WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Sportiqe Apparel Co. v. Christopher Gathright

Case No. D2018-0352

1. The Parties

Complainant is Sportiqe Apparel Co. of Tempe, Arizona, United States of America (“United States”), represented by Charles J. Glasser, Jr., United States.

Respondent is Christopher Gathright of San Francisco, California, United States, represented by Burgoyne Law Group, United States.

2. The Domain Name and Registrar

The disputed domain name <sportique.com> 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 February 16, 2018. On the same date, the Center transmitted by email to the Registrar a request for registrar verification in connection with the disputed domain name. On February 17, 2018, 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 Complainant on February 22, 2018, providing the registrant and contact information disclosed by the Registrar, and inviting Complainant to submit an amended Complaint. Complainant filed an amended Complaint on February 23, 2018.

The Center verified that the Complaint together with the amended 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 February 23, 2018. In accordance with the Rules, paragraph 5, the due date for Response was March 15, 2018. At Respondent’s request, the due date for Response was extended to March 19, 2018. The Response was filed with the Center on March 19, 2018.

The Center appointed Georges Nahitchevansky as the sole panelist in this matter on April 9, 2018. 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, Sportiqe Apparel Co., is a seller of apparel and accessories based in Arizona. Complainant uses the name and mark SPORTIQE in connection with its apparel and accessory products. Complainant owns and uses the domain name <sportiqe.com> to promote and sell its apparel and accessory products online under the SPORTIQE brand. Complainant owns a number of federal trademark registrations in the United States in connection with its apparel and retail products and services that consist of SPORTIQE, as follows:

- SPORTIQE (Registration No. 5,076,202 – filed June 5, 2015; issued November 8, 2016);

- SPORTIQE (Registration No. 5,391,350 -- filed July 6, 2017; issued January 30, 2018);

- SPORTIQE (Stylized) (Registration No. 5,084,693 -- filed June 10, 2015; issued November 22, 2016);

- SPORTIQE APPAREL CO. (Design) (Reg. No. 5,080,335 -- filed June 10, 2015; issued November 15, 2016);

- SPORTIQE’S HOMETOWN CLASSICS COLLECTION (Design) (Registration No. 4,236,160

-- filed August 16, 2011; issued November 6, 2012); and,

- SPORTIQE APPAREL CO. REINVENTING THE CLASSICS (Design) (Registration No. 3,486,373

filed March 8, 2006; issued August 12, 2008).

Respondent is the owner of a lifestyle retail company by the name of The Sports & Wellness Group LLC, which is based in California.¹ Respondent’s company sells online outdoor sports equipment, travel gear, performance apparel, and related items manufactured by third parties through a website bearing the name and mark SPORTIQUE. Respondent does not manufacture or sell any products under the SPORTIQUE name and mark. Since as early as February 2015, Respondent has used the domain name <sportiquesf.com> for its SPORTIQUE retail website.

On June 8, 2015, Complainant’s representative sent Respondent a demand letter regarding Respondent’s use of the SPORTIQUE mark. The parties then apparently engaged in some unsuccessful settlement discussions. Respondent subsequently filed a declaratory judgment action in the United States District Court for the Northern District of California, The Sports & Wellness Group LLC v. Sportiqe, LLC, 15-cv-03133-PSG (the “California Action”) seeking a declaration that Respondent’s use of SPORTIQUE in relation to retail sales of apparel and accessories did not infringe upon or dilute Plaintiff’s claimed rights in SPORTIQE. On September 22, 2015 the Parties entered into a Mutual Settlement and Release Agreement (the “Settlement Agreement”) resolving the California Action. Pursuant to the Settlement Agreement, the Parties, inter alia, mutually dropped and released each other from all claims arising from or based upon facts and circumstances existing prior to the execution of the Settlement Agreement, and Respondent agreed to withdraw the California Action

In or about December 2015 or January 2016, the disputed domain name was put up for sale by its original owner. Respondent purchased the disputed domain name at some point in January 2016 and appears to have started using it with its SPORTIQUE retail website shortly thereafter. The disputed domain name currently resolves to Respondent’s SPORTIQUE-branded retail website for the sale of online outdoor sports equipment, travel gear, performance apparel, and related items.

