Arbeta Plc -v- Potter [2003] DRS 827 (25 April 2003)

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3.1 The Complaint was received in full by Nominet on 24th January, 2003. Nominet validated the Complaint and notified the Respondent of the Complaint on 27th January, 2003. Nominet informed the Respondent that he had 15 working days (until 18th February, 2003) to lodge a Response. A Response was received on 4th February, 2003 and forwarded to the Complainant on 5th February, 2003 with an invitation to the Complainant to make any further submission in reply to the Response by 14th February, 2003.

3.2 The Complainant filed a Reply within this time limit, which was forwarded to the Respondent on 14th February, 2003. The dispute was not settled by Informal Mediation and on 11th March, 2003, the Complainant was invited to pay the fee to obtain the Expert Decision pursuant to paragraph 6 of the Nominet UK Dispute Resolution Policy (“the Policy”). The fee was duly paid.

3.3 On 25th March, 2003, Nick Gardner, the undersigned (“the Expert”), confirmed to Nominet that he knew of no reason why he could not properly accept the invitation to act as an expert in this case and further confirmed that he knew of no matters which ought to be drawn to the attention of the parties, which might appear to call into question his independence and/or impartiality.

3.4 On the same date the Expert (via Nominet) invited the Complainant to file a Reply to the Respondent’s evidence, and invited the Respondent to file a further response dealing with any matters raised by the Complainant in any such Reply. On 2nd April, 2003, the Complainant filed a Reply and on 11th April 200, Nominet received a further response from the Respondent.

5.1 A paucity of factual information and evidence has been filed. It is not the function of Nominet’s policy to conduct an enquiry into what has taken place or seek to resolve questions of fact, particularly if those are disputed. The Expert issued the request to the parties to file further information (above) to see if the facts could be clarified. Even now some matters are unclear. After careful consideration the Expert has concluded that sufficient material has been filed to enable a decision to be rendered. However careful consideration of matters that are either agreed or not disputed is required.

5.2.2 The Respondent is an ex-Director of the Complainant (the date of his appointment is in issue).

5.2.4 A business credit card statement dated 3rd August 2000 addressed to Mark Potter of Redifive Limited, Tullyhona Pen-yr-aw Lane, Llangynidr, Crick Howell, Powys NP8 1NE shows a transaction on 16th July for a payment to Easily Limited of £44.99.

6.1 The net position of the Complainant following its various submissions may be summarised as follows.

6.1.1 The Complainant company was purchased as a shelf company in May 2000 by the current owners of the Complainant, Mr and Mrs Graham Hurlstone. At the time the business was being set up, it was understood as between Mr and Mrs Hurlstone and the Respondent that the Respondent would be involved as a full-time director of the company.

6.1.2 Mr Hurlstone and the Respondent decided to choose a new name for the company. The Respondent suggested "Arbeta" and it was agreed that this name should be adopted.

6.1.3 The Respondent was a director of the Complainant at the time when he registered the Domain Name. A document entitled "Directors' Report for the period ended 30 September 2000 (continued)" records that Mark J Potter was appointed a director of the Complainant on 26th June, 2000.

6.1.4 The Respondent was acting for and on behalf of the Complainant in registering the Domain Name; he was aware at that time that the company was to re-named Arbeta plc and he was assigned the task of registering the Domain Name at a Directors' meeting.

6.1.5 The Respondent registered the Domain Name after the new company name had been agreed upon but before the document effecting this change had been filed at Companies House.

6.1.6 When the Respondent paid to register the Domain Name he used a company credit card. The Complainant has produced a copy of a credit card statement to support this submission (the "Credit Card Statement"). The statement is dated 3rd August, 2000 and is addressed to Mark Potter, Redifive Limited, Tullyhona Pen-yr-aw Lane, Llangynidr, Crick Howell, Powys, NP8 1NE. It shows a transaction on 16th July, 2000 for payment to Easily Limited of £44.99. The card to which this statement relates was in the Respondent's name in his capacity as a director of Redifive Limited. The Complainant submits that this payment relates to registration of the Domain Name. Easily Limited will not reveal details of the transaction to the Complainant's representative, but will reveal these to Nominet on request.

6.1.7 The Complainant presumes that the Domain Name was registered to the Respondent's home address for convenience as Redifive Limited did not have any permanent premises at the time.

6.1.8 The Domain Name has been used by the Complainant since its registration for email and web hosting. At some stage (the evidence on this is unclear) the Respondent has gained practical control of the domain and it now appears that it is used to reference a web page which is simply a “holding” page which says “new web launching shortly”

6.2 The net position of the Respondent following his various submissions may be summarised as follows.

6.2.1 The Respondent is seen as a world expert in the products of the type now made by the Complainant.

6.2.2 The Respondent was previously employed by a company called Tubex Limited, which was the market leader in the type of products now made by the Complainant.

6.2.3 Tubex Limited was suffering from increasingly disordered management and the Respondent decided to set up a rival company to compete with Tubex Limited. Arbeta was one possible name for that company.

