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Village Resorts Ltd v. Steven Lieberman [2001] GENDND 1311 (29 August 2001)


World Intellectual Property Organization

WIPO Arbitration and Mediation Center

ADMINISTRATIVE PANEL DECISION

Village Resorts Ltd v. Steven Lieberman

Case No. D2001-0814

1. The Parties

The Complainant is Village Resorts Ltd, a Jamaican corporation with its principal place of business at Kingston, Jamaica. The Complainant is represented by Ms. Kathy Silberthau Strom of Cahill, Gordon and Reindel, Attorneys, of Washington D.C., U.S.A.

The Respondent is Steven Lieberman, C/- United Airlines – Beijing Lufthansa Center, Beijing, China. He is representing himself.

2. The Domain Name and Registrar

The domain name at issue is <superfares.net>. The domain name is registered with Register.com of New York, U.S.A ("the Registrar"). The name was registered on April 8, 2000.

3. Procedural History

The Complaint submitted by Village Resorts Ltd was received on June 20, 2001, (electronic version) and June 25, 2001, (hard copy) by the World Intellectual Property Organization Arbitration and Mediation Center ("WIPO Center").

On June 25, 2001, a request for Registrar verification was transmitted by the WIPO Center to the Registrar, requesting it to:

- Confirm that a copy of the Complaint had been sent to it by the Complainant as requested by WIPO Supplemental Rules for Uniform Domain Name Dispute Resolution Policy ("Supplemental Rules"), paragraph 4(b).

- Confirm that the domain name at issue is registered with the Registrar.

- Confirm that the person identified as the Respondent is the current registrant of the domain name.

- Provide full contact details, i.e., postal address(es), telephone number(s), facsimile number(s), email address(es), available in the Registrar’s WHOIS database for the registrant of the disputed domain name, the technical contact, the administrative contact and the billing contact for the domain name.

- Confirm that the Uniform Domain Name Dispute Resolution Policy ("UDRP") was in effect.

- Indicate the current status of the domain name.

By email dated July 6, 2001, the Registrar advised WIPO Center as follows:

- It had received a copy of the Complaint from the Complainant.

- It is the Registrar of the domain name registration <superfares.net>.

- The Respondent is shown as the "current registrant" of the domain name.

- The Respondent is also shown as the administrative contact.

- The UDRP applies to the registration.

- The disputed domain name registration is currently in ‘active’ status.

The Registrar has incorporated in its agreements the Uniform Domain Name Dispute Resolution Policy adopted by the Internet Corporation for Assigned Names and Numbers ("ICANN").

The advice from the Registrar that the domain name in question is in ‘active’ status indicates the Respondent has not requested that the domain name at issue be deleted from the domain name database. The Respondent has not sought to terminate the agreement with the Registrar. Accordingly, the Respondent is bound by the provisions of the Registrar’s Uniform Domain Name Dispute Resolution Policy, i.e., the ICANN policy. The Respondent has not challenged the jurisdiction of the Panel.

Having verified that the Complaint satisfied the formal requirements of the Uniform Policy and the Uniform Rules, the WIPO Center on July 10, 2001, transmitted by courier and by email a notification of the Complaint and Commencement of Administrative Proceedings to the Respondent. A copy of the Complaint was also emailed to the Registrar and ICANN.

The Respondent was advised that a Response to the Complaint was required within 20 calendar days. The Respondent was also advised that any Response should be communicated, in accordance with the Rules, by one original and four sets of hard copy and by email. A Response was filed by the Respondent on July 30, 2001 (by electronic means) and on August 9, 2001 (in hard copy).

WIPO Center invited the Honorable Sir Ian Barker QC of Auckland, New Zealand to serve as sole Panelist in the case. It transmitted to him a statement of acceptance and requested a declaration of impartiality and independence. The Panelist duly advised acceptance and forwarded to the WIPO Center a statement of impartiality and independence. The Panel finds that the Administrative Panel was properly constituted in accordance with the Rules and the Supplemental Rules.