5. Parties’ Contentions

A. Complainant

Complainant asserts that it is the owner of the SPORTIQE mark which has been in use with apparel and accessories since March 3, 2006. Complainant notes that it is the owner of trademark registrations for the SPORTIQE mark in the United States in International Classes 25 and 35 in connection with its clothing and accessory products and retail services.

Complainant asserts that the disputed domain name is confusingly similar as it is phonetically identical and sounds alike to the SPORTIQE mark. Complainant also asserts that confusingly similarity is established because Complainant has evidence of actual confusion by consumers between the disputed domain name and Complainant’s SPORTIQE name and mark.

Complainant argues that Respondent has no rights or legitimate interests in the disputed domain name because Respondent was well aware of Complainant’s rights in the SPORTIQE mark when he purchased the disputed domain name in January 2016, and has knowingly used the sound-alike disputed domain name to engage in commerce directly competing in the same marketplace of goods. In that regard, Complainant maintains that Respondent is selling through his website at the disputed domain name the very same types of goods that are covered by Complainant’s trademark registrations for the SPORTIQE mark, namely apparel.

Complainant asserts that Respondent registered and is using the disputed domain name in bad faith as Respondent has (i) registered the disputed domain name in order to disrupt Complainant’s business, and (ii) to use the disputed domain name, which sounds like Complainant’s SPORTIQE mark, in order to misleadingly redirect consumers to Respondent’s website. Complainant also asserts that Respondent is using the disputed domain name in bad faith to sell directly competing or related goods, particularly as Respondent registered the disputed domain name six month after the Settlement Agreement.

Lastly, Complainant maintains that the Settlement Agreement between the Parties was essentially a “walk away” settlement that ended the matter without any payments or adjudication on the merits. Complainant further maintains that because it did not have the resources or time to pursue the litigation it hoped for the best and believed in assurances from Respondent that the use of “sf” at the end of the <sportiquesf.com> domain name used by Respondent would be a sufficient differentiator. Complainant also asserts that Respondent registered the disputed domain name six months after the Settlement Agreement and did so without Complainant’s knowledge, and that the use of the disputed domain name by Respondent has resulted in instances of actual confusion. Complainant argues that the Settlement Agreement and California Action do not preclude Complainant’s claims as the registration and use of the disputed domain name occurred after the Settlement Agreement and after Complainant secured rights in the SPORTIQE mark.

B. Respondent

Respondent asserts that it is an “active lifestyle company” that sells third party branded products, including apparel products, through its SPORTIQUE website. Respondent contends that its SPORTIQUE website has operated since 2009 in conjunction with the domain name <sportiquesf.com>, and since early 2016 with the disputed domain name.

Respondent maintains that Complainant waived and released whatever claims it can now raise against the disputed domain name when the Parties entered into the Settlement Agreement. Respondent notes that it initiated the California Action in 2015 after Complainant sent a demand letter regarding Respondent’s use of SPORTIQUE and the Parties were unable to resolve their differences. Respondent argues that the Settlement Agreement is clear on its face and expressly resolved and released any and all claims between the parties that existed at the time the Settlement Agreement was executed.

Respondent asserts that Complainant waited more than two years before initiating the instant UDRP proceeding, during which time Complainant registered and obtained a registration in the United States for SPORTIQE as a word mark (Registration No. 5,391,350) by committing fraud on the trademark office. Respondent also asserts that not only has Complainant waived its claims regarding Respondent’s sale of apparel through an online retail store under the name and mark SPORTIQUE under the terms of the Settlement Agreement, but as there are no limitations in the Settlement Agreement as to Respondent’s use of SPORTIQUE Complainant cannot now seek to effectively amend the Settlement Agreement by imposing restrictions retroactively. Respondent maintains that is has not acted in bad faith given that the Parties resolved their prior dispute regarding Respondent’s use of the SPORTIQUE mark and that based on such Respondent has continued to invest in the SPORTIQUE brand. In particular, Respondent asserts that when the opportunity arose to purchase the disputed domain name at an affordable price, Respondent purchased it and then immediately pointed it to Respondent’s existing SPORTIQUE website.

