jacuzzispas.com.au

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Jacuzzi, Inc. v. Wangra Pty Ltd

Case No. DAU2005-0001

1. The Parties

The Complainant is Jacuzzi, Inc., Dallas, Texas, United States of America, represented by Donahue Gallagher Woods LLP, United States of America.

The Respondent is Wangra Pty Ltd (ACN 071 841 042), Patterson Lakes, Australia, represented by Minter Ellison, Australia.

2. The Domain Name and Registrar

The disputed domain name <jacuzzispas.com.au> (the “Disputed Domain Name”) is registered with Melbourne IT trading as Internet Names Worldwide.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on March 22, 2005. On March 24, 2005, the Center transmitted by email to Melbourne IT Ltd a request for registrar verification in connection with the domain name at issue.

As filed, the Complaint listed three domain names registered in three different names which the Complainant contended had a unity of interest under related control and so should be treated as one. Paragraph 3(c) in Schedule B of the Rules for .au Dispute Resolution Policy (“auDRP Rules”) provides:

“The complaint may relate to more than one domain name, provided that the domain names are registered by the same domain name holder.”

auDA, the policy authority and industry self-regulatory body for the .au domain space, advised the Center that auDA’s adoption of this rule presumed a strict interpretation, leading to separate complaints for each differently named respondent. Accordingly, the Complainant filed an Amended Complaint in this proceeding on June 8, 2005.

Melbourne IT Ltd transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant of the Disputed Domain Name and that the contact details for the administrative, billing, and technical contact are as set out in the Amended Complaint. The Center verified that the now Amended Complaint satisfied the formal requirements of the .au Dispute Resolution Policy (the “auDRP Policy”), the Rules for .au Dispute Resolution Policy (the “auDRP Rules”), and the WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the auDRP Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced June 14, 2005. In accordance with the auDRP Rules, paragraph 5(a), the due date for Response was July 4, 2005, and this was filed with the Center on that date. Subsequently, in view of an issue in connection with what was now a second complaint in relation to the domain name <jacuzzi.com.au>, the Respondent filed an Amended Response on August 4, 2005.

The Center appointed Warwick A. Rothnie, Mary Padbury and Staniforth Ricketson as panelists in this matter on August 10, 2005. The Panel finds that it was properly constituted. Each member of the Panel has submitted the Statement of Acceptance and Declaration of Impartiality and Independence, as required by the Center to ensure compliance with the auDRP Rules, paragraph 7.

On August 18, 2005, the Complainant submitted a Further Statement (with 2 exhibits) with a request that the Panel exercise its discretion, under auDRP Rules paragraph 12, to include it in the record for this proceeding. The Respondent submitted a rebuttal, Response to the Complainant’s Further Statement, on August 19, 2005.

4. Factual Background

Jacuzzi Inc. and its affiliated companies operate as manufacturers and distributors of whirlpool baths and spa-related products. It claims to have been so engaged since 1968, when a Mr Roy Jacuzzi invented the whirlpool bath. Jacuzzi Inc. claims that it, and its affiliated companies, carry on their business in numerous countries including the United States of America, Australia, Singapore, Canada, Italy, France, Germany, United Kingdom, Brazil and Chile. The Complainant alleges that it has worldwide sales in excess of (presumably) US$350 million in each of 2001 and 2002, $400 million in 2003 and $500 million in 2004.

The Amended Complaint states that Jacuzzi Inc. has registered the JACUZZI trademark, or variations thereof, in at least 83 different countries. In Australia, it has registered the following trade marks¹:

The Complainant has also registered numerous domain names including <jacuzzi.com>.

The Respondent “licenses” the Disputed Domain Name to an affiliated company, Jacuzzi Pty Ltd, which carries on business selling spa baths, accessories and supplies from two stores in suburbs of Melbourne, Victoria, and via a website to which the Disputed Domain Name resolves. It does not seem to be disputed that this business, including the website, is promoted by reference to a logo which features the words “Jacuzzi The Spa Professionals”. Nor is it disputed that the products sold and offered for sale by the Respondent’s affiliated company, Jacuzzi Pty Ltd, are not products sourced from the Complainant or its affiliates, but are products of the Complainant’s competitors. The Respondent claims that it, or companies related to its directors, have been operating the store at Hallam under the name “Jacuzzi” since 1991. The second store, at Hoppers Crossing, was opened in October 2004. The Respondent registered the Disputed Domain Name shortly prior to that, in September 2004.

