Baklan v. All Answers Limited ( 2020 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Iaroslav Baklan, No. CV-20-00707-PHX-JZB 10 Plaintiff, ORDER 11 v. 12 All Answers Limited, 13 Defendant. 14 15 Pending before the Court is Defendant All Answers Limited’s Motion to Dismiss 16 Count Three of Plaintiff’s Complaint under Rule 12(b)(6) of the Federal Rules of Civil 17 Procedure. (Doc. 15.) The Court will grant Defendant’s motion. 18 I. Background. 19 On April 4, 2020, Plaintiff Iaroslav Baklan filed this action alleging that Defendant 20 “engaged in Reverse Domain Name Hijacking under the Anticybersquatting Consumer 21 Protection Act (“ACPA”), 15 U.S.C. § 1114(2)(D) (ii) and (iv).” (Doc. 1 at 1.) 22 On September 17, 2015, Defendant AAL applied for a trademark registration in the United Kingdom for the mark UKESSAYS, in connection with: 23 ‘Educational consultancy services; Educational information services; Information services related to education; Library services related to 24 documents stored and retrieved by electronic means.’ The mark registered on April 3, 2016. 25 26 (Id. at 4.) 27 “On October 16, 2019, Defendant . . . applied for a trademark registration in the 28 United Kingdom for the mark UKESSAY, in connection with: ‘Advisory services relating 1 to education; Editing of written text; Educating at universities or colleges; Education and 2 training services; Education services.’ The mark registered on January 10, 2020.” (Id.) 3 Plaintiff argues that Defendant’s UK mark is invalid because Defendant has not used the 4 mark for the purposes stated in the 2016 and 2020 applications. (Id. at 6.) 5 Plaintiff purchased , the disputed domain name, in 2017 to support 6 his online writing service for university students in the United Kingdom. (Id. at 3). The 7 disputed domain name was registered by a third party in 2005. (Id. at 4). On April 9, 2020, 8 Defendant brought a Uniform Domain Name Resolution Policy (“UDRP”) proceeding 9 against Plaintiff through the World Intellectual Property Organization (“WIPO”).1 (Id. at 10 2.) On March 25, 2020, WIPO “issued a decision directing [Godaddy.com Ltd., the domain 11 name host, to initiate] the transfer of the disputed domain name to Defendant.” (Id. at 6.) 12 On April 9, 2020, Plaintiff brought this action to prevent the transfer of the domain. 13 (Id. at 16.) Therein, Plaintiff pleads three counts: (1) Declaration Under Anticybersquatting 14 Consumer Protection Act, wherein Plaintiff claims that he has not violated Defendant’s 15 rights under the ACPA; (2) Declaratory Judgment, wherein Plaintiff requests that the Court 16 declare that Plaintiff’s registration and use of the disputed domain is not unlawful under 17 the ACPA; and (3) Reverse Domain Name Hijacking, wherein Plaintiff claims that 18 Defendant, in bad faith, used the UDRP proceeding to attempt to deprive him of the 19 disputed domain. (Doc. 1.) 20 On July 15, 2020, Defendant filed a Motion to Dismiss Count Three of Plaintiff’s 21 Complaint for failure to state a claim. Defendant argues that (1) “Plaintiff fails to allege 22 the disputed domain name was ‘suspended, disabled, or transferred” under the ACPA and 23 (2) that “Plaintiff fails to allege facts to support the ‘knowing and material 24 misrepresentation’ element of a reverse domain name hijacking claim.” (Doc. 15 at 5.) The 25 Motion was fully briefed. (See docs. 20 and 23.) 26 1 WIPO is a United Nations Agency that provides various intellectual property services. 27 World Intellectual Property Organization, https://www.wipo.int/portal/en/. WIPO operates the Madrid International Trademark Registration System and offers forums for alternative 28 dispute resolution, including domain name dispute resolution. Id. Domain name disputes are resolved under the UDRP. Id. 1 II. Legal Standard. 2 A successful 12(b)(6) motion must show either that the complaint lacks a cognizable 3 legal theory or fails to allege facts sufficient to support its theory. Godecke v. Kinetic 4 Concepts, Inc., 937 F.3d 1201, 1208 (9th Cir. 2019) (citing Balistreri v. Pacifica Police 5 Dep't, 901 F.2d 696, 699 (9th Cir. 1988)). A complaint that sets forth a cognizable legal 6 theory will survive a motion to dismiss provided it contains “sufficient factual matter, 7 accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. 