6. Discussion and Findings

Under paragraph 4(a) of the Policy, to succeed Complainant must satisfy the Panel that:

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

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

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

A. Identical or Confusingly Similar

Ownership of a trademark registration is generally sufficient evidence that a complainant has the requisite rights in a mark for purposes of paragraph 4(a)(i) of the Policy. See section 1.2.1 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Third Edition (“WIPO Overview 3.0”). Complainant has provided evidence that it owns trademark registrations for the SPORTIQE mark in connection with its apparel and accessory products and related retail services.

As the threshold for satisfying this first element is sometimes expressed as a “low” one, the Panel is willing to find that Complainant has established sufficient rights for purposes of the first element and that the disputed domain name which is likely pronounced the same as Complainant’s SPORTIQE mark is confusingly similar to Complainant’s SPORTIQE mark.

B. Rights or Legitimate Interests

Under paragraph 4(a)(ii) of the Policy, the complainant must make at least a prima facie showing that the respondent possesses no rights or legitimate interests in a disputed domain name (Malayan Banking Berhad v. Beauty, Success & Truth International, WIPO Case No. D2008-1393). Once the complainant makes such a prima facie showing, the burden of production to the respondent, though the burden of proof always remains on the complainant. If the respondent fails to come forward with evidence showing rights or legitimate interests, the complainant will have sustained its burden under the second element of the UDRP.

In assessing whether a respondent has rights or legitimate interests in a disputed domain name, the relevant time for the assessment is the date of the filing of the complaint. See WIPO Overview 3.0 at section 1.2.1. In this matter, Complainant argues that Respondent cannot have a legitimate interest in the disputed domain name because Respondent, in full awareness of Complainant’s rights in the SPORTIQE mark, registered the disputed domain name six months after the Parties’ Settlement Agreement, and then used such to offer competing goods for sale. Respondent, on the other hand, maintains that it has acted in good faith and has a legitimate interest in the disputed domain name in light of the Settlement Agreement resolving the California action that concerned Respondent’s right to use the SPORTIQUE mark for its retail services.

Having reviewed the evidence submitted by the parties, the Panel concludes that it is more likely than not that Respondent has a legitimate interest in the disputed domain name. The Panel notes that Complainant sent Respondent a demand letter on June 8, 2015 in which Complainant expressly raised the issue of Respondent’s use of SPORTIQUE as a name and trademark. Indeed, evidence provided by Respondent shows that Respondent was branding its website as SPORTIQUE in March 2015 and was selling, at that time, third party branded products through the website, including apparel. Thus, it seems more likely than not that Complainant was fully aware of Respondent’s use of the SPORTIQUE mark in this manner when it sent its demand letter in June 2015. Subsequently, Respondent filed the California Action and sought a declaration that its use of the SPORTIQUE name and mark for its retail website did not infringe or dilute Complainant’s rights in the SPORTIQE mark. The California Action was resolved through the Settlement Agreement and the Parties mutually released each other from all claims that were known or which could have been known as of the effective date of the Settlement Agreement. The Settlement Agreement defines “claims” to mean “all rights or actions which the Parties now have, ever had, or in the future may have against one another arising from or based upon facts or circumstances existing prior to the execution of this Agreement.”

In light of Respondent’s use of SPORTIQUE prior to June 2015, Complainant’s demand letter on June 8, 2015 and the California Action, there can be no doubt that the central issue at the time of the Settlement Agreement was Respondent’s use of the SPORTIQUE mark in connection with its retail website. Given that in the Settlement Agreement Complainant essentially released Respondent from all claims Complainant could make against Respondent at that time regarding the use of the SPORTIQUE mark, and given that the Settlement Agreement contained no restrictions on Respondent’s present or future use or display of the SPORTIQUE mark, it seems apparent that Respondent was at liberty to continue its use of the SPORTIQUE mark in connection with its retail website that has been offering third party products for sale, including apparel products. At the very least, a fair reading of the Settlement Agreement shows that when Complainant executed the Settlement Agreement resolving Respondent’s California Action, Complainant was implicitly willing to allow Respondent to keep using the SPORTIQUE name and mark in connection with its business.