The Complainant, through its then solicitors, sent a letter of demand in July 1996, to the Respondent’s predecessor at the Hallam store alleging trade mark infringement, false, misleading or deceptive conduct contrary to the trade practices legislation and passing off. The sole director and shareholder of Jacuzzi Pty Ltd (to whom the Respondent “licenses” the Disputed Domain Name) asserts that the Complainant took no further action in relation to these allegations until a further letter of demand, in similar terms, was sent in November 2004, by the Complainant’s present solicitors.

After filing the Complaint, the Complainant commenced Federal Court proceedings No VID316 of 2005, on April 7, 2005, against a number of parties, including the Respondent and its director. These proceedings allege that the respondents (including the Respondent) have infringed the Complainant’s registered trade marks, engaged in false, misleading or deceptive conduct contrary to the trade practices legislation and passing off. The Respondent filed a Defence and Cross-claim in those proceedings on June 15, 2005. The Defence denies infringement on the grounds that the Complainant’s registered trade marks, or the term JACUZZI, is or has become descriptive. The Defence also denies that the Complainant has any reputation in Australia in the term JACUZZI and further claims that the Complainant is estopped from bringing its action at this stage. The Cross-claim seeks cancellation or removal from the Trade Marks Register of the Complainant’s trade marks.

5. Discussion and Findings

Paragraph 15(a) of the auDRP Rules requires the Panel to decide the Complaint on the basis of the statements and documents submitted by the parties and in accordance with the auDRP Policy, the auDRP Rules and those principles of law that the Panel deems applicable.

The statements that the Panel takes into account for these purposes are the Amended Complaint and the Amended Response, both of which have a number of annexures and schedules.

As noted above, the Complainant submitted a Further Statement on August 18, 2005, and requested its inclusion on the grounds that the Amended Response raised new issues and factual contentions that require clarification and refutation. The Respondent had also submitted its Response to the Further Statement before the Panel was aware of the Further Statement. The Panel has reviewed both statements. The Further Statement broadly seeks to address five issues:

(1) the Respondent’s request for termination or suspension of the proceeding;

(2) whether or not the Disputed Domain Name is identical or confusingly similar to any trade mark rights of the Complainant;

(3) whether or not there is a prima facie showing that the Respondent lacks rights or legitimate interests;

(4) whether or not the Respondent’s acts were done in bad faith; and

(5) the Complaint presents issues clearly within the scope of the auDRP Policy and readily determinable by the Panel.

Having reviewed both documents, the Panel shall refer to them as appropriate in its discussion below.

In its Amended Complaint, the Complainant maintained its request for consolidation of this dispute with the complaints it has filed in respect of <jacuzzi.com.au> and <jacuzzi.net.au> on the basis of several factual relationships specified in the Complaint and in the Amended Complaint. The obvious and explicit reasons for this request are the interests of efficiency for all parties and to avoid any risk of inconsistent decisions.

Paragraph 4(f) of the auDRP Policy permits either party to apply to an administrative panel to consolidate multiple disputes between a complainant and a respondent. As noted above, however, notwithstanding the common interpretation of the identical rule under the Uniform Domain Name Dispute Resolution Policy, auDA informed the Center that paragraph 3(c) of the auDRP Rules as adopted normally concerned cases of legal identity between the parties to the respective disputes.

Like the Amended Complaint, the Amended Response does address all three disputes. Indeed, in the Amended Response, the Respondent concedes that the complaints are related and that it has no objections to them being considered simultaneously by the Panel. The Panel notes that the concerns about, in particular, inconsistent decisions are addressed by this approach. However this may be, in view of the direction from auDA (which as previously noted is the auDRP Policy authority for the .au name space), the Panel shall issue separate decisions in each.

In the present proceeding the Respondent has requested that the Panel terminate, or alternatively, suspend the proceeding under paragraph 18(a) of the auDRP Rules in light of the Federal Court proceedings referred to above. Paragraph 18(a) provides:

“In the event of any legal proceedings initiated prior to or during an administrative proceeding in respect of a domain name dispute that is the subject of the complaint, the Panel shall have the discretion to decide whether to suspend or terminate the administrative proceeding, or to proceed to a decision.”

In support of this request, the Respondent contends that the Federal Court proceedings go to the fundamental right of the Complainant to maintain and enforce its asserted rights in the JACUZZI trade marks. The Respondent contends that any decision by the Panel predicated on the Complainant’s trade mark claims would pre-empt the determination by the Federal Court. The Respondent also call in aid what it calls the inordinate and inexcusable delay of the Complainant in pursuing its claims against the Respondent. The Respondent also claims that termination or suspension of this administrative proceeding will not result in any real prejudice to the Complainant as the Respondent contends that the Federal Court proceeding is likely to be determined within 12 months and, further, the remedies available through the Federal Court proceedings include damages. On the other hand, the Respondent contends that it will suffer irreparable harm if the Panel orders transfer of the Disputed Domain Name to the Respondent and the Federal Court subsequently finds in favour of the Respondent.

