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You are here: BAILII >> Databases >> Nominet UK Dispute Resolution Service >> Formtek, Inc v W Neal Services Ltd [2008] DRS 5466 (26 May 2008) URL: http://www.bailii.org/uk/cases/DRS/2008/5466.html Cite as: [2008] DRS 5466 |
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Nominet UK Dispute Resolution Service
DRS Number 05466
Parties: Formtek, Inc. v W Neal Services Limited
Decision of Independent Expert
Complainant: Formtek, Inc. (Lead Complainant)
Country: US
Respondent: W Neal Services Limited
Country: GB
lockformer.co.uk
This domain name is referred to below as the "Domain Name".
A hardcopy of the Complaint was lodged with Nominet on 19 February 2008. Nominet validated the Complaint on 20 February 2008 and notified the Respondent. In this correspondence Nominet informed the Respondent that it had 15 working days within which to lodge a Response to the Complaint. A hardcopy of the Response was submitted within this time limit on 27 February 2008. The Complainant submitted a Reply within the time frame provided for in the Nominet Dispute Resolution Procedure (the Procedure) on 7 March 2008. The dispute not having been resolved in mediation, on 1 May 2008 the Complainant paid Nominet the appropriate fee for a decision of an Expert pursuant to paragraph 7 of the Nominet Dispute Resolution Service Policy ("the Policy").
Sallie Spilsbury, the undersigned ("the Expert") has confirmed to Nominet that she knew of no reason why she could not properly accept the invitation to act as Expert in this case and further confirmed that she knew of no matters which ought to be drawn to the attention of the Parties which might appear to call into question her independence and impartiality.
There are no outstanding formal issues.
At the request of the Expert the following additional submission was made during the decision making process; Exhibit 6 to the Complaint is an email to the Complainant from one of its authorised dealers. The email is written in French. On 20 May 2008 the Expert requested a translation of the email into English pursuant to paragraph 13a of the Procedure. The translation was provided within the 3 working day deadline specified by the Expert. The Respondent was given 2 working days to make any additional representations arising from the translation. No additional submission was submitted by the Respondent.
The Complainant
The lead Complainant is Formtek, Inc. In addition there are 2 other Complainants, Formtek SARL and Met-Coil Systems LLC. The relationship between the Complainants is set out below. For ease this Decision will refer to the Lead Complainant only (the Complainant) which is in line with the Complainant's presentation of its case.
The Complainant trades under the name "LOCKFORMER" and sells products under the "LOCKFORMER" mark. The Complainant and its predecessors in title have advertised in the UK using the LOCKFORMER mark and the name "The Lockformer Corporation" since 1960. Its current brochure, in use since 2000, is exhibited at Exhibit 4 to the Complaint and shows a range of products sold under the LOCKFORMER mark which includes rollforming machines, snap lock machines and duct connector machines. The Complainant spends approximately $100,000 per annum on advertising. In addition, authorised dealers of the Complainant have advertised the Complainant's machines bearing the LOCKFORMER mark in International Sheet Metal Review which is the premier magazine worldwide for the sheet metal industry published six times a year. The Complainant's machines bearing the "LOCKFORMER" mark are regularly exhibited at trade fairs in the UK, which include the 'Machine Tools Exhibition' in Birmingham, the premier event of its kind in the UK.
The Complainant is the owner of the following registered trade marks relevant to the Domain Name (the Trade Marks);
• UK Trade Mark: B.861573 for "LOCKFORMER" filed on 13 March 1964 in respect of "machines for bending sheet metal". A copy of the trade mark registration certificate is attached at Exhibit 1 to the Complaint. The proprietor of the registration is shown as The Lockformer Company but for reasons set out below the Complainant now owns the registration.
• Community Trade Mark: E3961216 for "LOCKFORMER" registered on 29 November 2005 in respect of, amongst other things, machines and machine tools, sheet metal rolling machines and metalworking machines. A print out from the Community Trade Mark Office website evidencing the registration is attached at Exhibit 2 to the Complaint. The proprietor of the registration is shown as Met-Coil Systems Corporation but for reasons set out below the Complainant now owns the registration.
