Nominet UK Dispute Resolution Service

DRS 2997

Sante de Suisse (Australia) Pty Limited v. Bauhinia International

Decision of Independent Expert

1.	Parties

Complainant:		Sante de Suisse (Australia) Pty Limited
Country:		Australia

Respondent:		Bauhinia International
Country:		Belize

2.	Domain Name

slimist.co.uk (“the Domain Name”)

3.	Procedural Background

The complaint was lodged with Nominet on 27 September 2005; hardcopies were received on 28 September 2005.  Nominet validated the complaint and notified the Respondent by letter dated 28 September 2005.  An electronic copy of the letter was attached to an email and sent by Nominet to the administrative contact email address and to postmaster@slimist.co.uk on the same date.  The letter to the Respondent advised it that it had 15 working days to respond to the Complaint, that is, until 20 October 2005.  On 17 October 2005 an electronic Response was received from the Respondent and this was duly forwarded to the Complainant by Nominet on the same day.  The Complainant was entitled to file a reply by 24 October 2005 and duly did so on 18 October 2005 in hard copy, on which day Nominet also forwarded a copy to the Respondent.

On 20 October 2005 Nominet wrote to both parties advising them that the Informal Mediation stage would begin on 21 October  and finish on 4 November 2005.  On 31 October 2005 Nominet wrote to the parties advising that Informal Mediation had been unsuccessful and that the case would be referred to an independent expert for a decision if the Complainant paid the requisite fee by 14 November 2005. The fees were duly received by Nominet on 15 November 2005. Nominet appears to have treated these as paid on 14 November.

Accordingly, the case was referred for a decision of an expert pursuant to paragraph 8 of Nominet's Procedure for the conduct of proceedings under the Dispute Resolution Service Version 2 ("the Procedure") and paragraph 7 of the corresponding Dispute Resolution Service Policy Version 2 ("the Policy").  On 21 November 2005, Andrew Lothian, the undersigned, ("the Expert") confirmed to Nominet that he knew of no reason why he could not properly accept the invitation to act as expert in this case and that he knew of no matters which ought to be drawn to the attention of the parties, which might appear to call into question his independence and/or impartiality. Nominet duly appointed the Expert with effect from 22 November 2005.

4.	Outstanding Formal/Procedural Issues (if any)

The response sent electronically on 17 October 2005 is deficient.  In terms of paragraph 5(c) of the Procedure, the response is to be sent both in hard copy and electronic form.  The response in this case was not received in hard copy.  The response concluded with a declaration of truth but, because it was not followed by a hard copy, it did not contain a signature of the Respondent (as required by paragraph 5(c)(v)).

Paragraph 15(c) of the Procedure provides that "If, in the absence of exceptional circumstances, a Party does not comply with any provision in the Policy or this Procedure or any request by us or the Expert, the Expert will draw such inferences from the Party's non-compliance as he or she considers appropriate."

In the Expert's opinion the absence of a duly signed declaration on a hard copy version of the response is a significant matter.   Accordingly, it is necessary to consider whether there are any exceptional circumstances for this failure.  It is indeed possible that a hard copy might have been delayed by the distances involved (the Respondent is situated in Belize, according to the WHOIS on the Domain Name).  However, while this would perhaps have been sufficient to allow the Expert to allow the hard copy to be received late, its complete absence is still a matter of concern, particularly where there is no indication in the correspondence that the Respondent has made any attempt to issue a hard copy, far less to see it delivered into Nominet’s hands. 

It would be open to the Expert to draw an inference that the Respondent is unwilling or unable to subscribe to the truth of the matters in the response and consequently to disregard the response completely.  However, on the basis that the Respondent is not legally represented, and that this is the most probable reason for the absence of a signed hard copy, the Expert will consider the response.  Notwithstanding this, without a signed declaration of truth the weight which can be applied to any statements of fact in the response must necessarily be less and the Expert will proceed on that basis.

5.	The Facts

The Complainant is an Australian registered company which owns the intellectual property rights to logos and other materials relating to a weight loss product known as SLIMist.  The Complainant is the only manufacturer of the SLIMist product.