On August 14, 2001, WIPO Center forwarded to the Panel by courier the relevant submissions and the record. In terms of Rule 15(b), in the absence of exceptional circumstances, the Panel is required to forward its decision by August 27, 2001. Because of the additional documents filed by the parties, the decision date is extended to August 29, 2001.

The Complainant sought leave to file a Reply on the grounds that Respondent has made an egregious factual error. The Panel granted leave for the Reply to be filed. One of the reasons for granting such leave is that the Respondent alleged against the Complainant reverse domain name hijacking. A counterclaim should be met with a defence under normal adversarial rules. Respondent was given leave to file and did file further submissions in rebuttal arising out of fresh matters in the Reply.

The Panel has independently determined and agrees with the assessment of WIPO Center that the Complaint meets the formal requirements of the Rules for Uniform Domain Name Dispute Resolution Policy as approved by ICANN on October 24, 1999, ("the Rules") and the Supplemental Rules.

The language of the administrative proceeding is English, being the language of the registration agreement.

4. Factual Background

Complainant through its subsidiaries offers resort hotel and travel reservation services. It and its subsidiaries are known and referred to in the resort hotel and travel industry as "SUPERCLUBS". Complainant offers resort hotel and travel reservation services which feature its numerous resort hotels in many locations, including Jamaica and the Caribbean. Complainant has advertised its travel reservation packages in connection with use of the mark "SUPERFARES". This mark has been used on Complainant’s website and has been used on brochures, rate sheets and advertisements.

Complainant is the owner of the US registered mark "SUPERFARES" which since May 1991 it has continuously used in commerce in connection with its resort hotel services and travel reservation services. United States Registration No. 1,779,925 was issued June 29, 1993 on the Supplemental Register for the mark "SUPERFARES" in Class 39 for travel reservation services. Registration No. 2,345,072 issued April 25, 2000 on the Principal Register in Class 39 is for travel reservation services. (A copy of Registration No. 2,345,072 is annexed hereto as Annex F.) Such registered marks are valid and subsisting. Annual sales under the SUPERFARES program have been between approximately $8 million and $32 million per year. The mark "SUPERFARES" is distinctive of the services of Complainant.

Complainant has also expended considerable sums in advertising its resort hotel services and its travel reservation services in connection with the "SUPERFARES" marks throughout the United States and elsewhere in the world. Complainant has developed goodwill through the "SUPERFARES" mark in the United States and elsewhere.

5. Parties’ Contentions

Complainant

The domain name registered by Respondent, namely, <superfares.net> is identical to and confusingly similar to Complainant’s usage of "SUPERFARES" as demonstrated on its website and brochures and to its registered mark "SUPERFARES".

Respondent works for United Airlines. As stated in one of his emails to Complainant, he intends to provide travel reservation services in connection with the domain name <superfares.net>. Such usage would confuse travel agents and other customers who would expect to find Complainant’s services featured at this website and domain name location.

The correspondence between Complainant and Respondent demonstrates that Respondent has registered and used the domain name in bad faith. On November 2, 2000, Complainant’s licensee International Lifestyles Inc. sent an email to Respondent setting forth the rights of Complainant to the "SUPERFARES" mark and domain name <superfares.net> and requesting transfer of the domain name. By email dated November 2, 2000, Respondent advised Complainant that he "may be opening up some form of Internet travel agency in the future". By email dated November 3, 2000, Complainant’s licensee on its behalf advised Respondent again of Complainant’s rights and sought transfer of the domain name. On November 4, 2000, Respondent stated that he would investigate the matter and get back to Complainant. Thereafter, after receiving no further communication from the Respondent, by letter dated December 12, 2000, attorneys for Complainant advised Respondent of the registered "SUPERFARES" mark owned by Complainant and demanded that Respondent transfer the domain name to Complainant. By email dated December 15, 2000, Respondent advised counsel for Complainant that he did not believe that use other than for travel services would violate Complainant’s rights, but that in any event, he was awaiting legal advice. Complainant has received no further communication from Respondent.

