Rand Refinery Limited v. P.T. Reinhardt

WIPO Arbitration

and Mediation Center

ADMINISTRATIVE

PANEL DECISION

Rand Refinery

Limited v. Patrick Reinhardt

Case No.

D2001-0233

1. The Parties

The Complainant is

Rand Refinery Limited, a South African corporation of Germiston, South Africa.

The Complainant is represented by Mr. John Giles, attorney, of Sandton,

South Africa.

The Respondent is Mr. P.T.

Reinhardt of Arrau, Switzerland. The Respondent is represented by Mr. John

B. Berryhill, attorney, of Philadelphia, PA, United States of America.

2. The Domain Name and

Registrar

The domain name at

issue is <krugerrand.com>. The domain name is registered with Tucows.com,

Inc. of Toronto, Canada ("the Registrar"). The name was registered

on March 16, 1998.

3. Procedural History

This is an administrative

proceeding pursuant to the Uniform Domain Name Dispute Resolution Policy

("the Policy") adopted by the Internet Corporation for Assigned

Names and Numbers (ICANN) on August 26, 1999, in accordance with the

Rules for the Policy, approved by ICANN on October 24, 1999 ("the Rules")

and the Supplemental Rules for the Policy ("the Supplemental Rules")

of the WIPO Arbitration and Mediation Center ("the Center").

The Complaint was received

by the Center on February 13, 2001, (electronically) and February 16,

2001, (hard copy). An amendment to the Complaint was filed on March 2, 2001

(email) and March 6, 2001 (hard copy).

On March 7, 2001,

the Center sought registration details from the Registrar. On March 12, 2001,

the Registrar advised that the registrant of the disputed domain name and

the Administrative, Technical, Zone and Billing Contact is the Respondent

at the above address. The Registrar’s Service Agreement incorporates the

Policy and requires the registrant to submit to a properly initiated complaint

under the Policy; that the status of the disputed domain name is "on

hold." and that a copy of the Complainant had not received.

On March 14, 2001,

the Center satisfied itself that the Complainant had complied with all formal

requirements, including payment of the prescribed fee. It formally notified

the Respondent by post/courier, facsimile and email of the Complaint and

the amended Complaint and of the commencement of this administrative proceeding

and sent copies to the Complainant, the Registrar and ICANN.

The formal date of

the commencement of the proceeding was accordingly March 14, 2001.

A Response was filed by the Respondent on April 3, 2001 (electronic)

and April 4, 2001 (hard copy).

A three-member Panel

was requested by the Respondent. Both parties have paid the requisite fees.

On May 7, 2001,

the Center notified the parties of the appointment of the Panel, all three

members having submitted a Statement of Acceptance and Declaration of Impartiality.

The Panel is required to give its decision by May 21, 2001. Because

of the delay in obtaining further material from the parties, the decision

will be delivered on or before June 1, 2001.

The language of the

proceeding is English, as being the language of the domain name Registration

Agreement, pursuant to paragraph 11(a) of the Rules.

The Panel received

a request from Complainant to file a Reply. By procedural order dated May

9, 2001, it allowed a Reply to be filed, plus submissions from the Respondent

on the Reply. The Panel has considered these additional materials before

giving its decision.

The Panel is satisfied

that the Complaint was filed in accordance with the requirements of the

Rules; payment was properly made; the Panel agrees with the Center’s assessment

concerning the Complaint’s compliance with paragraph 2(a) of the Rules;

and that the three member administrative panel was properly constituted.

4. Factual Background

The Complainant originally

claimed in its Complaint that the Complainant held or had held trademark

registrations for ‘Krugerrand’ in Taiwan and the U.S.A.

A krugerrand is a unit

of currency in South Africa, being a gold coin established by the legislature

of the Republic of South Africa in 1967 with its name, weight and dimensions

all prescribed by statute. The Complainant is authorised by the Reserve

Bank of South Africa to manufacture gold blanks that are minted into krugerrand

coins by the South African Mint, an organ of the Reserve Bank.

In its Response, the

Respondent produced evidence that showed that the Complainant had abandoned

a U.S. trademark registration application in 1989. In its Reply to the Response,

the Complainant’s excuse for referring to a U.S. trademark when it never

owned one was that it had referred to "past and/or present registration

in Taiwan and the United States". It rather limply stated that it did

not intend to mislead the Panel.

Complainant asserted

initially trademark registrations in Benelux, Singapore, Spain, Switzerland,

Portugal and Austria. It did not submit documentation to support all these

claims. In its procedural ruling, the Panel required the Complainant to

give full particulars of the marks and their status. It required hard copies

to be forwarded to WIPO Center and to the Respondent for checking. These

have now been supplied. It appears that the Complainant’s claims to trademark

registration for "Krugerrand" in at least some of the countries

mentioned is established.

