Nominet UK Dispute Resolution Service

DRS Number 04773

B E T W E E N:

HE-SHI ENTERPRISES LTD
Complainant

- and -

ANDREW CLELLAND
Respondent

Decision of Independent Expert

1.	Parties

	Complainant:	He-Shi Enterprises Ltd.
	Country:		GB

	Respondent:		Andrew Clelland
	Country:		GB

2.	Domain Name

	he-shi.co.uk

3.	Procedural Background
3.1.1	The Complaint, which is a complaint of Abusive Registration under the Dispute Resolution Procedure (“the DRS”), of Nominet UK (“Nominet”), and is dated  7 June 2007, was posted by Nominet to the Respondent under cover of a letter dated 11 June 2007.  The covering letter included the following paragraph:-
		“You do not have to respond to the complaint, but any decision made about your domain name will apply to you even if you do not respond.  If you want to respond (and we would encourage you to do so) we must receive the response on or before 03 July 2007”.

3.1.2	The Respondent did not respond by 3 July 2007 or at all.  In a letter dated 4 July 2007 Nominet wrote again to the Respondent, referring to the complaint and to the failure of the Respondent to submit a response within the deadline, and communicating that as a consequence the dispute would not go to mediation, but would be referred to an independent expert for a formal decision if He-Shi Enterprises Ltd paid the appropriate fees on or before 18 July 2007 - a condition which was fulfilled.

3.1.3	The Nominet file includes:-
	3.1.3.1	a file note dated 4 July 2007 in the following terms:-
		“Respondent called, Andrew Clelland.  He has just returned from holiday & has missed the response deadline, can he still respond?  I advised that the deadline had now passed, however he could submit a submission under 13b of the DRS procedure.
		Talked in detail about how this would work & who would and wouldn’t see the submission.
		Advised that I would approach the Complainant and offer them the opportunity to mediate (even though this is something that does not normally happen when it is a no response case).  If they are happy to and on receipt of the non standard submission we will allocate mediation time up to a maximum of 10 days.
		Followed up phone call with an email.  Mr Clelland advised that andrew@hairdivision.co.uk was his active email.”
	3.1.3.2	a copy of an e-mail from Nominet dated 4 July 2007 providing further information about the “Further Submissions process”.
	3.1.3.3	a copy of an e-mail dated 11 July 2007 as follows:-
			“Dear Mr Clelland,
			Further to our call and my email dated 4 July we have not yet received a further submission from you.
			In light of this I have not approached the Complainant with regards to offering mediation, which as we discussed does not happen if the dispute is a no response case.  Please can you make contact with the department to discuss whether you are going to be providing a further submission.”
	3.1.3.4	delivery failure reports in relation to the e-mail referred to in 3.1.3.3.
	3.1.3.5	a file note dated 11 July 2007 in the following terms:-
			“DRS04773 - he-shi.co.uk
			Tried to call Respondent to advise that the Comp has paid for IE as an email correspondence bounced regarding the possibility of mediation.
			Tel number does not accept incoming calls.”

3.1.4	Nothing was heard from the Respondent between 4 July 2007 and 3 August 2007.

3.1.5	By letter dated 12 July 2007 I was appointed with effect on 18 July 2007 to provide a Decision under Nominet UK’s Dispute Resolution Policy (“the Policy”).  

3.1.6		On 30 July 2007 I raised certain substantive queries with the Complainant.  The Complainant responded in an e-mail dated 2 August 2007, and a copy of this response was sent to the Respondent.

3.1.7		It appears that the Respondent telephoned Nominet on 2 August 2007, and on 3 August 2007, sent an e-mail in the following terms:-
			“I would wish that this email be treated as a holding objection to this case proceeding and would ask that the full text of our objection, to follow, be taken into account.

			The complaint is entirely without foundation and claims of breach of trade-mark are also inaccurate.  Accordingly as mentioned we would seek to have our objections considered.

			Please confirm if you would like to view the full submission.”

3.1.8	Without deciding whether to admit the proposed non-standard submission from the Respondent I directed that I was prepared to receive it provided I received it by 12.30pm on 3 August 2007.

3.1.9	Nominet e-mailed me at 10.52am on 3 August 2007 in the following terms:-
		“I have tried calling the respondent but the telephone number provided does not receive incoming calls.  I have subsequently sent him another ‘high priority’ email requesting the submission is received by 12.30pm today, otherwise you will proceed to make a final decision without his submission.

		Will keep you updated.”

