WIPO Panel Rules Entrepreneur Acted in Bad Faith, Attempted Reverse Domain Name Hijacking for Gains.com

A recent decision by a World Intellectual Property Organization (WIPO) panel has determined that Axel Sylvian van den Braken engaged in reverse domain name hijacking in an attempt to acquire the domain name gains.com. The panel’s findings underscore the importance of legitimate trademark rights and the potential consequences of filing frivolous claims under the Uniform Domain Name Dispute Resolution Policy (UDRP).

The case revolves around van den Braken’s interest in the domain name gains.com, which he sought for potential business ventures. Van den Braken operates an Instagram account under the handle @gains and maintains a website, gains.plus, where he sells journals. He had also recently filed trademark applications with the intention of selling supplements under the same name.

The domain name gains.com, however, was acquired by Ammar Kubba of afterTHOUGHT, a domain investor, in 2021. This prior ownership played a significant role in the WIPO panel’s decision.

In 2023, van den Braken contacted afterTHOUGHT to inquire about purchasing the domain. He expressed interest in acquiring gains.com for a planned business, but admitted he lacked the financial resources to purchase the domain outright. This admission later proved detrimental to his case.

Later that year, afterTHOUGHT began licensing the domain to GamerGains, Inc., a company operating a play-to-earn cryptocurrency gaming platform. This licensing agreement introduced a new element into the dispute, as van den Braken subsequently raised concerns about the domain’s use.

According to the WIPO panel’s decision, van den Braken argued that the new use of the domain “for a gambling and crypto-casino platform operated by a third party creates severe tarnishment, misleads consumers, and damages the Complainant’s reputation.” This claim formed a core part of his argument for acquiring the domain name.

However, the three-person WIPO panel ultimately rejected van den Braken’s claims. The panel concluded that he failed to demonstrate that the domain name gains.com was identical or confusingly similar to a trademark in which he held legitimate rights. This is a crucial requirement for a successful UDRP complaint.

Furthermore, the panel explicitly found that van den Braken engaged in reverse domain name hijacking. This finding carries significant weight, as it indicates that the complaint was filed in bad faith and constituted an abuse of the UDRP process.

The panel’s reasoning for finding reverse domain name hijacking was detailed and compelling. The panel highlighted several key deficiencies in van den Braken’s case, including:

Lack of Evidence of Acquired Distinctiveness: The panel noted that van den Braken failed to provide sufficient evidence to support a claim of common law trademark rights. He relied primarily on recently filed trademark applications, which, under the UDRP, do not confer rights. He also presented minimal evidence of sales, advertising, or public recognition that would demonstrate acquired distinctiveness or goodwill associated with the “gains” brand, despite claiming such rights existed for eight years. The panel cited the case of Zelig AI, LLC v. dong xuyan for precedent on the requirements for establishing common law trademark rights.

Contradictory Statements Regarding Business Plans: The panel pointed out that van den Braken’s own correspondence from July 2023 described his business plans as “aspirational” and acknowledged a lack of capital to acquire the disputed domain name. These statements directly contradicted his later assertions of longstanding trademark rights and the potential for damage to his reputation.

Prior Attempt to Purchase the Domain: The panel emphasized that van den Braken had previously attempted to purchase the domain from afterTHOUGHT. After failing to acquire it through negotiation due to a lack of funds, he initiated the UDRP proceeding, effectively seeking to obtain the domain without payment. This behavior strongly suggested an attempt to circumvent the legitimate market value of the domain name.

The WIPO panel summarized its decision by stating:

The Complainant submitted no evidence of the acquired distinctiveness required to support a claim of common law trademark rights. See Zelig AI, LLC v. dong xuyan, National Arbitration Forum Claim FA2410002120196. Instead, the Complainant relied primarily on recently filed trademark applications and provided only minimal evidence in support of its alleged common law rights. It is well established under the Policy that pending trademark applications do not confer rights. Moreover, the Complainant failed to submit credible evidence of sales, advertising, or public recognition sufficient to demonstrate acquired distinctiveness, despite asserting the existence of goodwill spanning eight years.

The Panel also notes that the Complainant’s own correspondence from July 2023 described its business plans as aspirational and acknowledged a lack of capital to acquire the disputed domain name. These statements directly contradict the Complainant’s assertions of longstanding trademark rights.

In light of the Respondent’s continuous ownership of the disputed domain name long before the Complainant acquired or claimed any trademark rights, the Complaint lacked any realistic prospect of success. The Panel further observes that the Complainant had previously approached the Respondent in an attempt to purchase the disputed domain name. After failing to acquire it through negotiation, the Complainant initiated this proceeding, effectively seeking to obtain the disputed domain name without payment.

Accordingly, the Panel concludes that the Complaint was brought in bad faith and constitutes an abuse of the administrative proceeding. The Panel therefore finds that the Complaint amounts to Reverse Domain Name Hijacking within the meaning of paragraph 15(e) of the Rules.

The case highlights the importance of thoroughly assessing the merits of a UDRP complaint before filing. Claimants must be able to demonstrate clear trademark rights and provide compelling evidence of bad faith registration or use by the domain name holder.

In this case, Axel Sylvian van den Braken represented himself in the proceedings. Ammar Kubba of afterTHOUGHT was represented by John Berryhill, a well-known attorney specializing in domain name disputes. Berryhill’s expertise likely contributed to the successful defense against the reverse domain name hijacking claim.

This decision serves as a reminder that the UDRP is not intended to be used as a tool for acquiring domain names without fair compensation. It is designed to protect legitimate trademark holders from cybersquatting, not to enable entrepreneurs to circumvent the market value of existing domain names. The full WIPO panel decision (pdf) is available for review.

The outcome of this case underscores the critical role of due diligence and a solid legal strategy in domain name disputes. Domain investors, as well as businesses seeking to protect their brands, can learn valuable lessons from this WIPO ruling. Understanding the UDRP policy and seeking expert legal counsel is essential for navigating the complex landscape of domain name ownership and trademark protection.