Playworld Systems, Inc. just won control of the 18 year old domain name playworld.com in a UDRP which I find to be very troubling.
Playworld Systems owns and operates PlayWorldSystems.com which was registered in 1996.
PlayWorld.com was registered on October 30, 1997
Playworld System apparently made an offer of $30K which the domain owner rejected, countering with $120K
According to the facts and findings the domain holder at one time turned down $80,000 for the domain years earlier from a third-party.
The one member Francine Siew Ling Tan found that laches did not bar the UDRP even coming some 18 years after the domain name was registered. The panelist also found the domain name was not registered in bad faith since the domain name was used for the first five years for the domain holders then business’ website. However the panelist found each renewal period reset the clock of bad faith and when the domain was most recently renewed in 2015, at that point the domain holder was acting in bad faith.
Most troubling for me was this language of the panelist:
“By placing the disputed domain name with the domain name parking service, Respondent was deliberately trying to attract, for commercial gain, Internet users to the webpage created by the domain name parking service by “by creating a likelihood of confusion with [Complainant’s] mark”
Wow
The domain holder did not help himself by recently parking the page and having links to the Complainant and its competitors and refusing the remove such links when he received a C & D letter not asking for the domain to be transferred but asking for the links to be removed nor by failing to ask for a three member panel.
Here are the highlights:
“”Complainant manufactures and sells commercial-grade playground, recreation and fitness equipment. The trade name “Playworld Systems” was used since 1971. Its PLAYWORLD SYSTEMS trademark was first used in Canada and in the U.S. in 1993 and 1988, respectively; registrations of the mark were secured in Canada in 2008, and in the U.S. in 1989.
Complainant owns and maintains the domain name
The disputed domain name was registered on October 30, 1997, almost a decade after Complainant’s first use of the PLAYWORLD SYSTEMS trade mark.
The disputed domain name is confusingly similar to Complainant’s PLAYWORLD SYSTEMS trade mark and identical to its PLAYWORLD trade mark.
Respondent owned 45% shares in a company known as Playworld Network Corporation (“PNC”) which began operations in late 1996 or early 1997.
It began developing online animated characters for use in connection with a cybermall and online theme park for kids in the toy industry.
In July 1996, PNC registered the domain
In 1997, the disputed domain name was used to redirect traffic to the site at www.playworld.net. By December 1998, PNC was selling toys online.
In 2002, PNC decided to cease operations and take its primary website down.
Around 2002 to 2003, Respondent learned about Complainant and contacted them to inquire if they would like to buy the disputed domain name.
Complainant allegedly expressed no interest.
Between 2008 and 2010, a third-party contacted Respondent and offered $80,000 for the disputed domain name.
Respondent declined the offer, with the intention of starting a new business in the future.
Around November 2014, Complainant contacted Respondent regarding the purchase of the disputed domain name and offered $30,000.
Respondent declined the offer, after which it posted the domain name with a parking service whilst it considered what business it would like to proceed with. It was the decision of the parking service to place text link advertisements for third-party advertisers.
The Panel notes that for at least five years after registration, Respondent used and operated the disputed domain name in connection with its business.
There is therefore some evidence that at that point in time, Respondent had rights or legitimate interests in the disputed domain name. The question then is whether the fact that rights or legitimate interests in a domain name may have existed initially or at one point in time, whether it precludes any finding of a lack of rights or legitimate interests further down the road, in this case, almost 20 years later.
The Panel is of the view that such a finding is not precluded.
Respondent does not appear to have any substantive use of the disputed domain name, whether in connection with a business or otherwise, since around 2003.
Although Respondent claims to have had an intention to start a business “in the future” (and presumably to use the disputed domain name in connection with that), no evidence of demonstrable preparations to use the domain name in connection with a bona fide offering of goods of services has been produced by Respondent.
This gap spans over a term of about 10 years. Instead, around 2002/2003 and again in 2014, according to Respondent’s own account, it took steps to try to sell the disputed domain name to Complainant.
In addition, after Complainant declined Respondent’s demand for $120,000 for the transfer of the disputed domain name, the latter parked it with a domain parking service which provided links from the resolving webpage misdirecting visitors to a variety of Complainant’s competitors.