6.2.4 The Respondent had a chance meeting with Mr Hurlstone, now the owner of the Complainant, and who had in the past been the owner of Tubex Limited. Mr Hurlstone wanted to back the Respondent's project.

6.2.5 The date of the Respondent's appointment as a director of the Complainant was the subject of a litigious dispute with Tubex Limited. The Respondent has produced a copy of a letter from solicitors Nicholson Graham & Jones dated 2nd November, 2000 in support of this submission. This letter is written in their capacity as solicitors to Tubex and makes complaint of the Respondent becoming a director of the Complainant on 26 June 2000 when still employed by Tubex. It is not at all clear to the Expert how this advances the Respondent’s case that he was not a director at this date – he states that Arbeta’s solicitors confirmed this registration was made without his knowledge and that he was not acting as a director but no copies of this correspondence are provided.

6.2.6 With regard to the Complainant’s submissions that actions were undertaken as a consequence of "Director's meetings", the Complainant company was run in a very informal manner and no directors' meetings of any recognisable form were held until early 2001.

6.2.7 The Domain Name pre-dates the Complainant company. Arbeta plc was not registered until 1st August, 2000.

6.2.8 With respect to the address used for the purposes of registration of the Domain Name, the Respondent used his home address because he undertook registration of the Domain Name on his own initiative prior to the registration of Arbeta plc using his own account with easily.co.uk, which is designated as "the potters". At the time the Domain Name was registered Mr Hurlstone of Redifive Limited had agreed to rent premises and this address or the Company's registered address in Cardiff could have been used if the Domain Name was to have been registered in the Complainant's name.

6.2.9 The Domain Name was registered using the Respondent's own personal credit card as have all subsequent renewals. All payments have been made to easily.co.uk.

6.2.10 When the Respondent later proposed using Arbeta as a name for the company this was initially opposed by Mr Hurlstone who wished to continue with Redifive.

6.2.11 With regard to the Complainant's submission that the Respondent left the Complainant company on bad terms, the Respondent was unaware of this. He suspects that the reference to this originated with the decision made by the company for which he now works (a purchaser of the sort of items made by the Complainant) to place its orders with the Complainant's main rival this season.

6.2.12 The Respondent is a forestry graduate and is employed as a forest manager. Words beginning with "arb", are derived form the Latin "Arbor" meaning tree, and are widely used in forestry. Much forestry in Britain lends its practice from experience in Scandinavia where "Arbeta" means work, and by implication forestry work. The Respondent says this submission is not part of the Respondent's justification for ownership but a defence against accusation of "abusive use".

7.1 To succeed in its Complaint the Complainant must prove to the Expert on the balance of probabilities (i) that it has Rights in respect of a mark identical or similar to the Domain Name, and (ii) that the Domain Name, in the hands of the Respondent, is an Abusive Registration (paragraph 2.a. of the Policy).

7.2 Under paragraph 1 of the Policy, “Rights” are defined as including, but not limited to rights enforceable under English law.

7.3 Under English law, rights in an unregistered mark are enforceable on the basis of the common law action of “passing off”. Such rights are acquired not through registration, but through the use of a mark which comes to function as a badge of recognition to which the goodwill of a business attaches.

7.4 Whilst the Complainant has not made any specific submissions on this point, the name "Arbeta plc" has been used by the Complainant since August, 2000. In the absence of any suggestion that the Complainant trades under or is known by any name other than "Arbeta plc", the Expert finds that on the balance of probabilities the Complainant has Rights in respect of a mark identical to the Domain Name.

7.5 Paragraph 1 of the Policy defines “Abusive Registration” as a Domain Name which either

7.5.1 was registered or otherwise acquired in a manner which, at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant’s Rights, or

7.5.2 has been used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant’s Rights.

7.6 A non-exhaustive list of factors, which may be evidence that the Domain Name is an Abusive Registration is set out at paragraph 3.a. of the Policy. The list is as follows:

7.6.1 Circumstances indicating that the Respondent has registered or otherwise acquired the Domain Name:
(A) primarily for the purposes of selling, renting or otherwise transferring the Domain Name to the Complainant or to a competitor of the Complainant, for valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly associated with acquiring or using the Domain Name;
(B) as a blocking registration against a name or mark in which the Complainant has Rights; or
(C) primarily for the purpose of unfairly disrupting the business of the Complainant;

7.6.2 Circumstances indicating that the Respondent is using the Domain Name in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant;

7.6.3 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; or

7.6.4 It is independently verified that the Respondent has given false contact details to Nominet.

7.7 It does not appear to be disputed (although the chronology is in dispute) that at the time of registration the Domain Name was registered by the Respondent with a view to that name being used by the Complainant. The Complainant says the Respondent was to do so as a director of the Complainant and that it should have been the Complainant that owned the Domain Name. The Respondent says he did so on his own account, but with a view to the Complainant using the Domain Name. Clearly the issue of in whose name the Domain Name was registered was of little or no practical significance until the Complainant and Respondent parted ways.

