TurboChip A/S (1) Specialist Autosport Services Ltd (2) –v- Christopher John

Nominet UK Dispute Resolution Service

DRS 04020

turbochip.co.uk

Decision of Independent Expert

1.	PARTIES:

	Complainants:		
		First Complainant	Turbochip A/S
				DK

		Second Complainant 	Specialist Autosport Services Ltd
					England

	Respondent:			Christopher John
					GB

2.	DOMAIN NAME:

	turbochip.co.uk (“the Domain Name”).

3.	PROCEDURAL BACKGROUND:

3.1	The Complainants have complained to Nominet.uk ("Nominet").  The dispute was entered into the Nominet Dispute Resolution Service (DRS) system on 20th September 2006.  Hardcopies of the Complaint were received in full by Nominet on 22nd September 2006 and Nominet validated the Complaint and sent a copy to the Respondent on 28 September 2006.  A Response was entered into the system on 24 October 2006 and hardcopies were received on 23 October 2006.  The Response was forwarded to the Complainants on 24 October 2006 and a Reply was entered into the system on 1st November 2006, the hardcopies being received on 2nd November 2006.  Mediation documents were generated on 21st November and the Complainants paid the fee for an expert decision on 23rd November 2006.

3.2	On 24th November 2006 Nominet invited Nick Phillips the undersigned expert (the "Expert") to provide an expert decision on the case.  The Expert confirms that he knows of no reason why he should not accept the appointment and that he knows of no reason why his independence or impartiality might be called into question.

4.	THE FACTS:

4.1	The Domain Name was registered by the Respondent on 2nd October 2004.

4.2	The First Complainant is a Danish company which trades under the name “Turbochip” and has a network of dealers throughout the world.  The First Complainant’s business involves altering the computerised engine management systems of vehicles to improve performance.

4.3	The Second Complainant is a company incorporated under the laws of England and Wales and claims to be the First Complainant’s exclusive dealer in the UK. 

4.4	The Respondent is a director and joint majority shareholder of Commercial Power Solutions Limited (“CPS”) which is a company incorporated under the laws of England and Wales.  The other director and joint majority shareholder of CPS is an individual called Nicholas Heyes.  CPS was the First Complainant’s sole UK dealer until in or about April 2006.

4.5	CPS is the registered owner of a UK registered trade mark for ‘Turbochip’ which was registered on 9 June 2006.  The trade mark ‘Turbochip’ was registered with the First Complainant’s consent.

4.6	Up until about April 2006 the “Turbochip” business functioned in the UK by one of two methods;
a)	Customers would approach CPS with a request to ‘chip’ their vehicles.  CPS would then copy the necessary files from the vehicle and forward them to the First Complainant.  The First Complainant would then overwrite these files, send the new files back to CPS and they would then be installed into the customer’s vehicle.
b)	Customers would approach CPS’s network of sub-dealers to ‘chip’ their vehicles.  The sub-dealers would then pass the files to CPS who would in turn pass the files onto the First Complainant.  The files would then pass back down the chain for the sub-dealer to install on the customer’s vehicle.

4.7	Specialist Autosport Services Limited (the Second Complainant) and Specialist Power Solutions (‘SPS’) were two such sub-dealers.  The Second Complainant is a company incorporated in England and Wales and Nicholas Heyes is the shareholder and is a director in the company.  SPS appears to be a trading name of the Respondent.  Both directors of CPS were therefore supplying customers directly as either sub-dealer and/or as dealer through CPS, or the Second Complainant and SPS.

4.8	It seems that in or around April 2006 Mr Heyes and the Respondent fell out.  This led to the First Respondent terminating its relationship with CPS and appointing the Second Complainant as its UK dealer.

4.9	The Domain Name is currently registered in the name of the Respondent and the Complainants have asked that the Domain Name be transferred into the name of the Second Complainant.

4.10	The Domain Name is in use and is currently pointing towards the First Complainant’s website ‘www.turbochip.dk’.

5.	OUTSTANDING FORMAL/PROCEDURAL ISSUES:

5.1	I am not aware of any outstanding formal or procedural issues.

6.	THE PARTIES' CONTENTIONS:

The parties' contentions can be summarised as follows:

Complainants

6.1	The Complainants have Rights in a mark which is identical or similar to the Domain Name and the Domain Name in the hands of the Respondent is an Abusive Registration.

