PSG Franchising Ltd v Elife Ltd, Court of Appeal - Nominet UK Dispute Resolution Service, October 13, 2008, [2008] DRS 5899

Resolution Date:October 13, 2008
Issuing Organization:Nominet UK Dispute Resolution Service
Actores:PSG Franchising Ltd v Elife Ltd
 
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10-51578-1 1

NOMINET DISPUTE RESOLUTION SERVICE

DRS 5899

PSG Franchising Limited

Complainant

and

Elife Limited

Respondent

______________________________________

DECISION OF INDEPENDENT EXPERT

______________________________________

1 Parties

2 Domain name

Psg.co.uk (the "Domain Name").

3 Procedural background

3.1 The Complaint entered Nominet's system on 18 July 2008. Hard copies of the Complaint were received by Nominet on 22 July 2008. The Complaint was validated on 22 July 2008 and was sent to the Respondent on the same date.

3.2 The Response entered Nominet's system and hard copies of the Response were received by Nominet on 13 August 2008. The Response was sent to the Complainant on the same date.

3.3 The Reply entered Nominet's system on 22 August 2008 and was forwarded to the Respondent's representative on the same date.

3.4 The dispute then entered the mediation phase, which evidently was unsuccessful. On 8 September 2008 the parties were notified that the dispute would be decided by an Independent Expert if the Complainant paid the requisite fees by no later than 22 September 2008.

3.5 On 22 September 2008, the requisite fees were received, evidently having been paid on behalf of the Complainant by an entity named Audiotel International Limited. On 24 September a conflict check was sent to the Independent Expert. The Independent Expert's declaration of impartiality and independence was signed and sent to Nominet on 25 September.

4 Outstanding formal/procedural issues (if any)

4.1 There do not appear to be any outstanding formal or procedural issues. There appears to be no reason why a complainant's fees should not be paid on its behalf by a third party.

5 The facts

5.1 The Complainant is a UK limited company with number 3674092 which was incorporated on 25 November 1998 and has since 15 December 1998 been known as PSG Franchising Limited, with a registered office at 133 Ebury Street, London SW1W 9QU. Mr Bernard Connor, who conducted the correspondence with the Respondent on behalf of the Complainant, is a director of that company.

5.2 The Domain Name was registered on 5 April 2006. It is currently registered to the Respondent, Elife Limited, which is a UK limited company with number 5333223 and an address at 383 Pinner Road, North Harrow, Middlesex HA1 4HN. The registrar is Mohammed Zaffer.

5.3 It would appear from the evidence exhibited to the Response that on 31 August 2006 the Domain Name was transferred from Christopher Bowler of 8 Grange Road, Sutton, Surrey SM2 6RS to Mohammed Zaffer of 383 Pinner Road, North Harrow, Middlesex HA1 4HN. The Domain Name appears to have been one of nine domain names transferred from Mr Bowler to Mr Zaffer on that date.

5.4 Since then Mr Zaffer and the Respondent appear to have used it to drive traffic to a search site named 'Go Search', which provides pay-per-click (PPC) links to websites relevant to the term searched against.

5.5 In addition, on 8 January 2007 the Domain Name appears to have been placed into the Respondent's Sedo account for sale. This has been confirmed by an email from Hugo Dalrymple-Smith of Sedo to the Respondent of 7 August 2008. The Complainant has exhibited evidence that the Domain Name was advertised for sale on the Sedo website at some point prior to submission of the Complaint (unfortunately, the screenshot submitted by the Complainant is undated).

5.6 The Respondent, Elife Limited, is Mr Zaffer's corporate vehicle. It was incorporated on 14 January 2005. Its directors are Mr Zaffer and a Mehrooz Fatma Zaffer whom Mr Zaffer says is his wife. Mr Zaffer says that he and his wife have always been directors. I have no reason to disbelieve either assertion. Elife Limited would therefore appear to be a small family company, controlled by Mr Zaffer.

5.7 On 29 May 2008 Bernard Connor of the Complainant sent an email to the Respondent in the following terms:

Dear Sirs

I am the CEO of the Property Search Group who trade under the PSG brand and have done so for over 10 years - we have PSG as a registered trademark since 1999.

