Hostway Ltd -v- Secure Screen Logo [2003] DRS 948 (3 June 2003)

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The complaint was entered into Nominet’s system on 7 April 2003. Nominet validated the complaint and sent notification to the Respondent on 14 April 2003, noting that the Dispute Resolution Service had been invoked and that the Respondent had 15 working days (until 9 May 2003) to submit a Response. No Response was received. On 14 May 2003 the Complainant was invited to pay the fee to obtain an Expert Decision pursuant to paragraph 6 of the Nominet UK Dispute Resolution Service Policy (“the Policy”). The fee was duly paid on 16 May 2003.

On 19 May 2003 Nominet invited me to provide a decision in this case and, following confirmation to Nominet that I knew of no reason why I could not properly accept the invitation to act in this case and of no matters which ought to be drawn to the attention of the parties which might appear to call into question my independence and/or impartiality, Nominet duly appointed me as Expert with effect from 23 May 2003.

From the Company Search annexed to the Complaint, I note that the Complainant is a UK registered private limited company (Company No. 03821675) which was incorporated on 9th August 1999 under the name IARNA.COM Limited and changed its name to Hostway Limited on 8th November 2002. It is an internet hosting company and a wholly owned subsidiary of Hostway Corporation, which specialises in internet hosting both nationally and internationally.

I am informed that the Hostway group of companies of which the Complainant is a member began trading under the name “hostway” in 1996 and first registered a domain name incorporating the word “hostway” in 1999.

I know nothing about the Respondent beyond the information stored on the Nominet register. The ‘Respondent’ – something of a misnomer as it has not responded to any correspondence from the Complainant or Nominet – is based in Denmark but I do not know whether it is a corporation, firm or an individual’s trading name.

The Nominet WHOIS search with which I have been provided shows that the Domain Name was registered by the Respondent on 26 November 1999.

The Complainant requests that the Domain Name be transferred to it on the basis of the following submissions, submitted by its UK solicitors Messrs. Blake Lapthorn:

“The Complainant, Hostway Limited, is part of the Hostway Group of companies being a wholly owned subsidiary of Hostway Corporation, which specialises in internet hosting both nationally and internationally. The Complainant group of companies began trading under the name "hostway" in 1996 and first registered a domain name bearing the "hostway" name in 1999.
The Complainant has used the hostway name since 1996 and, more particularly, has used the name in connection with hosting services consistently since 1999. The Complainant owns a number of other domain names bearing the hostway name. We attach documentation confirming the registration by the Complainant group in respect of the following hostway domain names: .com .net .org .info .biz .us hostway-uk.com hostway-uk.net hostway-uk.org hostway-uk.info hostway-uk.biz hostwayuk.com hostwayuk.net hostwayuk.org hostwayuk.info hostwayuk.biz
In addition, we enclose a copy of the Complainant group's registration certificate with the United States Patent and Trademark Office, registration number 2368611 in favour of Hostway Corporation for the following service mark, "HOSTWAY", for the following services:- Consulting and design services, namely managing on-line websites and website traffic in Class 42 (USCLS 100 and 101). First use is recorded as 1 April 1998, to include first use in commerce. The application was filed on 17 August 1999. In addition, the Complainant is in the process of applying for a community trademark in respect of the mark "Hostway", the filing date for which is 8 October and we enclose a confirmatory letter from the Trademark Office in Alicante in this regard.
The Complainant attempted to contact Secure Screen Logo by post by a letter dated 22 January 2002, however, no reply was received nor was the letter returned by any postal service. We enclose a copy of that letter. The Complainant attempted to contact the Respondent via the ISP, by email on 19 September 2002, however, no reply was received. We attach a copy of the email.
This firm attempted to write to Secure Screen Logo by post on 21 October 2002, on behalf of the Complainant. The letter was sent by Recorded Swiftair Delivery, a copy of the Swiftair receipt is attached. However, the letter was returned by the postal service on 31 October 2002, we enclose a copy of the return notices which were affixed to the envelope.
This firm subsequently attempted to transmit the letter of 21 October 2002 to the Respondent by email. The email was sent with delivery confirmation return notice and read confirmation return notice directions. A mail forwarding confirmation was received followed by a mail returned confirmation, giving an address of "trashcan@ultra2.uk2net.com". This firm, therefore, forwarded the original message to "postmaster@ultra2.uk2net.com". However, a receiving failure message was subsequently received for this email also. Copies of the relevant email receipts are attached all dated 10 December 2002.
The Complainant is aware of similar activity on the part of the Respondent in connection with other internet hosting companies across Europe. In particular, the Complainant is aware that a complaint has been brought pursuant to the DRS policy by 1&1 Internet AG, a German hosting company of Erbprinzenstrasse 4-12, 76133 Karlsruhe. Similarly, 1&1 found it impossible to effect communication in Denmark with the Respondent either by means of post or email.
The Complainant is of the view that registrations are being effected by the Respondent using the name of existing internet hosting companies, with full knowledge, in an attempt to block legitimate registrations and disrupt business patterns unfairly. Accordingly, the Complainant alleges that the registration of the domain name "hostway.co.uk" is abusive pursuant to the Nominet DRS policy.”
The Complainant requests that the Domain Name be transferred.