The Complainant is the registrant of the domain name slimist.com and its Australian website may be found at that address.   The Complainant is also the owner of an Australian registered trade mark for the device/word SLIMist, registered number 1028210, registered on 5 November 2004.

The Respondent registered the Domain Name on 7 June 2005.  Since then, the Respondent has published a website which it has associated with the Domain Name and which offers the Complainant's SLIMist product for sale.  The website contains instructions for purchasing the product online together with details of an affiliate programme operated by the Respondent offering 10% commission on referred sales.

6.	The Parties’ Contentions

Complainant

The Domain Name is an “Abusive Registration” in that: (a) it was registered in a manner which, at the time when registration took place, was unfairly detrimental to the Complainant’s rights; and (b) has been used in a manner which was unfairly detrimental to the rights of the Complainant.  

The SLIMist name and logo belongs to the Complainant which has a registered Trade Mark. The Complainant has not licensed others to use it. The Complainant accordingly asserts exclusive Rights over the name and mark.  A substantial amount of the material on the Respondent's site has been taken from the Complainant’s website without the Complainant’s approval.  The video being offered for viewing on the Respondent's website was produced by the Complainant for distribution in Australia for promotional activities and no other person has been given the rights to show this video.  

The Complainant is the only manufacturer of the SLIMist product and has not agreed to and will not agree to supplying any distributors with the product for on line sales as being offered by the Respondent. The Respondent's website offers on line sales and these sales are not approved by the Complainant and cannot be honoured.  The Respondent's site does not disclose its owner and only gives a head office address in West Malaysia. 

The Complainant has granted Exclusive Territory Franchises to various Franchisees and it is unlawful under the Franchise Agreement to sell the product outside of the nominated territory.

Having regard to the above, the Respondent's site is being used in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected to the Complainant. No such authority to use the name has been given by the Complainant.

Respondent

The domain slimist.co.uk has been operating as a successful business [since] 7 June 2005. The domain specialises and ONLY sells slimist weight loss products purchased through authorised sources. The site operates in good faith and clearly states that slimist.co.uk is not the manufacturer but to contact the manufacturer for any associated enquiries. 

Logos and pictures of the product were provided on a dealer promotion CD for the use and promotion of the product. No material was taken from the site but specific information about the product and pictures was taken from a dealer promotion CD provided to help promote the product. The online video was taken from the dealer CD for promotional purposes. 

The site states clearly that the Complainant is the manufacturer of the product. Products offered on sale are authorised products and manufactured by the Complainant. The Respondents provide online sales of slimist products along with 3000 other online retailers. The Respondents believe that they operate in good faith and as a legitimate business. The Respondents represent the product in a suitable and accurate manner through the use of text and images provided to dealers for the promotion of the product. 

There is no confusion as the Respondents clearly state on every page that they are not the manufacturer and that they are not the trademark holders of the logos especially in light that they provide links for visitors to visit the manufacturer's site.

Complainant’s reply to Respondent’s response

[The domain slimist.co.uk has been operating as a successful business [since] 7 June 2005.] This is irrelevant as the Respondent has been using the name and Intellectual Property without consent. The Respondent is not able to obtain goods to fill orders through means agreed by the Complainant. The Complainant also does not know a Richard Smith [the Respondent's contact name on the Response form] and requests that photo ID be obtained. The Complainant also requests evidence of registration of the entity Bauhinia International. 

[The domain specialises and ONLY sells slimist weight loss products purchased through authorised sources]. As the Complainant is the only manufacturer of the slimist products, it has not authorised distribution by this company and requests details of the "authorised sources" referred to.

[Logos and pictures of the product were provided on a dealer promotion CD for the use and promotion of the product.] The Complainant retains Intellectual Property rights in and to all promotional material and has not licensed and will not license the Respondent to use same.

[Specific information about the product and pictures was taken from a dealer promotion CD provided to help promote the product.] This CD was not provided to the Respondent and nor was or is the Respondent authorised to use same and the Complainant retains IP rights and requires that the Respondent cease using same.