7.8 It seems to the Expert that the issue really depends upon who owns the Domain Name. If the Complainant is correct that it was registered by the Respondent in his capacity of Director of the Complainant and paid for by the Complainant it owns the name and the Respondent’s subsequent use of the Domain Name without the Respondent’s consent will be use in bad faith (in that this will then be in effect a blocking registration against a name or mark in which the Complainant has Rights). Alternatively if the Respondent is correct that he registered the Domain Name on his own account then no objection can be taken to him using it on his own account once he had parted company with the Complainant.

7.9 The Expert is mindful that this issue raises contrary evidence of fact and that he has not had the benefit of seeing the parties or hearing any oral evidence. However on the evidence that has been put forward it seems clear that there are a number of matters which have been raised by the Complainant and which have not been satisfactorily dealt with by the Respondent. These matters could and should have been dealt with had the Respondent been able to establish his case. In this regard the Expert has been struck by the fact that the Respondent has been careful to go through the Complainant’s submissions and in most areas respond item by item to the points made. In doing so what is striking is not so much what is said as what is not said. In this regard:-

7.9.1 The Complainant in its original Complaint mistakenly identified the Domain Name has having been registered on 5 February 2002 with Clara net.. The Respondent responded that this was wrong, that Claranet’s services related to webhosting and that he had registered the Domain Name personally on the 16 July 2000 with “Easily”. He said it was purchased using his personal credit card.

7.9.2 The Complainant accepted that it had been mistaken in this regard but pointed out that on the 16 July 2000 the Respondent had used a company credit card (in the Complainant’s then name Redifive Limited) to pay Easily Limited £44.99. It produces a copy of the statement concerned and says the Respondent’s address is used as at that time the company had no premises.

7.9.3 The Respondent then simply asserts that the registration was made on his personal credit card. He does not challenge the fact that the supplied credit card statement (which clearly refers to Redifive Limited) was a company credit card, nor does he explain what else the transaction to Easily Limited was for, if not the registration of the Domain Name. He does take issue with the statement that the Complainant had no premises at this time. The Expert is struck by the challenge made to what is at best a peripheral point of detail contrasted with the lack of any real challenge (beyond a bare assertion) to the clear evidence that a company credit card made the payment. The Expert draws a clear inference that had the Respondent been able to deal more fully with this point he would have done so, but that the reason he has not done so is because he cannot.

7.9.4 Nowhere has the Respondent provided any explanation as to why it should have been the case that he would apply for and own the Domain Name personally. On the face of it one would normally expect parties going into a new venture with a corporate vehicle that was about to be renamed to arrange for the domain name corresponding to the corporate name to be owned by the entity concerned. No doubt alternative arrangements are possible but one would expect to see some rationale for such an alternative – and none is provided in this case.

7.9.5 The Respondent’s explanation as to when he became a director is not properly made out. He appears to seek to challenge the date of his appointment as recorded in the Company’s records but does not really offer any alternative case, and does not provide relevant documentary evidence. In any event he has not suggested the registration of the Domain Name was otherwise than in connection with the venture then proposed, nor that he did at some stage become a director.

7.9.6 The Respondent has not explained what he would wish to use the Domain Name for that would be independent of the Complainant. The Respondent’s case that the derivation of the word from the Latin “arbor” means that any use would not be abusive is far from clear – “arbeta” appears to the Expert to be a word which is distinctive. In any event this name had been adopted previously as the Complainant’s own name at a time when the Respondent was a director of the Complainant

7.9.7 As it is the Respondent seems to be using the name merely to as an address for a “holding” web page

7.10 In the light of the above the Expert takes the view that the filed evidence establishes, on the balance of probabilities, that the Domain Name was purchased by the Respondent acting in his capacity of a director of the Complainant and paid for by the Respondent using a credit card that belonged to the Complainant such that the costs concerned were met by the Complainant. In the absence of a credible explanation from the Respondent the Expert concludes that these events are entirely consistent with what one would normally expect to be the case, namely that where a company which is about to adopt a new corporate and trading name applies for a domain name corresponding to that new name, one would expect the company to do so on its own account.

7.11 The Expert concludes that the subsequent dealing by the Respondent with the Domain Name on his own account, and his refusal to relinquish the Domain Name to the Complainant, constitutes use in bad faith in that by doing so he is blocking the continuing use by the Complainant of that name and is therefore an Abusive Registration under paragraph 3 a. of the Policy.

In the light of the foregoing findings, namely that the Complainant has Rights in respect of a name which is identical to the Domain Name, and that the Domain Name, in the hands of the Respondent, is an Abusive Registration, the Expert directs that the Domain Name be transferred to the Complainant.

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You are here: BAILII >> Databases >> Nominet UK Dispute Resolution Service >> Arbeta Plc -v- Potter [2003] DRS 827 (25 April 2003) URL: http://www.bailii.org/uk/cases/DRS/2003/827.html Cite as: [2003] DRS 827

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