6.2	The First Complainant has a website which operates at www.turbochip.dk.  The other dealers appointed by the First Complainant run websites promoting Turbochip.  Such websites include www.turbochip.no and www.turbochip.net.

6.3	The First Complainant has exclusive dealers appointed for countries such as the UK, the Republic of Ireland, Belgium, Holland, Germany, Greece, Norway, Finland, New Zealand and South Africa.  Each of the dealers appointed in these countries use common branding, which consists of the word ‘TURBOCHIP’ with a horizontal red line through.   The First Complainant has traded under the name Turbochip since 1997 and its annual worldwide turnover is over £1,000,000.  The Second Complainant’s projected annual turnover for this year is approximately £250,000.

6.4	The domain name turbochip.ltd.uk was registered in the name of Turbochip Limited on 23 November 2005.  Turbochip Limited is a trading name of the Second Complainant .  The domain names turbo-chip.co.uk and turbo-chip.com are registered in the name of Commonality Limited who are the authorised consultant of the Second Complainant.  

6.5	During the period when it was the First Complainant’s exclusive distributor in the UK CPS promoted the Turbochip brand throughout the UK and acted as an administrative hub for the network of sub-dealers.  The Domain Name and the domain name turbochip.com was registered in the name of the Respondent due to his directorship of CPS and the Domain Name was linked to CPS’ website at. During this period CPS also registered the mark TURBOCHIP (stylised) as a UK trade mark. 

6.6	The First Complainant has now terminated the relationship with CPS and has appointed the Second Complainant as its exclusive partner in the UK.  Following the termination of the relationship between the First Complainant and CPS the Domain Name and turbochip.com were redirected by the Respondent to a website at tfiles.co.uk, then to the News Front Page of the BBC homepage and more recently to the First Complainant’s web site.  The website at tfiles.co.uk provided misleading information as to the current situation relating to CPS and the First Complainant and at one time also included a disclaimer.

6.7	The trade mark ‘TURBOCHIP’ is held on trust for the First Complainant and/or the Second Complainant.

6.8	The Respondent is attempting to divert business away from the First and Second Complainant, and the Respondent has no connection with the name ‘Turbochip’.

6.9	The Respondent has linked the Domain Name to websites which are attempting to solicit orders from customers and also find new dealers for a service which appears to be connected to that of the First Complainant.  The addition of the disclaimer on the web page is of no relevance to the confusion and disruption caused by the Respondent.

6.10	The Turbochip name and logo is used prominently in the First Complainants network of distributors’ advertising material, including the use on the distributor’s websites.

6.11	The Respondent has transferred the domain name turbochip.com to an agent of the First Complainant, therefore there should be no difference between that domain name and the current Domain Name.  

Respondent

6.12	The Domain Name and trade mark ‘Turbochip’ is owned by CPS.  The Respondent is the registered agent for CPS and can therefore do as he wishes with the Domain Name.  No action has been taken to register the trade mark for ‘Turbochip’ in the UK or in any other country by the First Complainant.  Turbochip Ltd was created to hold all the intellectual property of CPS and this company is jointly owned by the Respondent and Mr Heyes.

6.13	The First Complainant has not traded as Turbochip A/s  from 1997, rather  they have been trading as Padborg Elektro A/S.  The First Complainant has no official dealer network and no written agreement with any person or company in the world.

6.14	The Respondent, and his fellow director, Nicholas Heyes, both contributed significantly to CPS.  

6.15	Nicholas Heyes negotiated a deal with Pendragon Plc, in his capacity as a director of CPS and without the authority of the Respondent.  This deal was taken by Nicholas Heyes and put through the Second Complainant, rather than CPS.

6.16	Mr Heyes has attempted to take control of the Domain Name and the email servers by writing to hosting companies and claiming that the Respondent was no longer involved in CPS.  Mr Heyes has also attempted to transfer the Domain Name from the Respondent’s name to his own by submitting a transfer form to Nominet.

6.17	There is no sub-dealer network and although discussions were entered into for the purchase of turbochip.com, this was done in order to generate income for CPS.  The First Complainant has also offered to purchase the trade mark ‘Turbochip’ from CPS.  Discussions had also taken place concerning sale of shares between CPS and the First Complainant.

