Intellectual Property

Penalizing the Complainant for Abusing the UDRP Procedure

Against a complainant who abuses the UDRP procedure – a recent example being Collective Media, Inc. v. CKV / COLLECTIVEMEDIA.COM, D2008-0641 (WIPO July 31, 2008), who argued entitlement to the domain the registered years before because it had applied for a trademark of that name and wanted it for its own business – the only penalty in a panelist’s armory is to find it guilty of reverse domain name highjacking. Rule ¶15 (e) of the Policy provides:
[I]f after considering the submissions the Panel finds that the complaint was brought in bad faith, for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder, the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding.
Although this stigmatizes the complainant and undoubtedly gives pleasure to the respondent, it carries no financial consequence. The rule has been construed to mean that the conduct that qualifies for a reverse domain name hijacking claim should be “utterly clear,” Great American Insurance Company v. Ron Hamilton, FA109753 (Nat. Arb. Forum October 14, 2002), and “the Complainant [must have] proceeded with at least a reckless disregard of the likelihood that the Respondent had rights or legitimate interest in the name,” OnePhone Holding AB v. IndiGO Networks, D2007-1576 (WIPO December 22, 2007).
Such reckless disregard was found in Altru Health System v. Altruism Network c/o Doug West, FA0805001195584 (Nat. Arb. Forum July 15, 2008). The Panel held that while at “first sight” it may appear as though the Complainant “had fair reasons to file the Complaint,” on second sight it did not because it made false statements about its trademark which it compounded by making “deliberately false accusations of Respondent’s commercial activities” at the website to which the domain name resolved. What finally outraged the Panel was that Complainant’s actions were made in an attempt to convince the Panel to decide in Complainant’s favour in spite the fact that the case had obvious flaws. It is this Panels opinion that Complainant’s behaviour constitutes an abuse of the administrative proceeding.
Nevertheless, what appears sanctionable abuse to one panelist, may have an entirely different complexion to another. This was the case in General Media Communications, Inc. v. Crazy Troll c/o, FA0602000651676 (Nat. Arb. Forum May 12, 2006). The Panel found that Complainant’s or its counsel’s conduct was so egregious that it would likely warrant sanctions and/or referral of the matter to the appropriate Bar Association for disciplinary action, were this case being handled in a federal or state court of record. Here it forms the basis for the required Finding, set out above, that Complainant has wrongfully attempted a Reverse Domain Name Hijacking by virtue of its abuse of the arbitration proceeding through its omission of material facts and its intentional or negligent misstatement of some of the most significant and material facts in its briefs and exhibits.

However, the Complainant subsequently commenced a federal action, General Media Communications, Inc. v. Crazy Troll LLC and Gene Heu, 2007 U.S. Dist. Lexis 4281 [Not for Publication] (S.D.N.Y. 2007) for relief under the ACPA and whatever in the UDRP submission shocked the Panel, it failed utterly to impress the Magistrate Judge who entered a declaratory ruling on reverse domain name hijacking:
Obviously, if there was evidence that established – or even arguably established – all three elements of the UDRP test, GMCI could not have brought its proceeding in bad faith as the sole panelist found. There further was no basis for a finding that GMCI engaged in reverse domain name hijacking in violation of the UDRP by bringing the UDRP proceeding against Crazy Troll.
The action is presently sub judice, awaiting a determination on the issue of abusive registration.