates two online portals named “Brandsdistribution” and “Stocklot”.

Complainant states that Respondent has not provided any evidence of use of, or demonstrable preparations to use, the Domain Name in connection with a bona fide offering of goods or services before any notice of the dispute. The Domain Name is redirected to a web page where a prominent statement “WHOLESALE PRADA” is published, above the phrase “A wholesale distributor of Prada Jeans and clothing for men and women”. Respondent’s resale of various branded products is promoted through the publication of links to Respondent’s commercial websites at “www.brandsdistribution.com” and “www.stocklot.com” and the following description of Respondent’s activity: “We are committed to offering wholesale and stock by the biggest fashion worldwide brands such as Diesel, Fontana 2.0, Rochas, Versace 19.69 Abbigliamento Sportivo Milano, and many more…. We are also one of the largest distributors of Prada clothing and apparel wholesale that we sell at 70% off Wholesale Price”.

Complainant maintains that this use of the Domain Name, under the circumstances of the case, can be considered neither a bona fide offering of goods and services nor a legitimate noncommercial or fair use. Paragraph 2.3 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”) states that a reseller or distributor can be making a bona fide offering of goods and services and thus have a legitimate interest in the domain name if its use meets certain requirements. These requirements normally include the actual offering of goods and services at issue, the use of the site to sell only the trademarked goods, and the site accurately and prominently disclosing the registrant’s relationship with the trademark holder.

Many panels subscribing to this view have found that not only authorized but also unauthorized resellers may fall within such principles. Specifically, as indicated in the leading case, Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903, a “site must accurately disclose the registrant’s relationship with the trademark owner; it may not, for example, falsely suggest that it is the trademark owner, or that the website is the official site, if, in fact, it is only one of many sales agents”. In the case at hand, Complainant states that Respondent is using the Domain Name and the correspondent website to direct users to its websites at “www.brandsdistribution.com” and “www.stocklot.com”, where it offers for sale, besides purported PRADA products, products of Complainant’s competitors. Moreover, Respondent’s redirection of the Domain Name to Respondent’s website, together with the lack of any accurate and prominent disclaimer, suggests to Internet users that Respondent’s website is a site authorized by Complainant and/or operated by an authorized reseller of Complainant. Such use of the Domain Name to attract and divert consumers for commercial gain to Respondent’s sites does not satisfy the Oki Data principles and does not constitute either a bona fide offering of goods or services or a legitimate noncommercial or fair use.

In this regard, Complainant refers to Swarovski Aktiengesellschaft v. Jun Qiao, WIPO Case No. D2013-1617 where the panel stated: “The unauthorized incorporation of a well-known mark in the disputed domain name, which is then used to direct consumers to a website where goods purportedly emanating from the trademark owner are advertised or supplied, does not give rise to rights or legitimate interests. This is because it rests on a misleading suggestion of some legitimate association, rather than on a genuine authority or license”.

Furthermore, Complainant relies on EPSON Europe BV v. M31 Internet Palma, S.L., WIPO Case No. D2005-0604, where the panel found that the respondent’s use of the complainant’s well-known trademark in the domain name could not be qualified as a nominative fair use. While Complainant is not questioning, in the present proceedings, Respondent’s use of the trademark PRADA to identify genuine PRADA products that might be for resale, Respondent is certainly not entitled to advertise its business under the Domain Name, which does not correspond to its name but fully incorporates Complainant’s well-known trademark.

For the foregoing reasons, Complainant claims that Respondent has no rights or legitimate interests in respect of the Domain Name pursuant to paragraph 4(a)(ii) of the Policy.

(iii) Registered and used in bad faith

Complainant states that, regarding the assessment of Respondent’s bad faith at the time of registration, in light of the intensive use of the trademark PRADA since as early as 1913, and the amount of advertising and sales of Complainant’s products worldwide and especially in Italy where Respondent is based, Respondent could not have possibly ignored the existence of Complainant’s PRADA mark when it registered the confusingly similar Domain Name.

PRADA has been recognized as a famous trademark in various previous UDRP decisions, including Prada S.A. v. Whois as N/A, WIPO Case No. D2008-0135; Prada S.A. v. the peace company, WIPO Case No. D2006-1404; Prada S.A. v. Michael Faronston, WIPO Case No. D2006-0585; Prada S.A. v. Domains For Life, WIPO Case No. D2004-1019; and Prada S.A. v. Mark O'Flynn, WIPO Case No. D2001-0368. Therefore, it is inconceivable that Respondent was unaware of Complainant’s trademark at the time of registration of the Domain Name. The circumstances of the case and, in particular, the reference made to Complainant’s trademark on the website to which the Domain Name resolves, and Respondent’s advertising and sale of purported PRADA products through the websites linked thereto, suggest that Respondent was aware of the trademark at the time of registration of the Domain Name and that Respondent’s purpose in registering it was to capitalize on the reputation of Complainant's PRADA mark by diverting Internet users seeking products under the PRADA mark to its own websites.