It is evident from Respondent’s responses to Complainant’s emails that Respondent has no rights or legitimate interests in respect of the domain name <superfares.net>. Complainant has not licensed or otherwise permitted Respondent to use its "SUPERFARES" trademark. Respondent had made no efforts to use the domain name or a name corresponding with the domain name in connection with a bona fide offering of goods or services, nor has Respondent been commonly known by the domain name. Respondent’s website is currently inactive, and on information and belief has never been active. Respondent has registered and continues to hold the domain name in bad faith in order to prevent Complainant from using this domain name in which Complainant has rights.

Since the domain name <superfares.net> is confusingly similar to or identical to Complainant’s registered marks "SUPERFARES", registration and use of the domain name <superfares.net> by Respondent is likely to confuse consumers, customers and travel agents who would expect to find Complainant’s services featured at this website and domain name location.

Respondent’s conduct constitutes bad faith registration and use under the Policy. Not only does Respondent have no legitimate business interest in the domain name which he knows refers to the travel services of Complainant, but also Respondent has failed to act reasonably to resolve this dispute. Respondent has sought to maintain the domain name despite being advised of Complainant’s rights to the mark "SUPERFARES". First, Respondent stated that he may be opening an Internet travel agency, but then disingenuously responded to the legal ‘cease and desist’ letter by stating his position that uses other than travel reservation services would be permitted. While stating that he would seek advice of counsel, Respondent, on April 7, 2001, renewed registration of the domain name.

Respondent has made no bona fide use of the domain name and operates no website under <superfares.net>. Under these circumstances such conduct amounts to registration and use of the domain name in bad faith as contemplated by the Policy paragraph 4(c). See Thomas Cook Holdings Limited v Tailor Made Travel, WIPO Case No. D2001-0435 (May 24, 2001) (passive holding of domain name may constitute bad faith). It has been determined under the Policy that registration in bad faith followed by a passive holding of a domain name where there is no way in which it can legitimately be used can amount to use in bad faith.

As an employee in the airline industry, Respondent was likely to have known of the existence of the "SUPERFARES" mark and program of Complainant. Awareness of a competitor’s mark and registration of a corresponding domain name is further evidence of bad faith registration and use of a domain name.

Respondent

"I have legitimate interests in the domain name as described in the Policy. In particular, Article 4(c)(i) provides that a legitimate interest in a domain name is shown if "before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services".

I have been working in China since 1997 in a position that brings me into contact with numerous companies involved in the domestic Chinese travel industry. Due to China’s large population, long-distance passenger transportation is particularly important. In late 1999, in a personal capacity, I entered into discussions with a Chinese company regarding establishment of a domestic online reservation system for the Chinese travel market. Although current regulations in China restrict foreign involvement in the domestic travel industry, the PRC has committed to removing such restrictions within two years of accession to WTO. In contemplation of this market opportunity in China, and based on my discussions with my Chinese business partner, various domain names were registered in China and abroad. Since it was easier for me, as a non-PRC national, to make payments in foreign currency, I registered the <superfares.net> domain name for a proposed cooperative online reservation system in China. This venture cannot begin activities until the end of 2002 at the earliest, due to PRC regulatory issues. It is also necessary for me to finalize business discussions with my partner for establishment of the new domestic company that will use the relevant domain names. Until such time as these preparations are complete, it has been my intention to hold the <superfares.net> name in reserve.

I chose the domain name <superfares.net> as a descriptive name for a proposed service. It is a phrase that is commonly used in the travel industry to tell consumers that the fares are very good. The word "super" is used on a global basis by airlines, train companies, ferry services, and travel companies. See, for example, information related to Air France, Superfare.com Inc., Super Fare Travel, and SuperFast Ferries. Due to its common use in the industry, it did not occur to me that it would be possible to register rights in such a generic phrase. I therefore did not conduct a trademark search at the time of registering the name.