6.18	The First Complainant did not have the right to terminate the relationship between them and CPS.  There is no reason for the First Complainant to deal with the Second Complainant due to the lower turnover of the Second Complainant in comparison to CPS.

6.19	The Respondent does not in any way trade as Turbochip and any new customers are advised of the dispute between the directors of CPS by way of a disclaimer.

7.	DISCUSSIONS AND FINDINGS

7.1	By way of introduction to this section I should make it clear that I am only determining whether or not the Domain Name should be transferred to the Complainants.  It is clear that there are a number of potentially complex factual and legal disputes both between the parties and between Mr Heyes and the Respondent.  It is not for me to try and unravel those or to express any views on who is in the right save insofar as is strictly necessary for me to decide this dispute.
 
7.2	Paragraph 2 of the Policy requires that the Complainants must prove, on the balance of probabilities, that:

i	the Complainant(s) 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.

7.3	Rights are defined in Paragraph 1 of the Policy as follows:  “includes, but is not limited to, rights enforceable under English law.  However, the Complainant will be unable to rely on rights in a name or term which is wholly descriptive of the Complainant’s business”.  This has always been treated in decisions under Nominet’s DRS as a test with a low threshold to overcome and I think that must be the correct approach.

7.4	The First Complainant has clearly allowed, in various countries throughout the world, including the UK, the use of its brand ‘Turbochip’ in relation to a business altering the computerised engine management systems of vehicles to improve performance. This is clear from Annexes 1 and 2 of the Complaint and I do not think that it is material that these agreements have not been recorded in writing.

7.5	It follows that the mark ‘Turbochip’ both in words only form i.e. TURBOCHIP and in the stylised form which appears on CPS’ UK trade mark has been used worldwide and has also been used, through CPS, and more recently the Second Complainant, in the UK.  

7.6	There may of course be some dispute as to who the owner of the goodwill and reputation in the name “Turbochip” is as it seems that in the UK at least the name has been used by CPS, by the Second Complainant and possibly also by a number of sub-dealers.  Determining this question with any certainty would involve analysing the relationships between the First Complainant and CPS and between the First and Second Complainants. I have not seen these agreements and I indeed I do not know whether they were ever recorded in writing.

7.7	On the balance of probabilities however it does seem that the facts support a relationship in which the First Complainant is the owner of the relevant goodwill particularly given that it is clearly responsible for licensing it services to a range of dealers worldwide which is more consistent with the goodwill and reputation coming back to the First Complainant.  I may of course ultimately be wrong about this but on the balance of probabilities I find that the First Complainant is the owner of such goodwill and reputation and therefore the Rights in the word “Turbochip”.

7.8	Ignoring the first and second level suffix, as I must do, the Domain Name is therefore identical to the mark in which the Complainants have Rights.

7.9	Having concluded that the Complainant(s) have Rights in respect of a name or mark which is identical or similar to the Domain Name I must now go on to consider whether the Domain Name is in the hands of the Respondent an Abusive Registration.

7.10	Abusive Registration is defined in Paragraph 1 of the Policy 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.

7.11	There is no suggestion that at the time when the registration or acquisition took place it was in a manner that took unfair advantage of or was unfairly detrimental to the Complainant’s Rights.  The Respondent registered the Domain Name in his capacity as director for CPS who were, at that time, being permitted to use the name by the First Complainant and this appears to have been done with the approval of CPS.  Paragraph (i) above therefore does not apply.

7.12	The Complainant has asserted that the Domain Name has been used, to take unfair advantage of or that its use is unfairly detrimental to the Complainant’s Rights.  This must be proved by the Complainant on the balance of probabilities.

7.13	Paragraph 3 of the Policy sets out a non-exhaustive list of the factors which may be evidence that the Domain Name is an Abusive Registration. These are as follows:

3.	Evidence of Abusive Registration

a.	A non-exhaustive list of factors which may be evidence that the Domain Name is an Abusive Registration is as follows:

i.	Circumstances indicating that the Respondent has registered or otherwise acquired the Domain Name:

A	primarily for the purposes of selling, renting or otherwise transferring the Domain Name to the Complainant or to a competitor of the Complainant for valuable consideration in excess of the Respondents documented out-of-pocket costs directly associated with acquiring or using the Domain Name;

B	as a blocking registration against a name or mark in which the Complainant has Rights; or

C	primarily for the purpose of unfairly disrupting the business of the Complainant;

ii.	Circumstances indicating that the Respondent is using the Domain Name 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 with the Complainant;

iii.	In combination with other circumstances indicating that the Domain Name in dispute is an Abusive Registration, the Complainant can demonstrate that the Respondent is engaged in a pattern of making Abusive Registrations; or

iv.	It is independently verified that the Respondent has given false contact details to us.

b.	Failure on the Respondent's part to use the Domain Name for the purposes of e-mail or a web site is not in itself evidence that the Domain Name is an Abusive Registration.