With reference to the assessment of the bad faith use, the Domain Name is currently linked to a website promoting Respondent’s wholesale distribution of purported PRADA and competitors’ goods through the publication of a description of Respondent’s business and links to Respondent’s websites “www.brandsdistribution.com” and “www.stocklot.com”. In addition, Respondent has not published any disclaimer to inform users as to the absence of an affiliation of its website with Complainant. Therefore, Complainant argues that paragraph 4(b)(iv) of the Policy is applicable because Respondent intentionally attracted Internet users for commercial gain to Respondent’s website by creating a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s website “www.wholesaleprada.com” and the sites linked thereto.

Moreover, Respondent has also used the trademark PRADA as meta-tag keyword in the HTML structure of its website at “www.wholesaleprada.com” to obtain a higher search-engine ranking for its site when a search for PRADA is conducted. As stated by the panel in Chicago Mercantile Exchange Inc. v. e-globex/Abidin H., WIPO Case No. D2003-0743, “[s]uch activity strikes the Panel as persuasive evidence in support of its conclusion that the purpose of the Domain Name registration was to divert traffic to the Respondent’s website”.

As an additional circumstance evidencing bad faith, Complainant states that Respondent, in reply to the Complainant’s cease and desist letter, requested an amount of EUR 20.000 for transferring the Domain Name to Complainant, which is in excess of the out-of-pocket costs directly related to the Domain Name.

Furthermore, Respondent’s calculated efforts to attract users to its own websites for commercial gain by trading upon famous trademarks is demonstrated by Respondent’s registration and use of two additional domain names, <wholesalediesel.com> and <wholesaleguess.com>, both of which are confusingly similar to the registered and well-known trademarks DIESEL and GUESS. Both are used to promote Respondent’s website at “www.brandsdistribution.com”. Therefore, paragraph 4(b)(ii) is applicable in this case since Respondent has registered the Domain Name in order to prevent Complainant from reflecting the mark in a corresponding domain name and has engaged in a pattern of such conduct, as it has registered at least two additional domain names corresponding to well-known marks.

In light of the above, Complainant contends that the Domain Name was registered and is being used in bad faith, according to paragraph 4(a)(iii) of the Policy.

B. Respondent

Respondent states that it launched a website at <brandsdistribution.com> as an online platform developed for selling clothing and fashion accessories to small resellers and business-to-business online clients such as Vente-Prive, Brands4Friends, and Groupon. This type of business – formally known as business-to-business (“B2B”) – has become a worldwide phenomenon with the development of electronic commerce. By combining both the product and the integrated service in a single platform, Respondent’s <brandsdistribution.com> platform represents an alternative and innovative distribution channel that shortens the time and distances between sellers and buyers. Through its platform, Respondent claims to be one of the leading and most reputable entrepreneurs in the B2B ecommerce market, its service being available in 172 countries and having more than 90,000 registered users.

Respondent states that through <brandsdistribution.com>, it is an online dealer of famous brands such as VERSACE, CALVIN KLEIN, BROOKSFIELD, COLUMBIA, while also being an independent worldwide distributor of other famous brands, such as BURBERRY, CERUTTI, GUESS, SISLEY. As essential part of its business, Respondent states that it operates a series of websites, including “www.brandsdistribution.com”, “www.brandsworld.it”, “www.stocklot.com”, “www.analubin.com”, “www.sparcofashion.com”, “www.nolimits.com”, and “www.madeinitalia.net”. In addition, Respondent operates a series of gateway microsites that are brand oriented, including <wholesaleprada.com> and <wholesaleguess.com>, with the intent of bringing together customers interested in the wholesale of fashion branded products (e.g., purchasing the specific products with the intent to resale them), with Respondent’s offer to intermediate such purchases.

Respondent contends that it registered the Domain Name on April 4, 2011 for the purpose of informing potential customers that by accessing its <brandsdistribution.com> platform, they can acquire genuine PRADA products previously purchased by Respondent. Given the novelty of online B2B markets, in the absence of such a gateway site, it would be extremely difficult to link potential customers interested in reselling PRADA products with Respondent’s selling platform. Thus, Respondent argues it is essential to understand that the type of business practiced by Respondent, and the distributed products irrespective of their origin, are not addressed to the final customer, but to other commercial entities acting on wholesale markets.

(i) Identical or confusingly similar

Respondent states that the Domain Name is formed of two parts: “wholesale”, the first part, indicates the type of business performed by Respondent, namely, the sale of commodities in quantity for resale; and “prada”, the second part, consists of Complainant’s registered trademark. Even though the Domain Name entirely incorporates Complainant's mark, Respondent maintains that the first part – “wholesale” – does not trigger confusion in the minds of customers; to the contrary, it grants the Domain Name an independent and separate existence from the mark, while individualizing and emphasizing the type of trade performed by Respondent.

