Domain name - Domain name dispute resolution policy - No rights or legitimate interests in domain - Registration of domain name with intent to sell - Cybersquatting - Bad faith registration.

Trade mark - Identical - Confusingly similar - Elimination of spaces inconsequential -Addition of .COM inconsequential.

Procedure -Reasonable opportunity to respond - Default by Respondent.

Complainant is an Ohio company carrying on business under the name "The Step2 Company" and owns several trade marks in the U.S. and abroad using "Step2" or "Step 2."  Respondent registered STEP2.COM and offered it for sale on GREATDOMAINS.COM for $100,000.00.  Respondent contacted Complainant offering to sell the domain, telling the complainant to "name your price."

Held, Name Transferred to Complainant.

While the disputed domain name is not identical to Complainant's registered marks, the common feature of Complainant's trade marks is "Step 2", which is distinctive and dominates the commercial impression created by the domain name and Complainant's marks.  The disputed domain name is thus confusingly similar.  As well, Respondent has never used or made any preparations to use the domain name which would establish a legitimate right or interest in the domain name.  Finally, the Respondent's overt offer to sell the domain name for an amount grossly in excess of out-of-pocket expenses is ample evidence of bad faith registration.

Policies referred to

Uniform Domain Name Dispute Resolution Policy, adopted August 26, 1999.

Panel Decisions referred to

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Other Decisions referred to

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Mathis, Panelist -

1. The Parties

The Complainant in this administrative proceeding is The Step2 Company, (an Ohio corporation) having a principal place of business in Streetsboro, Ohio.

The Respondent is Softastic.com Corporation having an addresss in Fullerton, California.

2. The Domain Name(s) and Registrar(s)

The domain name in dispute is "step2.com".

The Registrar with whom the domain name is registered is Register.com, Inc., of 575 Eighth Avenue, 11th Floor, New York, New York 10018.

3. Procedural History

This administrative proceeding was brought under the Uniform Domain Name Dispute Resolution Policy (the "Policy") adopted by ICANN on August 26, 1999. The Complaint was received by the WIPO Arbitration and Mediation Center (the "Center") by email on May 5, 2000, and in hard copy on May 8, 2000.

On May 9, 2000, the Center sent a request to Register.com, Inc., for verification that the domain name in dispute was indeed registered by it and asking for confirmation of certain details. The Register.com response was received on May 12, 2000. It confirmed that it was the Registrar of "step2.com". The status of the domain name was characterized as "active". 

The Center also asked Register.com, Inc. to "confirm that the Respondent is the current registrant of the domain name." The Registrar's response confirmed "that Shanon Fernald of the Softastic.com Corporation is the current registrant of the <step2.com> domain name." In this connection, the WHOIS data sheet for the domain name in dispute (Complaint Annex A) does not use the term "registrant". It lists the "Organization" as "Softastic.com Corporation" and the "Administrative Contact" as "Fernald, Shanon". Section 3 of the Registration agreement used by Register.com, Inc., provided that "The entity named as the administrative contact … shall be the owner of the domain name".

A Formal Requirements Compliance Review was made by the Center on May 15, 2000 in accordance with the Rules for Uniform Domain Name Dispute Resolution Policy (the "Rules") and the Supplemental Rules for Uniform Domain Name Dispute Resolution Policy (the "Supplemental Rules"). The Center verified that "the Complaint satisfies the formal requirements of the Policy, Rules and Supplemental Rules." It also determined that the required fee payment had been made to the Center by the Complainant.

On May 15, 2000, the Center notified the Respondent of the Complaint and the commencement of the Administrative Proceeding. A copy of the Complaint and the required cover sheet were sent by courier service. The address used was that provided by Register.com, Inc., for the "organization" Softastic.com Corporation. The courier package was directed to Softastic.com Corporation (Attn. Shanon Fernald) at 208 S. Moody Ave., Fullerton, CA 92831, U.S.A., and final delivery of it is said to have been effected on May 17, 2000. A copy of the notification and Complaint also was sent to the email address of Shanon Fernald. May 15, 2000, marks the date of the formal commencement of this proceeding.

The notification to the Respondent concerning the Complaint specifically advised that the Respondent was required to submit its Response by June 3, 2000, and that failure to do so would be considered to be a default. No Response was received by the Center.

