Technology Arbitrators, Expert Determiners and Mediators Intellectual Property, Information Technology & Telecommunications Newsletter August 2006

In the arbitration of the dispute between Safeguard Operations, LLC and Safeguard Storage, regarding the domain name safeguard-storage.com, Safeguard Storage was successful in its claim that it should be allowed to retain the right to use the domain name.

Safeguard Operations instigated a complaint pursuant to the Uniform Domain Name Dispute Resolution Policy (see www.icann.org/services/udrp/udrppolicy24oct99.htm) and claimed that the domain name safeguard-storage.com is confusingly similar to Safeguard Operations’ trade marks, several of which include the words safeguard and storage.

Safeguard Operations also claimed that the fact that the domain name resolved to a website that lists self storage facility and other related services, similar and in competition to those currently offered by Safeguard Operations and included a link to Safeguard Operations' website, the similarity of the domain name to Safeguard Operations’ trade marks increases the confusion of Internet users. Safeguard Operations claimed that Internet users would assume that Safeguard Storage's website is affiliated or related in some way with Safeguard Operations and therefore the goodwill in Safeguard Operations’ trade marks is being diluted.

Safeguard Operations claimed, amongst other things that:

• Safeguard Storage had not been using the disputed domain name in connection with a bona fide offering of goods or services.
• Safeguard Storage was not affiliated with Safeguard Operations and was not authorised to use its trade marks.
• Safeguard Storage registered and used the domain name in spite of its actual or constructive knowledge of Safeguard Operations’ trade marks and Safeguard Operations’ prior 6 year use of its safeguardit.com domain name.
• Safeguard Storage is using the domain name to redirect Safeguard Operations’ customers to third party websites that are in competition with Safeguard Operations and benefits from this redirection by being paid based on the number of hits to the linked third party sites.

In reply, Safeguard Storage stated, amongst other things that:

• The domain name was not confusingly similar to Safeguard Operations’ SAFEGUARD trade marks
• There was no attempt to mislead Internet users as Safeguard Storage planned to offer public use storage facilities and the likely customers for such facilities will be localised near the storage facility. Safeguard Storage and Safeguard Operations operate in different geographical areas and therefore have different and non-overlapping market share. Despite the promotion of its services, Safeguard Operations had not established itself in the Michigan market in which Safeguard Storage was located and Safeguard Storage had not impacted Safeguard Operations’ in Indiana
• It had made demonstrable preparations to use the name in connection with its bona fide offering of self-storage services. It had designed a business plan and had undertaken a series of acts to implement the plan, including purchasing land to build the facility on, securing the rights to use the name “Safeguard Storage” in Ottawa and Muskegon Counties and throughout the entire state of Michigan and placing classified advertisements in various local telephone directories in anticipation of commencing its self-storage business and using the name “Safeguard Storage” in those advertisements.
• Within its localised area, it had become commonly known by the name “Safeguard Storage”
• Safeguard Operations does not have any storage facilities anywhere in the State of Michigan

In reply, Safeguard Operations argued, amongst other things that:

• regardless of the respective markets for both parties’ services, its federal trade mark registrations provide Safeguard Operations with nationwide exclusivity in relation to the trade marks.
• Safeguard Storage’s telephone directory advertisements were not published after the domain name was registered

and Safeguard Storage counter argued, amongst other things that:

• Safeguard Operations’ registered trade mark included text in conjunction with graphic design elements and the inclusion of a hyphen into and the omission of the term “self” and the graphical design elements from the domain name sufficiently distinguished the domain name from Safeguard Operations’ trade marks.
• it was not receiving and has never received, any revenue, click-through or otherwise, through use of the disputed domain name.
• its sole purpose in acquiring the domain name was to establish an Internet presence to advertise its planned public storage facility

Under the Rules for Uniform Domain Name Dispute Resolution Policy, in order for a domain name to be cancelled or transferred, the party lodging a complaint must show:

• the domain name is identical or confusingly similar to a trade mark or service mark in which Complainant has rights;
• the Respondent has no rights or legitimate interests in respect of the domain name; and
• the domain name has been registered and is being used in bad faith.

In this matter, the arbitrator decided that Safeguard Storage's actions to implement its business plan were sufficient to give it a legitimate right and interest in the domain name and as a consequence, was entitled to continue to use the domain name. The arbitrator also stated that he did not have the jurisdiction to decide the issues involving trade mark infringement and unfair competition raised by Safeguard Operations and that such matters would need to be heard by an appropriate judicial tribunal.

Points to Note:

• Business plans can be very important to protect your rights to a domain name as they may be useful in demonstrating your intention to use the domain name, even were that use has not yet commenced.
• Although the dispute resolution policies vary from jurisdiction to jurisdiction, these policies in general do not offer the same type of protection that registration of a trade mark offers and, in general, an arbitration conducted pursuant to these policies must be confined to the dispute regarding the domain name. The arbitrator would not usually have the jurisdiction to make a ruling regarding questions such as trade mark infringement or unfair competition.
• In some instances, registration of a trade mark will assist in protecting your rights to a domain name, but when your trade mark includes a graphical design element, it does not necessarily mean that you have the exclusive right to use the words contained in the trade mark. This is a common issue where a trade mark includes a phrase or words, which on there own would not have been registrable because they are descriptive of the goods and services for which the trade mark is registered.

Steve White

Technology Arbitrators, Expert Determiners and Mediators

August 2006