Paragraph 18(a) of the auDRP Rules was derived from a corresponding provision under the Uniform Domain Name Dispute Resolution Policy (the “UDRP”). A number of Panels have considered the application of that provision: see e.g. Western Holdings LLC v. JPC Enterprise LLC,WIPO Case No. D2004-0426, and the cases referred to there. Given the derivation of the auDRP Policy and Rules from the UDRP, the Panel has found the discussion of this issue in those cases helpful.

While the issues involved and the relief potentially available in the Federal Court proceeding are similar to those in an administrative proceeding under the auDRP Policy (see e.g. CSR Limited v. Resource Capital Australia Pty Ltd (2003) 128 FCR 408), they are not on all fours and there are very important differences. Moreover, the auDRP Policy operates expressly without prejudice to a party’s rights to bring proceedings, even after the administrative proceeding has been decided: auDRP Policy, paragraph 4(k). The court proceedings would necessarily be determined on different evidence and no question of “res judicata” or issue on estoppel can arise. As a corollary, the Respondent’s claim of irreparable harm is not correct. Indeed, if the Panel were to decide in favour of the Complainant and order transfer of the Disputed Domain Name, the registrar is required under paragraph 7.2 of the auDRP Policy to delay any implementation of the decision for 10 days to enable legal proceedings to be commenced.

Further, the Respondent registered the Disputed Domain Name on September 13, 2004. Thus, the Respondent registered the Disputed Domain Name subject to the terms and conditions of the auDRP Policy: auDRP Policy, Section 1 Background paragraph 2.1. The auDRP Policy makes the registration of the Disputed Domain Name subject to mandatory administrative proceedings under the auDRP where a complaint in accordance with the auDRP Policy is properly filed. Furthermore, the auDRP Policy expressly contemplates that the administrative proceeding will continue even though legal proceedings are on foot or commenced unless a positive discretion to suspend or terminate is exercised.

More generally, the purpose of the auDRP is:

“to provide a cheaper, speedier alternative to litigation for the resolution of disputes between the registrant of a .au domain name and a party with competing rights in the domain name.”

See auDRP Policy, Section 1 Background, paragraph 1.2. That objective could be frustrated if the bringing of legal proceedings were sufficient to lead to termination or suspension. That danger is not really avoided by the Respondent’s claim that the legal proceedings are likely to be resolved within 12 months. That could well prove to be a very optimistic estimate. In any event, it is much longer than the usual duration of these type of administrative proceedings.

Having regard to these matters and as the Complaint has been properly constituted under the auDRP Policy and both parties have submitted detailed submissions on the issues raised, the Panel has sufficient material to complete its duties and decide the administrative proceeding according to its obligations under paragraph 15(a) of the auDRP Rules. Accordingly, the Panel declines to exercise its discretion to suspend or terminate the proceedings. In view of the conclusion the Panel has reached on this issue, it is unnecessary for the Panel to consider further the Complainant’s submissions in the Further Statement under abovementioned topics (1) and (5).

Under paragraph 4(a) of the auDRP Policy, therefore, the Complainant has the burden of proving the following three elements:

(i) The Disputed Domain Name is identical or confusingly similar to a name, trade mark or service mark in which the Complainant has rights; and

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

(iii) The Disputed Domain Name has been registered or subsequently used in bad faith.

The Complainant bears the onus of proof of each of these factors. The Panel turns to consider them.

A. Identical or Confusingly Similar

This requirement will be easier to satisfy in some circumstances than the corresponding requirement under the UDRP as it expressly permits founding a claim on rights in a name, not just trade mark (including service mark) rights.

As under the UDRP, however, there are two parts to this inquiry: does the Complainant have rights in a name or trade mark and, if so, is the Disputed Domain Name identical or confusingly similar to those rights: See e.g. JupiterMedia Corporation and Australia.Internet.com Pty Ltd v. Spotpress Pty Ltd,WIPO Case No. DAU2003-0005 and, to similar effect, GlobalCenter Pty Ltd v. Global Domain Hosting Pty Ltd,WIPO Case No. DAU2002-0001.