I was not aware of Complainant or that the "SUPERFARES" was a registered trademark. I am located in China and have been for several years. I am not familiar with Caribbean resort activities, and I have never heard of the Complainant. I had no knowledge of Complainant’s public announcements or advertisements related to its Caribbean business, and to my knowledge, Complainant has not advertised or made public announcements in China using the mark, and its online activities do not appear to be directed to travelers in China. Since I was unaware of Complainant there is no way that I could have had an intention that such registration would disrupt Complainant’s business. See Asphalt Research Technology Inc. v Anything.com, WIPO Case No. D2000-0967 (October 2, 2000) (holding that registration of a generic domain name, with no knowledge of complainant at the time of registration, is not bad faith); International Data Group, Inc. v The Applied Media Companies, Inc., WIPO Case No. D2000-0191 (June 6, 2000) (registration of a domain name the same as a registered mark is not bad faith if Respondent did not know of Complainant, the mark is not a coined word, nor is a particularly well-known or famous mark and, importantly, if the Complainant’s mark is a common English word that could also be used to refer to other products); (1) Sloan Capital Companies (2) Stuart M. Sloan v Sloan Email Services, WIPO Case No. D2001-0138 (March 31, 2001) ("Further it is a prerequisite for a bad faith claim that the respondent’s bad faith intention is directed at the complainant."); Weider Publications, Inc. v Don Ho Cha, WIPO Case No. D2001-0105 (March 14, 2001) ("Respondent’s lack of knowledge of the trademark prior to this dispute is fatal to this aspect [bad faith] of the Complainant’s case.").

Not only are the words "super" and "fares" commonly used globally in advertising, they bear no indication of the type of business the Complainant is engaged in, ie travel resorts in the Caribbean. As such, this phrase by itself does not distinguish the Complainant’s service on a global basis. According to the Lanham Act, under which the Complainant has registered its mark, a valid claim of trademark infringement requires that the use be "in connection with the sale, offering for sale, distribution or advertising of any goods or services" which is likely to cause confusion, mistake or deception. It is therefore implausible that any confusion could arise between the use of "superfares" in relation to train travel in China and Complainant’s holiday resort activities in the Caribbean.

The domain name <superfare.com> and the associated registered mark are held by another US business engaged in general travel reservation services. They are also registered in a variety of ccTLDs, and represent their common use in commerce throughout the world.

The words "super" and fares", either immediately adjacent to each other or separated by another descriptive word (eg "super economy fares") is generically used in commerce on a worldwide basis. They are not distinctive of any particular product or service, but are rather descriptive words that can be applied to a vast variety of products and services on a global basis. Complainant has provided no evidence of the words exclusive identification with Complainant’s business in the Caribbean, nor that they are distinctive of the Complainant’s services.

As noted above, these words serve as the name of various other companies. Those particular companies are not able to prevent other parties from using the phrase "superfares" under a commonly accepted principle of international law that no one be allowed to remove commonly used words from the language of commerce. In the case of a coined phrase, such as "Kodak", a company can obtain exclusive and global rights in such a coined term. But with respect to commonly used phrases, registration of any rights must be strictly limited to prevent over-reaching by registrants. While registration of rights in a mark is an important legal protection that facilitates commerce, such rights cannot be abused.

Complainant states that it registered the mark "SUPERFARES" in 1991. Four years later, it appears that Complainant registered the domain name <superclubs.com> in 1995 (WHOIS search conducted July 27, 2001). When I registered <superfares.net> on April 8, 2000, the Complainant already had more than five years in which to have registered the domain name.

Eight months after I registered the domain name, I was contacted by Complainant’s counsel demanding that I transfer the domain name. This was the first official contact from the Complainant. In prior contacts, the Complainant’s representatives did not identify themselves or provide any means of determining who they were. The first email from <kscaccetti@800gosuper.com>, who was not identified as holder of any rights in the mark. It originated in Israel and simply wanted me to transfer the domain name. I refused, saying that the domain name was not for sale. I subsequently received the Trotta email, demanding that I transfer the domain name, but again not identifying Trotta as the legitimate holder of the mark. Trotta’s reference to "VRL International Ltd." bears little resemblance to the trademark registrant "Village Resorts Ltd." identified in the USPTO registration.

Complainant’s actions in bringing this complaint are an attempt to use the Policy in bad faith in order to deprive me of the domain name. Due to the improper use of the Policy, I request that the Panel find that the Complainant has attempted reverse domain name hijacking.

