Drew Bernstein and Kill City, Inc. dba Lip Service v. Action Advertising

WIPO Arbitration

and Mediation Center

ADMINISTRATIVE PANEL DECISION

Drew Bernstein and Kill City d/b/a Lip Service v. Action Advertising,

Inc.

Case No. D2000-0706

1. The Parties

Complainant Kill City, Inc. d/b/a Lip Service ("Lip Service") is

a California corporation. Complainant Drew Bernstein is the president and sole

shareholder of Kill City, Inc. The Complainants’ mailing address is 130 South

Anderson Street, Los Angeles, California, 90033.

The Respondent is Action Advertising, Inc., a Florida corporation. Its mailing

address is Box 4357, Boynton Beach, Florida, 33424.

2. The Domain Name and Registrar

The domain name at issue is "lipservice.com" (the "Domain Name").

The registrar with which the Domain Name is registered is Network Solutions,

Inc., located in Herndon, Virginia, USA (the "Registrar" or "NSI").

3. Procedural History

The WIPO Arbitration and Mediation Center (the "Center") received

the Complainant’s Complaint by e-mail on June 29, 2000. On July 3, 2000, the

Center sent the Complainant an Acknowledgment of Receipt of the Complaint.

On July 3, 2000, the Center sent to the Registrar, NSI, a Request for Registrar

Verification. On July 5, 2000, the Registrar transmitted to the Center via e-mail

a Registrar Verification Response confirming that the Domain Name is registered

with NSI and that the Respondent is the current registrant of the Domain Name.

NSI’s Response provided the following contact information for the Respondent:

Registrant: Action Advertising Products, Inc. (LIPSERVICE-DOM), Box 4357, Boynton

Beach, FL 33424. Administrative Contact, Technical Contact, Zone Contact, Billing

Contact: Schwartz, R (RS1364), "mr800king@aol.com", Box 4357, Boynton

Beach, FL 33424, (561) 753-1014.

The Center completed a Formalities Compliance Review on July 13, 2000, and

verified that the Complaint satisfied the formal requirements of the ICANN Uniform

Domain Name Dispute Resolution Policy (the "Policy"), the Rules for

Uniform Domain Name Dispute Resolution Policy (the "Uniform Rules"),

and the Supplemental Rules for Uniform Domain Name Dispute Resolution Policy

(the "WIPO Supplemental Rules"). Complainant made the required payment

to the Center. Upon independent review, the Administrative Panel also finds

that the Complaint satisfies the formal requirements of the Policy, the Uniform

Rules, and the Supplemental Rules.

On July 13, 2000, the Center transmitted to the parties, with copies to NSI

and ICANN, a Notification of Complaint and Commencement of Administrative

Proceeding, setting a deadline of August 2, 2000, by which the Respondent could

file a Response to the Complaint.

On August 1, 2000, the Center received Respondent’s Response to the Complaint.

On August 4, 2000, the Center notified the parties that it would proceed to

appoint the Administrative Panel.

On August 5, 2000, the Center received from Complainant a Supplemental Statement

of Facts and Law in Reply to Respondent’s Response and Complainant’s Selection

of Arbitrators, to be considered at the sole discretion of the panel pursuant

to ICANN Rule 12. The Panel has decided not to accept this additional submission

by the Complainants, as it was submitted contrary to the Uniform Rules and consists

merely of additional legal arguments that could have been made in the original

Complaint. See Document Technologies, Inc. v. International Communications,

Inc., ICANN Case No. D2000-0270 (no right of reply under ICANN Rules;

"truncated procedure allows for more rapid and cost effective resolution

of domain name challenges.")

In view of the Respondent’s request for appointment of a three-person panel

of arbitrators, on August 29, 2000, the Center provided the parties with a list

of five panelists, which each party was asked to rank in order of preference

and return to the Center by September 3, 2000. The Center then invited Jonathan

Hudis and Mark Partridge to serve as panelists and Dana Haviland to serve as

the presiding panelist. On September 11, 2000, after having received from each

panelist a Statement of Acceptance and Declaration of Impartiality and Independence,

the Center transmitted to the parties via e-mail a Notification of Appointment

of Administrative Panel and Projected Decision Date. The Projected Decision

Date was September 24, 2000. The Panel finds that the Administrative Panel was

properly constituted and appointed in accordance with the Uniform Rules and

the WIPO Supplemental Rules.