It is common knowledge that these services operate by providing the domain name registrant with “click through” revenue whenever an Internet user clicks on a sponsored link on the parking page. Whilst such practices are common and there is nothing inherently illegitimate about them, the activity of profiting from the deliberate linking of a parking page with the websites of competitors of a trademark owner does not demonstrate any legitimate interest in the domain name under the Policy (paragraph 4(c)(iii)). Neither has Respondent shown that it is “commonly known” by the disputed domain name.
The Panel accordingly finds that Respondent has no rights or legitimate interests in the disputed domain name.
Paragraph 4(a)(ii) of the Policy has been established.
Registration and Use in Bad Faith
Paragraph 2 of the Policy provides that:
“By applying to register a domain name, or by asking us to maintain or renew a domain name registration, you hereby represent and warrant to us that (a) the statements that you made in your Registration Agreement are complete and accurate; (b) to your knowledge, the registration of the domain name will not infringe upon or otherwise violate the rights of any third party; (c) you are not registering the domain name for an unlawful purpose; and (d) you will not knowingly use the domain name in violation of any applicable laws or regulations. It is your responsibility to determine whether your domain name registration infringes or violates someone else’s rights.” (Emphasis added.)
Respondent has the said obligations with each renewal or with each request to the Registrar to maintain the disputed domain name. Prior to March 2015, Complainant had no objection to Respondent’s registration of the disputed domain name. The Complaint was filed only after Complainant discovered Respondent had parked the disputed domain name with the website displaying pay-per-click advertisements for competitors and the latter ignored and/or chose not to respond to Complainant’s demand for the removal of the offending links from the parking page.
The Panel finds that there is evidence of bad faith registration and use in the circumstances of this case. The bases for this finding follow.
The renewal of a domain name is, by reference to paragraph 2 of the Policy, equivalent to a new registration in certain circumstances.
The Policy provides clearly that there is a responsibility that a domain name registrant has, namely to determine whether the domain name registration infringes or violates someone else’s rights.
The violation of Complainant’s rights in its trade marks was clearly in issue here and brought to Respondent’s attention by Complainant.
Respondent did not deny having received Complainant’s letter of demand.
Further, Respondent was, by 2002/2003, aware of Complainant and its interests in the PLAYWORLD and PLAYWORLD SYSTEMS marks.
Respondent sought to extract a huge sum of money from Complainant for the disputed domain name; and after Complainant refused to pay the sum, the domain name was parked with a domain name parking service which operated the pay-per-click links to webpages of competitors of Complainant.
The Panel is of the view that by placing the disputed domain name with the domain name parking service, Respondent was deliberately trying to attract, for commercial gain, Internet users to the webpage created by the domain name parking service by “by creating a likelihood of confusion with [Complainant’s] mark”. Pursuant to paragraph 4(b)(iv) of the Policy, this conduct constitutes bad faith registration and use under the Policy.
Respondent states that it was the decision of the parking service to place text link advertisements for third-party advertisers. The Panel is skeptical that Respondent is blameless or that it had no influence over the type of advertising that would appear. The amount of “click through” revenue that is generated is affected by the keywords that are associated with a domain name. In the absence of any explanation from Respondent as to how the links in this case were generated, the Panel accepts that Respondent had some involvement or influence in the selection process.
The Panel accordingly finds that Respondent has registered and is using the disputed domain name in bad faith.
Paragraph 4(a)(iii) of the Policy has been established.
Doctrine of Laches
The Panel is of the view that the doctrine of laches is not an applicable defense under the Policy (see Drown Corp. v. Premier Wine & Spirits, FA 616805 (Nat. Arb. Forum, February 13, 2006) and paragraph 4.10 of the WIPO Overview). What is relevant is Complainant has established a case on the merits under the requisite three elements of the Policy.
Accordingly, it is Ordered that the
Mike,
Yes, this is another awful decision, along with videolink.com, in which panelists took legitimately registered domains and turned them over to complainants. In Playworld.com, it is a domain that a 3rd party valued at $80,000. The complainant admits that its first use of the mark in the US wasn’t until 2004, several years after the domain was registered. The domain owner presented credible evidence that the domain had been used legitimately for an operating business.
Both the videolink.com and playworld.com decisions reply on the “paragraph 2” interpretation of the UDRP. This is an intellectually dishonest way that clever panelists have found to ignore the requirement under the UDRP that a domain be “registered in bad faith”, and it leads to decisions such as this one that make a travesty of the UDRP and result in the sanctioned theft of valuable domains.
