Type: Law Bulletins
Date: 01/11/2022

Established US Engineering Firm Loses Out in Bizarre Cybersquatting Case

A recent decision by a UDRP panelist found that a domain name registrant resident in China could continue to own and operate an explicit pornography website from a domain name consisting of the name of a Minnesota engineering company that has been in existence for over 70 years (see Bolton & Menk, Inc v. chaiming ming (FA2109001963601, Forum, 18 October 2021)). This odd decision highlights the urgent need for enhancements to the UDRP. Fortunately, ICANN is just about to kick off a working group empowered to do just that.

The UDRP is the original policy established by ICANN, and has served as an important pressure valve by providing a relatively quick and inexpensive way to deal with acts of cybersquatting. This in turn has likely led to a much lower number of cases being filed in US courts under the Anti-cybersquatting Consumer Protection Act. A UDRP complaint involves only three elements and a limited set of defenses. Evidence of bad-faith registration and use, as well as a third element, which may include, but is not limited to, the following:

  • Circumstances indicating that you have registered or acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the registration to the complainant who is the owner of the trademark or service mark, or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name.
  • You have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct;
  • You have registered the domain name primarily for the purpose of disrupting the business of a competitor.
  • By using the domain name, you have intentionally attempted to attract internet users to your website or other online location for commercial gain, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location, or of a product or service on your website or location.

Likewise, the defenses are short and sweet, and allow a registrant to demonstrate rights and interests to the domain name in dispute. These defenses include but are not limited to the following:

  • Before you are notified of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services.
  • You (as an individual, business, or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights.
  • You are making legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue.

The respondent in Bolton & Menk did not respond and therefore did not deny any of the assertions made by the complainant, including an assertion of 70+ years of common law rights to its mark. The panelist denied the complaint anyway.

Although the respondent did not argue that the complainant only used Bolton & Menk as a trade name and not as a trademark (whatever that means in the UDRP context), the panelist made that argument for the respondent and then relied on it to deny the claim. The panelist seems to have ignored the evidence placed before him, including a copy of the complainant’s website that set forth details of its 70-year history and which very clearly evidenced the use of the trademark.

Crucially, the panelist did not find that the registrant had any rights or legitimate interests in the domain name.

What makes the decision so peculiar is that the panelist, while denying there was sufficient evidence provided to prove common law rights, seemed to take no notice of the fact that there must be at least sufficient trademark rights for a registrant in China to know about the respondent’s trademark rights and register a domain name consisting entirely of the elements of the complainant’s mark. 

Neither element, ‘Bolton’ nor ‘Menk,’ have any known relationship to the pornography industry or any particular dictionary meaning either separately or together. In order to reach the decision that the panelist reached, one would have to suspend disbelief that an individual on the other side of the planet accidentally typed ‘boltonmenk’ into a registrar’s system and from there purchased the ‘.com’ variation. This notion of non-reputational, accidental, cross hemispheric, innocent registration is simply not plausible. Obviously, at least to some, an exact mark registration of a domain name for non-dictionary, non-industry words, is more than sufficient evidence of a complainant’s reputation in their name or product (also known as a service mark or trademark).

So, what is the takeaway from this odd case? First, urgent UDRP reform is needed to make it clear that when a respondent defaults, a panelist should decide in favor of the complainant based on any plausible assertions of fact set forth in the complaint. Without such guidance, complainants always run the risk of panelists deciding to argue a non-responsive respondent’s case for them (or in this case, the panelist wishes the non-responsive respondent would have made had it bothered to show up). Fortunately, ICANN is about to launch Phase 2of its review of All Rights Protection Mechanisms that will significantly affect the UDRP and the community will be looking for volunteers to staff that working group.

This issue of moving immediately to a decision in favor of the complainant when a respondent defaults, should be at the top of the list of items to consider. Secondly, until this flaw in the UDRP can be fixed, counsel for complainants relying on common law rights should deluge the panelist with mountains of common law evidence to make it more difficult for them to discount such rights and reach the wrong conclusion.   

This article originally appeared in World Trademark Review Weekly on Nov. 11, 2021 and is reprinted with permission.  

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