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December 21, 2010 / Nate Harris

Xiha.com: After the UDRP

A while back I wrote about Xiha Oy v. Qiu Shengjie, Chen Qing Mei (WIPO Case No. D2010-1204). Complainant Xiha Oy operates a social networking site at <xihalife.com>, which has over 800,000 users. It filed this complaint against the registrant of <xiha.com>. Since the disputed domain was registered, it had variously been parked and pointed at news sites. While the UDRP proceeding was ongoing, it pointed to what appeared to be a news and social media site.

The complaint was denied on the ground that registration of the disputed domain predated Xiha Oy’s trademark rights in its XIHA mark. I found the case interesting in part because the panel suggested that a subdomain could give rise to rights or legitimate interest under the second prong.

Today Jani Penttinen, one of the founders and CEO of Xiha, posted the following comment to my post:

Subsequently, after winning the process, the respondent has removed the content at xiha.com and returned it to parking. It is ironic that during the process the respondent claimed that it is running long-term business at the domain, and losing the domain would hurt all the users of their community. The respondent also stated it has never attempted to sell the domain is not planning to do so.

Unfortunately the UDRP panel decisions are final and the respondent is now free to reveal that all the claims about the domain usage were false, and there is nothing WIPO or the complainant can do about it anymore. The domain is, as it always has, reserved only so that it can be sold at a high profit with no intention to ever use it.

He’s right: the domain now redirects to <wwww.xiha.com> (note the extra “w”), which points to a sponsored links page. But is he right that “there is nothing WIPO or the complainant can do about it anymore”? Under Paragraph 4.4 of the WIPO Overview of WIPO Panel Views on Selected UDRP Questions, the consensus view is that a denied complaint can be refiled in limited circumstances, such as “when the complainant establishes in the complaint that relevant new actions have occurred since the original decision, or that a breach of natural justice or of due process has occurred, or that there was other serious misconduct by the panel or the parties in the original case (such as perjured evidence).” What’s more, “[a] refiled complaint will also be accepted if it includes newly presented evidence that was unavailable to the complainant during the original case.”

It seems Xiha believes it could make a case for any or all of those circumstances, though I’m still not sure that would resolve the issue of the respondent’s alleged prior rights. In other words, while Xiha might now be able to prove bad faith use, could it prove bad faith registration? What do you think?

I’d like to thank Mr. Penttinen for taking the time to provide this update and share his thoughts, and invite other parties to UDRP proceedings to do the same.

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4 Comments

  1. Bret Moore / Dec 21 2010 7:54 am

    Um, from your original post:

    Furthermore, the disputed domain was registered several years before Xiha Oy’s rights in its XIHA mark arose, making a finding of bad faith registration impossible.

    So it looks like the answer to your question is no. If Mr. Penttinen wants the domain, he’ll have to buy it… nothing wrong with that, that I can see, from a trademark/consumer perspective.

  2. Nate Harris / Dec 21 2010 3:28 pm

    I think you’re right, Bret. Even though bad faith use could be used to prove bad faith registration, the recent allegation of bad faith use is probably too remote in time from the original registration.

    The consensus view is that a registration renewal is not a registration for purposes of bad faith. Why is that? Should domains be vulnerable to transfer or cancellation if they are renewed by a registrant using them in bad faith? Or is an initial good faith registration enough to forever insulate the registrant from the UDRP, no matter how the domain is used later?

  3. Jani penttinen / Dec 21 2010 5:22 pm

    Thank you for the valuable thoughts regarding the case. We in fact first attempted to buy the domain. It is a short domain, and even though clearly unused through entire history, it is valuable. The first asking price was 10k euros, which we couldn’t afford. As the business grew we approached the owner again. We were prepared to pay thousands of euros for it, up to 10k if needed. However, the owner’s response was that the domain now costs at least 100k euros, with no room for negotiation.

    I can understand that it makes sense for the owner of the domain to ask for as high price as possible, but having registered hundreds of short domains years ago and sitting on them to milk future business owners just seems plain wrong. I mean, every year that goes by, the odds that the domain predates any potentially conflicting trade mark gets bigger. And it seems that the domain owner doesn’t need to have any intent to run a website, not even any idea that the name would ever be used – all he needed to do is bulk register a bunch of domains many years ago.

    In case of xiha.com, there are almost no other potential buyers. I am guessing the thinking goes that our business grows big enough and we will eventually pay 100k or possible a lot more to gain control of the domain. If we don’t then it’s all just part of the gamble – continued ownership of the domain doesn’t cost anything.

  4. Bret Moore / Dec 23 2010 6:10 am

    It relates, in my mind, to property law, Nate. It’s sort of a first-in-time, first-in-right idea. So I stake my claim on this little plot of Internet real estate in good faith, and then later I either give it to someone else or I abandon it and somebody else takes up residency there, pays the taxes, etc, and it becomes there plot of land. Whatever their motive or good/bad faith, the UDRP is not an effective eminent domain mechanism against that piece of property because … well … because it’s not a court proceeding. It’s probably unfair to have a single-member arbitration panel deciding whether somebody’s interest in the property is greater than another’s. So the UDRP does the good thing and says “we can’t decide this matter.” Note that they could still sue under the ACPA – and there, you don’t have to prove bad faith use AND bad faith registration at the time it was registered (I think you can get by just on bad faith use). Plus there’s statutory damages, up to $100,000 per domain name. So the incentives to settle/sell become much greater.

    For all the flack it gets from domainers, I think the UDRP functions pretty well, honestly. It has some “flaws” but those are mostly because I don’t think we really want it deciding things like this.

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