Microsoft owns many trademark registrations for the "XBox" mark,all over the world.Therefore,it was more than obvious that the disputed domain name is confusingly similar to its trademark .
Microsoft has also contended and managed to demonstrate that the respondent has no rights over the disputed domain name and that he registered and used the domain in bad faith :
" Respondent attempted, for commercial gain, to attract Internet users to the domain name by creating a likelihood of confusion as to the source of the domain name. The disputed domain name resolves to a website that operates a loyalty rewards program in competition with the one that Complainant offers. Respondent operates this rewards program to confuse Internet users and, presumably, to gain a monetary benefit"
"Respondent had actual knowledge of Complainant's rights in the XBOX LIVE mark when Respondent registered the disputed domain name. "
After Microsoft managed to established all three elements required under ICANN Policy,the Panel ordered the disputed domain name to be transferred from the respondent to the complainant .
You can read the decision here .