Domain Dispute Arbitration Panel Finds Authorize.net Waived Rights to Complain of Trademark Infringment After Over 10 Years of Use

File a UDRP case quickly or potentially lose your rights: 

Our friends over at domainnamewire.com recently picked up on an interesting case out of the World Intellectual Property Organization (WIPO).  This case involves the waiver doctrine and the effect of permission on a domain name dispute.  Authorize.net, credit card payment service provider and owner of the AUTHORIZE.NET trademark, filed a proceeding with WIPO against Cardservice High Sierra for the use of the AUTHORIZE.NET trademark in their registered domain name at authorized.net.

Cardservice was an authorized reseller of Authorize.net’s payment services since 1999.  Authorize.net’s primary Internet presence is housed at the authorize.net domain name, and the Respondent, Cardservice, registered the authorized.net domain name in 1999.  Cardservice used the domain name without protest, but in 2005 Authorize.net asked Cardservice to put a disclaimer on the page stating that they, Authorize.net, owned the AUTHORIZE.NET mark.  Cardservice complied. 

In February 2008, Authorize.net sent a threat letter to Cardservice stating that they infringing on the AUTHORIZE.NET trademark.  In examining whether Cardservice had rights and legitimate interests in the domain name, the panel stated that Authorize.net’s burden in this case was higher than in most because they had acquiesced to the use for almost a decade.  Further, the panel noted that Authorize.net profited from every referral that Cardservice solicited at authorized.net.  In denying the complaint, the court said:

The Person case identified changed circumstances that generated the complaint; here, the only apparent change in circumstances is Complainant’s change of mind more than nine years after Respondent’s first use. In this proceeding neither Respondent’s conduct generally nor the specific use of Complainant’s mark on Respondent’s website appears to have changed significantly over the years, beyond Respondent’s addition of the requested trademark acknowledgment at Complainant’s request. Complainant points to no new conduct in 2008, when it sent its cease-and-desist letter, which it claimed rendered illegitimate an earlier or otherwise permitted use.

The court finally noted that the dispute between the parties was something that would have to be worked out in litigation, and that an arbitration panel was not the appropriate forum.  There was no indication of why the relationship fell apart in the pleadings, nor was there any evidence of why Authorize.net waited for almost a decade before filing the complaint.  The panel found that authorized.net was not registered in bad faith, and the transfer of the domain was denied.