8 Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 9 (2007)). A claim has facial plausibility when “the plaintiff pleads factual content that 10 allows the court to draw the reasonable inference that the defendant is liable for the 11 misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). 12 In ruling on a 12(b)(6) motion, the Court takes the plaintiff’s well-pleaded factual 13 allegations as true and construes them in the light most favorable to the plaintiff. Cousins 14 v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Legal conclusions couched as factual 15 allegations are not entitled to a presumption of truth and are not sufficient to defeat 16 a 12(b)(6) motion. Iqbal, 556 U.S. at 678. A complaint does not need to have detailed 17 factual allegations, but it must have more than a “the-defendant-unlawfully-harmed-me 18 accusation.” Id. 19 III. Analysis. 20 To state a claim for reverse domain name hijacking, a plaintiff must show that the 21 disputed domain name was “suspended, disabled, or transferred” by a domain registrar 22 because of a knowing and material misrepresentation by defendant. 15 U.S.C. 23 §1114(2)(D)(iv). In its Motion, Defendant argues Count Three should be dismissed for two 24 reasons: (1) Plaintiff “fails to allege the disputed domain name was ‘suspended, disabled, 25 or transferred,’” and thus Plaintiff’s claim is not ripe for review; and (2) Plaintiff “fails to 26 allege facts to support the ‘knowing and material misrepresentation’ element of a reverse 27 domain name hijacking claim.” (Doc. 15 at 4–5.) The Court will address each argument 28 below. 1 a. Premature. 2 Defendant argues that the Court should dismiss Count Three of Plaintiff’s 3 Complaint because the claim is premature. (Doc. 15 at 4). Specifically, Defendant argues 4 that “[t]he Complaint does not allege that the domain name was 5 suspended, disabled, or transferred.” Id. The Court disagrees. 6 A reverse domain name hijacking claim requires the disputed domain name to be 7 “suspended, disabled, or transferred” at the time of filing. 15 U.S.C. § 1114(2)(D)(v). 8 Language within the statute indicates an intent to include pending, but inevitable transfers. 9 15 U.S.C. § 1114 (“(ii) An action referred to under clause (i)(I) is any action . . . transferring 10 . . . a domain name,” referenced by 1114(2)(D)(v).). While the Ninth Circuit has yet to 11 address the question of Defendant’s interpretation of the statute, other circuits consistently 12 find that “§ 1114(2)(D)(ii)(II), the statutory provision referenced in § 1114(2)(D)(v), 13 covers situations where a transfer by [the registrar] is inevitable unless a court action is 14 filed.” Sallen v. Corinthians Licenciamentos LTDA, 273 F.3d 14, 25 n. 11 (1st Cir. 2001); 15 see also Barcelona.com, Incorporated v. Excelentisimo Ayuntamiento De Barcelona, 330 16 F.3d 617, 626 (4th Cir. 2003) (“Bcom, Inc. is a domain name registrant, and its domain 17 name was suspended, disabled, or transferred . . . . Although the domain name had not 18 actually been transferred . . .as of the time that Bcom, Inc. commenced this action, the . . . 19 transfer was certain to occur absent the filing of this action to stop it.”). Therefore, a reverse 20 domain name hijacking claim requires an inevitable or completed transfer of the disputed 21 domain before a plaintiff may state a claim. 22 Here, Plaintiff’s claim in Count Three is not premature under the ACPA because 23 the filing of this action prevented the imminent transfer of the rights to 24 to Defendant. (Doc. 1 at 6). There is no dispute that Godaddy.com has been ordered to 25 transfer the disputed domain name and paused the transfer process pending resolution of 26 this action. (See doc. 23 at 5.) Under the ACPA, then, the domain name has “been 27 transferred” because the process of transferring has begun. Sallen, 273 F.3d at 25 n. 11. 28 Accordingly, Plaintiff’s claim in Count Three is not premature. 1 b. Misrepresentation. 2 Defendants next argue that the Court should dismiss Count Three of Plaintiff’s 3 Complaint because “[t]he Complaint fails to allege facts to support the ‘knowing and 4 material misrepresentation’ element of a reverse domain hijacking claim.” (Doc. 15 at 5.) 5 The Court agrees. 6 To support an inference that WIPO ordered the disputed domain name’s transfer 7 because of the Defendant’s knowing and material misrepresentation, Plaintiff must allege 8 facts (1) that establish that Defendant made a knowing and material representation to the 9 WIPO panel and (2) that support the inference that the WIPO panelist made its ruling based 10 on Defendant’s knowing and material misrepresentations. 