Both of the Trade Marks are now owned by the Complainant. The Lockformer Company (and all its assets) merged into Met-Coil Systems Corporation on 27 October, 2000, which subsequently became Met-Coil Systems LLC. The Trade Marks were subsequently assigned to the Complainant on 31 December, 2005 as part of the sale of Met Coil Systems LLC. Copies of documents evidencing the chain of title to the Trade Marks are attached at Exhibit 3 to the Complaint.
The Complaint states that the transfer of the Trade Marks to the Complainant will be formally recorded as part of a wider transfer of trade marks by the Complainant's trade mark agents, but at the time of filing the Complaint this had not yet occurred.
The Trade Marks are licensed by the Complainant to its subsidiary Formtek SARL, which is responsible for the distribution and sales of machines bearing the LOCKFORMER mark throughout Europe, including the UK.
The Complainant owns and trades under the following domain names; Formtekinc.com, lockformer.com and mestek.com.
The Respondent
A Nominet WHOIS search shows that the Domain Name was registered by the Respondent on 10 September 2003 and last updated on 3 September 2007. The Respondent's status is given as "UK Limited Company".
The Respondent is a family run business. It was formed in 1981 and incorporated on 31 July 2003. In the Response Mr. Neal of the Respondent states that he has been involved with rollforming and other sheet metal working machinery for over 30 years. Part of the Respondent's business is to offer a repair and service of rollforming and other sheet metal working machinery. It also buys and sells-on redundant machinery. Most of the Respondent's business is generated by recommendation, by exhibiting machinery at trade exhibitions and by mail shots 2 –3 times a year. According to the Response the Respondent's use of the Lockformer word is to indicate to potential sellers that it would be interested in buying any redundant machines for reconditioning and selling-on. The Respondent also uses the word Lockformer to indicate that it can repair, supply spares and service such machines.
The Response states that the Respondent has no desire, nor does it try, to give any indication that it is connected in any way to the Complainant.
Correspondence between the Complainant and the Respondent
On the 27th October 2006 the Complainant's solicitors wrote to the Respondent seeking the surrender of the Domain Name. The Complaint records that the Respondent said it would respond to that letter justifying its use of the Domain Name but that it did not do so. The Complainant states that it has therefore given the Respondent a reasonable opportunity to transfer voluntarily the Domain Name.
This version of events is disputed by the Respondent. It states that a reply to the Complainant's letter was emailed on 20th November 2006 and a copy of it is annexed to the Response. The letter stated that the Domain Name had not been used to imply that the Respondent was directly associated with the Complainant and ends "There would obviously appear to be a misunderstanding and would appreciate (sic) your confirmation that this is the case and that your client will not wish to pursue this matter any further".
In the Reply the Complainant points out that the response to its letter was sent to the incorrect email address and was never received by it.
The Use of the Domain Name by the Respondent
Originally the Respondent made use of the Domain Name to link to the Respondent's website address (www.wnealservices.com). More recently the Domain Name has been linked to the registered name server identified in the Respondent's Domain Name registration. The precise date of the change of use of the Domain Name is unclear.
With reference to the correspondence in 2006 between the parties which is referred to above, the Response records that "as a show of good will, we [the Respondent] broke the link from lockformer.co.uk to our web site until this matter was resolved…. Our web site www.wnealservices.com nor our literature ….does not remotely suggest, in our opinion, that we represent or have any connection to Lockformer. ….The word lockformer would only appear on our web site if we had a reconditioned lockformer, made by Lockformer, for sale. …..The reason for W. Neal Services Ltd to retain the domain name lockformer.co.uk is to show that we are prepared to buy any redundant rollformers /lockformer machines, we can offer service and repair of these machines, we can supply most spare parts at reasonable prices."
There is no evidence before the Expert about the exact date when the Respondent broke the link from the Domain Name to its website, but it clearly pre-dated the Complaint. A printout of the webpage to which the Domain Name was directed on 20 February 2008 has been supplied by Nominet and confirms that the Domain Name is directed to the registered name server.
The Expert has not been supplied with a printout of the Respondent's historic website content at the date that the Domain Name was directed to the Respondent's own website. The Expert has not accessed the Respondent's current website content. It may well have changed since the time that the Domain Name was last linked to it in which case it will be irrelevant to this Complaint.
