CIRA Gives Notorious Cybersquatters the Heave-ho

CIRA Gives Notorious Cybersquatters the Heave-ho

Virox Technologies Inc v Nameshield Inc, CIRA #344

In the modern world, Internet domain names are a significant asset that should be acquired and registered in a timely manner.

In this Canadian Internet Registration Authority (“CIRA”) decision, Virox Technologies Inc. (“Virox”) was granted its request to have the domain name virox.ca (“the Domain”) transferred from Nameshield Inc. (“Nameshield”) to itself. [19] The reasoning was based on the Domain being confusingly similar to Virox’s trademarks, [27] Nameshield having registered the Domain in bad faith [36] and Nameshield having no legitimate interest in the Domain. [41]

Background

Virox obtained trademark registration TMA 935502 (“the ‘502 Trademark”) for “VIROX and Design” on April 20, 2016, and trademark registration TMA 911409 (“the ‘409 Trademark,” and, collectively, “the Trademarks”) for “VIROX TECHNOLOGY INC. and Design” on August 17, 2015. [7] Nameshield registered the Domain on October 7, 2015. [8] Virox manufactures disinfectants and cleansers, is engaged in the research and development of disinfectants and cleansers, and provides education and training to do with disinfectants and cleansers. [9] Virox relied upon the Trademarks, which have been in use since at least December 31, 2000, and its trade name, which has been in continuous use since at least June 1998. [10] Nameshield accepted that it was only the nominal registrant of the Domain, [11] and claimed that the Domain was “re-registered” on October 7, 2015, “having been first registered many years prior,” but was unable to provide evidence to substantiate this claim. [12] Nameshield argued that Virox could not rely on the ‘502 Trademark because it was registered after the Domain, and that while Virox could rely on the ‘409 Trademark, it was not identical to the Domain. [13] As the nominal owner of the Domain on behalf of a certain Diversey Inc. (“Diversey”), Nameshield provided documents alleging that Diversey had previously owned the trademark “VIROX and Design.” [14] The documents also showed that the older “VIROX and Design” trademark was cancelled in 2014 pursuant to a request made by Virox under Section 45 of the Trade-marks Act. [15] Nameshield further advised that Diversey was selling a disinfectant cleaner called “Virox 5.” [16] Virox filed an affidavit from one of Diversey’s officers stating that Diversey had not authorized, instructed or engaged Nameshield to register the Domain on October 7, 2015, and that Diversey is a licensee of the Trademarks. [17]

Issues

The issues in this decision flowed from Paragraph 4.1 of the CIRA Dispute Resolution Policy (“CDRP”) [20] and were whether the Domain was confusingly similar to the Trademarks, whether the Domain was adopted by Nameshield in bad faith and whether Nameshield had no legitimate interest in the Domain. [19] An interesting aspect of these issues is that even if a complainant can satisfy the first two elements and provide some evidence of there being no legitimate interest, the registrant will still succeed if it can prove that, on a balance of probabilities, they have a legitimate interest in the domain name. [21]

Analysis

Each of the three issues were dealt with in turn by the presiding CIRA panel (“the Panel”).

Confusingly Similar

According to Paragraphs 3.1 and 3.3 of the CDRP, Virox was required to show that the Domain was confusingly similar to the Trademarks, which had to be registered before the Domain. [22] To be confusingly similar, the Domain needed to resemble the Trademarks in a manner that would likely mistake it for the Trademarks. [22] Virox was able to show that its trade name and the Trademarks had been in use long before the Domain was registered, [24] and argued that the Domain was confusingly similar with the Trademarks and trade name. [25] While Nameshield argued that the Trademarks were not identical to the Domain, the Panel highlighted that only a degree of resemblance was necessary, not a requirement of being identical. [26] The Panel concluded that the Domain was confusingly similar to the Trademarks, which Virox had indeed held rights to long before the Domain was registered. [27]

Bad Faith

Registration in bad faith is governed by Sections 3.5(b) and (d) of the CDRP, which state that the domain name was registered to prevent rightsholders from registering their trademarks as domain names and that the domain name was registered for commercial gain via a likelihood of confusion with the rightsholders trademarks, respectively. [28] Nameshield and its representative Daniel Mullen were involved in about fifteen CDRP and World Intellectual Property Organization decisions for having registered trademarks of third parties as domain names, in bad faith. [29] Furthermore, Nameshield was using the Domain to direct visitors to links for other disinfectants and cleansers on a “pay per click” scheme for commercial gain. [30] With Sections 3.5(b) and (d) satisfied, Nameshield contended that as the nominal holder of the Domain for Diversey, it did not itself experience any commercial gain from the click farming. [31] However, the CIRA Registration Agreement [33] clearly prohibits the nominal ownership of domain names of behalf of others, a fact known by Nameshield from its history of CDRP disputes. [34] The Panel thus found that the Domain was registered in bad faith by Nameshield. [36]

No Legitimate Interest

In determining whether Nameshield had a legitimate interest in the Domain, the Panel turned to Paragraph 3.4 of the CDRP. [37] An important aspect of this analysis was the issue of onus of proof, given by Paragraph 4.1 of the CDRP. [38] Virox alleged that the use of the Domain in bad faith could not lead to a finding of a legitimate interest, and that Nameshield would likely have no other use of that domain name. [39] Additionally, Virox argued that Nameshield being a nominal registrant of the Domain precluded them having any legitimate interest, and that even Diversey disclaimed, in an affidavit, any claim to the Domain or an arrangement whereby Nameshield would hold it for them. [40] The Panel also referred to the CIRA Registration Agreement’s clear prohibition of domain names being held on behalf of someone else, and found that Nameshield could not have a legitimate interest in the Domain. [41]

Conclusion

The Panel concluded that the Domain was confusingly similar to the Trademarks, that it was obtained in bad faith and that the Nameshield had no legitimate interest in the registration of the Domain. [42] The Panel directed that the Domain be transferred to Virox. [43]

Commentary

Cybersquatting has been around almost as long as the Internet. This has prompted many nations and international organizations to provide dispute resolution mechanisms for rightsholders whose trademarks or trade names have fallen victim to this mischief. Social media websites have taken similar steps to dissuade cybersquatting by making it a violation of their terms of use. But regardless of whatever remedial actions may be available, the best practice is and always has been avoiding getting into the situation in the first place. Trademark rightsholders should be pro-active in their acquisition and registration of domain names that are significant to their business. Diligently protecting one’s rights, or hiring experts to do the same, is likely the only way to avoid lengthy processes of proving rightful ownership later on.

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