Trendwest Resorts, Inc. v. Kevin Tisdel

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Trendwest Resorts, Inc. v. Kevin Tisdel

Case No. D2001-0987

1. The Parties

Complainant is Trendwest Resorts, Inc., an Oregon corporation with a principal

place of business in Redmond, Washington, USA.

Respondent is Kevin Tisdel, an individual located in Seattle, Washington, USA.

2. The Domain Names and Registrar

The domain names at issue are:

<mountainstar.com>

<mountainstarproperties.com>

<mountainstarrealestate.com>

<mountainstarhomes.com>

<mountainstarvacations.com>

<mountainstarre.com>

(collectively, the "Domain Names")

The Registrar is: Network Solutions, Inc.

3. Procedural History

This action was brought in accordance with the ICANN Uniform Domain Name Dispute

Resolution Policy, approved October 24, 1999, ("the Policy") and the ICANN Rules

for Uniform Domain Name Dispute Resolution Policy, approved October 24, 1999,

("the Rules").

The Complaint was submitted by electronic mail on August 2, 2001, and by hard

copy on August 7, 2001. On August 6, 2001, Network Solutions, Inc. confirmed

registration of the Domain Names at issue to the Respondent. An extension of

the Response deadline was granted on August 20, 2001, and a second extension

was granted on September 14, 2001. The Response was submitted by electronic

mail on September 24, 2001, and by hard copy on on September 25, 2001.

On October 10, 2001, the WIPO Arbitration and Mediation Center appointed Mark V. B.

Partridge as Sole Panelist.

4. Factual Background

1997

In January of 1997, Complainant sponsored a contest to name a resort facility

it was developing on the outskirts of Roslyn, Washington (Kittitas County),

in the foothills of the Cascade Mountains. On April 24, 1997, Complainant announced

that its proposed resort would be named "MountainStar Resort." Articles

announcing the name selection were published in the Daily Record and

the Seattle Times. The Daily Record has a circulation of about

5,500 and the Seattle Times has a circulation of more than 220,000.

From late 1997 through 2000, Complainant took the necessary steps to satisfy

local, state and federal regulations to begin construction on the planned resort.

These steps included: an Environmental Impact Statement; addressing water and

sewer issues; tax issues; and local economic issues. Complainant’s work in this

area entailed lobbying for, and gaining, changes in Washington State laws, and

winning State Court approval for a water leasing plan associated with the resort.

Many of these steps were chronicled in local newspapers in Kittitas County from

late 1997 through 2000.

On November 7, 1997, Complainant held an "open house" regarding the

proposed resort, with self guided displays detailing Complainant’s plans, and

offering tours of the property.

1998

On September 23, 1998, the Kittitas County Planning Department held a "workshop/openhouse"

regarding the Environmental Impact Statement for the proposed "MountainStar

Resort."

On December 14, 1998, Respondent registered <mountainstar.com> as a domain

name with Network Solutions.

1999

On October 19, 1999, Complainant contacted Respondent in an attempt to acquire

the domain name <mountainstar.com> from Respondent.

On October 29, 1999, Complainant filed an intent-to-use trademark application

with the United States Patent and Trademark Office (USPTO) for the mark MOUNTAINSTAR.

This application has since been abandoned.

On November 1, 1999, Respondent registered the domain name <mountainstarproperties.com>

with Network Solutions.

On November 24, 1999, Respondent filed intent-to-use applications with the

USPTO for the marks, MOUNTAINSTAR and MOUNTAINSTARPROPERTIES in connection with

real estate brokerage and management services. This application was abandoned

on October 26, 2000, after Respondent failed to respond to an office action.

On December 2, 1999, Respondent registered <mountainstarrealestate.com>,

<mountainstarhomes.com>, and <mountainstarre.com> as domain names

with Network Solutions.

On December 3, 1999, Complainant again contacted Respondent in an attempt to

acquire the domain name <mountainstar.com> from Respondent.

On December 6, 1999, Respondent registered the domain name <mountainstarvacations.com>

with Network Solutions.

In the winter of 1999, Complainant distributed a newsletter to residents of

Kittitas County, Washington to inform them of progress on the proposed resort.

On December 30, 1999, Complainant announced its selection of the "MoutainStar"

logo.

2000

On April 26, 2000, Complainant published an advertisement for the "MountainStar

Resort" in the Daily Record. In June of 2000, Complainant acquired

the property on which the proposed resort is to be constructed.