Moreover, when assessing potential confusion, Respondent asserts that the relevant consumer/Internet user should be taken into account. Given that the consumers/Internet users targeted by Respondent are companies and other professionals who operate on a daily basis with branded products and therefore are well informed as to the nature and origin of the products, the risk of confusion is almost non-existent.

Given the above, Respondent contends that the joining of the two words in Respondent’s Domain Name has enough distinctiveness to avoid confusing similarity with Complainant's trademark.

(ii) Rights or legitimate interests

While Complainant has asserted that Respondent does not make a bona fide offering of goods and services, nor a legitimate noncommercial or fair use of the Domain Name, Respondent emphasizes that the burden of proof lies with Complainant. Respondent reiterates that it performs an innovative type of business, which is lawful, bona fide, and entails the legitimate use of certain trademarks for the sole purpose of informing the customer about the B2B distribution of branded clothing and accessories.

Respondent acknowledges that no distributorship agreement has been concluded between Complainant and itself. However, Respondent states that for the past four years, it has been making orders to purchase Prada products. Respondent states that while Complainant should have known of the intended use (e.g., resale on the <brandsdistribution.com> platform), the supplying of goods has not been discontinued by Complainant. Since Complainant has tolerated this behavior, Respondent claims it is entitled to consider that an implicit authorization was granted by Complainant in these circumstances.

Moreover, Respondent urges that UDRP practice does not restrict those having legitimate interests only to authorized distributors. Respondent refers to Volvo Trademark Holding AB v. Auto Shivuk, WIPO Case No. D2005-0447 (<volvo-auto-body-parts-online.com>), where the panel stated that

“a reseller or other sale agent can be making a bona fide offering of goods and services and thus have a legitimate interest in the domain name if the use fits the above identified requirements. The Panel also holds the view that the Oki Data criteria are appropriate to be applied in cases, as the present case, where the complainant has not authorized the respondent to act as its distributor or there is no contractual relationship between the complainant and the respondent.”

In order to support its position regarding the bona fide offering of goods, Respondent refers the factual situation in this case to a review for compliance with the conditions established in Oki Data Americas, Inc. v. ASD, Inc., WIPO Case No. D2001-0903:

- The Respondent must actually be offering the goods or services at issue: As detailed above, the microsite at <wholsesaleprada.com> links interested customers to Respondent’s <brandsdistribution.com> platform where Respondent offers for sale genuine PRADA products. This element is therefore fulfilled.

- The Respondent must use the site to sell only the trademarked goods; otherwise, it could be using the trademark to attract Internet users and then switch them to other goods: The <brandsdistribution.com> platform to which customers are directed is used by Respondent to sell different fashion luxury products, among which are genuine PRADA products. Nevertheless, the website at “www.wholesaleprada.com” is not being used as bait for inexperienced Internet users to switch them to other goods. What is more, the <wholesaleprada.com> webpage states that <brandsdistribution.com> is “offering wholesale and stock by the biggest fashion worldwide brands such as Diesel, Fontana 2.0, Rochas, Versace 19.69 Abbigliamento Sportivo SRL Milano Italia and many more” and therefore not claiming to sell only PRADA products and not intending to mislead potential customers. Respondent asserts that <brandsdistribution.com> should be perceived as a virtual shopping center, a place like in real life where competitor’s shops share the same floors and building. In this specific situation (e.g., distribution of branded clothing and accessories), the Panel should envisage the ultimate scope of this criterion, which is to protect customers from being lured to access a website which does not sell the promised goods. Given that this is clearly not case for the sites to which <wholesaleprada.com> and <brandsdistribution.com> resolve, it would be inequitable dismiss Respondent’s bona fide offering just on the grounds that Respondent is also an independent or authorized distributor of other fashion brands’ products advertised on its websites.

- The site must accurately disclose the registrant’s relationship with the trademark owner; it may not, for example, falsely suggest that it is the trademark owner or that the website is the official site, if, in fact, it is only one of many sales agents: Respondent states that the webpage at <wholesaleprada.com> displays the following content as per the disclosure of the Respondent’s relationship to the Complainant:

“BRANDSDISTRIBUTIONCOM PRESENTS WHOLESALE PRADA A wholesale distributor of Prada Jeans and clothing for men and women; We are also one of the largest distributors of Prada clothing and apparel wholesale that we sell at 70% off Wholesale Price. We provide our customers a first quality selection of Prada Clothing. In our Prada catalogue you can find a selection of the best: wholesale Prada clothing, wholesale Prada shoes, wholesale Prada bags. Buy wholesale Prada on www.brandsdistribution.com.”

Respondent states that from this information, an Internet user can identify <brandsdistribution.com> as an online store where wholesale Prada products can be purchased. The <brandsdistribution.com> status is identified as a wholesale distributor of PRADA products. There are no false references, suggestions or claims that it is PRADA’s official site. Given that no false allegations are made, this criterion is also met.