The above scenario

demonstrates that it is lax practice for a complainant to assert trademark

registrations without tendering prima facie evidence such as copies of official

registration documents. The Panel is at a loss to understand why it was

given such obviously incorrect information about a U.S. trademark. What

follows is the Panel’s summary of the relevant information, including that

eventually supplied by the Complainant.

- The trademark

on which the Complaint is based is "Krugerrand". Gold coins

are the goods in connection with which the Complainant uses the trademark.

It has trademark registrations in some European countries, including

Switzerland where the Respondent is domiciled. Even so, the evidence

produced by the Complainant is not entirely satisfactory. Some of

the marks are in the name of International Gold Corporation Limited

and are said to have been transferred to the Complainant. However,

its ownership of a Swiss mark appears proved.

- The Respondent

has not developed a website for the domain name. He wishes to develop

the name in connection with investment activities, but is open to

offers to sell.

- Relevant

parts of a communication from the Respondent to the Complainant dated

June 8, 1999 read –

"The owner

informs me, that the domain name is for lease. At your discretion,

the monthly fee to forward this name (URL forwarding) is US$1,500

for the duration of one year after which the price will be adjusted

to the prevailing market conditions. If you wish to purchase this

name outright, the owner is asking 100k."

- A letter

of demand was sent to the Respondent in February, 2001 offering to

pay the Respondent’s out-of-pocket costs directly related to the domain

name in return for the transfer of the domain name: the Complainant

has received no response.

5. Parties’ Contentions

Complainant:

(a) domain

name is identical to the Complainant’s registered mark.

(b) Respondent

has no rights or legitimate interests in respect of the domain name

that is the subject of the Complaint for the following reasons –

- Respondent

has not used or made preparation to use the domain name in connection

with a bona fide offering of goods or services, and

- Respondent

is not commonly known by the domain name, and

- Respondent

is not making a legitimate non-commercial or fair use of the domain

name.

The web page that appears

at the domain name provides proof of the existence of the above factual

grounds. The Respondent has offered the domain name for sale.

(c) The name

was registered and is being used in bad faith, as can be seen from

the correspondence between the parties. The Complainant’s enquiry

about sale in 1999 was made without legal advice.

Respondent:

(a) The krugerrand

is a unit of currency of the Republic of South Africa. It is a one

troy-ounce gold coin established by an Act of the legislature of South

Africa in 1967. The name of the coin is derived from Paul Kruger,

the President of South Africa from 1883 to 1900, conjoined with the

fundamental currency unit of South Africa, the rand. The name of the

krugerrand, its weight, its composition, and its size, are all established

in Schedule 2 of the South African Reserve Bank Act. Section 16

of the Act states:

"The Bank

may make or cause to be made coins of the denominations and with the

mass set out in Schedule 2, and which are made of gold […]"

Section 2 of the Act,

specifies various weights of "krugerrand" and the composition

thereof. Section 17(2) of the Act defines as legal tender of the Republic:

"coin which

is lawfully in circulation in the Republic and of current mass, […]

and the value of each gold coin so tendered shall be equal to the

net amount at which the bank is prepared to purchase that gold coin

on the day of such tender thereof."

While the South African

Reserve Bank Act is clear in the establishment of the krugerrand as a coin,

and in the physical specifications for the coin, there is no mention of

the Complainant to be found in the Act. Krugerrands are not a product of

the Complainant. As the name of a unit of currency, the term "krugerrand"

is not the intellectual property of any person at all. The coin was named

by the legislature of South Africa, and the Complainant has no claim to

a trademark as the result of an Act of the legislature of its home country.

(b) For any

party to claim a trademark right in the term "krugerrand"

would be the equivalent of a trademark claim to "Swiss Franc",

"Deutsche Mark", or "U.S. Dollar". The krugerrand

is traded as a commodity item on world markets as a "krugerrand".

(c) The Complainant

exercises no control over the name, design or physical features of

this coin, and thus does not legally exercise control over the product

as would be required for goods subject to trademark. It does not manufacture

the krugerrand. The Complainant does not determine the number of krugerrands

to be produced in a given year. Indeed, the specifications of the

coin are conditions for the production of krugerrands, set by the

legislature of South Africa. The sine qua non of trademark

ownership is the ability to control the quality of the goods produced

under the alleged trademark.

(d) In the

absence of any valid trademark claim, the Respondent was entitled

to register the domain name <krugerrand.com> on a "first-come,

first-served" basis, when the domain name was available for registration.

Despite the presumption of validity of a registered mark, this is

one of those rare cases where the Panel should find that there is

no valid mark.