4. Factual Background

Complainant Kill City d/b/a Lip Service is a California corporation with its

principal place of business in Los Angeles, California. Complaint, paragraph

2. Complainant Drew Bernstein, the president and sole shareholder of Kill City,

Inc., owns the registered trademark LIP SERVICE for men’s clothing and women’s

clothing. The mark was registered with the U.S. Patent and Trademark Office

on February 6, 1990, and achieved incontestable status on July

5, 1996. Complaint, paragraph 12.1.1., Annex 3. The mark LIP SERVICE was first

used in commerce by Complainant in 1985. Id. According to Complainant,

the mark is used for clothing worn primarily by rock and roll musicians, nightclub

goers, and other "fashion freaks." Complaint, paragraph 12.1.1. Similar

trademarks incorporating the phrase "lip service" have been registered

by several other companies for different purposes, including advertising agency

and public relation services, lip balms, and computer software. Response, paragraph5.2,

Exhibit A.

On December 27, 1995, the Respondent registered the Domain Name "lipservice.com"

with NSI. Response, paragraph 5.1. Respondent has utilized the Domain Name as

a link to other web sites since its registration. Response, paragraph 5.1. Complainant

registered the domain name "lip-service.com" on May 20, 1998. Response,

paragraph 5.6, Exhibit B, p.3. On August 2, 1999, counsel for Complainant sent

a cease and desist letter to Respondent, informing him of Complainant’s trademark

rights and demanding the transfer of the Domain Name from the Respondent to

the Complainant. Complaint, paragraph 12.1.3, Annex 11. Receiving no response

from the Respondent, the Complainant then lodged a complaint with NSI under

NSI’s then-existing dispute resolution policy. Complaint, paragraph 12.1.3,

Annex 12. Such complaint, however, was put on hold pending the implementation

of the ICANN Policy, under which this proceeding was later brought. Id.

5. Parties’ Contentions

Complainants

The Complainants contend that the Domain Name registered by the Respondent

is identical to Complainants’ registered trademark, that the Respondent has

no rights or legitimate interests in the Domain Name, and that the Respondent

has registered and is using the Domain Name in bad faith.

With respect to the second element of their claim, "right or legitimate

interest in the domain name", Complainants assert that Respondent has not

been authorized to use their trademark, that Respondent has no independent trademark

rights or applications filed with respect to the mark, that he is not known

by the name "lip service", and that he is not making any legitimate

noncommercial use of the Domain Name. They further assert that Respondent is

not making a bona fide offering of goods and services under the "lip service"

domain name because Respondent uses the name "Slut Dot Com" for Respondent’s

web site accessed by the Domain Name.

Complainants also assert that Respondent is a cybersquatter who has registered

multiple domain names, including the Domain Name and others using registered

trademarks, for the purpose of selling them at a profit. They contend that cybersquatting

results in dilution of the trademark, and that in this case, the trademark is

being used in connection with pornography, and thus also tarnishing the Complainants’

mark. According to Complainant, Respondent is not making any legitimate use

of the Domain Name, but "merely holding [it] and waiting to sell it to

the highest bidder, and in the meantime, using the Domain Name, and the goodwill

inherent in Lip Service’s trademark to draw visitors to its pornographic site."

Complainants argue that Respondent’s registration and use of the Domain Name

constitute bad faith under Paragraphs 4(b)(I)(II) and (iv) of the Policy: "Respondent

is engaged in the business of cybersquatting, has registered the Domain Name

for the purpose of preventing the owner of the trademark from reflecting the

mark in a corresponding domain name, and has intentionally attempted to attract,

for commercial gain, Internet users to Respondent’s web site by creating a likelihood

of confusion with Lip Service’s mark as to the location of Lip Service’s goods

and services on the Internet." Complaint, paragraph 12. 2.3.

Complainants contend that Respondent makes a business of registering domain

names for the purpose of selling them to generate a profit and also maintains

a web site at which it sells domain names, including domain names incorporating

registered trademarks, thus engaging in a pattern of conduct constituting bad

faith under both paragraph 4(b)(i) and paragraph 4(b)(ii) of the Policy. As

evidence of bad faith under paragraph 4(b)(iv) of the Policy, Complainant alleges

that Respondent has registered the Domain Name for purposes not only of sale

but also to draw Internet users to Respondent’s web site(s) which allegedly

contain links to "pornographic materials" and generate advertising

income for Respondent. Complaint, paragraph 12.2.3.

Respondent

Respondent admits that the Domain Name is "virtually identical" to

the Complainants’ trademark, but asserts that it has "rights or a legitimate

interest" in the Domain Name, and denies that it has registered or used

the Domain Name in bad faith.

Specifically, Respondent denies that it is a cybersquatter, and asserts that

although it has registered many domain names, it is not in the business of selling

domains, but of purchasing domains and deriving income from them through linking

its domain names to adult and other web sites. Respondent states that it is

" in the business of warehousing and utilizing domains primarily of a generic

nature", and that "at no time has Respondent sought to sell or transfer

any such domains to any other party, including the Complainants", Response,

paragraph 5.1. Respondent argues that Complainant has adduced no evidence of

any offer to sell the Domain Name.