Paragraph 2 of the Policy requires that, in order for the Complainant to succeed, it must prove on the balance of probabilities both: that it has Rights in respect of 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 as defined in Paragraph 1 of the Policy.
The fact that the Respondent has failed to submit a Response does not mean the Complainant is entitled to what lawyers would call ‘judgment in default’, but I am required under paragraph 15(c) of the Procedure to draw such inferences from the Respondent’s non-compliance as I consider appropriate, absent exceptional circumstances.
Complainant’s Rights

“Rights” are defined in paragraph 1 of the Policy as including, but not being limited to, “rights enforceable under English law”. As the Complaint is concerned with the alleged abusiveness of the initial registration of the Domain Name, rather than any subsequent use of the Domain Name, I am only concerned with whether the Complainant owned ‘Rights’ as at the date of registration namely 26 November 1999.
I am not satisfied on the evidence before me that the Complainant has demonstrated that it itself owned any relevant Rights as at 26 November 1999. It did not (and still does not) own any UK or Community trade marks, and I have not been provided with any evidence of use of the designation ‘hostway’ by the Complainant in the course of business in the UK prior to 26 November 1999 upon which an action in passing off could be founded.
The Complainant claims that it “has used the hostway name since 1996 and, more particularly, has used the name in connection with hosting services consistently since 1999”. However, these claims are not strictly consistent with the Companies House records showing that the Complainant was not incorporated until August 1999 and was called IARNA.COM Limited until 8 November 2002. Further, the Community Trade Mark application dated 8 October 2002 which is said to be owned by the Complainant is actually in the name of its parent Hostway Corporation. I am left with the clear impression – reinforced by the reference to “Hostway (formally [sic] IARNA in Europe)” on the Complainant’s current web pages (http://www.hostway-uk.com/about/) – that the Complainant had not traded as ‘Hostway’ in the UK prior to 26 November 1999 and all references to the activities of ‘the Complainant’ in the Complaint are in fact references to the activities of other, overseas, companies in the Hostway group.
The question then arises: can the Complainant succeed in proving Rights solely on the basis of foreign rights owned by its parent company? The Nominet DRS appeal panel in Case DRS 00248 SEIKO UK LIMITED -v- DESIGNER TIME/WANDERWEB pointed out that:
“The requirement to demonstrate ‘rights’ is not a particularly high threshold test. It is satisfied in our view by the assertion of Seiko UK Limited that it is duly authorised by the trade mark owner to use the mark and to bring the Complaint. Where a complainant is a subsidiary or associated company of the trade mark proprietor, such an assertion will in our view generally be sufficient to demonstrate ‘rights’ in the absence of any good reason to doubt the veracity of that assertion.”
Guided by this reasoning and by a desire not to encumber the DRS unduly with legal technicalities, I am persuaded that the Complainant is entitled to rely on the US trade mark registration 2,368,611 HOSTWAY for “consulting and design services, namely, managing online websites and website traffic” applied for on 17 August 1999 and owned by its parent company Hostway Corporation. On this narrow basis I am satisfied that the Complainant has demonstrated Rights in the name HOSTWAY.

I am also satisfied that the name HOSTWAY is identical to the Domain Name (ignoring, as I am required to do, the first and second level suffixes).