Clause 2a of the Policy provides that a Respondent must submit to proceedings under the Dispute Resolution Service if a Complainant asserts according to the Procedure, that:
i the Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name; and
ii the Domain Name, in the hands of the Respondent, is an Abusive Registration.
For convenience the decision will set out the Complainant's submissions. Where the Respondent has responded to a submission, the Respondent's response will follow. Where relevant the submissions made by the Complainant in the Reply will also be recorded.
Rights in a mark identical or similar to the Domain Name
Complaint
In addition to the Trade Marks, the Complainant has built up goodwill and other rights in its use of the "LOCKFORMER" mark. This goodwill is what distinguishes the Complainant's products from similar products provided by other undertakings in the same industry (which are described by the generic industry terms "rollformer" or "metal forming" machinery). The Complainant has accordingly built up or acquired the requisite goodwill in the name "LOCKFORMER" using this as a trade name/business identifier so as to avail itself of protection under the common law right of passing off, as well as its trade mark and domain name registrations.
Response
The Respondent strongly disputes that the word lockformer is not a generic term. It states that a machine that has Pittsburgh Lock rolls fitted, which is most commonly used in the manufacturing of ducting, is commonly called a lockformer throughout the world and therefore is not distinctive to the Complainant. Typing the word lockformer into a search engine usually comes up with over 20,000 sites using the word lockformer. New manufacturers of such machines in, for example, China, Taiwan and Korea refer to their machines as lockformers/ Lock Formers. To illustrate this point exhibited to the Response is a page from a third party website showing a Lockforming Machine, which the Respondent understands was designed in the Netherlands by a third party company and is being manufactured in the UK. The Expert does however note that the website in question refers to Lockforming machinery but not to "Lockformer." [italics for emphasis].
The Response continues "After speaking to a representative of [name of third party company], who were, or, are still connected with Lockformer, think (sic) that Lockformer is a generic word. I [Mr Neal] also feel that the word lockformer is so commonly used to describe a machine with Pittsburgh lock rolls, that I would probably have a good case to have the trade mark Lockformer revoked, but I do feel that it would not be in anyone's interest to pursue this."
Reply
There is no evidence to support the Respondent's assertion that the term "lockformer" has become generic.
• The search carried out by the Respondent proves nothing; a Google search for coca-cola reveals 2,390,000 hits, but clearly the "coca-cola" brand is not generic.
• The fact that companies in the Far East may refer to certain types of machinery as Lockformers is irrelevant. The Complainant has established rights in Europe and the Complainant is not seeking to enforce its rights in China in this Complaint.
• No serious weight should be ascribed to a claim that an individual at a third party company told the Respondent that he thinks the "lockformer" name is generic.
• The Complainant's Trade Marks remain valid and in full force and effect.
In addition the Respondent refers to a former matter when the Complainant or its predecessors in title successfully demanded that the Respondent (among others) change its hard copy literature to remove the LOCKFORMER mark. In its Reply the Complainant seeks to make use of this to illustrate that the Respondent is contradicting its argument that the LOCKFORMER mark is generic in this Complaint by having apparently accepted that the previous demand to change its literature was valid. The Expert notes this but does not regard it as relevant. The Respondent may have changed its literature for commercial reasons without formally acknowledging the validity of the complaint. There is insufficient evidence before her about the matter to draw any conclusions on this point.
Abusive Registration
Complaint
The Domain Name in the hands of the Respondent is Abusive because it was primarily registered and used to unfairly disrupt the Complainant's business.
• The link to the Respondent's website address or, more recently, to the registered name server address (http://dns.flashomega.co.uk) is to the detriment of the Complainant's rights in the LOCKFORMER mark.
• If the Complainant had not built up a reputation in the LOCKFORMER mark, the Respondent would have had no reason to register the Domain Name and customers would not search for this term on the Internet.
• The Complainant believes that the Respondent's use of the Domain Name is a misrepresentation to prospective customers leading or likely to lead them to believe that all the goods or services offered by the Respondent are goods or services of the Complainant or otherwise approved by or connected to the Complainant. The effect of this misrepresentation is that prospective customers seeking "Lockformer" products are encouraged by the Respondent to visit its site (or registered domain server) which injures the business and goodwill of the Complainant. In short, the Complainant's rights have been and are being used to market third party goods, services and businesses, as a result of the actions of the Respondent.