The Response is accompanied by a document called an "affidavit" which repeats some of the above submissions and exhibits some documents. It is not an affidavit because it is neither sworn nor affirmed before any person in authority empowered to attest and verify sworn statements or declarations. It has no more evidential worth than the Response itself. Respondent states that in February 2000, he entered into major confidential discussions with officials from a senior Government entity in China and later produced a proposal for an online Reservation System. Registration of the domain name was made to provide a concrete example for members of the alternate audience. The project is sensitive and there are confidentially agreements. The exhibits to the Response include the Chinese official response to WTO commitments including that relating to the travel industry plus advertisements for other travel organizations which use the words "Superfare"."

Complainant’s Reply

Contrary to Respondent’s assertion in the Response that the mark "SUPERFARE.COM" is held by another business engaged in travel services, in fact, such mark is owned by Complainant. Village Resorts Ltd is the owner of the "SUPERFARE.COM" mark. The assignment of mark filed with the Trademark Office which establishes such ownership was attached. Furthermore, the mark owned by Complainant is used on the website referenced in Respondent’s Response pursuant to a License Agreement from Complainant as owner of the Mark to that business as Licensee. Contrary to the assertion of Respondent, Complainant’s distinctive "SUPERFARES" mark is not in "common use" in commerce, other than by Complainant and its licensees.

Complainant acted in good faith in selecting and using its "SUPERFARES" mark and name and in initiating this proceeding to seek the transfer to it of this domain name which reflects its mark. Complainant’s prior contacts with Respondent were made with Complainant’s authorization by Complainant’s licensee, International Lifestyles, which employs Ms Scacetti and Mr Trotta. Complainant has acted in good faith in prosecuting this proceeding. Complainant submits there should be no finding of reverse domain name hijacking.

Respondent Sub-Reply

Respondent does now not dispute Complainant’s right to the <SuperFare.com> mark. The assignment of the mark was not publicly known at the date the Response was filed.

On Complainant’s evidence, another company All Points Travel Ltd, was using the same trademark and domain name as at April 2000. The claim for reverse domain name by hijacking is not surprising given the tactics of the Complainant which were designed to entrap him. Complainant’s conduct is characterised by trickery, threats and intimidation. The administrative proceeding has been brought in bad faith in order to avert the name from Respondent.

6. Discussion and Findings

Paragraph 15(a) of the Rules instructs the Panel to:

"decide a complaint on the basis of the statements and documents submitted in accordance with the policy, these rules and any rules and principles of law that it deems applicable".

The burden for the Complainant, under paragraph 4(a) of the ICANN Policy, is to show:

- that the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights;

- that the Respondent has no rights or legitimate interests in respect of the domain name; and

- that the domain name has been registered and is being used in bad faith.

The Respondent’s allegation that "SUPERFARES" is a generic name is to no avail. It is enough to show that Complainant has a registered trademark somewhere, although in some jurisdictions, such a generic term might have been hard to register. The categories of trademark registration are also irrelevant in the present context. Accordingly, the Panel finds that the disputed domain name is identical to the Complainant’s mark.

The Complainant gave the Respondent no rights or legitimate interests in the disputed domain name. That finding can sometimes be sufficient for the Complainant to discharge the initial evidential burden. Paragraph 4(c) of the Policy indicates that a Respondent can demonstrate rights or legitimate interests in the domain name. Thus:

(i) before any notice to you of the dispute, your use of or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods and services; or

(ii) you (as an individual, business or other organization) have been commonly known by the domain name, even if you have acquired no trademark or service mark rights; or

(iii) you are making a legitimate non-commercial or fair use of the domain name, without intent for commercial gain to misleadingly direct customers or to tarnish the trademark or service mark at issue.

The Panel cannot find enough evidence that could properly bring the Respondent into any of the above categories. Respondent seeks to bring himself within sub-paragraph 4(c)(i) above. He claims that, in late 1999, he entered into discussions with Chinese interests to establish an online reservation register for the Chinese travel market. That is why he registered the name, intending to hold it in reserve until necessary preparations had been completed such as business discussions with a partner, establishment of a company and the completion of regulatory matters.