On October 17, 2000, the Kittitas County Commissioners approved Complainant’s

land use application for the resort. On November 29, 2000, Complainant extended

invitations to individuals to tour the "MountainStar Resort" property

in its "Pre-Construction Phase" and learn about possibilities for

reserving and viewing lots for vacation homes. Complainant’s letter indicated

that lots were "now available for reservation."

2001

On March 13, 2001, Complainant filed a trademark application with the USPTO

for the service mark MOUNTAINSTAR, in connection with "property management

services," and "real estate services." This application is pending,

and is based on a first use date of December 31, 1998.

On March 14, 2001, Complainant also filed an intent-to-use trademark application

with the USPTO for the service mark MOUNTAINSTAR, in connection with "tour

guide services," "facilities for recreational activities," and

"hotel and resort services." This application has been suspended.

5. Parties' Contentions

Complainant contends that it has prior common law rights in the service mark

MOUNTAINSTAR through Complainant’s promotional efforts and the mark’s frequent

recognition in local newspapers. Complainant contends that Respondent’s Domain

Names are confusingly similar to Complainant’s service mark, and are, therefore,

likely to cause confusion among users as to the source of Respondent’s proposed

websites.

Complainant also contends that Respondent has no legitimate interest in the

Domain Names because he has no rights in the mark MOUNTAINSTAR, has failed to

use the Names in a bona fide offering of goods and services, is not known

by any of the Domain Names, and has not made a legitimate noncommercial or fair

use of the Names.

Complainant contends that Respondent registered the Domain Names in bad faith

because he registered the first domain name, <mountainstar.com>, on December 14, 1998,

after Complainant had "made significant public use of its Mark" beginning

April 24, 1997. Further, Complainant contends that Respondent registered the

remaining five Domain Names after being contacted by Complainant regarding the

likelihood of confusion associated with the first domain name. Finally, Complainant

contends that Respondent's failure to make legitimate use of the Domain Names

constitutes bad faith use.

Respondent denies ICANN jurisdiction over the Domain Names because the Policy

was not part of his Registration Agreement with Network Solutions when he registered

the Domain Names. Therefore, he contends that the Policy does not apply to these

Names and the Complaint should be dismissed.

Respondent contends that other vacation resorts throughout North America currently

use the mark MOUNTAINSTAR, and that their use was prior to Complainant’s. Respondent

contends that Complainant did not acquire any rights in the service mark, MOUNTAINSTAR,

until after Respondent registered the Domain Names.

Respondent further contends that the Domain Names are not confusingly similar

to Complainant’s service mark. Respondent contends that he has a legitimate

interest in the Domain Names and "has commenced development of a bona fide

business use of the names prior to any notice of a dispute." Finally, Respondent

contends that he registered the Domain Names "in a legitimate pursuit of

business interests, and did not register or use the [Names] in bad faith."

6. Discussion

Respondent registered all six Domain Names with Network Solutions. Through

his registration agreement, Respondent has had notice that he is subject to

whatever dispute policy Network Solutions has in effect at the time a Complaint

is filed against him. Network Solutions has incorporated the Uniform Domain

Name Dispute Resolution Policy (the "Policy") into its own domain name dispute

policy, and this was in effect when the Complaint in this matter was filed.

Therefore, this Panel has jurisdiction in this dispute. Respondent is also on

notice that, in the event that he objects to Network Solutions’ policy regarding

dispute resolutions, his sole remedy is to cancel his domain name registrations.

Since this dispute is clearly within the Panel’s jurisdiction, our substantive

inquiry will focus on three issues: (1) are the Domain Names confusingly similar

to a trademark or service mark in which Complainant has rights; (2) does Respondent

have a legitimate interest in the Domain Names; and (3) have the Domain Names

been registered and used in bad faith? The Complainant has the burden of proof

on each of these issues.

A. Confusing Similarity

Complainant’s Rights in the Service Mark

The Policy requires that a Complainant have "rights" in a mark that

is the subject of a domain name dispute. Therefore, a threshold question here

is whether Complainant has established a protectable right in the service mark

MOUNTAINSTAR. In order to have a protectable right, Complainant’s mark must

be distinctive and used in commerce. Federal registration of a mark is prima

facie evidence of its distinctiveness.

Complainant has neither a federal, nor a state registration for the service

mark MOUNTAINSTAR. However, the Policy does not require a service mark to be

registered by a governmental authority for the Complainant to have rights in

the mark. Complainant may have established common law rights in the mark prior

to Respondent’s domain name registration. Therefore, we must look to Complainant’s

use of the service mark prior to the registration date of each of the six Domain

Names.