Putting it short, IMHO Respondent’s biggest mistake was parking the domain with ad links … basically a suicide move … 🙂
Even if personally I don’t see bad faith in registration, so basically it’s a wrong decision …
why is it a mistake ? Parking doesnt imply bad-faith.
it seems the panelist bended ( and broke ) the proper interpretation.
my question would be, how one would stop / appeal such a decision, in a manner that would avoid setting such precedence ? [ without spending rivers of money ? ]
rm,
Parking with links to Complainant business or competitors can be seen as bad faith in use, in this case “by creating a likelihood of confusion with [Complainant’s] mark”.
No. Biggest mistake was not paying $1500 for a 3 judge panel. ALWAYS ALWAYS pay for the 3 judge.
I think that was their second mistake.
As I’ve often mentioned also here on TheDomains, we always suggest the 3 panelists.
IMHO parking with ads was the biggest mistake because, unless in a UDRP, where they have to prove bad faith in registration AND bad faith in use, if they start a lawsuit they only need to prove one of them, and in that case by parking it with ads you have provided them the keys to get your domain … 🙂
“unlike in a UDRP” (not “unless”), typo, sorry.
It’s less likely to be the same result but it’s not guaranteed that the result be the same.
This domain had lots of baggage and lots of history – it was “intent to use” but “with offers for sale” – it was parked for profit and didn’t respond to C&D.
The “AND” clause has always been open to interpretation by different panelists and while I don’t agree with the decision at all the justification for the renewal by the original owner was to continue to profit from someone else’s mark so it wasn’t just simply seen as a case where renewal and registration are equivalent automatically but based on intent.
A lot of the contention would be removed from UDRP through simple legal update of the standards for making the decision; however, removing the flexibility of interpretation would actually, I feel, hurt domainers more in the long run.
One equation has been known for years:
Parking is trouble.
We can add:
Parking after you’ve been warned is simply stupid.
We should stop acting surprised and we should all face up to the fact that parking revenues (except in the cases of real generics) are often tied to someone else’s TM and if you take home money for click-thrus to a TM site you are simply profiting from a mark. That’s going to be enough in the minds of many and the when the “and” clause is weak it will be enough in the minds of many panelists.
Not surprised, but hardly think the complainant was an innocent bystander caught by surprise here.
These so called UDRP judges are nothing but clowns hired to do a clowns job which they do brilliantly.
On another note. I have never understood how they can cite one another’s UDRP cases to defend themselfs as if to say if one clown says its right then this clown can also say it’s right. Can you imagine that rule amongst criminals? Oh yeah…. there’s no need to imagine we have the UDRP. : )
Nat
Domain owners need to get smarter too
Here is a guy that turned down $80K for a domain and doesn’t spend $1,500 to get a three member panel
Makes no sense.
We all know a UDRP is a crap shoot at best and if you think your name is worth $120K which this guy did, you have to pay for the three member panel and of course you get to suggested three panelists as one of the panelists
“The domain holder did not help himself by recently parking the page and having links to the Complainant and its competitors and refusing the remove such links when he received a C & D letter not asking for the domain to be transferred but asking for the links to be removed nor by failing to ask for a three member panel.”
Stupidity!!
I didn’t read the links were to the Complainant in the highlights of the decision, quoted, above.
It states: “misdirecting visitors to a variety of Complainant’s competitors.”
Making money from parking is a legitimate use. As long as the links didn’t say the Complainant’s trademark, it isn’t purposefully confusing the visitor as to the identity. “Play,” and, “World,” are two generic words that put together would generate advertising links based on the word’s meaning.
Bad decision. But, I disagree with the commenters that advertising links is not legitimate use.
What are the costs involved for disputing this decision in federal court?
The fight may not be over with yet…
David
You better figure $25K and hope the case resolves quickly.
If the trademark holder has the money and the desire they could easily push you over to $100K in fees
Money talks!!
There is always “playworld.sucks”
I wonder if TM olders can sue the registry selling them their own TM lol
DON’T BUY play.world!!!!
When I hear terrible decisions like this I wonder… Is there any way to sue the panelist(s) or the arbitration forum for not adhering to the terms of UDRP? I would certainly hope there is a way. If so that would make panelists more liable for making correct decisions in cases.