• The fact that the Respondent has historically directly linked from the Domain Name to the Respondent's own web site (and more recently to its registered domain server) shows that the Respondent's purpose in registering the Domain Name was to attract business to its main site and away from the Complainant. The Domain Name has no other use for the Respondent. The Respondent may seek to argue that it is justified in using the "lockformer" name as it may repair "lockformer" products – i.e. this is "fair use" to describe a legitimate trading activity. However, the Respondent's use of the Domain Name has been to attract business generally – not merely repair of lockformer products. As such, this goes well beyond what could reasonably be considered legitimate use and instead constitutes an abuse of the Complainant's rights in the LOCKFORMER mark.
• The Respondent has used the Complainant's "LOCKFORMER" mark on its website to link through to third party rollforming machines. Although use of the "lockformer" name on the site is not the same as use of the Domain Name which is the subject of the current complaint, it is evidence of wider abuse by the Respondent of the Complainant's rights. Use of the "LOCKFORMER" mark on the Respondent's website to indicate other third party rollforming machines sold or serviced by the Respondent is additional evidence to show the Respondent's abusive behaviour as it infringes the Complainant's trade mark under s.10 (1) of the Trade Marks Act 1994. This is an attempt by the Respondent to 'ride on the back' of the Complainant's success in selling or servicing its lockformer products.
• Damage to the Complainant's goodwill or repute in the "LOCKFORMER" name derives from the Respondent's activities. The main head of damage claimed by the Complainant is the diversion of sales away from the Complainant and to the Respondent due to the actions set out above. Nor is this damage purely theoretical. The Domain Name has already confused people into thinking that it was in some way connected with, controlled by or approved by the Complainant. For example, the Complainant received telephone calls from its authorised dealers seeking an explanation due to complaints received from their customers who had been looking for the LOCKFORMER machine on the Respondent's website. Attached as Exhibit 6 is a copy email from an authorised dealer of the Complainant dated 31 October 2007 seeking an explanation why his customers, when searching the Internet for information on the LOCKFORMER machine have clicked on the Domain Name and been redirected to the Respondent's website rather than that of the Complainant. This email is in French. A translation has been provided by the Complainant pursuant to a 13a request by the Expert. It reads as follows;
"Hi Matt
In looking on the Internet for information about your range of Lockformer metal forming machines, several customers have already commented to me (and I do not know how to explain it to them or give a reason myself), that they come across the site www.lockfomer.co.uk which redirects them directly to an English manufacturer of metal forming machines similar to yours, which I didn't know about until now….. can you explain this to me?
Thank you for your information on this urgently.
Hugues PELLETIER"
Response
• The use of the Lockformer word is to indicate to potential sellers that the Respondent would be interested in buying redundant machines. The Respondent has no desire, to try to give any indication that it is connected in any way to the Complainant.
• As a show of goodwill, the Respondent broke the link from lockformer.co.uk to its web site until this matter was resolved
• The word lockformer would only appear on the Respondent's web site if it had a reconditioned lockformer machine, made by Lockformer, for sale.
• The reason for the Respondent to retain the Domain Name is to show that it is prepared to buy any redundant rollformers /lockformer machines. In many ways the Respondent feels that it has been of service to the Complainant's customers by repairing and servicing their machines quickly and efficiently.
Reply
• Because the Respondent repairs rollformers generally does not mean it can use the name "lockformer" to promote its own and third party products and services.
• Use of "lockformer" to promote the sale of rollforming machines is precisely the abuse of the Complainant's rights complained of.
• The change of use of the Domain Name does not indicate a "show of goodwill". On the contrary it is an attempt to avoid liability for infringing the Complainant's rights by suspending the infringing activity. Whereas before web users would have been directed automatically to the Respondent's site, they now receive an error message. This is damage limitation seeking to conceal the abuse.
General
For ease of reference the Decision reiterates in this section that Clause 2a of the Policy provides that a Respondent must submit to proceedings under the Dispute Resolution Service if a Complainant asserts according to the Procedure, that:
i the Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name; and
ii the Domain Name, in the hands of the Respondent, is an Abusive Registration.
The Complainant is required to prove to the Expert that both elements are present on the balance of probabilities (clause 2b of the Policy).