(e) The Respondent’s

interest in krugerrands arises from the Respondent’s professional

involvement in investments. The Respondent has a Swiss commercial

diploma in economic studies, and is professionally employed as an

investment advisor with the Aarauische Kantonalbank. It has been the

Respondent’s plan to develop the domain name in connection with investment

activities, as the krugerrand is an investment vehicle. Pending the

development of an active website in connection with the domain name,

the Respondent is open to offers that others desiring to develop the

domain name may have. The Complainant initially approached the

Respondent’s brother, stating that it was "interested to know

if you would sale …".

(f) A speculative

interest in a domain name that one has legitimately acquired to the

detriment of no trademark right, is a legitimate interest. Here, the

domain name is the generic name of a unit of currency, and is not

a trademark. In John Fairfax Publications Pty Ltd v. Domain

Names 4U and Fred Gray, (WIPO Case No. D2000-1403),

the domain name at issue was <financialreview.com>.

(g) <krugerrand.com>

was registered by the Respondent on March 16, 1998. The Complainant’s

domain name, <krugerrand.org>, was registered on June 10,

1999, at a time when the Complainant was surely on notice of the prior

registration of <krugerrand.com> by the Respondent. The Policy

is akin to an action in equity, giving rise to the equitable defense

of laches. Even if the Complainant had a claim of right to the term

"krugerrand", (which is not conceded), the Respondent would

still be entitled to a legitimate reliance in the undisturbed registration

of the domain name in view of the Complainant’s several years of inaction

followed by the Complainant’s new-found interest in acquiring the

domain name.

(h) The Respondent

has not engaged in a pattern of registering domain names corresponding

to any trademark of the Complainant. Moreover, the Respondent has

not prevented the Complainant from using the term "krugerrand"

in a domain name – even though the term is not a trademark of the

Complainant. The Complainant has registered and uses the domain name

<krugerrand.org>, and the Complainant admits at the corresponding

website that they are coins issued by South Africa for the manufacture

of which the Complainant supplies the blanks.

(i) The Respondent,

having a professional interest in investments, registered the domain

name <krugerrand.com> because it is a term of relevance to his

occupation. The Respondent has maintained contact data sufficient

to provide actual notice of the dispute, and has updated the data

at various times to reflect parties with whom the Respondent was engaged

in potential developments for the domain name. Had the Respondent

registered the domain name primarily for the purpose of selling it

to the Complainant, then the Respondent would have approached the

Complainant at some point during the Respondent’s undisturbed years

of registration.

(j) It is

unlikely that any relevant consumer associates the term "krugerrand"

with the Rand Refinery, which does not manufacture or sell krugerrands.

Rather, it is clear that the investment world recognizes the term

"krugerrand" as a one-ounce gold coin which provides a practical

method of owning a calibrated weight of gold for investors in countries

which allow coin ownership but which do not allow private ownership

of bullion per se. Just as the coin is legitimately held

for speculation, so too is it a legitimate activity to speculate in

the generic name of the coin. The Complainant has presented no evidence

of any secondary meaning or distinct consumer association of the term

"krugerrand" with any commercial activity of the Complainant.

(k) There

is no bad faith evident in the Respondent’s willingness to sell the

domain name.

6. Discussion and

Findings

To qualify for cancellation

or transfer, a complainant must prove each element of paragraph 4(a) of

the Policy, namely:

(i) the disputed

domain names are identical or confusingly similar to a trademark or

service mark in which the Complainant has rights;

(ii) the Respondent

has no rights or legitimate interests in respect of the domain names;

and

(iii) the

disputed domain names have been registered and are being used in bad

faith.

Although the Panel

has misgivings about the validity of the trademark registration of "krugerrand"

which is a unit of currency not controlled by the Complainant, the Panel

does not find it necessary to investigate the Respondent’s concerns. Such

an investigation is best made by a Court of competent jurisdiction in a

proceeding to test the validity of the mark. Because there are valid trademark

registrations of "krugerrand" owned by the Complainant, the Panel

is prepared to hold that the domain name is identical to the registered

mark. Thus the first criterion is proved.

However, the Panel

considers that the Complaint must fail because it is not satisfied that

the Respondent registered <krugerrand.com> in bad faith in June, 1998.

Although there may have been a Swiss trademark registration, a reasonable

person in the finance industry such as the Respondent, could not be assumed

to know that a trademark registration existed for a unit of currency with

worldwide recognition which is authorized by the legislature of the country

that produces and distributes it. Respondent would normally be entitled

to use "krugerrand" as a generic term. Maybe the Respondent did

register the name in bad faith. But that fact cannot be decided on the papers

– only a Court would be able properly on evidence to so decide.

It is therefore unnecessary

to consider the second criterion under the Policy, in view of the clear

view of the Panel that the third criterion has not been met by the Complainant.

7. Decision

For the above reasons,

the Panel declines to order the transfer or removal of the domain name.

The Complaint is denied.

Hon. Sir

Ian Barker QC

Presiding Panelist

Archibald

Findlay, S.C.

Panelist

Tony Willoughby

Panelist

Dated: May

23, 2001