When determining prior use of a service mark, the proper test is to "look

at the evidence as a whole, as if each piece of evidence were part of a puzzle

which, when fitted together establishes prior use." West Florida Seafood,

Inc. v. Jet Restaurants, Inc. 31 F.3d 1122 (Fed. Cir. 1994). We must fit

together the pieces of the puzzle in the record here to determine whether, with

respect to each of the six Domain Names, Complainant made prior use.

<mountainstar.com>

In January of 1997, Complainant sponsored a contest to name its proposed resort

facility. On April 24, 1997, Complainant announced that the proposed resort

would be named "MountainStar." Articles announcing the name selection

were published in local newspapers with combined circulations of approximately

230,000 in the Kittitas and King County areas of Washington.

In late 1997, Complainant began taking the steps necessary to satisfy local,

state and federal regulations to begin construction on the planned resort. Between

June of 1997 and December 14, 1998, the date Respondent registered <mountainstar.com>

with Network Solutions, at least 13 different articles and/or letters to the

editor appeared in four local newspapers in and around Kittitas and King Counties

that chronicled Complainant’s progress in meeting the required regulations to

begin construction on the proposed resort. More importantly, each article referred

to Complainant’s proposed resort as either, "MountainStar," "Mountainstar"

or "Mountain Star."

Additionally, on November 7, 1997, Complainant held an "open house"

regarding the proposed resort, with self guided displays detailing Complainant’s

plans, and offering tours of the property.

Then between March and September of 1998, Complainant published a series of

four notices entitled "MOUNTAINSTAR PUBLIC INFORMATION SERIES," in

one of the Kittitas County newspapers. These notices were intended to provide

Kittitas County residents with information about the environmental impacts of

the proposed resort, the possible property tax effects, employment possibilities

and annual wage rates for "MountainStar Resort" employees.

Finally, on September 23, 1998, the Kittitas County Planning Department held

a "workshop/open house" regarding the Environmental Impact Statement

for the proposed "MountainStar Resort."

Respondent contends that Complainant had no rights in the service mark when

Respondent registered the first of the Domain Names, <mountainstar.com>,

on December 14, 1998 because Complainant had not, and could not have possibly,

made a sale using the mark by that date.

However, it is well recognized that actual sale of a marked product is not

necessary for the purpose of determining priority of use in an unfair competition

action. New West Corp. v. NYM Co. of Calif., Inc., 595F.2d 1194 (9th

Cir. 1979) (finding prior rights based on pre-sale publicity). Although evidence

of actual sales is highly persuasive in determining prior use, the 9th

Circuit has found that,

"evidence showing, first, adoption, and second, use in a way sufficiently

public to identify or distinguish the marked [services] in an appropriate segment

of the public mind as those of the adopter of the mark is competent to establish

ownership, even without evidence of actual sales." Id.(quoting New

England Duplicating Co. Inc. v. Mendes, 190 F.2d 415, 418 (1st

Cir. 1951))

The Washington Courts have also adopted this line of reasoning, holding that

the requirement of prior use in a mark is met when that name is actually used

in such a way as to become associated in the public’s mind as the name of the

business. Fish v. Koldkist Beverage Ice, 802 P.2d 837, 838, 60 Wash.App.

122, 123 (1991) (prior rights arise when a name "is actually used in such a

way as to be come associated in the public mind as the name of the business").

To determine whether Complainant used the service mark in such a way that it

identified and distinguished the mark in an appropriate segment of the public

mind as signifying the Complainant’s proposed resort, we must look at the evidence

as a whole. The numerous media reports between April of 1997 and December of

1998 on the proposed resort, all using Complainant’s mark to identify the resort,

are probative. Also probative are: the numerous announcements and updates published

and circulated by Complainant, the various local meetings and "open houses"

held to discuss the proposed resort, and the involvement of the Washington state

legislature and the courts in the process. Taken as a whole, all of these factors

are sufficient for the public to identify the service mark with the Complainant’s

resort.

But even more probative of the service mark’s impact on the "appropriate

segment" of the public is the reaction of those in the real estate business,

such as the Respondent, to the mark. Respondent submitted an affidavit for the

record in which he explains his thinking when he registered the domain name

<mountainstar.com>. In paragraph 2 of the affidavit, Respondent states

that he believed Complainant ". . . had no interest in using the domain

name," because, "Approximately twenty months had elapsed since [Complainant]

announced that it would be using the name ‘MountainStar’ for its planned resort

community … and [Complainant] still had done nothing to register the domain

name or to seek trademark registration of the name…."

