WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Marshmallow Skins, Inc. v. Piipiinoo Australia Pty Limited

Case No. DAU2013-0015

1. The Parties

The Complainant is Marshmallow Skins, Inc. of Irvine, California, United States of America (“USA”), represented by Banki Haddock Fiora, Australia.

The Respondent is Piipiinoo Australia Pty Limited of Bondi Junction, New South Wales, Australia.

2. The Domain Names and Registrars

The disputed domain names <zipz.com.au> and <zipz.net.au> (the “Domain Names”) are registered with Domain Directors Pty Ltd.

3. Procedural History

The Complaint was filed with the WIPO Arbitration and Mediation Center (the “Center”) on May 17, 2013. On May 17, 2013, the Center transmitted by email to Domain Directors Pty Ltd. a request for registrar verification in connection with the Domain Names. On May 19, 2013, Domain Directors Pty Ltd. transmitted by email to the Center its verification response confirming that the Respondent is listed as the registrant and providing the contact details. In particular, although the WhoIs database for <zipz.net.au> indicates that the registrant is “Pipinoo Australia” and not “Piipiinoo Australia”, this appears to be a typographical error, both because the entity that is the listed registrant of <zipz.net.au> has the same Australian Business Number as the Respondent and because the Registrar specifically confirmed that the “Respondent ‘Piipiinoo Australia Pty Limited’ is the current Registrant of the domain names ‘zipz.com.au’ and ‘zipz.net.au’”. On that basis the Panel is satisfied that the proceeding should proceed without the need to amend the Complaint.

The Center verified that the Complaint satisfied the formal requirements of the .au Dispute Resolution Policy (the “Policy” or “.auDRP”), the Rules for .au Dispute Resolution Policy (the “Rules”), and the WIPO Supplemental Rules for .au Domain Name Dispute Resolution Policy (the “Supplemental Rules”).

In accordance with the Rules, paragraphs 2(a) and 4(a), the Center formally notified the Respondent of the Complaint, and the proceedings commenced on May 24, 2013. In accordance with the Rules, paragraph 5(a), the due date for Response was June 13, 2013. The Respondent did not submit any response. Accordingly, the Center notified the Respondent’s default on June 14, 2013.

The Center appointed Nicholas Smith as the sole panelist in this matter on June 18, 2013. 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

Established in 2006, the Complainant is a clothing and footwear manufacturer based in Irvine, California, USA. The Complainant principally sells shoes known as “ZIPZ shoes”, which were first launched in February 2007. ZIPZ shoes are a form of shoes which consist of a canvas tennis-style sole with interchangeable covers (uppers), cores (insoles) and “souls” (soles). The uppers and soles of the shoes can be unattached and replaced using a zipper system. The Complainant commenced the sale of ZIPZ shoes in Australia in 2010 and today sells ZIPZ shoes in 48 countries.

The Complainant is the holder of the USA trade mark registration for ZIPZ SYSTEM and holds trade mark registrations for the word mark ZIPZ (the “ZIPZ Mark”) in Taiwan, Japan, South Africa and Mexico. The Complainant has the application for registration of the trade mark ZIPZ currently pending in Australia and India.

The Domain Names were both registered on June 14, 2012. The Domain Name <zipz.com.au> is currently inactive. The Domain Name <zipz.net.au> currently redirects to a website related to the Respondent (the “Respondent’s Website”) located at “www.piipiinoo.com.au.” The Respondent’s Website promotes the Respondent and in particular the sale of “Zip shoes”. Zip Shoes appear to be based on a similar concept to the ZIPZ shoes in that they are canvas tennis shoes with interchangeable elements. The Respondent is apparently a subsidiary of a Chinese company which manufactures Zip Shoes.

5. Parties’ Contentions

A. Complainant

The Complainant makes the following contentions:

(i) that the Domain Names are identical or confusingly similar to the Complainant’s ZIPZ Mark;

(ii) that the Respondent has no rights nor any legitimate interests in respect of the Domain Names; and

(iii) that the Domain Names have been registered and/or are subsequently being used in bad faith.

The Complainant is the owner of the ZIPZ Mark. The Complainant owns a trade mark registration for the ZIPZ Mark in a number of countries around the world, and has applied for the registration of the ZIPZ Mark in Australia. The Complainant’s ZIPZ Mark is also well-known in Australia. The Complainant has sold ZIPZ shoes to the Australian market since late 2010. Furthermore, the ZIPZ shoes have been exhibited at Australian shoe fairs, been featured in Australian newspaper spreads as early as February 2011 and have been the subject of specific marketing campaigns. Accordingly, the Complainant also claims that its common law trade mark rights were well established in Australia prior to the registration of the Domain Names.