Respondent also denies that it is a distributor of pornography on the Internet,

and states that it owns "numerous domains, some of which are linked to

adult web sites." Respondent asserts that it has utilized the Domain Name

which is the subject of this proceeding continuously since registration as a

link to adult entertainment sites not owned by the Respondent, which Respondent

states deal with a "literal" [i.e., sexual] interpretation of the

generic term "lip service", Response, paragraph 5.1.

Respondent further contends that although the Complainants’ trademark and the

Domain Name are nearly identical, the similarity is not confusing, for several

reasons: Respondent has never used the Domain Name in connection with the sale

of clothing, the LIP SERVICE mark is not famous or distinctive, several other

similar registered trademarks use the term "lip service", and the

phrase "lip service" is a generic term. Citing dictionary definitions

of the phrase "lip service" as an "insincere agreement"

or "insincere expression of respect", Respondent contends that these

definitions "more aptly describe" Respondent’s use of the domain name

than Complainants’ use of the trademark, Response, paragraphs. 5.1, 5.2.

Respondent contends that it has a right or legitimate interest in the Domain

Name because it has used the Domain Name in its business for approximately five

years and because the name "lipservice.com" is appropriate for its

use as a link to adult entertainment sites. Respondent argues also that the

fact that some of the other domain names registered by the Respondent may be

identical to trademarks owned by others is, in itself, insufficient evidence

of an intent to profit from or abuse such trademark rights.

Respondent denies that it has registered or used the Domain Name in bad faith..

Respondent contends that the trademark is not famous or distinctive, that Respondent

had no knowledge of the Complainants’ trademark until receipt of their ‘cease

and desist letter" four years after Respondent’s registration and commencement

of use of the Domain Name, and that a domain name holder is not required to

undertake prior trademark searches in every country of the world. Respondent

denies that use of a domain name to link to an adult entertainment web site

and utilize banner advertisements to generate income constitutes bad faith use.

Finally, Respondent contends that Complainants have provided no evidence that

Respondent engages in a pattern of registering the trademarks of others as domain

names, have not shown that Respondent registered the Domain Name for the purpose

of disrupting the business of a competitor, and have not shown that Respondent

intentionally attempted to create a likelihood of confusion with Complainants’

mark.

6. Discussion and Findings

Under the terms of the Policy, the Complainant must prove three distinct elements

in order to prevail on a claim for transfer of a domain name. These elements

are set forth in Paragraph 4(a) of the Policy:

- that the domain name registered by the respondent is identical or confusingly

similar to a trademark or service mark in which the complainant has rights;

and

- that the respondent has no rights or legitimate interests in respect of the

domain name; and

- that the domain name has been registered and is being used in bad faith.

(a) Identity or confusing similarity of domain name and trademark

The Panel finds that the Domain Name "lipservice.com" registered

by the Respondent is identical or confusingly similar to the Complainants’ "Lip

Service" trademark, differing only in the addition of the ".com"

suffix and eliminating the space between the two words. The Panel thus finds

that the Complainants have proved the first element of their claim under Paragraph

4(b) of the Policy.

(b) No legitimate interest in domain name

Paragraph 4(c) of the Policy sets forth, without limitation, three examples

whereby a domain name registrant may show a right or legitimate interest in

a domain name:

(i) before any notice of the dispute to you 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:

or

(ii) 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; or

(iii) you are making a legitimate noncommercial 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.

In this case, only the first example is at issue, as Respondent concedes the

inapplicability of (ii) and admits that its use of the Domain Name is for commercial

gain.

Respondent states, and Complainants have offered no evidence to the contrary,

that the Domain Name has been continually in use for a web site containing links

to adult entertainment sites generating advertising revenue for Respondent since

its registration in 1995. Complainants contend, however, that Respondent is

not using the Domain Name in connection with a bona fide offering of goods or

services because the web site of Respondent which is accessed by the Domain

Name does not display the Domain Name or the name "Lip Service", but

rather utilizes the name "Slut Dot Com". However, the Policy does

not specify that a domain name must itself be displayed on the registrant’s

web site in order for there to be a legitimate interest in its use in connection

with a bona fide offering of goods and services.

Complainant next contends that Respondent’s interest in the Domain Name is

not legitimate because Respondent is a cybersquatter, hoarding and attempting

to sell domain names for a profit and preventing trademark holders from using

the domain names. Respondent correctly points out, however, that Complainants

have produced no evidence of any offer by Respondent to sell the Domain Name

to Complainants or others. Complainants’ exhibits include copies of a web site,

"erealestate.com", operated by Respondent, which shows that Respondents

register and purchase domain names, but does not evidence sales or offers to

sell. Complaint, Annex 10. Annex 10 of the Complaint also contains copies of

pages from a web site "dnsresearch.com" offering domain names for

sale, which Complainants allege is somehow linked to Respondent’s "erealestate.com"

web site, but there is no evidence that Respondent operates the "dnsresearch.com"

web site or that it has any interest in the domain names listed there for sale.