3.1.10	In the event, nothing further was received by that deadline.  Having regard to the time which has elapsed since the date on which a Response was due (3 July 2007), to the events referred to in paragraph 3.1.3 above, and to the absence of any explanation for the delay, it would not be appropriate for any non-standard submission from the Respondent now to be admitted, and I decline to do so.

3.1.11	I have been provided with the following materials:-
•	Dispute History
•	Complaint
•	Standard correspondence between Nominet and the parties
•	Non standard correspondence between Nominet and the parties.
•	Companies House entries.
•	Register entry for he-shi.co.uk.
•	Nominet WHOIS query result for he-shi-co.uk.
•	Printout of website at he-shi.co.uk.
•	Copy of Nominet UK’s Policy and Procedures.
•	The e-mails referred to in paragraphs 3.1.6, 3.1.7, and 3.1.9 above.

4.	Outstanding Formal Procedural Issues
4.1	There are no outstanding formal or procedural issues.

5.	The Facts
5.1	The domain name was registered by the Respondent on 21 July 2006.

6.	The Parties’ Contentions
	Complainant
6.1	The Complaint of Abusive Registration is as follows:-

	The Complaint
	I confirm that Domain Name(s) in dispute are identical or similar to a name or mark in which I have Rights.

	I confirm that Domain Name(s) in the hands of the Respondent is an Abusive Registration. 

	1.	Following your email 1/6/07 we wish to proceed with the current complaint and have expanded on the reasons.
	2.	The Domain name is identical to our company name, trading name and trademark.  He-Shi Enterprises Ltd (Reg No. NI 062044) formed on 6/12/06 as a sister company to Euro-Tan & Leisure Ltd Reg No. (NI32233) to take the He-Shi Tanning Range to the export Market.
	3.	The directors of both companies are the same as both companies are owned by the McMurray family.
	4.	The trade mark is owned by Euro-Tan & Leisure Ltd (copy of registration attached), who give full rights and permission to He-Shi Enterprises Ltd (ONLY) to use the name.
	5.	The products supplied under the brand name are as follows (Leaflet attached):
		He-Shi Express Liquid Tan 150ml
		He-Shi Express Liquid Tan 300ml
		He-Shi Express Liquid Tan 500ml
		He-Shi Facial Gel 100ml
		He-Shi Tanning Mitt He-Shi Golden Glitter Spray 75ml
		He-Shi Dark Spraytan Solution 1000ml
		He-Shi Lite Spraytan Solution 1000ml
	6.	The equipment supplied under the brand name is as follows: (Leaflet attached) He-Shi 501 Compressor He-Shi HVLP Spraygun and ancillary parts
	7.	We have also had t-shirts, sweatshirts, fleeces, posters, countertop stands and promotional material designed to promote the brand.
	8.	The rights to the trading name and trade mark clearly existed before the date of registration of he-shi.co.uk.
	9.	At the time when the registration took place Andrew Clelland took unfair advantage in that Euro-Tan & Leisure Ltd made an offer to him to be the Scottish Distributor, not the whole of the UK, however the offer has been reclined due to lack of activity.  In the 12 month period Andrew Clelland T/A HD Direct took one small order of stock, barely enough for 1 salon, let alone service all the salons in Scotland.
	10.	To anyone keying in He-Shi.co.uk WHO IS, it appears Andrew Clelland in passing off as he-she brand owner, which is not correct.
	11.	This is detrimental to our business as it does not promote the prestigious national company image we wish to portray to the rest of the world.
	12.	We approached HD Direct offering to buy the domain name (copy letter & subsequent emails attached) and you will note his refusal to accept our offer.
	13.	He has in the past week directed traffic to our website and we offered to pay his registration fee, however he is not accepting this for some unknown reason.
	14.	It would appear the Primary purpose of retaining the domain name is to stop He-Shi Enterprises Ltd from using it.
	15.	Whilst we offered the respondent the opportunity to distribute the brand in Scotland, no formal agreement was signed and he never consulted us prior to purchase of the domain name.
	16.	A local accountant who recently became known to us through the business was confused when he searched the WHOIS and found Andrew Clelland’s name coming up.
	17.	A simple transfer to He-Shi Enterprises Ltd would resolve this matter.
	18.	Index of annexes: Registration Certificate Update on current worldwide registration applied for He-Shi Salon Pricelist and Spraytan Equipment list Letter to HD Direct Emails to/from Andrew Clelland.
	[Paragraph numbering added]

6.2	The documents annexed to the Complaint include:-
	
6.2.1	A letter to the Respondent dated 9 May 2007 from Euro-Tan and Leisure Ltd, trading as Euro Products, requiring the transfer of the Domain Name.

