Equitable Outcome, Bad Precedent or Both?
Can a UDRP decision be equitable while at the same time potentially set bad precedent? In my mind, the answer to this question is Yes.
In the recently published decision Multitracks.com LLC v. George George / George, a UDRP Panelist for THE FORUM ruled in favor of the Complainant and ordered the transfer of the seemingly generic / descriptive domain name <multitrack.com>. At a 50,000-foot level a decision like this one can easily be a head scratcher. How is it possible that a Complainant can demonstrate that a domain name registrant registered and used a generic / descriptive domain name in bad faith?
All domain name registrants are required to submit to a mandatory administrative proceeding in the event that a third party asserts that (i) the registered domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights; and (ii) the registrant has no rights or legitimate interests in respect of the domain name; and (iii) the domain name has been registered and is being used in bad faith. See https://www.icann.org/resources/pages/policy-2012-02-25-en. If the third party (called "Complainant") can demonstrate those three elements, it may be entitled to the transfer of the domain name.
In Multitracks, the Complainant claimed it had rights to the term MULTITRACKS by virtue of its registration of MULTITRACKS in the United States Patent and Trademark Office's Supplemental Register. Unlike the official Principal Register, the Supplemental Register provides very limited trademark rights and benefits and consists of marks that do not qualify for the Principal Register. This is common with respect to terms like MULTITRACKS which are nondistinctive and consumers generally do not associate those terms with the specific claimed owner.
Recognizing the limited rights afforded to trademarks on the Supplemental Register, the Panelist in this case rightfully stated that the reliance on marks not on the Principal Register requires Complainant's to demonstrate that its mark has become a distinctive identifier to which consumers associate with its goods and/or services. The Respondent argued that there was no way for the Complainant to do that because "MULTITRACKS" is a descriptive and/or generic name meaning "individual audio parts that are recorded separately for audio production." And the Respondent here is technically correct.
So how then did the Complainant succeed? And Doesn't this set awful precedent?
Without judging whether this case was right or wrong, this case was decided on the specific facts and circumstances of this case alone. The Panelist, therefor, must have believed that ordering the transfer of this name was the equitable outcome.
With the caveat that none of us has access to the entire record, and we can only see the written decision, it appears that the registrant in this case knew of, and was a direct competitor of, the Complainant. The registrant registered the domain name (which corresponded to the Complainant's domain name minus the "s") and directed all of the traffic it received to loopcommunity.com, a website the registrant operated that competed directly with the Complainant. The Panelist found that the combination of these facts amounted to registering and using the name in bad faith.
But in a UDRP action, if a Complainant cannot show that it has trademark rights in a particular mark (the first mandatory element of a UDRP action), then it shouldn’t matter if the domain name was registered and used in bad faith. Before assessing whether a name was registered and used in bad faith, a Complainant must prove that it has trademark rights in a mark that is identical or confusingly similar to the domain name. In other words, you have to have a mark in which you have rights in order to even have standing to bring a UDRP action against a registrant.
I believe the Panelist may have been lenient in evaluating this first element given the specific facts of the case. Namely - the registrant clearly knew of the Complainant, competed directly with the Complainant, and forwarded all traffic to its competing website. The Panelist gave the benefit of the doubt to Complainant that in the niche community of Christian worship leaders (the community to which both Complainant and the registrant provide services), this otherwise descriptive term was generally associated with the Complainant. Given the intentional conduct of the registrant, that may have been enough to determine that the Complainant had trademark rights to meet the standing requirement.
I imagine there will be a number of critics that disagree with the way that this case came out. And I do understand their cause for concern. Even if this case was equitably decided, lawyers and other panelists tend to generalize UDRP findings beyond the scope of what was intended. Although all UDRP decisions should be determined on their individual facts and circumstances, there are some that tend to try and extrapolate broader findings. Sometimes these broader findings show up in overviews or articles without reference to the very specific facts and circumstances of the particular case.
Articles, overviews and treatises and extremely helpful to lawyers, panelists, and other practitioners. However, one must also keep in mind that those principles are tied to a particular set of fact. If the facts of the Multitracks case had been different (e.g., the registrant had no knowledge of the Complainant, or had not forwarded the traffic to a competing service, etc.), the domain name would not have been transferred. But the concern is that others will use this case to expand the rights of alleged owners of descriptive or generic terms to succeed in future UDRP cases. And that danger is very real IF UDRP Panelists in the future are not cognizant of the very facts and circumstances surrounding this one case.