- The Respondent must not try to corner the market in all domain names, thus depriving the trademark owner of reflecting its own mark in a domain name: As indicated in the website linked to the Domain Name, Respondent through <brandsdistribution.com> is an operator in the wholesale industry, more precisely in the B2B distribution of branded clothing and accessories. The purpose behind the website is not to corner the market or to deprive the trademark owner of its right, but to link interested customers and therefore operate and maintain its unique business.

Respondent’s claims its situation, even though it operates at a larger scale, is similar to situation of the respondent in National Association for Stock Car Auto Racing, Inc. v. Racing Connection /The Racin' Connection, Inc., WIPO Case No. D2007-1524 <nascartours.com>:

“The Panel has carefully considered these arguments but ultimately agrees with the opinion articulated in Volvo Trademark Holding ABsupra that the Oki Data criteria are appropriate even in cases where the respondent is not an authorized dealer, so long as the Respondent operates a business genuinely revolving around the trademark owner’s goods or services. Such an approach is not only consistent with the Policy, but also is consistent with the nominative fair use principles that apply under the trademark law of the United States of America (which is relevant here given that both parties are residents of the United States of America). Moreover, it is not clear from the record that Respondent is not an authorized reseller. The Respondent operates under resale agreements with companies that are sanctioned by the Complainant and, since they share the same postal address, may be affiliated with the Complainant. At the very least, in these circumstances, it seems disingenuous for the Complainant to treat the Respondent as simply an opportunistic trademark infringer.”

Respondent argues that just as in the case, Dr. Ing. h.c. F. Porsche AG v. Del Fabbro Laurent, WIPO Case No. D2004-0481 (<porsche-buy.com> and <porschebuy.com>), the choice of the domain name was intuitive and logical for the conducted business it identifies – wholesale of PRADA products:

“The Domain Names are descriptive of the platforms conducted there under. In creating these websites, the use of the word “PORSCHE” has an evident logic, as “PORSCHE” is the normal term to signify the products offered. The Complainant did not produce any evidence according to which the Respondent would be able to describe in the Domain Names the goods offered under the Domain Names without making any reference to the trademark of the Complainant.”

In addition to the above, the panel held in DaimlerChrysler A.G. v. Donald Drummonds, WIPO Case No. D2001-0160 (<mercedesshop.com>) that:

“Respondent is serving as a clearinghouse for information concerning Complainant’s vehicles and is selling parts and accessories exclusively for Complainant’s vehicles. The domain name and the name of Respondent’s web site “MercedesShop” is descriptive of the business conducted there. In conducting the business that Respondent is conducting, “it would be difficult, if not impossible for [Respondent] to avoid altogether the use of the word ‘Mercedes…which [is] the normal term[] which, to the public at large, signify [Complainant’s] cars.... Under the present facts, if the Panel were to find for the Complainant, the majority can conceive of no case in which a legitimate competitor in the sale of parts and aftermarket accessories could ever register a domain name descriptive of that business. The Policy was designed to deal only with the limited problem of cybersquatting. It was not designed to establish for the holder of a strong trademark a bar to entry of online competitors.”

Respondent argues these observations are relevant to this case in which, if Respondent would be banned to use Complainant’s trademark, it would be inherently banned from exercising its own business.

Respondent also argues that Internet users are not misled, given that Respondent's websites do not use the logo or the calligraphic representation of Complainant’s trademark, as highlighted in the case, Dr. Ing. h.c. F. Porsche AG v. Del Fabbro Laurent, WIPO Case No. D2004-0481:

“Further, the Respondent does not use the distinctive characters nor the logo nor the drawing of the ‘PORSCHE’ trademark, but uses a different calligraphic presentation. Therefore, and considering that the websites contain advertisements for used PORSCHE cars, Internet users are not misled to assume that the Respondent’s websites are run by the trademark owner itself, an affiliate or an official sales agent of the Complainant. On the contrary, it is clear that under the Domain Names used Porsche cars are offered for sale by third parties.”

Respondent’s websites at <wholesaleprada.com> and <brandsdistribution.com> could not be confused with Complainant’s official website as they clearly disclose the independent distributor capacity of Respondent. In Volvo Trademark Holding AB v. Auto Shivuk, WIPO Case No. D2005-0447, Respondent states it was shown that even the absence of the disclosure message can be tolerated:

“Although Respondent’s website does not contain a disclaimer which states that it is not affiliated with Complainant, Respondent on website accurately discloses that it is a mere distributor of VOLVO auto parts. There are no facts which would suggest that the Respondent intentionally trades on the fame of Complainant and intentionally has adopted his website presentation so as to benefit from the goodwill of the VOLVO mark. The Respondent does not use the Logo of Complainant or otherwise improperly suggests that it is the trademark owner, or that the website is the official site. In fact, the Respondent merely uses a domain name which is descriptive of the business conducted under the domain name. The Panel therefore does not find that Internet users are likely to believe they are dealing with an authorized agent of Complainant or that Complainant sponsors or otherwise endorses the site.”