15 U.S.C. 1114(2)(D)(iv). 11 Neither burden is met. 12 Here, Plaintiff does not plead facts which, when accepted as true, support a 13 reasonable inference that Defendant knowingly described the mark inaccurately or 14 manipulatively to WIPO. Plaintiff argues that “Defendant knowingly provided the UDRP 15 panel with incomplete and misleading information” by presenting an invalid trademark. 16 (Doc. 1 at 14.) The validity of the mark, however, is irrelevant; the unlawful action 17 described by 15 U.S.C. §1114(2)(D)(iv) is making a knowing and material 18 misrepresentation of a trademark notwithstanding the mark’s validity or lack thereof.2 19 Plaintiff does not show that Defendant knowingly misstated information about the 20 trademark during the UDRP proceedings, nor does Plaintiff provide facts in the Complaint 21 showing what information Defendant provided to the UDRP panel. (Doc. 1 at 3-10.) 22 Instead, Plaintiff merely raises the possibility that Defendant misrepresented the mark as 23 valid to the UDRP panel. (See id.) This contention is insufficient to meet the requirements 24 set forth in Iqbal. 556 U.S. at 678 (“The plausibility standard is not akin to a ‘probability 25 requirement,’ but it asks for more than a sheer possibility that a defendant has acted 26 unlawfully.”). (See doc. 1). Therefore, Plaintiff fails to show that Defendant made a 27 2 The Court notes that validity of Defendant’s trademark is at issue in Count One of Plaintiff’s complaint and that Defendant has agreed that Plaintiff stated a claim in Count 28 One. Since Plaintiff has alternate routes to relief based on validity disputes, the Court will focus on the narrow issue presented by 15 U.S.C. §1114(2)(D)(iv). 1 knowing and material misrepresentation to the URDP panel sufficient to sustain his claim. 2 Even if this Court found a knowing and material misrepresentation by Defendant, 3 Plaintiff fails to show that WIPO took action on the basis of that material misrepresentation. 4 Cf. Strong College Students Moving Incorporated v. College Hunks Hauling Junk 5 Franchising LLC, 2015 WL 12602438, at *12 (D.Ariz., 2015) (finding that plaintiffs 6 disputing the validity of a trademark based on fraud must prove that the agency 7 adjudicating the issue was materially affected by defendant’s misrepresentation when the 8 agency determined the mark’s validity.). Specifically, Plaintiff does not allege any facts 9 related to WIPO’s decision-making process, much less facts that support a conclusion that 10 WIPO ordered the transfer of based on a knowing material 11 misrepresentation by Defendant. (See doc. 1.) 12 Although Plaintiff provides many reasons why the WIPO panel may have made a 13 poor decision, (see doc. 1 at 6), Plaintiff’s burden in pleading a reverse domain name 14 hijacking claim is to establish that WIPO’s poor decision was made based on Defendant’s 15 knowing and material misrepresentation. 15 U.S.C. §1114(2)(D)(iv). Since Plaintiff has 16 not alleged facts sufficient to support that Defendant made a knowing and material 17 misrepresentation to WIPO, or that WIPO made its decision based on a knowing and 18 material misrepresentation by Defendant, Plaintiff has not stated a claim on which relief 19 can be granted.3 20 // 21 // 22 // 23 // 24 3 To the extent that Plaintiff argues that the Court should deny Defendant’s Motion to 25 Dismiss because Defendant failed to comply with LRCiv 12.1(c), the Court disagrees. To comply with LRCiv 12.1(c), the moving party must “include a certification that, before 26 filing, the movant notified the opposing party of the issues asserted in the motion and the parties were unable to agree that the pleading was curable . . . by a permissible amendment 27 . . . .” LRCiv 12.1(c). Here, Defendant complied with LRCiv 12.1(c) by notifying Plaintiff’s counsel of the basis for the motion via email and discussing it via phone. 28 (Doc. 23 at 6). Defendant also included a certification in the Motion to Dismiss. (Doc. 15 at 1). Therefore, Defendant complied with the requirements of LRCiv 12.1(c). 1 IT IS ORDERED that Defendant All Answers Limited’s Motion to Dismiss Count 2|| Three of Plaintiff's Complaint (doc. 15) is granted. 3 Dated this 14th day of October, 2020. 4 Lo > al son 6 United States Magistrate Judge 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -7-