Complainants also contend that the Respondent has no legitimate interest in

the Domain Name because Respondent’s use of the Domain Name results in dilution

and/or tarnishment of their trademark. Causes of action for trademark dilution

and tarnishment, however, involve in-depth analysis of factual and legal issues

more suitable for resolution by an arbitrator or a court, and are beyond the

scope of jurisdiction of the Panel in this ICANN administrative proceeding,

which is limited to a summary determination of whether the Complainant has proven

the elements of a claim under the Policy. See Bridgestone Firestone,

Inc., et al., v. Myers, ICANN Case No. D2000-0190; cf. Avery

Dennison Corp. v. Sumpton, 189 F. 3d 868 (9th Cir. 1969) (cybersquatting

dilution and tarnishment claims presented issues of fact that could not be decided

on summary judgment); see also WIPO Report, April 30, 1999, paragraph.

172 ("[G]ood faith disputes between competing right holders or other competing

legitimate interests over whether two names were misleadingly similar would

not fall within the scope of the procedure"). 1

In view of the evidence showing that the Respondent has used the Domain Name

for several years in connection with web sites providing advertising links to

adult entertainment web sites, and because the term "lip service"

is susceptible of a meaning that is arguably, as Respondent has asserted, "apt"

for the services offered, the Panel finds that the Complainants have failed

to carry the burden of proof as to Respondent’s lack of "right or legitimate

interest" in the Domain Name under Paragraph 4(a) (ii) of the Policy.

(c) Bad faith registration and use of the domain name

Paragraph 4(b) of the Policy sets forth four examples of bad faith, which are

not exclusive, but which "shall be evidence of registration and use of

a domain name in bad faith":

"(i) circumstances indicating that you have registered or you have acquired

the domain name primarily for the purpose of selling, renting or otherwise transferring

the domain name 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; or

(ii) 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; or

(iii) you have registered the domain name primarily for the purpose of disrupting

the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract,

for commercial gain, Internet users to your web site 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 your web site or location

or of a product or service on your web site or location."

The first example above is inapplicable, because there is no evidence that

Respondent registered or acquired the Domain Name primarily for the purpose

of selling it to the Complainants or a competitor. Complainants have produced

no evidence of any offer by Respondent to sell the Domain Name to anyone. Similarly,

the second example above is inapposite, because the evidence is insufficient

to show that the Respondent’s registration or use of the Domain Name was intended

to prevent the Complainants from utilizing their mark in a domain name. The

third example does not apply because the parties are not competitors, and there

is no evidence the Respondent registered the Domain Name for the purpose of

disrupting the Complainants’ business.

The fourth example presents a closer question, whether the Respondent intentionally

attempted to attract, for commercial gain, Internet users to its web site or

the web sites of others, by creating a likelihood of confusion with the Complainants’

mark as to the source or sponsorship of the web site or services offered by

the Respondent’s web site. Certainly the Respondent had constructive knowledge

of the Complainants’ federally registered trademark, whatever the state of its

actual knowledge. However, the evidence also shows that the term "lip service"

used in the Respondent’s Domain Name is not an arbitrary or coined term nor

a distinctive trademark, but a common English phrase susceptible of more than

one meaning or connotation, which can be and is used in many commercial contexts,

and that one of those connotations is, as Respondent argues, "apt"

for the adult entertainment advertising engaged in by Respondent on the web

site accessed by the Domain Name. For this reason, the Panel finds that the

evidence is insufficient to establish bad faith registration and use under Paragraph

4(b)(iv) of the Policy.

The Policy’s list of examples of bad faith registration and use is not intended

to be exhaustive, and the Panel has considered all other arguments made by the

Complainants in this regard. As discussed above, however, on the evidence presented,

we find that Complainant has not met its burden of proving that the domain name

was registered and is being used in bad faith, as required by Paragraph 4(a)(iii)

of the Policy.

7. Decision

For all of the foregoing reasons, it is the decision of the Panel that the

Complainants have not satisfied their burden of proving all the elements of

the claim under the Policy, and that the Complainants’ claim for transfer of

the Domain Name "lipservice.com" is therefore denied.

Dana Haviland

Presiding Panelist

Jonathan Hudis Mark Partridge

Panelists

Dated September 28, 2000

Footnotes:

1. Although facts showing intentional tarnishment could be relevant

to a claim by Respondent of a legitimate interest under Paragraph 4(c) (iii)

of the Policy, or to the issue of bad faith, Complainant has not presented evidence

sufficient to support a finding of intentional tarnishment.