The Panel considers that these preliminary discussions do not bring the Respondent within the ambit of paragraph 4(c)(i). Discussions about possible use - dependent on a range of other factors – do not constitute "demonstrable preparations to use" the domain name in connection with a bona fide offering of goods or services. Unlike in some cases where such a defence has been made out, there is here neither documentary evidence nor corroborative statement that would give weight to the assertion of "demonstrable preparations to use". The whole flavor is one of uncertainty and vagueness.

The second criterion is established, in the view of the Panel.

Paragraph 4(b) of the Policy states:

"For the purposes of paragraph 4(a)(iii), the following circumstances, in particular but without limitation, if found by the Panel to be present, shall be evidence of the registration and use of a domain name in bad faith:

(i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration the complainant who is the owner of the trademark or service mark or to a competitor of that complainant, for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name; or

(ii) you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that you have engaged in a pattern of such conduct; or

(iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor; or

(iv) by using the domain name, you have intentionally attempted to attract, for commercial gain, Internet users to your website or other on-line location, by creating a likelihood of confusion with the complainant’s mark as to the source, sponsorship, affiliation, or endorsement of your website or location or of a product or service on your website or location."

It should be noted that the circumstances of bad faith are not limited to the above.

The Panel finds it difficult to infer that the Respondent, who is obviously experienced in the travel industry and who works in China for an American airline and a German airline, did not know of the Complainant’s mark at the date of the original registration of the name.

However, there is no evidence that the Complainant’s mark, whilst no doubt enjoying fame in the Caribbean or the United States, is well-known outside that country, particularly in China where the Respondent is resident. See KCTS Television Inc. v Get-on-the-Web Limited, WIPO Case No. D2001-0154 (April 20, 2001). None of the Complainant’s material indicated any outreach into the Chinese market.

The Panel finds the two inferences available from the facts are in equipoise. Consequently, the matter has to be decided on the onus of proof. The Panel concludes therefore that the Complainant has not proved bad faith registration at the time the name was first registered.

A Complainant has to prove bad faith both at the time of registration of the name and continuing bad faith use of the name. Conduct relating to lack of use of the site and failure to deal sensibly with ‘cease and desist’ letters are more often useful evidence of bad faith use. The Respondent re-registered the name on April 7, 2001, long after he had notice of the Complainant’s rights and long after he had given an unfulfilled promise to reply to the formal lawyer’s ‘cease and desist’ letter. In these circumstances, Respondent may have acted in bad faith. However that may be evidence of bad faith use and not be evidence of bad faith at the time of initial registration. In this regard, the Panel adopts the reasoning of the learned Panelist in Weatherall Green & Smith v Everymedia.com, WIPO Case No. D2000-1528 (February 19, 2001), which in turn followed Teradyne, Inc. v. 4Tel Technology, WIPO Case No. (May 9, 2000) to the effect that it was not the intention of the Report which preceded the Policy to extend the definition of abusive registration to include names originally registered in good faith.

Determining bad faith use is shown by the failure to develop the site and the failure to reply sensibly to the ‘cease and desist’ approaches of the Complainant. One would have thought that the reasons for registration set out in the Complaint might have been canvassed by the Respondent in a considered reply to the ‘cease and desist’ letter sent by the Complainant’s lawyers.

7. Reverse Domain Name Hijacking

Such a claim is not infrequently made by a counter-attacking Respondent. It is rarely justified and is certainly not justified here. Respondent has offered no grounds such as those which found favour with the majority of the Panel in Koninklijke KPN N.V. v Telepathy Inc, WIPO Case No. D2001-0217 (May 7, 2001). See also Sydney Opera House Trust v Trilynx Pty Ltd., WIPO Case No. D2000-1224 (October 31, 2000). The Panel does not see the Complainant’s communications to the Respondent as being unreasonable. They are what one would expect from a trademark owner seeking to uphold its rights to the mark.

The Panel declines to make such an order against the Complainant in this case.

8. Decision

The Panel accordingly decides:

(a) that the Complaint be denied;

(b) that no finding of reverse domain name hijacking be made against the Complainant.


Hon. Sir Ian Barker QC
Sole Panelist

Dated: August 29, 2001


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