A recent New Zealand domain name decision highlights the perils of delaying a challenge to the registration of a domain name, in Electrosafe Limited/Wayne Fowler v e-merge Data Solutions Limited/Hayden Wells  NZDNC 1490 (8 September 2023).
In this case, Electrosafe Limited (EL) registered its trade mark ELECTROSAFE in New Zealand in March 1999. It also obtained the equivalent domain www.electrosafe.co.nz around the same time. Jumping forward to 2020, Mr Fowler purchased the Electrosafe business from the former owner, including the domain name and trade mark.
E-merge Data Solutions Limited (eDS) is the registrant of the disputed domain www.electrasafe.co.nz. eDS has used the trade mark ELECTRASAFE since 1991, registering the disputed domain in August 2004.
EL's concern regarding the disputed domain focuses upon alleged confusion between the respective businesses, due to their use of very similar trade marks and domains – ELECTROSAFE and ELECTRASAFE.
The parties proceeded to Domain Name Commission Limited's (DNC) informal mediation, but in 20 July 2023, the DNC mediator informed the parties that the mediation had failed to achieve a resolution. EL subsequently filed a domain name complaint with DNC on 31 July 2023. Following the DNC's speedy dispute resolution policy service, the assigned expert Rebecca Scott (Expert) reviewed the complaint.
What did EL need to establish to succeed in its domain name complaint?
In order to succeed, EL needed to prove that:
- EL has rights in respect of a name or mark which is identical or similar to the disputed domain; and
- if retained by eDS, the disputed domain is an "Unfair Registration" .
The first element is generally recognised as a relatively low threshold. EL established the element through its trade mark registration of ELECTROSAFE. However, the second element is much more difficult for any complainant to satisfy.
What is an "Unfair Registration" in New Zealand domain name disputes?
DNC's dispute policy requires EL to prove on the balance of probabilities that the disputed domain is:
A Domain Name which either:
(i) 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
(ii) has been, or is likely to be, used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
DNC provides a non-exhaustive list of factors which may demonstrate the domain is an Unfair Registration at s5 of the .nz Rules. These include that the respondent has registered or acquired the domain name in the following circumstances:
5.1.1. Circumstances indicating that the Respondent has registered or acquired the Domain Name primarily:
- for the purposes of selling, renting or otherwise transferring the Domain Name to the Complainant or 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;
- as a blocking registration against a name or mark in which the Complainant has rights; or
- for the purpose of unfairly disrupting the business of the Complainant; or
5.1.2. Circumstances demonstrating that the Respondent is using the Domain Name in a way which is likely to confuse, mislead, or deceive people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant.
Crucially, the .nzRules state that the assigned expert shall not take account of any acts/omissions amounting to Unfair Registration or use which occurred more than three years before the date of the complaint. This meant the Expert in the present case could not consider any acts/omissions before 31 July 2020.
Did EL establish that the disputed domain is an Unfair Registration?
No. None of ELs' evidence was sufficient to establish that the disputed domain was an Unfair Registration. The Expert noted that EL's reference to phone calls from eDS' customers, or its customers mistakenly visiting eDS' premises when they are intending to visit EL was insufficient to support a finding that eDS registered the disputed domain primarily for the purpose of unfairly disrupting EL's business. There was also insufficient evidence to suggest that the phone calls actually disrupted EL's business.
The Expert also noted:
- Whilst ELECTOSAFE and ELECTRASAFE are certainly similar, there was insufficient evidence to establish that eDS is using the disputed domain in a way that is "likely to confuse, mislead, or deceive people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with [EL]".
- The respective EL and eDS websites "are different in their form and display. The services advertised on the two websites are also different. There is nothing on the face of the website at the disputed domain to suggest any connection with [EL's] business".
- The dates when the respective companies were registered and acquired their current names, and when they registered their domain names, fall outside the period the Expert can consider.
What should brand owners take away from this domain name case?
Parties should not delay once they become aware of any concerns regarding the use or registration of a domain name which is similar to their own trade mark. In this case, the respective parties had been operating for almost 30 years under their respective brands ELECTROSAFE/ELECTRASAFE and as such, it was unlikely that the complaint would ever succeed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.