Towing The Line On Trademarks – Can You Hitch An Infringement Claim To A UDRP Case?

By Steve Levy

It is a foundational concept that the UDRP was created to deal with abuse of trademarks through the registration and use of domain names, namely, “cybersquatting”. These are situations where a domain name takes unfair advantage of a brand owner’s reputation for illicit gain. Obvious cases are phishing, counterfeit products, monetized links that divert traffic from the brand owner, and so on. However, where a domain name incorporates a trademark and is used for a legitimate business or otherwise in a good-faith manner, things may be less clear and the UDRP may not be the right vehicle for a brand owner’s grievance. That’s where the courts come in to consider cases of trademark infringement and dilution.

recent UDRP decision addressed this fine point and denied a claim against the domain name. The Complainant is the owner of the famous AIRSTREAM mark for recreational vehicles and the Respondent is an AIRSTREAM enthusiast who created a website that allows sellers and buyers to communicate about AIRSTREAM trailers posted for sale. The Website has more than 18,000 users and almost 22,000 subscribers to its accompanying newsletter. What it didn’t have, however, was a notice disclaiming any authorization by, or affiliation with Complainant’s company, although one was added, and other changes to the site were made, after the Complainant’s lawyers sent correspondence to the Respondent alerting them to a legal dispute. However, as the Respondent wasn’t willing to transfer the domain name to the Complainant, the UDRP case was filed.

The 3-member panel found that the domain was, in fact, confusingly similar to the AIRSTREAM mark since it only added the generic word “marketplace”. It next considered whether the Respondent had any rights or legitimate interests in the domain name and found that it was a close call. Although distributors and resellers of branded products are given some leeway to make a fair use of a trademark, they must meet certain standards, one of which is the use of a prominent notice letting visitors to their site know that it’s not operated by or endorsed by the mentioned brand owner. Here, the disclaimer was only added after the Respondent was put on-notice of the legal dispute and so the panel found that the Respondent “failed to implement safeguards sufficient to prevent the potential for Internet users mistakenly to perceive affiliation with Complainant.” By a slim margin, it found that the Respondent failed the rights or legitimate interests test.

One of the more nuanced aspects of the decision came in the next section where the panel noted that a lack of rights or legitimate interests does not automatically mean that the domain name was registered and used in bad faith under the third element of the UDRP test as so often follows in typical cybersquatting situations. Rather, since the Respondent appeared to be operating a site that serves to connect sellers and buyers of AIRSTREAM products, it’s possible that such activity might be considered acceptable under the laws governing trademark infringement. The panel noted that it has limited evidentiary tools, such as document discovery, witness testimony, and cross-examination, and found that “[t]his is a case where more information, as well as the interpretation of the [United States] Lanham Act in the particular jurisdiction where any dispute would be resolved, could be determinative.” As such, it determined that the UDRP is not the proper tool for deciding this case and that the Complainant has not shown, by a preponderance of the evidence, that the Respondent registered and uses the domain name in bad faith.

What we can learn from this situation is that disputes must be carefully vetted and assessed for viability before a complaint is fired off under the UDRP. This is not the place to sort out the really close calls or otherwise decide fact-intensive issues of trademark infringement and smart brand owners must be willing to make hard decisions, in advance, of whether to pursue their cases through the UDRP or the courts.

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