The UDRP is not a legal system it’s purely administrative. This is why Panelist are allowed to be so corrupt. As long as they put like this…it is this panels view or in the panels opinion….after these words they can more or less say whatever they like and be immune from any legal recourse. Even if the descion is blantly corrupt there is nothing anyone can do about it. It’s like living in North Korea.
This all seems to boil down to greed and stupidity on both sides.
Stupid is…
This is why domain investors should get united and form a central organization that can act to protect their legitimate rights. And the leading domain investors should take an initiative. An Individual play will not help to protect their rights from the strong and malicious predators who can influence panels.
I found this very interesting thread from Namepros. Looks like a new user back in September 2014 asked how much the domain was worth in the domain appraisal section. If I were to bet this user was the complainant trying to get a feel for what the domain was worth. Anyone that knows domain values would easily say this domain is worth mid 5 figures but it looks like some Namepros members put their valuations closer to mid 4 figures for the name. Did some Namepros members inadvertently create a UDRP by giving this domain such low valuations. Interesting.
https://www.namepros.com/threads/playworld-com.834898/
Reseller and end user values are two separate things. Reseller it was a 4 to very low 5 figure name. No member on any forum would have paid 30-80 or120 thousand.
I understand the different values but from the way the conversation went in the forum it seems they were talking more about end user value. They were way off in their estimations.
I see what you mean, well it may helped them make a decision, yes.
Yes I believe it did help them make a decision which was the wrong decision and this is why I brought it up in the first place. If the valuations would have been more correct then maybe the complainant would have paid more money for the domain and not do a UDRP but since he got low valuations he didn’t think it made sense to pay so much for the domain because the so called “industry experts” said it wasn’t worth that much.
Obviously this whole scenario is based on if the New User on Namepros was the Complainant. We will never know that but it seems to much of a coincidence for it not to be.
But Todd no one at the price level can say $80k and especially $120K is correct for an end user.
Your thinking that the low valuations may have added in their decision to file makes sense but to go as far to say domainers should have valued it and big 5 to 6 figures+ is and I am sorry, not correct.
That name was not worth $120,000 to anyone at that time in history and based ont heir offer of $30k and the one he claims to have gotten at $80k proves that.
I would go as far to say that even if a domainer thread valuated it at $120k and supported the seller that would potentially still been wrong because maybe they would have paid $200k!
So again asking for values from domainers in terms of reseller is ok, end user is anyone’s guess and they cannot be blamed for the buyer not going more than $30k, not jmo, just the way it is.
Parking is a legitimate use, because it makes $$ for the owner.
Parking or no parking, Panelist Ms. Tan set a dangerous precedent: that renewing a domain is equivalent to a new registration.
You can throw out all the decisions where a new trademark owner loses against someone who registered a domain years prior . . . before there was a trademark.
Though its not illegal to park domains for profit..but the domain holder should have just place a page on the domain after receiving offer or letter from the complainant. Parking should not have been the way to go since the domain holder cannot control the content that will be placed by the parking company..But in all,the decision is discouraging as the domain has been registered before the trademark
Its one more fraud with domains using Visa and Mastercard 180 days chargebacks. And PayPal looks better for this…
I think UDRP is a case of better the devil you know. Trying to get consistency in application or creating some form of legal framework to simplify things would do more harm than good.
Reading the commenters on this blog I also think the UDRP process would be in worse hands if domainers were on the panel. Comments like “Parking is a legitimate use, because it makes $$ for the owner.” and “UDRP judges are nothing but clowns hired to do a clowns job” makes me wonder if they have any understanding of what is happening at all.
We like to use words like “Crapshoot” but I think maybe Russian Roulette is more appropriate when you use parking and link that directly grant $ from a TM pass-thru. When presented with a C&D it’s like giving you an extra trigger pull. At some point the game, surely, becomes too dangerous.
“UDRP judges are nothing but clowns hired to do a clowns job makes me wonder if they have any understanding of what is happening at all.”
Believe me I have a lot more understanding of the UDRP than I care to want. I say what I do because if I didn’t have complete utter contempt for the UDRP and those run it I would probably go mad.
