An affidavit stating "on information and belief" that
a domain name registrant is not using the domain name for any legitimate
business purpose is not sufficient evidence to support a finding that the
registrant has no rights nor legitimate interest in the domain name, an
arbitrator of the National Arbitration Forum ruled June 7 (Cottonsmith LLC v.
Resource Services Ltd., NAF, Claim No.
FA0104000097096, 6/7/01).
The arbitrator also found that a one-time offer to
sell a domain name registration to a complainant does not by itself
support a finding of bad faith registration and use of the domain
name.
The respondent, Resource Services Ltd. of Costa Mesa,
Calif., registered the domain name cottonsmith.com with
Network Solutions Inc.
The complainant, Cottonsmith LLC of Los
Angeles, brought this action under the Uniform Domain Name Dispute
Resolution Policy adopted by the Internet Corporation for Assigned Names
and Numbers in 1999. All domain names registered with ICANN-accredited
registrars are subject by contract to the UDRP.
The UDRP authorizes an accredited administrative
arbitrator to transfer or cancel a domain name registration if the
arbitrator finds that the domain name is identical or confusingly similar
to a mark in which the complainant has rights, if the registrant has no
rights nor legitimate interest in the domain name, and if the domain name
was registered and used in bad faith.
Arbitrator Irving H. Perluss found that the
complainant had failed to meet its burden in showing that the respondent
had no rights nor legitimate interest in the domain name.
Paragraph 4(c)(i) of the UDRP states that a respondent
has demonstrated that it has rights or legitimate interest in a domain
name if it can show that before notice of the dispute, the respondent has
used or demonstrably prepared to use "the domain name or a name
corresponding to the domain name in connection with a bona fide offering
of goods or services."
Affidavits Were Flat
Contradictions
The respondent
submitted an affidavit that stated that Resource Services had used the
domain name as well as the mark Cottonsmith in
connection with its business. The complainant submitted evidence of the
existence of companies using the name Cottonsmith in the
form of invoices and also submitted affidavits.
The complainant's affidavits, however, said that "[o]n
information and belief, [the respondent] is not using the domain for any
business purpose. [The respondent] is merely holding up the registration
to prevent COTTONSMITH from using
it to develop an internet website to service it's [sic] customers on a broader
scale."
Such an affidavit, based on information and belief,
could not be used as evidence to support the complainant's contentions,
the arbitrator said, quoting from Star Motor
Imports Inc. v. Superior Court, 88 Cal. App.
3d 201, 151 Cal. Rptr. 721 (1979): "An affidavit based on 'information and
belief' is hearsay and must be disregarded."
Additionally, the arbitrator found that the
complainant had failed to meet its burden in showing that the respondent
had registered and used the domain name in bad faith.
The complainant submitted a letter from the respondent
to the complainant offering to sell the domain name registration to the
complainant. Paragraph 4b(i) of the UDRP says that "registering a domain
name primarily for the purpose of selling it for valuable consideration in
excess of out of pocket costs is evidence of bad faith."
However, the arbitrator, quoted from a treatise on
trademark law, saying that "the mere offer to sell a domain name to a mark
owner" is not sufficient for a finding of bad faith. In addition, the UDRP
requires that such a finding be based on a pattern of such behavior, which
had also not been established.
The complainant was represented by Linda Kohler of Big
Dogs Legal Department. The respondent was represented by Stephen H.
Sturgeon.
The text of the arbitrator's opinion is available
at the Web site of the National Arbitration Forum, http://www.arbforum.com/domains/decisions/97096.htm.
The text of the Uniform Domain Name Dispute
Resolution Policy is available at the Web site of the Internet Corporation
for Assigned Names and Numbers, http://www.icann.org/udrp/udrp-policy-24oct99.htm.