Complainant seeks to bypass this conclusion by suggesting that it signed the Settlement Agreement in reliance on assurances from Respondent that the use of “sf” as an appendage to the SPORTIQUE mark by Respondent would be a sufficient differentiator. However, it should be noted that the Settlement agreement contains no requirements or restrictions on Respondent’s use of the SPORTIQUE name and mark, including an obligation to use “sf” in any manner in connection with the SPORTIQUE mark. While this might be a line of legal inquiry in a Court action, such a claim is beyond the scope of UDRP proceeding which is a streamlined administrative proceeding without the benefit of live witnesses testifying, cross-examination, and the discovery process that is typical in a United States court action. What is before the Panel is a Settlement Agreement that Complainant voluntarily agreed to and executed that contains no restrictions on Respondent’s use of the SPORTIQUE mark in its appearance, or on Respondent’s use of the SPORTIQUE mark in its online retail business going forward. As such, it appears from the evidence available that, on the balance of the probabilities, Respondent registered the <sportique.com> disputed domain name in January 2016 in furtherance of his legitimate business interests, particularly as the disputed domain name was immediately used with Respondent’s retail website that has been branded under the name and mark SPORTIQUE since at least February 2015.

Seeking to bypass the Settlement Agreement, Complainant also argues that Respondent lacks a legitimate interest in the disputed domain name because it was registered by Respondent after Complainant’s rights arose in the SPORTIQE mark. However, it should be noted that all of Complainant’s registrations for the SPORTIQE mark standing alone were filed after Respondent had already adopted and had been using the SPORTIQUE mark in the United States for its online retail services. Indeed, a review of the registrations shows that Complainant filed applications for its SPORTIQE word mark slightly before or just after Complainant sent its June 8, 2015 demand letter to Respondent. Consequently, Complainant cannot claim that Respondent lacked a legitimate interest, or even acted in bad faith, on the basis of trademark registrations that were applied for and issued to registration well after Respondent had adopted and was already using the SPORTIQUE mark.

It should also be noted that while Complainant owns a couple of older logo design mark registrations in the United States in International Class 25 (for specific clothing products) that include “sportiqe” as part of the wording used in the design (Registration Nos. 3,486,373 and 4,236,160), such do not prove Complainant’s rights in SPORTIQE standing alone per se. Indeed, whether these logo registrations would give Complainant rights in SPORTIQE alone, or provide a basis for an infringement claim against Respondent’s use of the SPORTIQUE mark for online retail services, is beyond the scope of the UDRP proceeding and perhaps, if anything, would be part of a court action for trademark infringement. For purposes of the UDRP, however, these registrations do not in of themselves prove that Complainant enjoys prior rights, particularly as Complainant has not submitted any evidence showing use of these older marks at any relevant time. Nevertheless, and as already noted, as Complainant released Respondent in the Settlement Agreement from all claims regarding the SPORTIQUE mark that existed at that time, these marks are irrelevant in a consideration of whether Complainant has a legitimate interest in the disputed domain name given that any claims that Complainant might have had in June 2015 based on these older trademark registrations against Respondent’s use of the SPORTIQUE name and mark were released and waived.

In sum, the Panel thus concludes that Complainant has failed to establish that Respondent does not have right or legitimate interests in the disputed domain name.

C. Registered and Used in Bad Faith

Given that Complainant has not established the second element of lack of rights or legitimate interests, the Panel does not need to address the issue of bad faith registration and use. That being said, though, the Panel notes that as Complainant released Respondent in the Settlement Agreement from all claims that could have been asserted against Respondent based on its use of the SPORTIQUE mark, Respondent had a right and legitimate interest in continuing its use of the SPORTIQUE mark for its online retail services, and thus on the record before the Panel could not have been acting in bad faith when registering the disputed domain name that is identical to Respondent’s SPORTIQUE mark.

7. Decision

For the foregoing reasons, the Complaint is denied.

Georges Nahitchevansky
Sole Panelist
Date: April 24, 2018

¹ Complainant’s initial Complaint listed Respondent as The Sports Wellness Group LLC. Complainant then filed an Amended Complaint naming Chris Gathright, the actual registrant of the disputed domain name, as Respondent. As the Parties’ contentions concern both The Sports Wellness Group LLC and its owner Chris Gathright, for purposes of convenience Respondent shall hereinafter mean Chris Gathright and his company The Sports Wellness Group LLC.