Complainant's Rights
Rights are defined in clause 1 of the Policy as including but not limited to "rights enforceable under English law.
The Complainant's Rights
The Complainant is the proprietor of trade marks consisting of the LOCKFORMER word mark which cover the machinery in which the Respondent trades. The Complainant has therefore demonstrated that it owns Rights in the Mark for the purpose of the Policy.
The Respondent calls into question the distinctiveness of the LOCKFORMER mark. The Expert has noted the submissions. However the submissions do not affect the validity of the existing Trade Marks which the Expert is in no position to look behind. The Expert also agrees with the Complainant that the evidence which the Respondent puts forward to prove the generic nature of the LOCKFORMER mark is inconclusive. The Expert does not find the LOCKFORMER mark to be generic on the limited evidence before her.
The Complainant has provided information about the goodwill which it asserts has been built up in the LOCKFORMER word mark. Strictly it is not necessary for the Expert to make any finding about goodwill because the Trade Marks in themselves provide evidence of the Complainant's Rights. Nevertheless the Expert also finds that the Complainant enjoys common law rights in the UK as evidenced by the length of time that the LOCKFORMER mark has been used in the UK and the (limited) information before the Expert about exhibitions at trade fairs, advertising in trade journals and marketing literature.
The next question is whether the LOCKFORMER mark in which the Complainant has Rights is identical or similar to the Domain Name to invoke the Policy. It clearly is. The only difference to the Mark is the addition of the suffix ".co.uk" which it is customary to disregard.
It follows that the Complaint has met the first requirement of the Policy, namely it has shown that it has Rights in a name which is identical or similar to the Domain Name.
Abusive Registration
Abusive Registration is defined in clause 1 of the Policy as follows:
A Domain Name which either:
i was registered or otherwise acquired in a manner, which, at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant's Rights,
OR
ii has been used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
The Complainant's case is based on the Respondent's registration and use of the Domain Name.
Registration
The Complainant asserts that the registration of the Domain Name by the Respondent was an Abusive Registration in the sense that there are circumstances indicating that the Respondent has registered the Domain Name primarily for the purpose of unfairly disrupting the Complainant's business (clause 1(3)(i)(C) of the Policy) .
The Expert does not agree with this submission. The Respondent has put forward its case for choosing to register the Domain Name stating that it did so to provide an indication of its business in trading in second hand machinery and repairs. The Expert accepts that this was the Respondent's motivation and that the registration of the Domain Name per se was not abusive. Mere assertion on the part of the Complainant that if the Complainant had not built up a reputation in the LOCKFORMER mark, the Respondent would have had no reason to register the Domain Name is not, in the view of the Expert, sufficient in this matter to show on the balance of probabilities that the primary motivation for registering the Domain Name is to cause unfair disruption to the Respondent.
It follows that the registration of the Domain Name by the Respondent was not in itself abusive.
The Expert will now move on to consider whether the way in which the Domain Name has been used amounts to an Abusive Registration under the Policy.
Use
The overriding concept behind abusive use is as stated in clause 1 of the Policy:
[The Domain Name] has been used in a manner which took unfair advantage of or was unfairly detrimental to the Complainant's Rights.
A non-exhaustive list of factors which may be evidence that the use of the Domain Name is an Abusive Registration is given in clause 3a of the Policy. They include the following factor:
ii Circumstances indicating that the Respondent is using the Domain Name in a way which has confused people or businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant;
…….
Unusually the Expert has not been provided with a printout of the Respondent's historic website content. She must therefore rely on the Parties submissions.
The Complainant asserts that the Domain Name has been used to market competitor third party goods, services and businesses. The main head of damage claimed by the Complainant is the diversion of sales away from the Complainant and to the Respondent. It states that the Domain Name has confused people into thinking that it was in some way connected with, controlled by or approved by the Complainant. It states that it has received telephone calls from its authorised dealers seeking an explanation due to complaints received from their customers who had been looking for a LOCKFORMER machine on the Respondent's website. Attached as Exhibit 6 is a copy email from an authorised dealer of the Complainant dated 31 October 2007 in similar terms (the email is set out in full earlier in this Decision at page 6).
