Recent Case Notes & Commentary

PROCEED CAREFULLY – AND CARRY A BIG BOOK OF UDRP AND SUPPLEMENTAL RULES

Enterprise Holdings, Inc. and Vanguard Trademark Holdings USA LLC v. Zhichao Yang Claim Number: FA2012001923923 19 January 2021


While the substance of the UDRP itself is straightforward, it is vital that practitioners carefully consider the totality of the Policy, the Rules made under it and Supplemental Rules made by the ICANN provider of arbitration services in which the Complaint has been brought. Oftentimes, overlooking key procedural elements can lead to an otherwise meritorious claim’s untimely demise. The present case is noted so that you be aware that there is an issue and for you to think about it later.



In Enterprise Holdings, Inc. and Vanguard Trademark Holdings USA LLC v. Zhichao Yang, the Complainants were two, unrelated parties who both ran independent car rental businesses. The Respondent, who did not defend the claim, held three domain names alleged to be identical to both Complainants’ trademarks. However, before the claim could proceed, the panel had to consider whether it was appropriate to join the Complainant parties as they were two separate claims being brought by the one Complaint.


The Complainants argued it was appropriate for them to act collectively because they both held ‘a specific common grievance against the Respondent’ whose common conduct affected both their ‘individual rights in a similar fashion,’ echoing the WIPO Jurisprudential Overview 3.0 (Paragraph 4.1.1.).


However, the Forum’s Supplemental Rule 1(e) (the FORUM was the provider of the arbitration services) clearly had to be considered. That is so because the Policy itself states in paragraph 1 that the proceedings are to be conducted according to the Policy, the UDRP Rules and the provider’s supplemental rules.

First, the Policy. That seems to contemplate a single Complainant in each complaint. But the Policy then provides in Rule 4(f) for consolidated of several of those separate complaints. The decision to allow consolidation or not is to be made in the panel’s “sole discretion.”


Secondly, there are the UDRP Rules. Rule 1 defines the party initiating a complaint, which implies that there is only one per complaint, i.e., a single complainant. That is alright because separate complaints can be consolidated under the Policy itself, by 4(f ).


But then there are the supplemental rules and the applicable one in this case, Forum 1 (e), tries a short cut by saying that the single complainant in UDRP Rule 1 can actually mean “multiple persons” if they have a nexus with each other that gives them a right to all the domain names claimed in the one proceeding. So, if this rule were applied, you would not need consolidation because all the complainants are validly in the one proceeding.


The question then is whether in the present case the two complainants have that nexus and the panellist held that they did not, or at least that they had not proved it. Unfortunately for the Complainants, the panel found that they did not meet the evidentiary burden to satisfy Supplemental Rule 1(e). That was so because the trademarks relied on were not held by a common entity and thus it could not be said that the complainants were:


“multiple persons or entities who have a sufficient nexus who can each claim to have rights to all domain names listed in the Complaint.”


The panellist also held, to deal with the complainants’ reliance on the WIPO Overview that the nature of any common grievance was not sufficiently clear from the evidence.


Consequently. the panel found that the Complainants were improperly joined under Rule 1(e) and the Complaint was dismissed.


Such an outcome is an important reminder of a flaw that we see in some Complaints. It is always vital that all arguments made, both substantive and procedural, are supported by clear and convincing evidence. Even in undefended claims, Panels seek to make sure that all the requirements of the policy and the Rules have been met. While it may seem a harsh result in what may well have been an otherwise clear instance of cybersquatting, ensuring that Complaints are carefully planned, comprehensive and always supported by evidence, will reduce the risk of an otherwise meritorious Complaint being denied.


Nevertheless, in the present case, the Complainants may still have had a reason to be disappointed in the result. Despite the evidentiary deficiencies apparent when the Forum supplemental rules is relied on, one wonders why a case for consolidation had not been made out. The complaints had relied on 4.1.1 of the WIPO Overview which noted that panels took account of


“... whether (i) the complainants have a specific common grievance against the respondent, or the respondent has engaged in common conduct that has affected the complainants in a similar fashion, and (ii) it would be equitable and procedurally efficient to permit the consolidation.”


The panel felt the complainant had not proved (i), but what about (ii)?


It seems that the panel did not consider whether the consolidation of the complainants was sufficiently equitable and procedurally efficient to permit it. If it had, the result may have been different. The cost and time involved in filing two separate Complaints to begin with, let alone after this failed attempt could arguably lead to a less desirable outcome than allowing the Complaint to go ahead despite a seemingly minor procedural deficiency.


This gives rise to an interesting and, so far as we know, unresolved question: how should a case be decided if there is a clash between, say the WIPO Overview that may have justified consolidation in this case and a Supplemental rule of one of the providers that did not allow consolidation in the absence of extra evidence? Such an outcome is an example of the occasional tension between the WIPO Jurisprudential Overview and the Supplemental Rules of the providers, which of course differ between the providers. With Panels entitled to favour the latter, if the case is brought in that provider’s jurisdiction, and tending to do so, it is important to be comprehensive and cover all eventualities.


Ultimately, this outcome serves as an important reminder to practitioners of the pitfalls of overlooking Supplemental Rules and treating the Jurisprudential Overview as too close to being gospel and the answer to all problems; it is useful and a good guide to many issues, but like all of us, it has its limitations.