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XYZ settles Verisign’s back-end switcheroo lawsuit

Kevin Murphy, May 16, 2016, 09:18:43 (UTC), Domain Registries

XYZ.com has settled a lawsuit filed against it against Verisign stemming from XYZ’s acquisition of .theatre, .security and .protection.

Verisign sued the new gTLD registry operator for “interfering” with its back-end contracts with the previous owners last August, as part of its campaign to compete against new gTLDs in the courtroom.

XYZ had acquired the .security and .protection ICANN contracts from security Symantec, and .theatre from a company called KBE Holdings.

As part of the transitions, all three applications were modified with ICANN to name CentralNic as the back-end registry services provider, replacing Verisign.

Verisign sued on the basis of tortious interference and business conspiracy. It was thrown out of court in November then amended and re-filed.

But the case appears to have now been settled.

Negari issued a grovelling not-quite-apology statement on his blog:

I am pleased to report that the recent case filed by Verisign against CentralNic, Ltd., XYZ and myself has been settled. After looking at the claims in dispute, we regret that as a result of our acquisition of the .theatre, .security and .protection extensions and our arrangement for CentralNic to serve as the backend service provider for these extensions, that Verisign was prevented from the opportunity to pursue monetization of those relationships. As ICANN’s new gTLD program continues to evolve, we would caution others who find themselves in similar situations to be mindful of the existing contracts extension owners may have with third parties.

Registries changing their minds about their back-end provider is not unheard of.

In this case, large portions of Verisign’s final amended complaint were redacted, suggesting some peculiarities to this particular switch.

If there was a monetary component to the settlement, it was not disclosed. The original Verisign complaint had demanded damages of over $2 million.

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