Even though the majority of the cases above relate to the automobile industry, Respondent can see no reason for why they would not be applicable to the fashion industry, given that both industries have companies with strong and distinctive trademarks.

For the reasons described above, Respondent requests the Panel to reject Complainant’s allegations and to hold that Respondent has established a bona fide offering of goods and services and the fair use of the Domain Name.

(iii) Registered and used in bad faith

Respondent states that the consensus view in UDRP practice is that the requirements of “registration and use” under the Policy, paragraph 4(a)(iii), are conjunctive, requiring a panel to consider both bad faith at the date of registration, and to examine whether the respondent’s subsequent use was also in bad faith. To establish registration in bad faith, the complainant ordinarily must prove that the respondent, at the time of registration, knew of the complainant and its mark and selected the mark to take advantage of whatever renown was attached to that mark. The cases generally involved separate analyses of facts pertaining to different points in time. This two-pronged approach is well-settled precedent and the analysis in this case should follow this approach.

Respondent maintains it registered the Domain Name in good faith. As indicated above, Respondent registered the Domain Name in 2011 with the purpose of informing potential customers that by accessing the <brandsdistribution.com> platform, they can acquire genuine PRADA products previously purchased by Respondent. Since 2011 the website has been active and accessed by a number of Internet users. Further, Respondent argues that redirection can be legitimate, as shown in Jeffrey S. Thompson d/b/a The Wedding Planner v. Weddingchannel.com, Inc., WIPO Case No. D2002-0086 (<weddingplanner.com> and <weddingplanner.net>):

“Finally, Complainant asserts that Respondent does not offer goods or services at the disputed domain names, but merely uses them to divert Internet users to the website located at <weddingchannel.com>. Here, the redirect links users to Respondent’s website offering bona fide wedding planning services. As discussed earlier, redirection is a common practice among domain name registrants. The Panel determines that Respondent is using a descriptive (if not generic) term in the domain names. Under the circumstances, Respondent is entitled to redirect Internet users to a single website that consolidates its commercial activities.”

Respondent thus contends that a registrant may resort to redirecting in order to sustain legitimate business activities. This is the case with Respondent, which offer users the possibility to redirect to and access its main commercial platform at <brandsdistribution.com>. Respondent further emphasizes that Internet users are not automatically redirected and they are informed that the purchase can be performed only on <brandsdistribution.com>. Thus there is no bad faith element in this situation.

Respondent states that it has had no intention of prejudicing Complainant or its business, or to benefit in an inappropriate way by infringing Complainant’s intellectual property in its PRADA mark. As argued above, Respondent states that the website does not attract customers by misleading them and neither does it create a likelihood of confusion with Complainant’s mark as to the source, sponsorship, affiliation, or endorsement of Respondent’s website, or the location of a product or service on Respondent’s website. Satisfied customers are vital to Respondent’s business; therefore, Respondent would not assume the risks generated by such infringing behavior.

Respondent contends that Complainant’s arguments in support of malicious intent are solely based on a superfluous assertion regarding the trademark’s reputation and on the redirecting aspect. Respondent has already described to the Panel the nature of its innovative business, which precludes any premeditated purpose to harm or otherwise benefit from Complainant’s trademark. In addition to this, Respondent and Complainant are not direct competitors since Respondent’s business is addressed to outlets and other small retailers, while Complainant addresses its products to select elite customers, primarily final purchasers. It is also obvious that neither the Domain Name nor Respondent’s wholesale of fashion products disrupt Complainant’s business.

Complainant’s allegations that Respondent registered the Domain Name in order to prevent Complainant from reflecting the mark in a corresponding domain name and that Respondent has engaged in a pattern of such conduct are entirely ungrounded as they are supported only by mismatched evidence. The Domain Name is the only domain that Respondent has registered by using the PRADA trademark, while the other two domain names referenced by Complainant – including the DIESEL and GUESS marks – are irrelevant in proving infringing behavior by Respondent against Complainant.

Respondent contends that it uses the Domain Name in good faith. Regarding the purchase offer made in 2011, Respondent indicates that domain names are to be considered as tradable goods, and a selling offer does not per se indicate bad faith. As shown in Choice Courier Systems, Inc. v. William H. Kirkendale, WIPO Case No. D2002-0483,

“In addition, the focus is not on whether the Respondent offered to sell the domain name, but whether the circumstances indicate that Respondent's primary purpose in registering the domain name was to sell it for an excessive sum. [Citation omitted]Respondent may have discussed selling the Domain Name, whether flippantly or not, but the Panel does not find, based on the evidence presented, that selling the Doman Name was Respondent's primary purpose in registering <choice.com>.”