[The online video was taken from the dealer CD for promotional purposes.] The Respondent is not an authorised dealer and has no rights to use any promotional material nor offer the goods for sale.

[Products offered on sale are authorised products and manufactured by the Complainant.] The Complainant has not sold these goods to the Respondent and cannot verify that any goods offered for sale by the Respondent are genuine. In any event, the Respondent is not authorised to sell them. 

[The Respondents provide online sales of slimist products along with 3000 other online retailers.] This is false. There are no other online retailers using the word "SLIMIST" and any use of the word is deceptive and misleading as they have no right to use that name. The name is protected by TM registration. 

[The Respondents believe that they operate in good faith and as a legitimate business.] This cannot be true as the Respondent is improperly using the IP rights of the Complainant and is offering for sale goods that it cannot legitimately obtain. Each Franchisee has undertaken not to sell goods outside of their respective territories. No-one is authorised to sell goods on-line and certainly not on a web site outside Australia. It is not a legitimate or authorised supply of the product.

7.	Discussion and Findings:

General

In terms of paragraph 2(b) of the Policy the primary onus is on the Complainant to prove to the Expert on balance of probabilities each of the two elements set out in paragraph 2(a) of the Policy, namely that:

(i) The Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name; and

(ii) The Domain Name, in the hands of the Respondent, is an Abusive Registration.

Complainant’s Rights

Paragraph 1 of the Policy provides that Rights "includes, but is not limited to, rights enforceable under English law.  However, a Complainant will be unable to rely on rights in a name or term which is wholly descriptive of the Complainant's business".  Accordingly there are three questions to consider - (1) whether the Complainant has Rights; (2) if the Complainant does have Rights, whether the name or term in which the Complainant has these is wholly descriptive of its business; (3) if not wholly descriptive, whether the name or mark is identical or similar to the Domain Name.

Complainant's rights in the mark 'SLIMist'

The requirement to demonstrate Rights under the Policy is not a particularly high threshold test.  Under English Law, rights in a name or mark can be protected by registered trade marks, or unregistered rights such as the entitlement to bring a claim for passing off to protect goodwill inherent in any such name or mark.  In the present case, the Complainant has produced an Australian trade mark to demonstrate its rights.  The Expert notes however that the Complainant provides no specific evidence of any rights or registrations in the United Kingdom. An Australian national trade mark registration is of limited value in the United Kingdom due to the restrictions in its territorial extent. 

The definition of Rights in paragraph 1 of the Policy defines these as "including but not limited to rights enforceable under English Law".  Other Experts under the DRS have found that registered trade marks which would not be enforceable in the United Kingdom are sufficient to fulfil this requirement; see for example the decisions in Park Hospitality Worldwide LLC v Maggie Davis DRS 01093 [US mark], Right Ascension Inc. v Cosgrove DRS 01619 [US mark] and Turkcell Iletisim Hizmetleri AS v Zafer Metin Atas DRS 00286 [Turkish mark]. The Expert sees no reason to deviate from these decisions and consequently, finds that, for purposes of the Policy, the Complainant has Rights in respect of the name or mark SLIMist.

Clearly the term 'SLIMist' is not descriptive of the Complainant's business in whole or in part.  The only remaining question therefore is whether the name or mark is identical or similar to the Domain Name.  The first (.uk) and second (.co) levels of the Domain Name can be disregarded as being wholly generic.  Having removed the device elements of the Complainant's trade mark, the Expert is left with a comparison between the mark 'SLIMist' and the third level part of the Domain Name 'slimist'.  Internet domain names are not case sensitive, albeit that they are conventionally represented in lower case letters.  On this comparison, the Expert is satisfied on the balance of probabilities that the Complainant has Rights in respect of a name or mark which is identical to the Domain Name.

Abusive Registration

Is the Domain Name, in the hands of the Respondent, an Abusive Registration? Paragraph 1 of the Policy defines “Abusive Registration” as:-

	"a Domain Name which either:

i.	was registered or otherwise acquired in a manner, which at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant’s Rights; OR

ii.	has been used in a manner, which took unfair advantage of or was unfairly detrimental to the Complainant’s Rights."

