Panels Consistently Find That “Domain Investing” Is Legitimate Bona Fide Offering

PALM BEACH, FL – Upon reading recent news from “Neus News”, I stumbled onto an interesting find where Howard Neu, a long-time attorney for the domain name industry, was representing a domain owner in a case where Oath Inc. (now Verizon Media), the company that purchased Yahoo! related assets in 2017 for $4.83 billion, claimed the domain name “YMobile.com” was infringing on Yahoo! related trademarks such as “Y”’ and “Y!”, as well as “Y Mobile” (although Y Mobile is only held in Japan). The case was heard just recently on October 8th, 2019. (Oath Inc. v. Mira Hold / Mira Holdings, Inc)

According to Neu, regarding the complaint, a decision was made by the WIPO panel to dismiss or deny the complaint according to the panel’s belief that “Domain Investing” by itself does not constitute bad faith.

Generic domain name reselling is considered to be a legitimate business so long as it does not appear that the Respondent attempts to target the Complainant’s mark.”

That decision referenced another to support its findings (Platterz Inc. v. Andrew Melcher, WIPO Claim Number FA1705001729887) which prompted me to take a look at it, and to examine some others to read the referenced cases which are all provided below. Most are WIPO decisions but a few are from the National Arbitration Forum.

Complainant argues that domain investing, which is what it accuses Respondent of doing, is contrary to the Policy, but UDRP panels have consistently found that investing in genuinely generic terms, for purpose of resale, is a legitimate business and that the acquisition of domain names consisting of common, dictionary terms for resale can confer rights and legitimate interests upon entrepreneurs who engage in this activity.

Platterz Inc. v. Andrew Melcher Claim Number: FA1705001729887 National Arbitration Forum (June 19, 2017)

Due to the commercial value of descriptive or generic domain names it has become a business model to register and sell such domain names to the highest potential bidder. Such a practice – including the sale of the domain name – has been found to constitute use of the domain name concerned in connection with a bona fide offering of goods or services provided that the registration of the domain name was not undertaken with intent to profit from or otherwise abuse a complainant’s trademark rights.

X6D Limited v. Telepathy, Inc. WIPO Case No. D2010-1519 (Nov. 16, 2010)

Respondent has registered over 400 domain names, all of which contain or are composed of common words or short phrases from the English language or misspellings of such words. In trademark terms, many of these domain names would be considered descriptive of certain goods or services, or generic. Registration of descriptive or generic terms as a domain name is possible under the .com TLD. As the commercial value of such domain names has increased, brokers like Respondent have seized the opportunity to sell such domain names to the highest bidder. In principle, such a practice may constitute use of the domain name in connection with a bona fide offering of goods or services (i.e. the sale of the domain name itself).

Allocation Network GmbH v. Steve Gregory, WIPO Case No. D2000-0016 (Mar. 24, 2000)

Since registering generic names, even with the intent to resell them, is a legitimate business activity, a majority of the Panel holds that the Respondents have a legitimate interest in the contested domain name.

John Fairfax Publications Pty Ltd v. Domain Names 4U and Fred Gray Case No. D2000-1403 (Dec. 13, 2000)

As the commercial value of descriptive or generic domain names has increased, many people have seized the opportunity to register and sell such domain names to the highest bidder in principle, such a practice (i.e. the sale of the domain name itself) may constitute use of the domain name in connection with a bona fide offering of goods or services.

General Machine Products Company, Inc. v. Prime Domains (a/k/a Telepathy, Inc.) National Arbitration Forum File FA0001000092531

Respondent is in the business of creating and supplying names for new entities, including acquiring expired domain names. This is a legitimate activity in which there are numerous suppliers in the United States.

Alphalogix Inc. v. DNS Servs., FA 491557 (National Arbitration Forum, July 26, 2005).

Respondent is in the business of selling domain names consisting of generic or descriptive terms. The Panel finds that selling domain names consisting of generic or descriptive terms is a bona fide offering of goods or services pursuant to Policy.

InCorp Services, Inc. v RareNames, WebReg, Claim Number: FA0509000559911 – (National Arbitration Forum, Nov. 10, 2005)

It is interesting to read over case after case, and there are likely many more examples to be dug up, where domain name investing is deemed a clear and legitimate offering of bona fide goods and services.

John Colascione

About The Author: John Colascione is Chief Executive Officer of Internet Marketing Services Inc. He specializes in Website Monetization, is a Google AdWords Certified Professional, authored a ‘how to’ book called ”Mastering Your Website‘, and is a key player in several Internet related businesses through his search engine strategy brand Searchen Networks®