At the very least, the Complainant has demonstrated ownership of the registered trade marks in Australia referred to in section 4 above. The Complainant also claims trade mark registrations in 82 other countries and extensive common law rights. The existence of the latter, at least in Australia, is vigorously contested by the Respondent. In its Further Statement, the Complainant also exhibits by way of evidence of sales and promotional activity in Australia a wholesale price list for Jacuzzi Whirlpool Bath – THE REAL ONE effective from February 1, 1990, and 2 invoices from March and December 1991. The Panel notes in passing that this additional evidence should really have been part of the Complaint as the burden falls on the Complainant to prove its rights. It is unnecessary for the Panel to resolve the dispute between the Complainant and the Respondent on this issue, however, as the Australian registered trade marks for which specific evidence has been provided are themselves sufficient under the auDRP Policy.

The Respondent contests even reliance on the registered Australian trade marks on the basis of its challenge to their validity in the Federal Court proceedings. The Panel does not accept that contention. As the Respondent admits, the trade marks are registered. The grounds which the Respondent alleges, if proved, are capable of causing the registered trade marks to be cancelled or removed. It is one thing to allege, however, and quite another to prove the claim. Accordingly, the Panel thinks the proper course is to proceed under this head on the basis that the rights have been proved. This is not to say that the Respondent’s allegations are wholly irrelevant and, as the Panel discusses below, they call for further consideration in relation to the other requirements of the auDRP Policy.

As to the second part, what is involved is a comparison of the Disputed Domain Name to the trade marks of the Complainant that have been established, independently of questions about how (if at all) the Disputed Domain Name is used or what for. See e.g. GlobalCenter Pty Ltd v. Global Domain Hosting Pty Ltd,WIPO Case No. DAU2002-0001.

The Disputed Domain Name is not identical to the Complainant’s trade mark rights as the former includes the word “spas” and “.com.au” appended as suffixes to the word Jacuzzi. Two of the Complainant’s trade marks also include device elements. The mere addition of such generic material, however, cannot escape a finding of confusing similarity to the word marks or the composite marks involving both word and device elements.

Accordingly, the Panel finds that the Disputed Domain Name is confusingly similar to the Complainant’s trade mark rights and the requirements of paragraph 4(a) of the auDRP Policy are satisfied.

B. Rights or Legitimate Interests

The second requirement that the Complainant must establish is that the Respondent has no rights or legitimate interests in respect of the Disputed Domain Name. In view of the difficulties in proving a negative, it is usually sufficient for the Complainant to advance facts giving rise to a prima facie case that the Respondent does not have the necessary rights or legitimate interests and then an evidential burden shifts to the Respondent to show the basis for a claim to rights or legitimate interests in the relevant sense: See e.g. GlobalCenter Pty Ltd v. Global Domain Hosting Pty Ltd,WIPO Case No. DAU2002-0001, and Produits Berger v. Lay Tee Ong,WIPO Case No. DAU2004-0008. Paragraph 4(c) of the auDRP Policy outlines the following factors which may provide a basis for a claim to rights or legitimate interests:

(i) before any notice to you of the subject matter of the dispute, your bona fide use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with an offering of goods or services (not being the offering of domain names that you have acquired for the purpose of selling, renting or otherwise transferring); or

(ii) you (as an individual, business, or other organisation) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

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

As with the similar factors under the UDRP, this is a non-exhaustive list and a respondent may be able to establish rights or a legitimate interests on some other basis.

In this administrative proceeding, the Complainant states that it has never licensed or otherwise authorised the Respondent to use the trade mark JACUZZI in any capacity. The Complainant also points to the sending of the letter of demand in July 1996, to the Respondent’s predecessor in which it alleged trade mark infringement, false, misleading or deceptive conduct and passing off as precluding any licence. In addition, the website to which the Disputed Domain Name resolves sells goods which directly compete with the Complainant’s products.

The Further Statement submitted by the Complainant reiterates its claims that is has established a prima facie case that the Respondent lacks rights or legitimate interests. The Panel agrees with the Complainant thus far.

In its Amended Response, the Respondent answers, first, that a company related to the sole director and shareholder of the Respondent started to carry on business under the name Jacuzzi from the Hallam store in October 1991. It also registered the business name Jacuzzi in the Victorian Register of Business Names on October 18, 1991. Since that date, that company or other companies associated with the Respondent have continuously carried on business under the name JACUZZI from that site. A copy of the Registration of Business Name is not in evidence. The allegation is verified, however, in a statutory declaration of Graham Ritchie made on August 4, 2005, which forms Annexure B to the Amended Response. Some additional support for the allegation can be found in the Amended Complaint which relies on the sending of the letter of demand in July 1996, in relation to the activities at the Hallam store.