The Complainant's submissions do not make much reference to the non-exhaustive list of factors in paragraph 3 of the Policy which may be evidence of an Abusive Registration.  The Complainant's main focus seems to be on the alleged misappropriation of its intellectual property (principally copyright material) by the Respondent.  The parties spend some time in submissions discussing the manner in which the Respondent came by this material and whether it did so legitimately.  None of this is particularly helpful to the Expert on a consideration of whether the Domain Name is an Abusive Registration.

The key issue which seems relevant to the non-exhaustive factors in the Policy is the Complainant's mention of the fact that it has granted exclusive territory franchises to various franchisees and that it has not agreed to and will not agree to supplying any distributors with the product for on line sales as offered by the Respondent.  Clearly this could be taken as a submission regarding the Complainant's control of the distribution of its product and that the Respondent's activities thereby amount to disruption of its business (paragraph 3(a)(i)(C) of the Policy).  Likewise, the Complainant also submits that the Respondent's activities have confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected to the Complainant (paragraph 3(a)(ii) of the Policy).

The Respondent's answer to these points is clear.  It claims to be a legitimate business specialising in selling the Complainant's product through authorised sources (which are not specified).  It claims to have used the intellectual property on its website which was available from a dealer CD.  It claims that it is among 3000 online retailers offering the Complainant's product for sale.  It denies that it has caused any confusion and states that it makes it clear on its website that it is not the manufacturer of the Complainant's product.

In reply, the Complainant denies all knowledge of the Respondent and states that the Respondent is not an authorised dealer, nor is it permitted by the Complainant to fulfil orders of the Complainant's product.  It states that the Respondent has no right to use the material on the dealer CD,  that there are no online retailers of its product and that none of the Complainant's official dealers are entitled to sell the product online.

It is significant that, while the Respondent claims to be a 'legitimate business', it does not claim to be authorised by the Complainant to resell the SLIMist product.  There is therefore no dispute between the parties on this point and the primary issue is clearly focused.  Is the use of the Domain Name, being a direct reference without qualification to the Complainant's product name and trade mark, by a Respondent who is an unauthorised reseller an abusive use?

A similar issue (but with regard to the unauthorised use of the complainant's corporate name) was considered in the case of The Royal Crown Derby Porcelain Co. Ltd v. Yesterday Once More DRS 01449.  The expert in that case stated that it was surely too naïve, particularly in the face of numerous decisions in trade mark and company law and in the UDRP and Nominet DRS, for any non-exclusive retailer to imagine that it could be in accordance with honest commercial practice for such a retailer to adopt, without authorisation, the mark or name of the originator of the goods as a domain name or a company name for themselves.  The expert went on to point out that there is a difference between referring to a trade mark when dealing in a trade mark owner’s goods and a right to appropriate the mark itself, the latter being properly exclusive to the trade mark owner.  The Expert in the present case agrees with that analysis.

The judgement of the European Court of Justice in BMW v. Deenik, Case C-63/97, is often considered with regard to these circumstances. This was a trade mark case dealing with the interpretation of Articles 5 to 7 of the First Council Directive to approximate the laws of the member states relating to trade marks No. 89/104/EEC of 21 December 1988.  The issue was whether an unauthorised dealer could make use of a registered trade mark for informative purposes and, while this does not relate to disputes over the use or registration of domain names, it is clearly of relevance.

In Deenik, the Court held that the proprietor of a trade mark was not entitled to prohibit a third party from using the mark for such informative purposes "unless the mark is used in a way that may create the impression that there is a commercial connection between the other undertaking and the trade mark proprietor, and in particular that the reseller's business is affiliated to the trade mark proprietor's distribution network or that there is a special relationship between the two undertakings."  

In the Expert's opinion, use of the SLIMist mark in the Domain Name creates precisely the impression of a commercial connection between the Respondent and the Complainant, of an affiliation of the reseller's business to the proprietor's distribution network and indeed of a "special relationship" beyond that of any ordinary retailer of the Complainant's products, which the ECJ would allow the trade mark owner to prevent.  This in itself might entitle the Expert to  make a finding of Abusive Registration.