I do agree with you in that you shouldn’t give Panelist any reason to find against. Panelist make up bad faith reasons even when there aren’t any to find, some even coach Complainants into giving their style of bad faith reasons, as the Panel did in the recent case videolink..com, so they certainly do not need any help in the bad faith department. The UDRP is no longer fit for purpose. Maybe in the early years when the Internet was sorting itself out it was useful but now it’s gone crazy. The UDRP needs major reform.
“I say what I do because if I didn’t have complete utter contempt for the UDRP and those run it I would probably go mad.”
I understand better now. Your quote was less about not understanding the process and more a contempt for it – which is reasonable because the decisions are often seemingly arbitrary and often contentious.
Domainers should be aware though that the TM process heavily favors use in commerce based on real commercial products. It should be simpler for domainers to protect themselves through prevention than to ask for a change in procedures that is likely to swing even more out of their favor.
But domainers also hang on to the “before there was a trademark” registration. The “and” clause.
From a legal standpoint the notion that a decision be based solely on intent when registered is outdated. It clearly has to be based on intent of usage regardless of when registration happens. A simple fortuitous decision based on the day something was registered should not absolve you of future sins, and no law or system will ever see it that way. This will be the first vague / dispute change addressed and it would align more with this case than people would like in my opinion.
The UDRP should be re-written, re-clarified, and re-scoped. The international demands make the application of real legal jurisdiction a challenge. But again, be prepared for the clarification and scoping ending up being unfortunately weighted in the wrong direction. Perhaps just a better appeals process would make sense? But then you’d have to make it expensive enough to prevent frivolous appeals and cheap enough to make it worthwhile.
Domainers also suffer because of the unethical habits of many. Like it or not 🙂
My contempt isn’t for TM owner rights I have many of them myself, nor do I think people should ever be absolved of thier legal responsibility, my issue is that Policy absolves Panelist from thier legal responsibility. Panelist treat the process as a dictatorial system inclined to dictate or command rather than adjudicate neutrally which is what underpins the UDRP. Bottomline. Without any threat of legal recourse people do whatever they want and often do. Where there is no accountability you can be sure to find corruption. The process is not fit for purpose.
Domainers do have an appeals process its the ACPA an action bought in federal court. It’s the only one that I have faith in.
“My contempt isn’t for TM owner rights …”
I thought it was clear I understood you meant the UDRP/Panelist process. Sorry for muddying the waters. I don’t think we’re really different in our thinking except I don’t think I’d trust the ACPA either at this point to get the results people would expect or want – but at least it is based on a legal premise with legal understanding and legal consideration and remedies would be through legal challenges/corrections, etc. 🙂
Bad one for the respondent, he should have collected $80,000.
Domain Observer
“”domain investors should get united and form a central organization that can act to protect their legitimate rights””
We have one
Its called the Internet Commerce Association
Join today or at least paypal them a few bucks
Thanks for pointing that out Michael. And ICA will celebrate its 9th anniversary of representing the domain name industry this coming September.
ICA is preparing for the internal ICANN debate on UDRP reform, which is likely to kick off in 2016.
Meantime, everyone who is upset by this UDRP decision should be up in arms over ICANN staff trying to impose URS on .Travel, and incumbent gTLD, by contract renewal which is top-down policymaking at its worst. If you don’t want a precedent set that could bring URS to .Org, .Net, and .Com by improper means down the road then take five minutes and submit a comment to ICANN. ICA has provided background and a comment template at http://www.internetcommerce.org/no-urs-at-dot-travel/
Here is some lingo – for what it’s worth – on one of Name Administration’s udrp defense, by J. Berryhill, Esq.:
That was just masterful! Sorry, Berryhill, when I publicly take exception to some of your opinions. This is like a master class in how to respond to UDRP.
When you receive the email, first respond by asking if there is any further information to be brought to the Respondent’s attention.
That way, Complainant can’t sneak extra arguments into the proceedings.
In the example, above, the Respondent extablished he wasn’t aware of any trademark when he registered teh domain name. Maybe the commenters are right, a switch to a parked page after a C&D is sent makes the respondent more vulnerable.
Here is discussion by a panel on a case which screams, to me, trademark! That of phones4u.com. It should have gone the complainant’s way, on the surface of it. But Berryhill defended it well:
How to stop those bandits and keep our pieces of land safe?