As argued above by Respondent, the purpose of the Domain Name is to sustain B2B distribution of branded clothing accessories. Moreover, the type of business chosen by Respondent, explained in detail above, should not be considered very different from department store selling and advertising, acceptable in practice, where different brands are advertised, showcased and sold in the same place.

In conclusion, Respondent requests that the Panel acknowledges Respondent’s good faith registration and use of the Domain Name and rejects the Complaint.

6. Discussion and Findings

The Panel notes at the outset that the parties have submitted comprehensive and thoughtful submissions in this case. In order to succeed in its claim, Complainant must demonstrate that the three elements enumerated in paragraph 4(a) of the Policy have been satisfied. These elements are that:

(i) the Domain Name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights;

(ii) Respondent has no rights to or legitimate interests in respect of the Domain Name; and

(iii) Respondent has registered and is using the Domain Name in bad faith.

A. Identical or Confusingly Similar

The Panel must first determine whether the Domain Name is identical or confusingly similar to a trademark in which Complainant has rights. Complainant has submitted evidence to show that it owns numerous trademark registrations and has strong trademark rights in its distinctive and well-known PRADA mark, including in Italy where Respondent is located. The Panel agrees with those UDRP panels that have previously found that the PRADA mark is well-known with a strong and distinctive reputation.

The test of identity or confusing similarity under the Policy is confined to a comparison of the disputed domain name and the trademark. See WIPO Overview 2.0, paragraph 1.2 (“The threshold test for confusing similarity under the UDRP involves a comparison between the trademark and the domain name itself to determine likelihood of Internet user confusion. In order to satisfy this test, the relevant trademark would generally need to be recognizable as such within the domain name….”). As the panel explained in Red Bull GmbH v. Paul Battista, WIPO Case No. D2010-0353 (quoting SANOFI-AVENTIS v. Jason Trevenio, WIPO Case No. D2007-0648), “[c]onfusion in this context, in the sense of bewilderment or failing to distinguish between things, may be regarded as a state of wondering whether there is an association, rather than a state of erroneously believing that there is one”. An appropriate formulation might be: “Is it likely that, because of the similarity between the domain name on the one hand and the Complainant’s trademark on the other hand, people will wonder whether the domain name is associated in some way with the Complainant?”.

Here, the Panel finds that the Domain Name is confusingly similar to Complainant’s well-known PRADA trademarks. The Panel finds that it is likely that consumers would wonder whether the Domain Name, which combines the term “wholesale” with the mark PRADA in the Domain Name, is associated in some way with Complainant. For example, a consumer might consider that Complainant also possibly operates in certain wholesale markets, or that Respondent is somehow authorized by or affiliated with Complainant. The descriptive term, in this sense, does not serve to distinguish sufficiently the Domain Name from Complainant and its PRADA marks. This view is consistent with many other UDRP decision. See e.g., WIPO Overview 2.0 (UDRP panels have found that the mere addition of descriptive terms to a complainant’s mark does not adequately distinguish the disputed domain name from the mark pursuant to the Policy, paragraph 4(a)(i)); see alsoPrada S.A. v. Ms. Jenny Saputo, WIPO Case No. D2003-0895 (the panel found that the domain name <boutiqueprada.net> was a combination of the distinctive word “prada” and the descriptive word “boutique” and was confusingly similar with the trademark PRADA); Hermes International v. Huang hai, WIPO Case No. D2010-2281 (“the additional word ‘wholesale’ does not serve sufficiently to distinguish or differentiate the domain name from the complainant’s HERMES trademark, as it is a descriptive element that refers to the selling and marketing of products, and as such is insignificant”); Swarovski Aktiengesellschaft v. swarovski-wholesale.net, WIPO Case No. D2013-1598 (the elements “wholesale” and the hyphen are not sufficient to avoid confusing similarity); Maplin Electronics Limited v. Daisy Hon, Maplin Electronics Limited, WIPO Case No. D2015-0294 (the panel found, in comparing the complainant’s trademark MAPLIN and the domain name <maplinwholesale.com>, the only difference is the addition of the generic word “wholesale”, which does not suffice to negate the similarity between the domain name and the complainant’s MAPLIN trademark); Red Bull GmbH v. Paul Battista, WIPO Case No. D2010-0353 (finding <cookingwithredbull.com> confusingly similar to the RED BULL mark);and HSBC Holdings Plc v. David H. Gold, WIPO Case No. D2001-0343, (finding <bankwithhsbc.com> confusingly similar to HSBC).

Based on the evidence presented, the Panel determines that Internet users may actually believe there is a real connection between the Domain Name and Complainant and its PRADA trademarks. Accordingly, the Panel concludes that the Domain Name is confusingly similar to Complainant’s PRADA trademarks.