The Complainant has not explicitly referred to any paragraph of the Policy in its Complaint, but I consider that paragraphs 3(a)(i)(B), 3(a)(i)(C) and 3(a)(iii) of the Policy are potentially engaged by the last two paragraphs of the Complaint:

· Under paragraph 3(a)(i)(B), it is indicative of Abusive Registration if the Respondent has registered or otherwise acquired the Domain Name as a blocking registration against a name or mark in which the Complainant has Rights.
· Under paragraph 3(a)(i)(C), it is indicative of Abusive Registration if the Respondent has registered or otherwise acquired the Domain Name primarily for the purpose of unfairly disrupting the business of the Complainant.
· Under paragraph 3(a)(iii) of the Policy, it is indicative of Abusive Registration if, 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.
I have no direct evidence of what the Respondent’s intentions were in registering the Domain Name; only the fact that the Respondent registered it at a time when the Hostway Corporation was trading under the domain name hostway.com and within 3 days of the date on which the Respondent registered the domain name “1and1.co.uk”, which is the name of another internet hosting company. Even this evidence must be approached with caution, as the Nominet DRS Expert in DRS 00442 1&1 Internet Limited -v- SSL held that the current Respondent’s registration of the domain name “1and1.co.uk” had not been proven to be Abusive. The current Complainant has not suggested that DRS 00442 was wrongly decided and accordingly the domain name “1and1.co.uk” cannot be relied on as falling strictly within paragraph 3(a)(iii) of the Policy.
I am also conscious of the fact that nefarious intentions cannot be inferred solely from the Respondent’s failure to use the Domain Name for the purposes of e-mail or a web-site – see paragraph 3(b) of the Policy.
The considerations set out in paragraph 3 of the Policy are illustrative and non-exhaustive. The question for my ultimate consideration is whether, on the evidence as a whole, the Complainant has discharged the burden of proving that the Domain Name was registered in a manner which took unfair advantage of or was unfairly detrimental to the Complainant’s Rights.
Not without hesitation, I have come to the conclusion that the Complainant has discharged its burden and I find that the Respondent registered the Domain Name in a manner which took unfair advantage of the Complainant’s Rights.
I consider that the Respondent’s registration in November 1999 of domain names corresponding to the trading names of two unrelated internet hosting companies – hostway.co.uk and 1and1.co.uk – calls for an explanation. There may very well be a simple and innocent explanation for the Respondent’s behaviour, but the fact remains that the Respondent has failed to provide it. I infer under paragraph 15(c) of the Procedure that the Respondent has no such innocent explanation and was in November 1999 engaged in a pattern of registering domain names corresponding to the trading names of internet hosting companies. Whether its intention was to block, disrupt or re-sell those domain names, I do not know.
The fact that the Complaint in DRS 00442 1&1 Internet Limited -v- SSL relating to 1and1.co.uk was rejected does not detract from this conclusion, for the following reasons: (a) the Expert’s verdict in that case was what a Scots jury would call “not proven” rather than “not guilty”; (b) the hostway.co.uk registration does not appear to have been drawn to the Expert’s attention; and (c) the complainant in that case failed to demonstrate any ‘Rights’ beyond bare contractual rights in a different domain name. In my view the present case falls narrowly on the other side of the line: the Complainant has established a prima facie case to answer and the Respondent has failed to answer it.
I do not know whether or not the Respondent was emboldened by the success of its “stay quiet and keep your head beneath the parapet” strategy in DRS 00442 and it is idle for me to speculate. However I should point out for the benefit of future DRS respondents that when experts are asked to make decisions on the balance of probabilities, it is far preferable to state one’s case than to hide behind the presumption of innocence alone in the face of a complainant’s uncontradicted allegations.
As my overall assessment on the balance of probabilities is that the Respondent registered the Domain Name in a manner which took unfair advantage of the Complainant’s Rights, I conclude that the Domain Name, in the hands of the Respondent, is an Abusive Registration.

Having concluded that the Complainant has Rights in respect of a name or mark which is identical to the Domain Name and that the Domain Name, in the hands of the Respondent, is an Abusive Registration, the Expert determines that the Domain Name, hostway.co.uk, should be transferred to the Complainant.

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You are here: BAILII >> Databases >> Nominet UK Dispute Resolution Service >> Hostway Ltd -v- Secure Screen Logo [2003] DRS 948 (3 June 2003) URL: http://www.bailii.org/uk/cases/DRS/2003/948.html Cite as: [2003] DRS 948