6.2.2	An e-mail (to Hilary McMurray) in response dated 22 May 2007 in the following terms:-
		“I write in reply to your letter regarding our domain name He-Shi.co.uk.

		As you are aware Hilary at the time of registration we were acting as your distributor in Scotland and as such would consider that we registered the name in good faith as a promotion of our business.

		I have diverted the name to your own site and will be having our own site updated asap to reflect the fact that we no longer distribute the brand on your behalf but am not prepared to transfer our domain name to you, we have no intention to exploit the name or your trademark but will be retaining ownership of our domain name.”

6.2.3	An e-mail from Hilary McMurray to the Respondent dated 25 May 2007 as follows:-
		“Hi Andrew

		I am disappointed that you have not made a return telephone call to speak to me personally.

		However in reply to your email, we are quite prepared to pay you the fee which you have paid for the domain name, which I believe was in the region of £9.99, because retaining ownership of the domain name is not in keeping with your statement of “we have no intention to exploit the name or your trademark”.

		This name is of no benefit to you and I would point out that you did not consult us before purchasing the name initially.

		As you have not returned the required papers to resolve passing of as he-shi.co.uk, you leave us with no alternative but to take a disputes claim with Nominet UK.

		This is a situation I would have preferred to avoid and would have thought unnecessary, as if you say your intentions are good, then the name should be of no interest to you.

		I therefore ask you again to return the necessary papers immediately and without further delay, in order to avoid any unnecessary eventualities.

		Best Regards,

		Hilary McMurray”

6.3	In response to queries raised by me, the Complainant provided the following further information:-
		“1/ He-Shi Enterprises Ltd is registered on the Card of Index held in England at Companies House.  Substantiation can be viewed on the Card of Index on their website www.companieshouse.gov.uk

		2/  A license has not been deemed necessary as the 2 companies, Euro-Tan & Leisure Ltd, the home market distribution company and He-Shi Enterprises Ltd, the export company have the same directors both run by the McMurray family.  As the He-Shi range has been developed by ourselves, no one else should have any rights unless specifically agreed by He-Shi Enterprises Ltd.

		(No contract was in place regarding Andrew Clelland).

		In fact since this dispute was initiated the trade mark “He-Shi” has already been assigned to He-Shi Enterprises Ltd (copy of assignment attached for reference).”	

6.4	The Complainant requests the transfer of the Domain Name.

	Respondent
6.5	As stated above, the Respondent did not submit a Response in time and I have declined to admit any non-standard submission from him.
  	
7.	Discussion and Findings:
	General
7.1	Under paragraph 2a of the Policy the Respondent is required to submit to proceedings if a Complainant asserts to Nominet in accordance with the DRS Procedure 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.”

7.2	Under paragraph 2b of the Policy a Complainant is required to prove both these elements on the balance of probabilities.

7.3	Paragraph 1 of the Policy defines “Rights” as including but not being “limited to, rights enforceable under English law”.  This definition is subject to a qualification which is not material.

	Complainant’s Rights
7.4	The Complainant (which is signed and includes a statement of truth and to which there is no admitted challenge) and the documentation provided with it, in my opinion :- 

	7.4.1	shows that the Complainant has “rights” enforceable under English law in its registered name “He-Shi Enterprises Ltd”.

	7.4.2	that before the assignment referred to in paragraph 6.2 above, the Complainant also had rights in the trade mark HE-SHI: even in the absence of a formal license a tacit arrangement between two persons or companies whereby one is allowed to use the mark of another can achieve the same effect - either on the basis of an inferred agreement or on the basis of an estoppel.

	7.4.3	establishes that since the initiation of the current proceedings the Complainant has by assignment acquired the title to the trade mark HE-SHI.

7.5	The evidence before me does not establish that He-Shi is the Complainants trading name.  The leaflet exhibited to the Complaint bears the heading “He-Shi Enterprises Ltd”.  In other words, the Complainant is trading under its registered name and not as “He-Shi”.  However, it appears that the products in which it trades all have “He-Shi” as a prefix.

7.6	The earliest date upon which the Complainant could acquire rights in the name HE-SHI was its date of incorporation, namely 6 December 2006.

7.7	Under the Policy the mere assertion that a Complainant has “rights” is sufficient for there to be jurisdiction.  For this purpose the date when such alleged rights are acquired is immaterial. Accordingly, I am satisfied that the condition of paragraph 2 a I of the Policy are fulfilled. 

7.8	I do not consider that the Complainant’s name or the mark HE-SHI are identical to the Domain Name.   Nevertheless I consider and find as a fact that the names in which the Complainant has rights are similar to the Domain Name.   

