3.7 Passive Holding in General
The concept of “passive holding” refers to the “non-use” of a disputed domain name. It originates with the Telstra case in 2000. In this early UDRP case, the Panel attempted to find a basis in the Policy for “bad faith use” when the disputed domain name remained unused and determined “in the circumstances of this particular Complaint, the passive holding by the Respondent amounts to the Respondent acting in bad faith”. The particular facts of the Telstra case have since been construed as the Telstra test and involve five criteria:
(i) the Complainant’s trademark has a strong reputation and is widely known, as evidenced by its substantial use in Australia and in other countries,
(ii) the Respondent has provided no evidence whatsoever of any actual or contemplated good faith use by it of the domain name,
(iii) the Respondent has taken active steps to conceal its true identity, by operating under a name that is not a registered business name,
(iv) the Respondent has actively provided, and failed to correct, false contact details, in breach of its registration agreement, and
(v) taking into account all of the above, it is not possible to conceive of any plausible actual or contemplated active use of the domain name by the Respondent that would not be illegitimate, such as by being a passing off, an infringement of consumer protection legislation, or an infringement of the Complainant’s rights under trademark law.
Accordingly, “passive holding” is a concept is a product of the Telstra case and for it to apply, the Telstra test must be met. Crucially, the Telstra test requires a strong reputation of the mark and the impossibility of conceiving any plausible or actual good faith use of the particular domain name. Such a determination would generally arise only where the disputed domain name corresponds to a particularly distinctive and famous mark. Where a domain name is unused, it may be considered to be “passively held” but that alone does not amount to bad faith use absent meeting the narrow requirements of the Telstra test.
Panels when considering passive holding, must contemplate whether there is any plausible good faith use for the disputed domain name. Where there is, the Telstra test will not have been met and passive holding will not amount to bad faith use.
Additional Information
Relevant Decisions
Tractus Asia Limited v. Domain Administrator / Synergy Technologies, LLC, Forum FA2311002070088, <tractus.com>, 3-member, Denied
Further, the Panel finds Complainant’s arguments with respect to passive holding inapplicable here, given that the Disputed Domain Name is in fact associated with an active website – albeit one that displays only PPC links…In any event, even if the Panel considered the PPC page associated with the Disputed Domain Name to constitute passive holding, the Panel does not find the doctrine applicable here given, at least, Complainant’s failure to establish that the TRACTUS Trademark “has a strong reputation and is widely known” (citing Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003) because Complainant has not provided any evidence to support its statements about the TRACTUS Trademark other than a certificate for a single U.S. trademark registration; and further given Respondent’s evidence of “actual or contemplated good faith use by it of the domain name”.
Margaritaville Enterprises, LLC v. Callaway, Joann, Forum FA2208002009673, <margaritavillenews.com>, 3-member, Transfer with Dissenting Opinion
Majority View:
The majority of the Panel also finds that, in addition to the foregoing specific criteria and for the foregoing reasons, Respondent’s conduct also amounts to bad faith registration and use within the generally understood meaning of that expression. Respondent has taken Complainant’s distinctive trademark which certainly has a significant reputation in the area in which the Complainant operates, has passively held it in the disputed domain name for an extended period of time and proposes to use it for news purposes which is already an activity of the Complainant.
Dissenting View:
This Panelist considers that Complainant has not established that its mark is sufficiently distinctive, as in the leading case on passive use, Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003, <telstra.org>, such that it is implausible that the disputed domain name may be put to any good faith use, such as a news site to cover the fun and adventure of South West Florida.
Endo Pharmaceuticals Inc. v. Tanzim Ahmad, WIPO D2021-0511, <aveed.com>, 3-member, Denied
Finally, with respect to Complainant’s argument that Respondent’s “passive holding” of the Domain Name may constitute bad faith pursuant to the seminal decision in Telstra Corp. v. Nuclear Marshmallows, WIPO Case No. D2000-0003, the Panel rejects this argument. The Telstra decision is typically (though not always) reserved to famous trademarks, and, again, there is no evidence here that AVEED enjoys such renown. Moreover, unlike the respondent in Telstra, Respondent in the instant case has come forward and explained, under oath, why he registered the Domain Name.
AIH General Merchandise UG (haftungsbeschränkt) & Co. KG v. Zhang Jun (张俊), WIPO D2019-1108, <jumiapay.com>, 3-member, Transfer
As regards use, the Respondent makes only passive use of the disputed domain name but this does not preclude a finding of use in bad faith. See Telstra Corporation Limited v. Nuclear Marshmallows, WIPO Case No. D2000-0003. In the present dispute, the Complainant has a considerable reputation in its JUMIA trademark in the retail sector due to its use of that trademark in connection with its e-commerce platform, including through its official website.
Sage Global Services Limited v. Narendra Ghimire, Deep Vision Architects, WIPO DAI2023-0010, <sage.ai>, 3-member, Denied
The Telstra case is long standing but relatively narrow in operation. In that case, the complainant’s trademark was unique and one of the most famous in Australia, the complainant provided substantial evidence of its reputation in Australia, the respondent had an Australian address and was likely aware of the complainant, and the respondent used a fake name (Nuclear Marshmallows) to conceal his or her identity. In the present case, the Complainant has not presented strong evidence to satisfy the test set out in Telstra. Merely asserting that the Complainant has a trademark and that the Respondent has not used the disputed domain name is typically not sufficient to satisfy the Telstra test. Unlike Telstra, the Panel here can consider uses of the disputed domain name that would be in good faith.
Hong Kong Exchanges and Clearing Limited v. Time Cowork Ltd., ADNDRC HK- 2101563, HK-2101564 and HK 2101565 (2022), <hkex.com>, <hkex.net> and <hkex.org>, 3-member, Denied
The Panel does not consider that there are no other possible uses of the disputed domain names and, that, therefore, the doctrine of passive holding is not applicable in this case.
Bytedance Ltd v. liu xin, ADNDRC HK-2201645 (2022), <tiktokparati.com>, et. al., Transfer
The Panel finds evidence in support of the contention that the Complainant’s “TIKTOK” app with a large internet presence through its primary website <tiktok.com> is one of the most popular apps globally in recent years… It is inconceivable that the Respondent would not have known of the Complainant’s “TIKTOK” brand or trademark at the time of registration of the Disputed Domain Names in 2021.
Rosetta Stone Ltd. v. Digital Privacy Corporation / Stuart Thomas, WIPO D2018-2322 <rosettastone.app>, 3-member, Transfer with dissenting opinion
Majority:
The disputed domain name does not resolve to an active website. However, as discussed in section 3.3 of the WIPO Overview 3.0, the non-use of a domain name would not prevent a finding of bad faith under the doctrine of passive holding. Taking into account the circumstances of this case, the majority of the Panel accepts that many of these factors are present in this dispute. There is no dispute between the Parties that the ROSETTA STONE trademark is well known, and the Respondent has not presented evidence of any actual or contemplated good faith use of the disputed domain name.
Dissent:
In that regard, the principle discerned from Telstra v. Nuclear Marshmallows, WIPO Case No. D2000-0003 is clearly not applicable in the present case, as the evidence is unequivocal that the Respondent intended to make an active and entirely legitimate use of the domain name, in clear contrast with the situation in the Telstra case, where that was not the intention of the registrant.