Later, in paragraph 7 of his affidavit, Respondent states, "The domain

name <mountainstar.com> and the other domain names at issue in this arbitration

have never been intended to be used as part of my business name, but were used

merely because they provide a geographic reference to the Mountainstar community."

What Respondent refers to as "the Mountainstar Community" only exists

because Complainant adopted that name as their service mark for the resort.

From this statement it is clear, not only that Respondent associated Complainant’s

service mark with Complainant’s proposed resort, but that he also knew consumers

associated the mark with the resort. Otherwise, as a real estate professional,

he would have no business reason to register the Domain Names at issue.

Although Complainant had not obtained federal registration of its mark or made

an actual sale, it made enough use of the mark prior to December 14, 1998, that

Respondent, a real estate professional, associated the mark with Complainant’s

services and apparently believed the public made the same association. I find,

therefore, that Complainant established a protectable right in the mark in its

local area of business prior to Respondent’s registration of the first domain

name at issue, <mountainstar.com>.

Respondent also argues that several other entities throughout North America

were using the name MOUNTAINSTAR for vacation resort-related business activities

at the time Respondent registered the domain name <mountainstar.com>.

This is not relevant because none of these other businesses were operating in

the State of Washington and Respondent does not intend his use of the Domain

Name to relate to any of those uses.

<mountainstarproperties.com>, <mountainstarrealestate.com>, <mountainstarhomes.com>,

<mountainstarvacations.com>, and <mountainstarre.com>

Evidence of adequate use by Complainant of MOUNTAINSTAR prior to Respondent’s

registration of the five additional Domain Names is even stronger. Again, Respondent’s

own statements submitted for the record best demonstrate this. In paragraph

3 of his affidavit, Respondent states:

"Throughout 1999 I was contacted by friends and clients inquiring whether

I would provide vacation rental management services in the Roslyn, Washington

area, including future vacation homes at the Mountainstar resort community.

I decided to offer such services for these clients, and began preparations to

offer vacation rental referral services under the business name Roslyn Properties.

As part of my business preparations I registered additional domain names that

could be used in connection with these services … . I registered these domain

names with the understanding that individuals would need a way to find the companies

that offer the services for which they are looking and that numerous other real

estate companies would be offering similar services in the area of the Mountainstar

community."

Respondent registered the last five Domain Names in November and December of

1999. The above statement by Respondent demonstrates that he registered these

five Domain Names in response to consumer demand for services in connection

with Complainant’s proposed resort "[t]hroughout 1999." Prior to Respondent’s

registration of the five Domain Names, consumers were referring to Complainant’s

resort by its service mark. Therefore, whatever use Complainant was engaged

in with respect to its mark was driving consumers to seek out services in connection

with the mark. This demonstrates that Complainant had established secondary

meaning in the mark by the time Respondent registered the five remaining Domain

Names.

Therefore, I find that Complainant had a protectable interest in MOUNTAINSTAR

at the time each of the Domain Names was registered.

Similarity of the Domain Names and the Service Mark

The domain name <mountainstar.com> is virtually identical to Complainant’s

service mark, and is, therefore, confusingly similar to Complainant’s protected

mark.

The misspelling of the mark in the domain name <mountainstarre.com> does

not cure the confusing similarity because the domain name retains the same meaning

as the mark. Furthermore the residents of Kittitas and King Counties have been

inundated with news reports and advertisements for Complainant’s resort, with

many of the reports including variations on the spelling of MOUNTAINSTAR (e.g.,

"MountainStar," "Mountain Star," or "Mountainstar").

As a result, Respondent’s domain name <mountainstarre.com> is likely to

be confused by consumers as another variation of the service mark representing

Complainant’s resort.

The remaining four domain names, <mountainstarproperties.com>, <mountainstarrealestate.com>,

<mountainstarhomes.com>, and <mountainstarvacations.com> are also

likely to confuse consumers as to source. The generic terms that Respondent

has added to Complainant’s service mark to form these Domain Names are all descriptive

of the very services – properties, real estate, homes and vacations -- Complainant

has advertised in conjunction with the proposed resort under the mark since

April of 1997. As a result, the use of these terms together with Complainant’s

mark could actually make these Domain Names more likely to confuse consumers.

Complainant succeeds on this element for all six Domain Names.

