Recent Case Notes & Commentary

Requesting a termination of proceedings under the UDRP: A case of prejudice

In Loco Tecnologia da Informação v. Perfect Privacy[1]

WIPO Case No. D2019-2738

24th March 2020


Panels resolving UDRP matters have a broad power conferred by Paragraph 10(a) of the Rules which states: “the Panel shall conduct the administrative proceeding in such manner as it considers appropriate in accordance with the Policy and [the] Rules”. Additionally, Paragraph 17(b) of the Rules gives panels the power to terminate the matter at the request of one of the parties and for the other party to raise any objections to the termination. Together these sections give panels the power to terminate a claim with or without prejudice to the Complainant. Terminating a complaint without prejudice simply means reserving a decision in the matter, leaving the Complainant with the right to bring the complaint again at a later date. Panels will consider the reasons for requesting a termination as well as the other parties’ objections before deciding to terminate with prejudice. Naturally it will be in the Respondents’ interest to terminate with prejudice.

In the case of In Loco Tecnologia da Informação v. Perfect Privacy a Brazilian tech company requested to have their complaint terminated after being granted multiple time extensions and failing to come to a settlement with the Respondent. Their request came after the Respondent had spent time and money making submissions in the matter. The Respondent objected to the Complainant’s request to terminate without prejudice, submitting that the termination should be with prejudice as well as a finding of reverse domain name hijacking (RDNH), which was ultimately granted.

No Bad faith if Complainant did not exist before registration

The Respondent registered the domain name <inloco.com> in 1999 but the Complainant company did not incorporate until years later and only registered their IN LOCO trademark in 2017. This makes it practically impossible for the Complainant to succeed in their claim because they would not be able to show that the domain name was registered in bad faith – at a time when they did not yet exist and had no interests that could have been targeted by the Respondent. Bringing a doomed claim supports a finding of RDNH and in this matter the panel found that the Respondent was entitled to have the RDNH request dealt with in spite of the matter being terminated because like a counterclaim, it is a separate question. History between the parties suggest that the Complainant had been unable to purchase <inloco.com> and now sought to use the UDRP to take it procedurally.

In responding to the request for a finding of RDNH, panels may have to look to the whole of the evidence and decide on the matter as they usually would have done. The reason is that making a claim that would have been successful, almost certainly would not have amounted to an abuse of process. But a claim that would have failed, although not determinative, is far more suggestive of the whole claim having been an abusive one.

The complaint’s claim in relation to the ‘bad faith’ requirement was essentially that the Respondent hadn’t been using the domain name for any discernible purpose. Unfortunately for them, passive holding of a domain name is not itself an act of bad faith and this was the reason their complaint failed. In addition, the panel found that Complainant had engaged in RDNH for reasons which are instructive as to facts which make a finding of RDNH more likely:

1. The Complainant did not provide any evidence of the Respondent using the domain name to target C or its interests;

2. The Complainant did not acquire rights to the name until 15 years after Respondent had registered the name. They could not have satisfied the bad faith requirement and their claim was doomed to fail;

3. Multiple attempts to buy the domain name failed – the Complainant likely used the UDRP to acquire the domain name for commercial reasons, not to address an issue of cyber-squatting.

It is also important to note that an unproductive delay and subsequent withdrawal of the claim will often not be favourable to Complainants, due to it increasing the likelihood of a Panel finding that the UDRP was being used to punish the other party financially.

[1] The Hon Neil Brown QC was a member of the Panel in this proceeding