The registration and commencement of business in 1991, if proved, is of course well before notification of this dispute including even the July 1996 letter of demand. It does not, however, anticipate the Complainant’s registered trade marks, the earliest of which date from 1978 and 1984. Moreover, registration of a business name does not provide immunity against action for infringement of a registered trade mark unless the stringent requirements of the “good faith” defence provided by Trade Marks Act 1995, (Cth) s 122(1)(a) are satisfied.

Secondly, the Respondent also relies on what it claims to be the Complainant’s delay. In its Further Statement, the Complainant denies that it has delayed unduly since the Disputed Domain Name started resolving to an active website (neither of the other domain names does). The Panel accepts that. However, neither the Amended Complaint nor the Further Statement address the very long delay between the sending of the letter of demand in July 1996, and the renewed attempt to assert rights in 2004. On the basis of this delay, the Respondent claims that it has acted to its detriment by continuing to develop its business under the name Jacuzzi and, accordingly, the Respondent claims that the Complainant is estopped from asserting its rights now. This too, if the necessary facts be proved, could provide a legal basis for an entitlement to continue using the name Jacuzzi: the principles, and the difficulties, are discussed in e.g. Autocaps (Aust) Pty Ltd v. Pro-Kit Pty Ltd (1999) 46 IPR 339.

Finally, the Respondent claims that the term Jacuzzi is not distinctive in Australia and is or has become merely a descriptive alternative for “spas”. See Trade Marks Act 1995 (Cth) ss 24 and 87. In this connection, the Respondent also points to the absence of any specific evidence of the sale and distribution of the Complainant’s products in Australia under or by reference to the trade mark JACUZZI. As the Panel has noted above, the Complainant’s Further Statement does provide specific evidence in rebuttal in the form of one wholesale price list effective from February 1, 1990, and two invoices in, respectively, March and December 1991. While this is evidence of use of the JACUZZI mark in Australia to some extent, it is very limited: three examples some 14 or 15 years ago. Even allowing that they are examples only, they are not evidence of use on such a scale or scope as to plainly refute the Respondent’s claim.

In summary, then, the Complainant has raised grounds which are usually sufficient to shift the evidential onus to the Respondent. The Respondent has countered with claims which, if established, would provide it with rights or legitimate interests to use the Disputed Domain Name in Australia. To a considerable extent, the Respondent’s claims are just that. This is not just a case of bare, incredible assertion, however. The Respondent has provided verifying support by way of statutory declaration (albeit this is balanced by statutory declarations on the part of the Complainant). In addition, it is common ground between the parties that the Respondent, or parties associated with it, has been using the name Jacuzzi since prior to July 1996, and there has been a very long delay in the Complainant taking any further action against the Respondent or any of its associated parties. While the Complaint did seek to rely on the letter of demand in July 1996, it has not sought to explain the delay in following up that demand – a delay of eight years. In the special circumstances of this administrative proceeding, therefore, the Respondent’s claims have some objective support and cannot simply be dismissed as untenable.

The Panel has noted that the matters claimed by the Respondent are possible defences that may be available to the Respondent. They are not easy defences to make out, however, and the Respondent may not be able to establish them. A proper assessment of them requires much wider evidence gathering powers, including discovery and cross-examination of witnesses, than is available in an administrative proceeding of this kind. In view of the limited nature of these administrative proceedings as proceedings on the papers, therefore, the Panel’s finding cannot, and should not, be taken as a final endorsement of the Respondent’s claims.

Accordingly, on the record in this administrative proceeding, the Panel finds that the Complainant has not discharged its onus under this head. The Panel finds, therefore, that on the record in this administrative proceeding the Complainant has been unable to prove that the Respondent has no rights or legitimate interests in the domain name.

C. Registered or Used in Bad Faith

The third factor that must be established by the Complainant is somewhat different to the corresponding test under the UDRP in that the Complainant need show only either registration in bad faith or subsequent use in bad faith. That is, registration or use in bad faith are alternative, rather than cumulative, requirements as under the UDRP.

In view of the Panel’s conclusion in relation to the second factor above, it is unnecessary for the Panel to decide this issue. The registration of a domain name which is confusingly similar to a competitor’s trade mark to sell competing products is a classic example of “bad faith”: see e.g. auDRP Policy paragraph 4(b)(iv). Whether or not the Respondent’s conduct is properly described as in bad faith, however, turns on whether or not it has rights or legitimate interests to use the Disputed Domain Name in the way it has done.

6. Decision

For all the foregoing reasons, the Complaint is denied.

Dated: August 24, 2005