7.14	The Complainant expressly relies on 3(a)(i)(C) and 3(a)(ii).

7.15	With respect to paragraph 3(a)(i)(C) I have some difficulty with this.  The Respondent did not register or acquire the Domain Name primarily to unfairly disrupt the business of the Complainants.  The Domain Name was registered or acquired on 2 October 2004 by the Respondent, during the period of its relationship with the First Complainant and this appears to have been done with the consent of CPS which is in any event not a party to this Complaint.    

7.16	The Complainant also submits that pursuant to paragraph 3(a)(ii), that the way in which the Domain Name is being used by the Respondent has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant.

7.17	Evidence has been provided that the Respondent has linked the Domain Name to websites which have attempted to solicit new orders and dealers for the Respondent’s new business.  This is not disputed and indeed the Respondent himself has provided an exchange of emails from a customer who was clearly confused.  

7.18	In my decision this in itself is enough for the Complainant to have made out a case under paragraph 3(a)(ii) and therefore to have established a prima facie case of Abusive Registration and I do need to take into account the Respondent’s subsequent use of a disclaimer or the fact that the Domain Name now links to the First Complainant’s site. 

7.19	That is not of course the end of the story. Having found a prima facie finding of Abusive Registration it is now open to the Respondent to rebut this finding by, for example, establishing any of the non-exhaustive factors under paragraph 4.

7.20	The relevant sub-sections of paragraph 4 state as follows:

a)	A non-exhaustive list of factors which may be evidence that the Domain Name is not an Abusive Registration is as follows:
i)	Before being aware of the Complainant’s cause for complaint (not necessarily the ‘complaint’ under the DRS), the Respondent has
A)	used or made demonstrable preparations to use the Domain Name or a Domain Name which is similar to the Domain Name in connection with a genuine offering of goods and services;
B)	been commonly known by the name or legitimately connected with a mark which is identical or similar to the Domain Name

7.21	In relation to paragraph 4(a)(i)(A) it is not disputed that the Respondent, before he was aware of the Complainant’s cause for complaint did make demonstrable preparations to use the Domain Name in connection with a genuine offering of goods and services.  However, these preparations were through CPS, who were at that time authorised by the First Complainant to use the Turbochip brand.  

7.22	Subsequently it seems reasonably clear that the First Complainant has terminated its relationship with CPS.  As I have said I do not know precisely what the terms of this agreement were or how it could be terminated.  The emails from the First Complainant terminating CPS’ rights to use the name “Turbochip” do appear to be fairly unequivocal and certainly the parties concerned do appear to accept that the relationship between CPS and the First Complainant has been severed and therefore I cannot see how the Respondent’s authorised use of the Domain Name during the time when CPS and the First Complainant had a relationship can provide the Respondent with a defence. Rather it is the Respondent’s subsequent use of the Domain Name which must be taken into account and in relation to that use i.e. the Respondent’s use of the Domain Name following the termination of CPS’ licence by the First Complainant I cannot accept that this falls within paragraph 4(a)(i)(A). Indeed the Respondent himself concedes that he “…does not trade in anyway as Turbochip”. 

7.23	In respect of Section 4(a)(i)(B), it is certainly arguable that at one time the Respondent was legitimately connected with a mark which is identical to the Domain Name. Once again however this was the case only because CPS was authorised by the First Complainant and following the termination of the relationship between CPS and the First Complainant I do not believe that it is any longer a valid contention.

8.	DECISION

For the reasons set out above, I find that, on the balance of probabilities, the Complainants have Rights in a name or mark which is identical or similar to the Domain Name, and that the Domain Name in the hands of the Respondent is an Abusive Registration. I therefore direct that the Domain Name be transferred to the Second Complainant as requested by the Complainants.

Nick Phillips

12 December, 2006