After Passing on $35k Offer, Panet.com is Lost in UDRP

According to NameBio, Panet.com was acquired for $5,752 via auction at DropCatch.com in September of 2020. A company that operates on a Panet ccTLD filed a UDRP against the domain name at the World Intellectual Property Organization (WIPO) and the single member panel ruled in favor of the complainant. You should have a look at the published decision in its entirety to understand the facts of the case.

Notably, it appears the domain registrant could have sold the domain name to the complainant for $35,000. Here’s an excerpt about that from the decision:

“The Respondent has repeatedly offered to end the dispute for a fee of USD 110,000, which the Complainant has declined, offering USD 35,000 instead.”

I don’t understand if the complainant had offered $35,000 after filing the UDRP or before filing the UDRP. If this offer was made, I think it shows that the complainant may not have felt its chances at prevailing in a UDRP were very good. If the domain registrant doesn’t file a lawsuit to retain the domain name, it will be a swing of more than $40,000 considering the cost of the domain name and the offer that was reportedly made.

The domain registrant, who was self-represented in this UDRP filing, argued that this is more of a business dispute than a legal dispute:

“The Complainant approached the previous owner over several years to buy the disputed domain name but its offers had been rejected. The Complainant also admits that it approached the Respondent to purchase the disputed domain name yet calls for the proposal it received to be considered an extortion attempt because it feels that the price was not appropriate. The dispute is a matter of business considerations and has no legal basis. It violates the principle of freedom of business competition and the unrestricted right to register domain names.”

My reading of the decision is that the panelist did not believe the domain registrant when he said he acquired the domain name “to build an international social networking website.” In fact, the panelist cited the domain registrant’s outbound email to the complainant shortly after buying the domain name:

“Accordingly, it may be seen that less than ten days after winning an auction for the disputed domain name, the Respondent approached the Complainant stating that the disputed domain name was for sale. This does not appear to be consistent with the behavior of a new registrant of a domain name with plans to develop it into its own commercial website, as the Respondent asserts. Based upon the Panel’s chronology, after the initial approach by the Respondent there followed an alleged auction for the disputed domain name, which was ultimately discontinued by the Respondent. Finally, on October 18, 2020, the chronology shows the Respondent stating that the auction is over and that it is processing a deal with the winner. No evidence of this deal has been produced. In any event, the disputed domain name did not change hands following this process.”

The Panel concludes from the circumstances on the record that the Respondent most probably did not acquire the disputed domain name for any purpose other than to sell it to the Complainant for an amount in excess of its out-of-pocket costs. The proximity between the Respondent’s acquisition date and the date of its first approach to the Complainant is significant. This suggests to the Panel in the absence of evidence to the contrary, that the intention to sell to the Complainant was the Respondent’s primary purpose and that the Respondent has effectively violated paragraph 4(b)(i) of the Policy.

This dispute may not be fully resolved. The domain registrant and indicated that he may take this case to court:

“The Complainant must solve the problem at a business, rather than a legal level. It is a matter of price for the Complainant and not legal rights. If the dispute develops, the Respondent is ready to defend itself with United States counsel.”

One thing domain investors should note is that if they do outbound marketing on a domain name shortly after acquiring it, a UDRP panel might find it difficult to believe the domain name was acquired with development in mind rather than a quick flip.