On June 5, 2000, William L. Mathis was invited to serve as a Panelist in this proceeding and on June 9, 2000, he transmitted to the center his Statement of Acceptance and Declaration of Impartiality and Independence. 

Thereafter, on June 13, 2000, William L. Mathis was notified of his appointment, and the case file was forwarded to him.

A Notification of Respondent Default was communicated by the Center on June 13, 2000, to the Respondent's postal address and each email address that had been made available to the Center.

4. Factual Background

Complainant asserts that it owns and uses STEP2 or STEP 2 trademarks in the United Stated and abroad. Four of these are registered in the United States Patent and Trademark Office. Further, Complainant has registrations of STEP 2 trademarks in Canada, Taiwan and Thailand.

Copies of U.S. Patent and Trademark Office Trademark Text and Image Datebase sheets are attached to the Complaint as Annexes D-G. Registration No. 1,705,038 relates to STEP 2 for "all-purpose plastic containers with wheels". This registration was issued initially in 1992 and remains in force. Registration No. 1,756,878 is for a stylized form of STEP 2 for "all-purpose plastic containers with wheels". It was issued initially in 1993, and is in force at the present time. Registration No. 1,877,170 is for a stylized form of STEP 2 for "children's playthings for recreational purposes, excluding formal exercise equipment, accessories thereof, and exercise instruction; namely swingsets, sand boxes, climbers, plastic warming huts, juvenile furniture, ride-ins, ride-ons, pedalcars, playhouses, toy kitchen appliances and house keeping units, and preschool toys". It was issued initially in 1995. Registration No. 1,892,697 is for STEP 2 for "children's playthings for recreational purposes, excluding formal exercise equipment, accessories therefor, and exercise instruction; namely swingsets, sand boxes, climbers, plastic warming huts, juvenile furniture, ride-ins, ride-ons, pedalcars, playhouses, toy kitchen appliances and house keeping units, and preschool toys". It was issued initially in 1995. 

All of the U.S.A. trademark registrations were on the Principal Register. They were issued initially to Step 2 Corporation but the name was changed in 1996 to The Step2 Company.

The Respondent registered the "step2.com" domain name with Register.com, Inc., on November 13, 1999. After the registration of "step2.com", the Respondent offered the domain name in dispute for sale on GreatDomains.com. The asking price is listed as USD$100,000. Complaint Annex L.

On January 12, 2000, the Respondent or Respondent's representative, Shanon Fernald, contacted Complainant via email. The text of the email reads, "You interested in buying step2.com? It is available. Name your price." Complaint Annex M. 

5. Parties' Contentions

The contentions of the Complainant are stated summarily in Paragraph 11 of the Complaint as follows:

(1) The domain name in dispute is identical or confusingly similar to trademarks in which the Complainant has rights; and

(2) The Respondent has no rights or legitimate interests in respect of the domain name; and

(3) The domain name was registered and is being used in bad faith.

Since no Response was submitted by the Respondent, no contentions are presented by the Respondent. 

6. Discussion and Findings

The Panel turns first to the issue of confusing similarity. While "step2.com" is not identical to any of Complainant's registered STEP2 or STEP 2 trademarks. The differences are insignificant insofar as confusing similarity is concerned. It is commonplace that, when trademarks are migrated into domain names, spaces are eliminated and ".com" is often added. As a consequence, such differences have little tendency to communicate a difference in ownership or control over the things designated. The common feature "STEP2" is distinctive in nature and dominates the commercial impression created by both the domain name in dispute and the Complainant's trademarks. Accordingly, the Panel finds that the domain name "step2.com" is confusingly similar to Complainant's previously existed registered trademarks.

The Panel next considers the issue of whether the Respondent has rights or legitimate interests in respect of the domain name. In this connection, Paragraph 4.c. of the Policy provides some guidance. This paragraph sets out in a nonexclusive fashion three sets of circumstances for particular consideration. The Policy says that, "if found by the Panel to be proved based on its evaluation of all evidence presented" any of the following will demonstrate the Respondent's rights or legitimate interests to the domain name:

"(i) before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services; or

(ii) you … have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate noncommercial or fair use of the domain name, without intent for commercial gain to misleadingly divert consumers or to tarnish the trademark or service mark at issue."