B. Legitimate Interest

Respondent has made no use of the Domain Names in connection with the bona

fide offering of goods and services. Not only is Respondent not commonly

known by any of the Domain Names, he states in the affidavit filed in this matter

that he does not intend to name his business anything similar to any of the

Domain Names. Respondent has also failed to demonstrate that he is engaged in

a legitimate noncommercial or fair use of the Domain Names. Finally, although

Respondent alleges in his Response that he "has commenced the development

of a bona fide business use of the names prior to any notice of a dispute,"

Respondent fails to provide any demonstrable evidence to support this claim.

I find that Respondent lacks a legitimate interest in the Domain Names. Complainant

succeeds on this element.

C. Bad Faith

The circumstances surrounding Respondent’s registration of the Domain Names

and his intent for registering the Names as expressed in the affidavit filed

for the record indicate that Respondent registered the Domain Names in bad faith.

Respondent admits he selected and intends to commercially exploit the Domain

Names solely because of Complainant's selection and use of the MOUNTAIN STAR

name for its resort. The Domain Names would not have been registered by Respondent

but for Complainant's adoption and prior use of MOUNTAIN STAR. Further, Respondent's

proposed use of the Domain Names involves attracting Internet users seeking

Complainant's services to Respondent's website for profit.

Respondent registered the first domain name, <mountainstar.com>, after

numerous news articles were published concerning Complainant’s progress in establishing

the proposed resort. Each of these news reports associates Complainant’s service

mark with the proposed resort. Given that these news reports were published

in the area where Respondent operates a real estate business, it is reasonable

to believe that Respondent registered the first domain name to prevent Complainant

from registering its service mark as a domain name, disrupt the Complainant’s

business, and/or intentionally attempt to attract, for commercial gain, Internet

users to his website by creating a likelihood of confusion with the Complainant's

mark..

Respondent’s statements from his affidavit to the effect that he registered

the Domain Names in order to provide services in association with Complainant’s

resort, indicate that he did, in fact, register the last five Domain Names with

the intent of attempting to attract, for commercial gain, Internet users to

his website by creating a likelihood of confusion with the Complainant's mark.

Furthermore, Respondent registered the last five Domain Names after Complainant

had already contacted him to express its concern over his registration of the

first domain name. Several of the Domain Names were registered within days after

Complainant and Respondent met to discuss these issues. The timing of these

registrations is indicative that Respondent was acting in bad faith.

I believe the reasons Respondent cited for selecting the Domain Names, and

the timing of their selection, demonstrate that Respondent registered the Domain

Names in bad faith.

Respondent has yet to make use of the Domain Names. However, passive holding

of a domain name can be considered bad faith. The Chancellor, Masters and

Scholars of the University of Oxford v. Damian Macafee WIPO

Case No. D2001-0975. The only possible good faith use Respondent could engage

in is noncommercial or fair use, but because Respondent stated that he intended

to use the Domain Names in conjunction with his real estate business, I will

take Respondent at his word. Unfortunately, because of Respondent’s stated intent

for registering the Domain Names, it is difficult to imagine how Respondent

could use the Domain Names in conjunction with his real estate business in the

Kittitas or King County region at this point without that use being in bad faith.

In similar situations involving the adoption of a trademark, the U.S. Courts

have recognized that a deliberate attempt to preempt another's rights in a mark

may be an act of bad faith. Stern Electronics, Inc. v. Kaufman, 523 F.

Supp. 635 (E.D.N.Y. 1981) (finding defendant's attempt to preempt plaintiff's

rights was bad faith use of SCRAMBLE mark). That principle is applicable here

where Respondent deliberately selected a Domain Name based on Complainant's

use of MOUNTAIN STAR.

Complainant contends that Respondent offered to exchange the Domain Names for

a lot in the proposed resort. The evidence in the record does not support this

allegation. However, Respondent’s overall conduct, combined with his stated

intent for registering the Domain Names, leads me to the conclusion that he

acted in bad faith. Complainant also succeeds on this element.

7. Conclusion

All six of Respondent’s Domain Names are confusingly similar to the service

mark in which Complainant has protectable rights. Respondent does not have a

legitimate interest in any of the Domain Names and Respondent registered and

used the Domain Names in bad faith. Therefore, the six Domain Names, <mountainstar.com>,

<mountainstarproperties.com>, <mountainstarrealestate.com>, <mountainstarhomes.com>,

<mountainstarvacations.com> and <mountainstarre.com> shall be transferred

to Complainant.

Mark V. B. Partridge

Sole Panelist

October 24, 2001