The Respondent states that the use of the Lockformer word is to indicate to potential sellers that the Respondent would be interested in buying redundant machines. The Respondent states that it has no desire, to try to give any indication that it is connected in any way to the Complainant.
The evidence to which the Complaint refers (including the email at Exhibit 6) provides evidence that the Domain Name is at first sight associated with the Complainant. There is however no evidence before the Expert that the Complainant's customers remained confused into believing that the Respondent was connected to the Complainant on visiting the Respondent's website. Instead there seems to be recognition that the Respondent is a third party entity coupled with concern that the Domain Name is being used to attract business to competitors of the Respondent.
The Expert notes that the Respondent disagrees that the Domain Name has been used to divert custom from the Respondent.
However the Expert finds on the evidence before her (notably the email at Exhibit 6 to the Complaint) that the Domain Name has been used in a manner that was capable of diverting business from the Complainant to third party manufacturers of metal forming machinery. This is not an example of use of the Domain Name to confuse businesses into believing that the Domain Name is registered to, operated or authorised by, or otherwise connected with the Complainant. It is instead an example of the wider concept of Abusive Registration in which potential custom has been diverted through the initial interest created by the Domain Name to third parties thereby taking unfair advantage of the LOCKFORMER mark to the detriment of the mark (and therefore to the Complainant's Rights).
There is accordingly a threshold case of Abusive Registration. But this must be considered in the light of the Respondent's submissions.
Clause 4 of the Policy provides a non-exhaustive list of ways in which the Respondent may demonstrate that the Domain Name is not an Abusive Registration. The Respondent presents its case by disputing the Complainant's submissions. Nevertheless implicit within the Response is reliance on some of the matters that are set out in clause 4 of the Policy, as follows:
I. Before being aware of the Complainant's cause for complaint (not necessarily the "complaint" under the DRS), the Respondent has
A. used or made demonstrable preparations to use the Domain Name….. in connection with the genuine offering of goods or services
…….
C. made legitimate non-commercial use or fair use of the Domain Name
II. The Domain Name is generic or descriptive and the Respondent is making fair use of it
For the reasons set out above the Expert finds that the Domain Name is NOT generic. Clause 4 (ii) does not therefore apply.
The issue is therefore whether the Respondent has used the Domain Name in connection with a genuine offering of goods or services or is making fair use of the Domain Name.
It should be borne in mind that the Expert has already made a background finding (based in the main on the email at Exhibit 6 to the Complaint) that the Domain Name has been used in part to facilitate links to competitors of the Complainant.
Now If that had NOT been the case and if the Respondent had made it sufficiently clear that it was ONLY seeking to buy or repair the Complainant's used machines the Expert would have been minded to make a finding both of fair use of the Domain Name and that the Domain Name had been used solely in connection with a genuine offering of goods and services. But this is not so. The evidence suggests that the content of the Respondent's website went further. It suggests that potential customers of the Complainant visiting the Respondent's website under a mistaken impression that the Domain Name was linked to the Complainant found themselves provided with links to other manufacturers of lockforming machines. This is not fair use. Nor is it use that is LIMITED to a genuine offer of repair services or offers to buy used machines.
For these reasons the Expert finds that the use of the Domain Name by the Respondent amounts to an Abusive Registration.
The Expert notes that the Respondent has removed the link between the Domain Name and its website. However the Policy covers both current and past use of a Domain Name and past abusive use is not automatically neutralised by temporary cessation of use. For the avoidance of doubt the Expert makes no finding that the Respondent has acted in bad faith in this matter. It is the effect of its use of the Domain Name (as supported by evidence put forward by the Complainant) that has led to the finding of Abusive Registration.
The Complainant's submissions about alleged trade mark infringement arising from the Respondent's asserted use of the Trade Marks on its website is not directly relevant to this Complaint. In the absence of any printouts of the website content the Expert has not taken them into account and makes no findings in relation to them.
The Expert finds that the Complainant has proved on the balance of probabilities that it owns Rights in respect of a name or mark which is identical or similar to the Domain Name and that the Domain Name in the hands of the Respondent is an Abusive Registration.
Accordingly the Expert finds in favour of the Complainant and directs that the Domain Name is transferred to the Lead Complainant.
Sallie Spilsbury
26 May 2008