5. Whether and to what extent the Respondent has used, or has made demonstrable preparations to use, the sign corresponding to the gTLD in connection with a bona fide offering of goods or services or a bona fide provision of information in a way that does not interfere with the legitimate exercise by the Objector of its mark rights.

The Respondent and its predecessors in title have used the Trade Mark since 1989 in connection with a bona fide offering of various food products, but subject to the terms of the Licence Agreements and, with the apparent exception of South Africa, in circumstances where the registrations for the Trade Mark in all the jurisdictions in which the Respondent operates have continued to be held in the name of the Objector.

6. Whether the Respondent has marks or other intellectual property rights in the sign corresponding to the gTLD, and, if so, whether any acquisition of such a right in the sign, and use of the sign, has been bona fide, and whether the purported or likely use of the gTLD by the Respondent is consistent with such acquisition or use.

The Respondent claims to have owned word and device mark registrations for the Trade Mark in South Africa directly or through its affiliate or predecessor since 1990.

The Respondent has submitted a letter dated February 2, 2012 from a South African law firm addressed to a “Del Monte Fresh Produce Company” with an address in Florida, United States, enclosing:

1. a copy of a one page Certificate of Assignment dated December 2, 2011 apparently issued by the Registrar of Trade Marks of the Republic of South Africa, with respect to, inter alia, trade mark registration numbers 1972/01710, 1972/00599, 1966/01372 and 1972/01711, and indicating that the Respondent has been entered in the South African Trade Marks Register as the proprietor of these registrations effective as from October 14, 2011; and
2. a copy of a one page Deed of Assignment dated October 14, 2011 between the South African company Del Monte Fruits (S.A.) (Proprietary) Limited as assignor and the Respondent as assignee, the Schedule of which lists, inter alia, the above referenced four registrations for the DEL MONTE and DEL MONTE & DEVICE trademarks.

The registration certificates for each of these registrations have not been filed with the Response.

Given the registration numbers suggest that one of the registrations was filed in 1966 and each of the other three in 1972, and given the Respondent’s assertion that its affiliate and predecessor has been the proprietor of these registrations since 1990, and given the Respondent has failed to file copies of the relevant registration certificates with the Response, the Panel majority concludes the likely inference to be drawn is that these registrations were first registered in the name of the Objector, before being assigned to the Respondent’s affiliate and predecessor in 1990, shortly after the Licence Agreements had been entered into, and notwithstanding the express terms of the Licence Agreements requiring all of the Objector’s registrations for the Trade Mark worldwide to remain registered in the name of the Objector.

The Panel majority concludes it is at least arguable, and notwithstanding the Objector’s apparent acquiescence, that the assignment of the South African registrations into the name of the Respondent’s affiliate and predecessor, and subsequently (and as late as October 2011) into the name of the Respondent, was in breach of the Licence Agreements and therefore, for the purposes of the Guidebook and the Procedure, not bona fide.

Neither party has been particularly forthcoming in providing information relative to the South African trade mark registrations, which in and of itself is remarkable. The Panel majority would query the motivation the Respondent had in October 2011 for proceeding with a purported “paper” transfer of the registrations from an affiliated company, if doing so could place at risk a longstanding licensing arrangement with the Objector.

The Panel majority would also query whether it is possible that, regardless of who the prior registrant was, the Respondent sought to have these registrations assigned to it to bolster an eventual gTLD application for the <.delmonte> gTLD string.

7. Whether and to what extent the Respondent has been commonly known by the sign corresponding to the gTLD, and if so, whether any purported or likely use of the gTLD by the Respondent is consistent therewith and bona fide.

The evidence shows that the Respondent, as the Objector’s licensee, has been authorised strictly pursuant to the terms of the License Agreements to incorporate the Trade Mark into its corporate name. By virtue of its use of the Trade Mark, under license from the Objector since 1989, and by virtue of its use of the Trade Mark in its corporate name, the Panel majority concludes it is likely the Respondent is commonly known by the Trade Mark, at least among certain members of the relevant sector of the public.