The Domain Names are identical to the ZIPZ Mark.

The Respondent has no rights or legitimate interests in the Domain Names. The Respondent does not hold a trade mark for ZIPZ or any similar trade mark. The Respondent is not licensed or authorised by the Complainant to register the Domain Names. The Respondent does not have any other apparent rights in the Domain Names. Rather the Respondent is a subsidiary of a Chinese company which also manufactures and sells shoes also featuring replaceable uppers and soles and using a zipper system. It has never used the Domain Names other than to redirect to its own website at “www.piipiinoo.com.au”. The Complainant notes that the Respondent’s representative applied for registration of the trade mark ZIPZ on May 17, 2012 and the Respondent itself applied for registration of the trade mark ZIPZ on May 25, 2012, both in Australia. However, the mere fact that the Respondent has filed trade mark applications of its own for ZIPZ does not necessarily give rise to rights of legitimate interests in the corresponding domain names. For example, under the Uniform Dispute Resolution Policy (“UDRP”), even in the case of registered trade marks the dominant view arising from prior decisions is that a respondent will not acquire such rights or legitimate interests in a domain name on the basis of a corresponding trade mark registration where the overall circumstances demonstrate that such trade mark was obtained primarily to circumvent the application of the UDRP. Such is the case here. The Respondent lodged its trade mark applications for ZIPZ and registered the Domain Names solely to gain a commercial advantage over the Complainant. Such use does not give rise to rights or legitimate interests.

The Domain Names were registered and are being used in bad faith. Under the Policy, in certain situations, when the respondent is clearly aware of the complainant, and it is clear that the aim of the registration was to take advantage of the confusion between the domain name and any actual or potential complainant rights, bad faith can be found. The Complainant submits that it is inconceivable that the Respondent registered the Domain Names without knowledge of the Complainant’s widespread use and reputation in the ZIPZ Mark. Registration of a domain name comprising a competitor’s trade mark with knowledge of such competitor’s already established and widespread use and reputation in the mark is registration in bad faith. The Complainant submits that the Respondent registered the Domain Names primarily for the purpose of disrupting the business of a competitor and secondarily for the purpose of selling, renting, or otherwise transferring the Domain Names to the Complainant who is the owner of the trade mark or service mark or to a competitor of that Complainant, for valuable consideration in excess of its documented out-of-pocket costs directly related to the Domain Names.

B. Respondent

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

6. Discussion and Findings

The Panel notes that although the Policy and the UDRP are different policies, both share substantial similarities and, as such, the Panel finds it appropriate to rely on authority concerning the UDRP in resolving the present dispute.

The Panel also notes that this case is a complex one and that in reaching a decision, the Panel had to make a judgement about the reasons behind the Respondent’s application to register ZIPZ as a trade mark in the absence of any evidence or submissions from the Respondent. The Respondent failed to participate in this proceeding despite being properly notified of the Complaint pursuant to the Rules.

The WIPO Overview of WIPO Panel Views on Selected UDRP Questions, Second Edition (“WIPO Overview 2.0”), paragraph 4.6 says in relation to the failure of a respondent to respond to a complaint, that

“A respondent’s default does not automatically result in a decision in favor of the complainant. Subject to the principles described in paragraph 2.1 above with regard to the second UDRP element, the complainant must establish each of the three elements required by paragraph 4(a) of the UDRP. Although a panel may draw appropriate inferences from a respondent's default (e.g., to regard factual allegations which are not inherently implausible as being true), paragraph 4 of the UDRP requires the complainant to support its assertions with actual evidence in order to succeed in a UDRP proceeding.”

While still requiring the Complainant to establish each of the three elements, the Panel has drawn a negative inference in accordance with the Rules, paragraph 14(b) of the Policy from the fact that the Respondent has chosen not to make any submissions or evidence to establish the legitimacy of its trade mark applications or its registration and use of the Domain Names.

A. Identical or Confusingly Similar

To prove this element the Complainant must have a name or trade or service mark rights and the Domain Names must be identical or confusingly similar to the Complainant’s name, trade or service mark.

The Complainant holds trade mark registrations for the ZIPZ Mark in numerous countries outside Australia, and has applied to register the ZIPZ mark in Australia. The mere application to register a mark does not in itself grant trade mark rights; indeed the Respondent has also applied for the ZIPZ Mark in Australia. It is therefore necessary to consider whether the registration of a trade mark in a country outside Australia is sufficient to satisfy the requirements under the Policy.

The relevant section of the Policy states that “your domain name is identical or confusingly similar to a name [Note 1], trademark or service mark in which the complainant has rights”. Note 1 being “[1] For the purposes of this policy, auDA has determined that a ‘name […] in which the complainant has rights’ refers to:
a) the complainant's company, business or other legal or trading name, as registered with the relevant Australian government authority; or b) the complainant's personal name.”