With respect to (i), the record in this case contains no evidence that Softastic.com Corporation or Shanon Fernald has ever used or made demonstrable preparations to use "step2.com" or any corresponding name in connection with a bona fide offering of any goods or services. Hence, the Panel does not find that the circumstances of subpart (i) of Paragraph 4.c. of the Policy have been proved.

Nor is there any evidence that the Respondent has ever been known by "step2" or any similar name, or that the Respondent is making a legitimate non-commercial or fair use of the domain name. Accordingly, the Panel finds that none of the three sets of circumstances to which the Policy refers as being indicative of a Respondent's rights or legitimate interests in a domain name exists in this case.

Consideration also has been given to the fact that Paragraph 4.c. of the Policy leaves open the possibility that still other factors might establish a respondent's rights or legitimate interests in a domain name in some cases. However, no evidence of such factors appears in the present record and Respondent has not attempted to present any evidence in support of its registration of the domain name in dispute. The Complaint alleges that "Respondent's sole use of the domain name STEP2.COM is presently parking the domain name on a domain name auction site" (Paragraph 15) and that "Respondent … has registered it solely for the purpose of selling it." Respondent has had an opportunity to refute or otherwise comment on those allegations but has not done so. In these circumstances, the Panel accepts the allegations as true and indicative of a lack on the part of the Respondent of rights to or legitimate interests in "step2.com". Hence, the Panel finds that Respondent has no rights or legitimate interests in respect of the disputed domain name "step2.com".

Finally, the Panel turns to the question of whether Respondent's domain name has been registered and is being used in bad faith. Section 4.b. of the Uniform Domain Name Dispute Resolution Policy under which this administrative proceeding is taking place describes some circumstances which, if found to exist, will be evidence of the registration and use of the domain name in bad faith. Four descriptions are presented in passages (i), (ii), (iii) and (iv). They are presented in the alternative. That is, a finding of the existence of the circumstances in any one of the four descriptions will qualify such circumstances as evidence of the required bad faith.

Passage 4.b.(i) describes circumstances of particular pertinence to this case:

"(i) circumstances indicating that … [Respondent] … registered … the domain name primarily for the purpose of selling … the domain name registration to the complainant … or to a competitor of … complainant, for a valuable consideration in excess of … documented out-of-pocket costs directly related to the domain name."

Respondent registered the domain name "step2.com" long after Complainant had registered its STEP2 trademarks on the Principal Register. Such registrations of a mark constitute "constructive notice of the registrant's claim of ownership thereof." 15 U.S.C. § 1072. Further, the placement of the domain name for auction with GreatDomains.com speaks to Respondent's intent. This is compelling evidence that the registration was obtained primarily for the purpose of selling the domain name, and the Panel so finds.

The Panel finds that Respondent's offering of this domain name for sale on GreatDomains.com was open to all and therefore constituted an attempt to sell to Complainant or its competitors. Further, Respondent's purpose of selling the disputed domain name to Complainant was confirmed by a January 12, 2000, email. Paragraph 17 of the Complaint alleges: "Respondent has contacted Complainant directly to offer the STEP2.COM domain name for sale. A copy of the e-mail correspondence from Mr. Shanon Fernald to Complainant regarding purchasing the STEP2.COM domain name is attached as Annex (M) to this Complaint."

The "asking price" on the GreatDomains.com auction page for the domain name in dispute was USD$100,000.00. This amount is in excess of the out-of-pocket costs for registering a domain name.

Accordingly, the Panel finds that Respondent registered the "step2.com" domain name for the primary purpose of transferring it to Complainant for a consideration in excess of Respondent's costs. According to Paragraph 4.b. of the Policy, this finding "shall be evidence of the registration and use of … [the] domain name in bad faith." There being no evidence to the contrary in the present record, the Panel concludes that "step2.com" has been registered and is being used in bad faith.

7. Decision

For these reasons, the Panel decides that the "step2.com" domain name in dispute is confusingly similar to marks in which the Complainant has rights, and that the Respondent does not have rights or legitimate interests in respect of the domain name, and that the domain name has been registered and is being used in bad faith.

Accordingly, the Panel requires that the registration of the domain name "step2.com" be transferred to the Complainant.
 

Domain Name Transferred