There is of course no mention of gTLDs in the License Agreements. It cannot possibly have been envisaged by the Objector, the Respondent and the persons negotiating the drafting of the License Agreements at the time that a mechanism would be put into place by ICANN over 20 years later permitting persons to register and exclusively control the registry for new gTLDs comprising the Trade Mark.

The Panel majority rejects the Respondent’s assertion that, as the Licence Agreements do not expressly prohibit the registration of the applied-for gTLD string by the Respondent, therefore the Respondent is free to do so under the terms of the License Agreements, or otherwise.

To the contrary, the terms of the Licence Agreements clearly express the intention of the parties that the Objector would retain sole control over issues relating to the registration and enforcement of the Trade Mark worldwide. This, in the opinion of the Panel majority, clearly extends to the right to control the registration of domain names and gTLDs comprising or incorporating the Trade Mark, or similar marks.

It is particularly pertinent to note that the terms of the Licence Agreements expressly proscribe the use by the Respondent and the other licensees of the Trade Mark by itself as a corporate or trade name.

8. Whether the Respondent’s intended use of the gTLD would create a likelihood of confusion with the Objector’s mark as to the source, sponsorship, affiliation, or endorsement of the gTLD.

The evidence shows that, by virtue of the Licence Agreements and the conduct of the Objector, the Respondent and other licensees since 1989 (with the apparent exceptions of South Africa and the Philippines), the Objector has, consistent with its long-standing use of the Trade Mark worldwide commencing in the United States as early as 1891, sought to preserve its position as the owner of the Trade Mark worldwide, as well as the goodwill pertaining thereto.

From the crucial perspective of the average consumer, and notwithstanding the somewhat complicated licensing arrangements, the coexistence of the parties’ products in certain territories, and the similarity of the parties’ coexisting food products, the evidence shows that the Trade Mark has continued to function as an indicator of the commercial origin of the Objector and its goods (whether the Objector’s direct goods, or licensed goods). The Panel majority notes that global licensing of well-known brands is a common practice in the food industry and, notwithstanding the use of such brands by different licensees in different jurisdictions, in the mind of the average consumer, such well-known food brands continue to function effectively as trademarks designating the same trade source or commercial origin, notwithstanding such licensing arrangements.

The Objector has established at least a prima facie case that the Respondent’s intended use of the applied- for gTLD, to the exclusion of the Objector and the other licensees, is likely to unsettle the delicate balance struck by the competing interests of the parties under the licensing arrangements and, more importantly, is likely to create an impermissible likelihood of confusion with the Objector’s Trade Mark as to the source, sponsorship, affiliation or endorsement of the applied-for gTLD.

Conclusion

The Panel majority concludes, on the evidence, the first two limbs under the broad criteria set out in Section 3.5.2 of the Guidebook have not been made out.

For the reasons specified above, in particular under item 8 above, the Panel majority determines, in all the circumstances, that the potential use by the Respondent of the applied-for gTLD string will otherwise create an impermissible likelihood of confusion between the applied-for gTLD string and the Trade Mark.

The Panel majority considers that the applied-for gTLD string, being identical to the Objector’s well-known mark, and given the nature of the Respondent’s proposed use, will create a likelihood of confusion between the gTLD and the Objector’s mark. The Panel must conclude, however, that the gTLD creates an impermissible likelihood of confusion in order to sustain the Objection. Several LRO panels have considered that a respondent’s behaviour, short of bad faith, may be relevant to this determination. See, for example, Defender Security Company v. Lifestyle Domain Holdings, Inc., WIPO Case No. LRO2013-0035:

For an Objector to prevail, “there must be something more than mere advantage gained, or mere impairment, or mere likelihood of confusion.” See Right at Home v. Johnson Shareholdings, WIPO Case No. LRO2013-0030. Although the terms “unfair, “unjustifiably,” and “impermissible” are not uniformly defined or understood in the trademark context, their use here suggests that, in order to sustain the Objection, the Panel must find something untoward about the Respondent’s behavior or something intolerable about the Respondent being permitted to keep the string in dispute, even if the Respondent’s conduct or motives do not rise to the level of bad faith.