	Abusive Registration
7.9	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.”
		 
7.10	The Policy provides:
	“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 primarily: 
	A 	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 Respondent's 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 	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 	The Complainant can demonstrate that the Respondent is engaged in a pattern of registrations where the Respondent is the registrant of domain names (under .uk or otherwise) which correspond to well known names or trade marks in which the Respondent has no apparent rights, and the Domain Name is part of that pattern; 
	iv 	It is independently verified that the Respondent has given false contact details to us; or
	v 	The domain name was registered as a result of a relationship between the Complainant and the Respondent, and the Complainant: 	
		A 	has been using the domain name registration exclusively; and
		B 	paid for the registration and/or renewal of the domain name registration.
	b	Failure on the Respondent's part to use the Domain Name for the purposes of e-mail or a website is not in itself evidence that the Domain Name is an Abusive Registration.
	c 	There shall be a presumption of Abusive Registration if the Complainant proves that Respondent has been found to have made an Abusive Registration in three (3) or more Dispute Resolution Service cases in the two (2) years before the Complaint was filed. This presumption can be rebutted (see paragraph 4 (c)).

	4.	How the Respondent may demonstrate in its response that the Domain Name is not an Abusive Registration 

	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 or services;
			B 	been commonly known by the name or legitimately connected with a mark which is identical or similar to the Domain Name; or
			C 	made legitimate non-commercial or fair use of the Domain Name; or 
		ii 	The Domain Name is generic or descriptive and the Respondent is making fair use of it.
		iii 	In relation to paragraph 3(a)(v); that the Registrant’s holding of the Domain Name is consistent with an express term of a written agreement entered into by the Parties; or
		iv 	In relation to paragraphs 3(a)(iii) and/or 3(c); that the Domain Name is not part of a wider pattern or series of registrations because the Domain Name is of a significantly different type or character to the other domain names registered by the Respondent.
	b 	Fair use may include sites operated solely in tribute to or criticism of a person or business. 
	c 	If paragraph 3(c) applies to succeed the Respondent must rebut the presumption by proving in the Response that the registration of the Domain Name is not an Abusive Registration.

7.11	There is no admitted challenge to the facts asserted in paragraphs 2 to 7 or 12 to 16 of the Complaint.  There is no reason to doubt the accuracy of those assertions, and accordingly I accept them as being factually correct.

7.12	As can be seen, in paragraph 8 of the Complaint it is alleged that:
		“The rights to the trading name and trade mark clearly existed before the date of registration of he-shi.co.uk.”

	The assertion is unsustainable - in so far as it relates to the rights of the Complainant.  The Complainant was not incorporated at the date when the Domain Name was registered.  Accordingly, the Domain Name cannot have been registered “in a manner which, at the time when the registration … took place, took unfair advantage of or was unfairly detrimental to the Complainant’s Rights” within the terms of paragraph 1 of the Policy.

7.13	It appears that the Respondent was informally appointed as distributor in Scotland for the He-Shi products.  The letter referred to in paragraph 6.2.1 above, written by Euro-Tan and Leisure Ltd which was then the owner of the HE-SHI mark, makes it clear that the distributorship was over and that objection was made to the use by the Respondent of a domain name which was similar to it.  By the date of that letter the Complainant was also in existence, by then marketing the He-Shi products, and had rights in the He-Shi name.

7.14	On the basis of the assertions of fact set out in paragraphs 15, 12, and 16 of the Complaint (which assertions I accept) it is established that there are:
		“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;”

	within the terms of paragraph 3aii of the Policy.

7.15	It also appears that

		“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 or services.” -

	within the terms of paragraph 4aiA of the Policy.

7.16	However, having regard to the fact that the Domain name was registered (apparently for the purpose of marketing the He-Shi products) without the consent of the Complainant’s sister company, and in the light of the circumstances referred to in paragraph 7.13 and 7.14 above, and of the fact that an offer was made to reimburse the Respondent for the registration fee, I am of the opinion that the Complainant has established, on the balance of probabilities, that the Domain Name has been used in a manner which was unfairly detrimental to the Complainant’s Rights within the terms of paragraph 1ii of the Policy.

8.	Decision
8.1	For the reasons give above, I find that the Domain Name has been used in a manner which was unfairly detrimental to the Complainant’s Rights and, in the hands of the Respondent, is an Abusive Registration.

8.2	The Complainant has requested the transfer of the Domain Name.  On the basis of the material before me I consider that that is an appropriate remedy and accordingly that the Domain Name should now be transferred to the Complainant as it requests.

							Signed…………………………
David Blunt QC
3 August 2007