However, the Appeal Panel in Seiko UK Limited v. Designer Time/Wanderweb DRS 00248, a DRS case which dealt with similar circumstances, strongly encouraged experts to address the terms of the Policy rather than focus on the question of trade mark infringement itself.  This is all the more important in the present case where the Expert is dealing with non-European rights and activities, namely an Australian trade mark and a registrant who is apparently based in Belize (albeit that the website associated with the Domain Name claims that the Respondent has a Head Office in Malaysia).  

It seems to the Expert that there is support in the evidence for the proposition that the Domain Name makes, or is liable to be perceived as making, a misrepresentation that there is something approved or official about the Respondent's website.  The Expert believes that the use of the name of the Complainant's trade mark and product name in the Domain Name without any qualification is one which most people would expect to be the preserve of the Complainant, not that of an unauthorised reseller such as the Respondent.  Such a use, in the opinion of the Expert, takes unfair advantage of the Complainant's Rights.

The Respondent submits that it clearly states on every page that it is not the manufacturer and that it is not "the trademark holder of the logos".  This is not quite correct.  In particular, the homepage for www.slimist.co.uk, which is likely to provoke the most immediate and strongest impression in the visitor's mind regarding the Respondent's status, says nothing about the manufacturer and could reasonably be taken as a promotional site published by or on behalf of the Complainant.  This is perhaps not surprising if the Complainant's submission is accepted that the site makes use of official promotional material generated by the Complainant.  

There is a trade mark acknowledgement in small type at the foot of the home page stating "SLIMist : Slim Mist: Slimmist and other trademarks belong to their respective owners" but this does not make the representation which the Respondent claims, nor does it clarify the Respondent's status to visitors to the site.  A different representation, which may be the one referred to by the Respondent, appears elsewhere on the site:- "SLIMIST.co.uk is a privately held company that specialises in online sales of innovative weight loss products. Please contact the manufacturers: Sante de Suisse [hyperlink to http://www.santedesuisse.com.au] for wholesale and distributor enquiries."  In the Expert's view this is less prominent, not being on the home page of the site, and in any event it does nothing to clarify the relationship (or absence of one) between the Complainant and Respondent.

The Respondent could have selected a Domain Name which clarified at least the fact that it was a reseller of the Complainant's products:- "we-sell-slimist.co.uk" is a variation of the formula suggested in Seiko and echoed in Royal Crown Derby.  Clearly, such an example is more likely to point to the fact that the domain name registrant is merely trading in the goods concerned while in the present case the Domain Name indicates some greater entitlement to use the mark itself.  Such an indication, as demonstrated by the home page of the website associated with the Domain Name, is bound to lead to confusion, in the Expert's view, albeit that the Complainant has provided no evidence of actual confusion having taken place. 

As regards the submissions of the Complainant which point to disruption of its business, the Appeal Panel in Seiko stated that although a domain name registrant may start out with the best of intentions, if the effect of his actions is to give rise to confusion and to disrupt a Complainant’s business then he has fallen foul of paragraph 3(a)(i)(C) of the Policy.  Here, the Respondent's intentions at the time of registration of the Domain Name are not known but given that the effect of its actions is clearly to disrupt the Complainant's legitimate franchising and distribution arrangements and to give rise to the potential for confusion as to the relationship between the Complainant and Respondent, the Expert is satisfied that the Complainant has made out a case under the Policy paragraph 3(a)(i)(C).  

The Expert is of the view that an appropriation of the Complainant's mark by the Respondent in the Domain Name takes unfair advantage of the Complainant's rights and is also unfairly detrimental to those rights.  In these circumstances, the Expert finds on balance of probabilities that the Domain Name constitutes an Abusive Registration within the meaning of the Policy.

8.	Decision

The Expert finds that, on the balance of probabilities, the Complainant has Rights in a name or mark which is identical to the Domain Name and that the Domain Name is, in the hands of the Respondent, an Abusive Registration. The Expert therefore directs that the Domain Name be transferred to the Complainant.

Andrew D S Lothian

5 December, 2005