I would therefore like to own this Domain name.

I have checked with our advisors and can initiate a nominet DSR procedure which will mean your company wil be forced to handover this domain name due to the fact that you are using our trade name without our permission.

However, before I go down that route, I would like to offer you a nominal amount - say £300 - to transfer this domain name and therefore prevent the adverse publicity with nominet that my procedure may cause you and your company.

Best regards

Bernie Connor - CEO Property Search Group

5.8 The Respondent replied on the same day in the following terms:

Dear Mr Connor

You have unfortunately been advised incorrectly. Whilst you may have a trademark for classes 36 and 42 for 'PSG The PROPERTY SEARCH GROUP', this does not give you total exclusivity for other areas of business for this term and certainly does not give you any exclusivity for the term 'PSG' for any class.

Furthermore, we don't promote any products or services under classes 36 and 42. Bearing this in mind you have no grounds for a complaint. As the advice you have been given is obviously incorrect, may we respectfully suggest that you take proper legal advice before pursuing any course of action against us.

As we have made you aware of the position, we will of course hold you liable for all costs incurred in this matter without further notice and ask you to make any further communications directly with our lawyers whom we have copied in to this email.

Regards

Mohammed Zaffer

Elife Limited

383 Pinner Road

North Harrow

Middlesex

HA1 4HN

5.9 Mr Connor of the Complainant replied within half an hour, in the following terms:

"Dear Mr Zaffer

Many Thanks for your quick reply - I will obviously forward your email on to my legal advisors.

As you have not responded to my offer to purchase the domain name from you I must assume that this path is not available.

Brest regards [sic]

Bernie Connor"

5.10 On 8 July 2008 the Domain Name was transferred by Mr Zaffer to his company, Elife Limited. The Domain Name appears to have been one of 39 domain names so transferred.

6 Parties' contentions

Complaint

6.1 The Complainant asserts that it has been registered as a company under the name "PSG Franchising" since 1998. It says it has traded since 1998 under the name PSG and that it has advertised under this name since the same date. The Complainant asserts that it and its franchisees "spent about £1.8m on such advertisements" in 2005. However, no explanation is provided of how much of that advertising spend was contributed by the Complainant and how much by the franchisees. Moreover no evidence at all is provided of that spend (e.g. advertising and/or marketing budgets, media schedules, invoices, etc). The only evidence in support of that assertion is five undated press advertisements in unidentified publications. The Complainant asserts that in 2005 its "brand's sales volume", i.e. presumably the aggregate turnover of the Complainant and all franchisees, was "about £40 million". Again no evidence is provided of that assertion (e.g. report and accounts). Further, it is not clear why more recent financial information could not have been provided, particularly in light of the fact that accounts have been filed at Companies House for the 12 months to 31 March 2008 (which shows the Complainant's turnover for the 12 months to 31 March 2008 as £9.6 million and for the previous 12 month period as £8.9 million).

6.2 The Complainant relies on its registered mark PSG - PROPERTY SEARCH GROUP which was registered on 30 July 1999 with number 2186313. The Complainant points out that the initials PSG comprise more than 90% of the entire registered device, the font for the letters PSG being more than 10 times larger than that for the words Property Search Group. The Complainant also asserts that the letters PSG are "the more memorable portion of the mark, as it abbreviates the rest of it". On that basis, the Complainant asserts that the Domain Name is identical to the Complainant's trading name of PSG and similar to its registered trade mark and company name.

6.3 The Complainant alleges that the Respondent is a "sham entity that serves as the alter ego of Mr Mohammed Zaffer". For reasons best known to its authorised representative, Mr Harry Jacobs of RegainDomain.com, the Complaint refers throughout to Mr Zaffer by his first name, Mohammed. It is not clear why this course has been taken, but parties to the DRS would be well advised to observe the professional courtesies.

6.4 The Complainant says that when it approached the Respondent to "settle the instant matter amicably", the Respondent (a) "promptly...

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