The Panel majority finds that there is something untoward about the Respondent’s behaviour in this
case. As previously indicated, the Respondent arguably violated the terms of its Licence Agreements with the Objector by acquiring trade mark registrations that under the circumstances might have been acquired to bolster the Respondent’s eventual gTLD application. In light of all the attendant circumstances, and considering such untoward behaviour, the Panel majority believes the gTLD creates an impermissible likelihood of confusion between the gTLD and the Objector’s mark.

Accordingly, the third limb under the broad criteria set out in Section 3.5.2 of the Guidebook has been made out.

The Panel majority rejects the Respondent’s contention that the long-standing principle of first rights should be restricted solely to the simple question of who applied first for registration of the applied-for gTLD string. To the contrary, the Panel must determine the question of first rights from the broad perspective of rights in the Trade Mark in general. The evidence clearly shows that the Objector’s ongoing rights in the Trade Mark predate the Respondent’s more recent and expressly limited rights in the Trade Mark, as licensee, by over 100 years.

The Panel majority also finds force in the submissions of the Objector and the other Trade Mark licensees that granting the Respondent the exclusive right to register and use the applied-for gTLD string (including maintaining the register and processing applications for registration of domain names using the applied-for gTLD string) may cause harm or detriment to the Objector and the other licensees.

The Panel majority considers the long history of the Trade Mark, the complicated nature of the global licensing arrangements of the Trade Mark, and the 24 year history of coexistence in the global marketplace of food products manufactured, marketed, sold and distributed under the Trade Mark by the Objector, the Respondent and the other licensees, are all relevant factors in support of the Panel majority’s conclusion that the Objection should be upheld. It is pertinent to note that no other parties (including the Objector and the other licensees) have applied for registration of the applied-for gTLD string.

7. Decision

The Panel majority therefore concludes, for the reasons specified above, that the Objection is valid and should be upheld.

Hughes, Sebastian M W

Presiding Panelist

Towns, William R

Panelist
Date: July 29, 2013

Dissenting Opinion

I respectfully must dissent here. I agree with most of what the Panel majority has to say in its thoughtful opinion. Nonetheless, based on the record presented and the fact that Objector bears the burden of proof in this proceeding, I would tip the balance in this close case in favor of Respondent.

I agree with the Panel majority that Respondent overstated its case in various respects, as are duly detailed in the majority opinion. I believe, though, that Objector also overreached, and in a significant way. Throughout the pleadings, Objector asserts that Respondent has “no ownership interest in the DEL MONTE Mark.” Respondent, on the other hand, asserts that it is the owner of the DEL MONTE mark registration in South Africa.

The Panel majority notes that the actual South African registration certificates for the DEL MONTE mark are not annexed to the Response. The majority also concludes that it is “at least arguable” that the assignment of the South African registrations into the name of Respondent’s affiliate and predecessor, and ultimately of Respondent, was in breach of the License Agreements and therefore not bona fide for purposes of this LRO Procedure.

I am not prepared to reach the same conclusion in these circumstances. Although Respondent would have done well to annex the certificates to its Response, it seems to me that Objector should have anticipated in its initial pleading that Respondent would invoke its South African trademark registrations, however acquired, in response to the Objection, and that Objector should have dealt with any cloud over such alleged rights at the outset. Rather, Objector simply asserted that Respondent has “no ownership interest” whatsoever in the DEL MONTE mark.

In this connection, I should also note that I had favored the acceptance of supplemental submissions from the Parties. On the issue of the South African trademarks alone, I would have thought that the supplemental