B. Rights or Legitimate Interests

Pursuant to paragraph 4(a)(ii) of the Policy, Complainant must prove that Respondent has no rights or legitimate interests in respect of the Domain Name. A complainant is normally required to make out a prima facie case that a respondent lacks rights or legitimate interests in a domain name. Once such prima facie case is made, the respondent carries the burden of demonstrating rights or legitimate interests. If the respondent fails to do so, a complainant is deemed to have satisfied paragraph 4(a)(ii) of the Policy.

In this case, Complainant has established a prima facie case, and Respondent has failed to rebut it. Respondent is not an authorized reseller of Complainant’s PRADA goods, nor did Complainant license or otherwise authorize Respondent to use its PRADA trademarks in the Domain Name. There is no claim by Respondent that it is making a noncommercial use of the Domain Name.

In addition, Respondent is not commonly known by the Domain Name; instead, Respondent’s name is IDT S.p.A. and it operates its business through websites at “www.brandsdistribution.com” and “www.stocklot.com”. Thus, it is clear that there is no independent basis (i.e., a reason unrelated to Complainant’s well-known PRADA trademark) supporting Respondent’s choice of the Domain Name, which incorporates Complainant’s PRADA mark. Instead, there is no dispute that Respondent chose the Domain Name – comprised of the term “wholesale” and the mark PRADA – precisely because it incorporates Complainant’s mark. In this regard, given that Respondent main websites used to conduct its business are located at “www.brandsdistribution.com” and “www.stocklot.com”, one could ask why, then, does it need a microsite linked to the Domain Name <wholesaleprada.com>, which merely directs users back to its other websites? Respondent has argued that if it is banned from using Complainant’s trademark in the Domain Name, it would be inherently banned from exercising its own business. This statement implies that Respondent is well aware that it is trading off on the name and reputation of Complainant’s well-known PRADA trademark to attract customers to its websites.

In this case, a key issue in determining whether Respondent has any rights or legitimate interests in the Doman Name is one that is referenced in the WIPO Overview 2.0, paragraph 2.3: “Can a reseller/distributor of trademarked goods or services have rights or legitimate interests in a domain name which contains such trademark?” WIPO Overview 2.0 provides the following guidance on this issue in paragraph 2.3:

“Consensus view: Normally, a reseller or distributor can be making a bona fide offering of goods and services and thus have a legitimate interest in the domain name if its use meets certain requirements. These requirements normally include the actual offering of goods and services at issue, the use of the site to sell only the trademarked goods, and the site's accurately and prominently disclosing the registrant's relationship with the trademark holder. The respondent must also not try to ‘corner the market’ in domain names that reflect the trademark. Many panels subscribing to this view have also found that not only authorized but also unauthorized resellers may fall within such Oki Data principles. Pay-per-click (PPC) websites would not normally fall within such principles where such websites seek to take unfair advantage of the value of the trademark.”

Both of the parties here have referenced the case mentioned in the WIPO Overview 2.0 , Oki Data Inc. v. ASD, Inc., WIPO Case No. D2001-0903. The panel there set forth the following factors: (i) the respondent must actually be offering the goods or services at issue; (ii) the respondent must use the site to sell only the trademarked goods; otherwise, it could be using the trademark to bait Internet users and then switch them to other goods; (iii) the site must accurately disclose the registrant's relationship with the trademark owner; it may not, for example, falsely suggest that it is the trademark owner, or that the website is the official site, if, in fact, it is only one of many sales agents; and (iv) the Respondent must not try to corner the market in all domain names, thus depriving the trademark owner of reflecting its own mark in a domain name.

In this case, Respondent’s conduct does not meet all these factors. Complainant has provided evidence that the Domain Name resolves to a website where Respondent’s resale of various branded products are promoted through information on the site, as well as links to Respondent’s websites at “www.brandsdistribution.com” and “www.stocklot.com”. Respondent is using the Domain Name and the linked website to direct users to its websites, where it offers for sale, not only purported PRADA products, but also the products of Complainant’s competitors. Respondent does not deny this and instead candidly admits that the <brandsdistribution.com> platform, to which customers are directed, is used by Respondent to sell different fashion luxury products, among which are PRADA products.

In addition, the UDRP cases referenced by Respondent are distinguishable because the respondents in those cases dealt exclusively with the goods of the respective trademark owners, thus making it difficult to describe the goods or services offered without referencing the relevant mark. For example, in a case cited by Respondent, National Association for Stock Car Auto Racing, Inc. v. Racing Connection /The Racin' Connection, Inc., WIPO Case No. D2007-1524 <nascartours.com>, the panel found that “the Oki Data criteria are appropriate even in cases where the respondent is not an authorized dealer, so long as the Respondent operates a business genuinely revolving around the trademark owner’s goods or services.” Here, by contrast, while the website linked to the Domain Name references Complainant’s PRADA branded products, Respondent’s websites to which users are directed – located at “www.brandsdistribution.com” and “www.stocklot.com” – carry numerous branded products offered by many different companies, some of which compete with Complainant’s products. Thus, it cannot be said that Respondent’s has a “business genuinely revolving around” Complainant’s PRADA goods. Moreover, at least most of respondents in the cases cited by Respondent had posted appropriate disclaimers on their websites.