The Policy as written does not restrict the Complaint’s rights to a trade mark registered with an Australian government authority.

Previous cases under the Policy have come to different views on this issue, with Smart Voucher Ltd T/A Ukash v. Chowdhury, MD Abu Russel and Sydney Business & Technology Group Pty Ltd, WIPO Case No. DAU2013-0006; TeamViewer GmbH v. Nigel Burke, WIPO Case No. DAU2012-0027; and Hutchinson Wines v. Amphora Wine Group Pty Ltd, William Howard, WIPO Case No. DAU2011-0008 finding that a trade mark registered overseas (but not in Australia) satisfies the first element in the Policy while Brilliance Publishing, Inc. v. My Brilliance Pty Ltd / Ceinwen Schneider, WIPO Case No. DAU2013-0007 and We Buy Any Car Limited v. Highway Auto Mart and Jason Collings, WIPO Case No. DAU2012-0004 take the opposite approach and require the complainant establish rights, be they registered or unregistered rights, in Australia to satisfy the first element.

The Panel considers that the appropriate interpretation of the Policy is the former one (that a complainant satisfies the first element of the Policy when they show a trade mark registration that is identical or confusingly similar to a domain name, regardless of where the mark is registered). The Panel does not seek to insert a nationality requirement in the Policy, which does not exist in the text of the Policy. Furthermore, while there may be a practical concern that a broad interpretation of “trade mark” could allow a complainant with no connection to Australia to satisfy the first element of the Policy and thereby acquire a “.au” domain name, this concern can be addressed in three ways:

a) It is highly unlikely that a complainant would expend legal resources preparing a complaint for a “.au” domain name if it has no connection to or interest in Australia.

b) If the complainant has no connection with Australia, it will have difficulty in satisfying the bad faith requirement under the Policy, as a finding of bad faith will often require the panel to reach a conclusion that the respondent had or must have had some knowledge or awareness of the complainant’s mark.

c) The Domain Name Eligibility and Allocation Policy Rules for the Open 2LDs (2012-04) for the “.au” domain state in paragraph 2 of schedule A that domain name licences may only be allocated to a registrant who is Australian, as defined under the eligibility and allocation rules for each second level domain (2LD). Each 2LD then has its own requirements as to who is eligible to register a domain name, generally requiring some connection to Australia, such as a registered trade mark in Australia. The Domain Name Eligibility and Allocation Policy Rules operate to prevent a complainant who relies solely on a foreign registered trade mark and has with no connection with Australia from taking possession of a domain name in the “.au” space that it is not entitled to, even if it obtained an order for transfer under the Policy. The creation of a “nationality requirement” under the first element of the Policy requires the reading of words into the Policy that do not exist and is practically unnecessary. The Panel finds that the Complainant has trade mark rights in the ZIPZ Mark under the Policy and therefore it is not necessarily to determine whether or not the Complainant established common law trade mark rights in Australia.

The Domain Names consist of the ZIPZ Mark and the suffixes “.com.au” and “.net.au”. Disregarding the “.com.au” and “.net.au” suffixes, the Domain Names are identical to the ZIPZ Mark. Consequently, the requirement of paragraph 4(a)(i) of the Policy is satisfied.

B. Rights or Legitimate Interests

To succeed on this element, a complainant must make out a prima facie case that the respondent lacks rights or legitimate interests in the domain name. If such a prima facie case is made out, then the burden of production shifts to the respondent to demonstrate rights or legitimate interests in the domain name.

Paragraph 4(c) of the Policy enumerates several ways in which a respondent may demonstrate rights or legitimate interests in a domain name:

“Any of the following circumstances, in particular but without limitation, if found by the Panel to be proved based on its evaluation of all evidence presented, is to be taken to demonstrate your rights or legitimate interests to the domain name for purposes of Paragraph 4(a)(ii):

(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.” (Policy, paragraph 4(c))”

The Respondent is not affiliated with the Complainant in any way. It has not been authorised by the Complainant to register or use the Domain Names or to seek the registration of any domain name incorporating the ZIPZ Mark or a mark similar to the ZIPZ Mark. There is no evidence that the Respondent is commonly known by the Domain Names or any similar name. There is no evidence that the Respondent has used the Domain Names in connection with a legitimate noncommercial use. There is no evidence that the Respondent has made a bona fide use or demonstrable preparations to use the Domain Names or a name corresponding to the Domain Names. Rather the Domain Names are either inactive or redirects to the Respondent’s Website, which in itself does not give rights or legitimate interests in the Domain Names.