The Panel therefore concludes that Respondent crosses the line established in Oki Data. Rather than selling only Complainant’s PRADA trademarked goods, Respondent is using the Domain Name (incorporating Complainant’s well-known mark) to attract consumers to its websites where it sells the products of many companies, some of which are in direct competition with Complainant. This does not constitute a “fair” use of the Domain Name, nor does it give rise to any right or legitimate interest on the part of Respondent in the Domain Name.

In addition, although Respondent has gone to lengths to urge that a visitor to its microsite to which the Domain Name resolves would not be confused as to whether this site is authorized or sponsored by, or affiliated with, Complainant, the Panel disagrees with this assessment. The website linked to the Domain Names lacks an accurate and prominent disclaimer that there is no connection between Respondent and Complainant. A user might assume that the operator of this website has the authorization or backing of Complainant. Therefore, such use of the Domain Name to attract and divert consumers for commercial gain to Respondent’s sites does not satisfy the Oki Data principles and does not constitute either a bona fide offering of goods or services or a legitimate fair use.

C. Registered and Used in Bad Faith

The third element of paragraph 4(a) of the Policy requires that Complainant demonstrate that Respondent registered and is using the Domain Name in bad faith. The parties do not dispute that an assessment should be made as to whether there was a bad faith registration of the Domain Name, as well as bad faith use of it. Here, the Panel concludes that Complainant has demonstrated both elements.

First, there is no dispute that Respondent, as discussed above, specifically had in mind Complainant and its PRADA well-known trademark when it registered the Domain Name. In other words, Respondent targeted Complainant and its PRADA mark when registering the Domain Name. The Panel finds that this amounted to bad faith registration because Respondent took unfair advantage of the distinctive character and reputation of Complainant’s PRADA mark, engaging in a form of free-riding through use of the Domain Name, which is confusingly similar to Complainant’s PRADA mark, to create initial interest confusion. See Swarovski Aktiengesellschaft v. Jun Qiao, supra (“the fact that purported Swarovski goods were offered at the relevant website indicates that the Respondent was fully aware of the Swarovski mark’s distinct reputation and association with the Complainant. There is no reason to choose such a distinctive mark, and also to include other terms in a domain name that are suggestive of the very business of the Complainant, other than a bad faith attempt to ride on the coattails of the trademark owner”); see also Interflora Inc. v. Marks & Spencer PLC, CJEU[2012] E.T.M.R. 1, C-323/09 (2011).

Respondent’s bad faith registration of the Domain Name is further confirmed by Respondent’s bad faith use. The Domain Name is linked to Respondent’s microsite, which refers to Prada products but directs users to Respondent’s main websites, where the branded products of numerous companies are offered, including companies in direct competition with Complainant. Respondent’s conduct falls within the Policy, paragraph 4(b)(iv) (using the domain name to intentionally attract, for commercial gain, Internet users to a 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 the website or location or of a product or service on the website or location). The Panel is persuaded by the reasoning in Intex Recreation Corp. v. RBT, Inc., Ira Weinstein, WIPO Case No. D2010-0119, where the panel found that:

“the Respondent has not established a legitimate, nominative fair use of the Complainant’s mark in the Domain Name as a reseller of the Complainant’s products…. The Respondent does not dispute the Complainant’s assertion that the Complainant has never authorized the Respondent’s use of the Domain Name for a website that sells competitors’ products. The Respondent argues that there was no intent to mislead consumers, because the content of the website associated with the Domain Name clearly identified products by manufacturer. But this does not change the fact that the Domain Name itself misleadingly suggests an affiliation with the Complainant and then leads the consumer to competing products sold by or through the Respondent. This abuse of the Complainant’s trademark for commercial gain fits the illustration of bad faith in paragraph 4(b)(iv) of the Policy”.

Finally, Respondent has argued that the type of business it operates should not be considered different from department store selling and advertising, where different brands are advertised, showcased and sold in the same place. If Respondent had chosen to label its “store” only as <brandsdistribution.com> or <stocklot.com>, the analogy it suggests might be appropriate. However, what Respondent cannot do is open a department store offering multiple brands, showcased and sold in the same place, but which uses without authorization the well-known trademark of a particular brand – such as PRADA – to comprise all or part of that stores’ name. Instead, Respondent must go to the trouble of choosing and developing a name of its own that does not take unfair advantage of third-party’s well-known trademark.

The Panel finds that the Domain Name was registered and is being used in bad faith, satisfying the third element of the Policy.

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 Domain Name, <wholesaleprada.com>, be transferred to Complainant.

Christopher S. Gibson
Sole Panelist
Date: November 19, 2015