The Respondent and its representative have each applied to register ZIPZ as a trade mark in Australia. The application to register a mark does not in itself grant a party rights in a domain name. However, an application can be taken as an indication that a respondent does have rights and legitimate interests in the Domain Names, if supported by evidence of the fact that the application is based on the offering of, or the making of demonstrable preparations to offer, goods and services under the trade mark.

The WIPO Overview 2.0, paragraph 2.7 says in relation to whether the respondent holding a trade mark corresponding to a disputed domain name automatically generates rights or legitimate interests, that

“Panels have tended to recognize that a respondent's registration of a trademark which corresponds to a disputed domain name normally will, but does not necessarily, establish respondent rights or legitimate interests in that domain name for the purpose of the second element of the UDRP. For example, panels have generally declined to find respondent rights or legitimate interests in a domain name on the basis of a corresponding trademark registration where the overall circumstances demonstrate that such trademark was obtained primarily to circumvent the application of the UDRP.”

The Complainant has submitted that the Respondent’s trade mark application was made solely to gain a commercial advantage over the Complainant, and the Respondent has never been commonly known by ZIPZ.

Based on the case record, the Panel is finds that the Respondent lacks rights or legitimate interests in the Domain Names. The mere application for a trade mark in this case is insufficient to ground a claim of rights or legitimate interests. The Complainant has established a prima facie case that the Respondent lacks rights or legitimate interests in the Domain Names. The Respondent has had an opportunity to rebut the presumption that it lacks rights or legitimate interests including putting on any evidence that the application for ZIPZ was for any other purpose than the one asserted by the Complainant, or putting on any other evidence of rights and legitimate interests pursuant to any of the three circumstances above, or any other circumstances. However, it has chosen not to do so. The Panel therefore finds that the Respondent has no rights or legitimate interests in respect of the Domain Names under paragraph 4(a)(ii) of the Policy.

C. Registered or Subsequently Used in Bad Faith

For the purposes of paragraph 4(a)(iii) of the Policy, the following circumstances, in particular but without limitation, if found by the panel to be present, shall be evidence of the registration and use of a domain name in bad faith:

(i) circumstances indicating that a respondent has registered or has acquired a domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registrations to the Complainant who is the owner of the trade mark or service mark or to a competitor of that a complainant, for valuable consideration in excess of its documented out-of-pocket costs directly related to the domain name; or

(ii) the respondent has registered the domain name in order to prevent the owner of the trade mark or service mark from reflecting the mark in a corresponding domain name; or

(iii) the respondent has registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, the respondent has intentionally attempted to attract, for commercial gain, Internet users to its website or other on-line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of the respondent’s website or location or of a product or service on the respondent’s website or location.

The Panel finds that it is more likely that the Respondent, at the time of registration of the Domain Names, knew of the existence of the ZIPZ Mark. The Respondent is a direct competitor of the Complainant and appears to sell very similar shoes with a similar name (Zip shoes vs. ZIPZ shoes). The registration of the Domain Names in awareness of the Complainant’s ZIPZ Mark and in the absence of rights or legitimate interests amounts to registration in bad faith.

The Panel also finds that the Respondent has registered the Domain Names in order to prevent the owner of the trade mark or service mark from reflecting the mark in a corresponding domain name. The Respondent registered the Domain Names and applied for the ZIPZ trade marks despite no apparent evidence of any rights in the Domain Names. The Respondent has held the Domain Names for a year without any evidence that it is using or has used them for any legitimate purpose. The Respondent and the Complainants are competitors and the fact that the Respondent holds two domain names that reflect their competitor’s mark in its entirety leads the Panel to the conclusion that the Respondent has registered the Domain Names in order to prevent the owner of the trade mark or service mark from reflecting the mark in a corresponding domain name. The Respondent has failed to make any submissions or put on any evidence that would rebut this conclusion.

The Panel, noting that the Policy only requires that a complainant shows that a respondent registered or subsequently used the domain name at issue in bad faith, finds that the Respondent has registered the Domain Names in bad faith under paragraph 4(a)(iii) of the Policy.

D. Complainant’s Eligibility

The Complainant has requested transfer of the Domain Names to itself. Given that the Complainant is an applicant for an Australian registered trade mark that is identical to both of the Domain Names, the Complainant appears to satisfy the eligibility requirements for registration of the Domain Names under the Domain Name Eligibility and Allocation Policy Rules for the Open 2LDs .

7. Decision

For all the foregoing reasons, in accordance with paragraphs 4(i) of the Policy and 15 of the Rules, the Panel orders that the Domain Names <zipz.com.au> and <zipz.net.au> be transferred to the Complainant.

Nicholas Smith
Sole Panelist
Date: June 24, 2013