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Rumor sites fair game under UDRP

Kevin Murphy, February 14, 2011, Domain Policy

Could Apple shut down MacRumors.com using the Uniform Dispute Resolution Policy?

That seems like a fair interpretation of a recent WIPO decision over the domain name LegoRumors.com, which was handed over to Lego Juris, maker of the popular toys.

LegoRumors.com leads to blog-style news site, not many months old, that reports on Lego products.

The site is a bit of a mess – poorly written, spammy, and ad-heavy. You’d have to be nuts to think it was an official Lego site.

It does appear to contain original content, and does not look to me like the kind of clear-cut cybersquatting that the UDRP was intended to address.

Lego succeeded in seizing the domain, regardless. The WIPO panelist (in a decision that could also have used a run through a spell-checker) found:

The disputed domain name consists of two different words, one consisting of the Complainants registered trademark and other of a generic term “rumors”. The Panel considers that the addition of the generic denomination, especially when added to a famous trademark is not sufficient to avoid confusion.

Pay attention, “rumors” sites.

The panelist also found that the domain name was registered in bad faith, on the basis that the registrant clearly was aware of Lego’s trademark (because he’s writing about Lego) and because the site contained sponsored links to potential competitors.

Apply this logic to MacRumors.com, which knowingly uses an Apple trademark in its domain name, writes about Apple products, and currently shows ads for BlackBerry and Adobe products that compete with Apple.

I’m not suggesting for a second that MacRumors is in any danger of losing its domain, but if the UDRP was implemented equitably, this case could be seen as scary precedent.

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VeriSign scores big win in .com pricing lawsuit

Kevin Murphy, February 14, 2011, Domain Registries

VeriSign has successfully had an antitrust lawsuit, which claims the company has been raising .com domain name prices anti-competitively, dismissed by a California court.

While it’s encouraging news if you’re a VeriSign shareholder, the Coalition for ICANN Transparency, which filed the suit, will be allowed to amend and re-file its complaint.

The basis for the dismissal (pdf) goes to the central irony of CFIT – the fact that, despite its noble name, it’s not itself a particularly transparent organization.

CFIT was set up in 2005 in order to sue ICANN and VeriSign over their deal that gave VeriSign the right to raise the price of .com and .net domains, and to keep its registry contracts on favorable terms.

While it was cagey about who was backing the organization, those of us who attended the ICANN meeting in Vancouver that year knew from the off it was primarily a front for Momentous.ca, owner of Pool.com and other domainer services.

In dismissing the case last Friday, Judge Ronald Whyte decided that CFIT’s membership is vague enough to raise a question over its standing to sue on antitrust grounds. He wrote:

By failing to identify its purported members, CFIT has made it impossible to determine whether the members are participants in the alleged relevant markets, or whether they have suffered antitrust injury. Because the [Third Amended Complaint] identifies no members of CFIT, it must be dismissed.

While CFIT had disclosed some time ago Pool.com’s involvement, it recently tried to add uber-domainer Frank Schilling’s Name Administration Inc and iRegistry Corp to the list of its financial supporters.

But Whyte was not convinced that the two companies were CFIT “members” with standing to sue.

Whyte decided that CFIT’s complaint, “fatally fails to allege facts showing that iRegistry or Name Administration were financial supporters or members at the time the complaint was filed”.

He also denied CFIT’s demand for a jury trial.

CFIT wants VeriSign to return all the excess profits it has made on .com registrations since it started raising its prices above $6.

If CFIT were to win, it would severely curtail VeriSign’s ability to grow its registry business, and could lead to billions being wiped off its accounts.

The organization has been given leave to file a fourth amended complaint, so it’s not over yet.

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ICANN terminates another registrar

Kevin Murphy, February 14, 2011, Domain Registrars

Another tiny domain name registrar has been given its marching orders by ICANN.

Best Bulk Register, which looks to have only a few hundred domains under management, will be shut down March 4, according to a letter (pdf) from ICANN’s compliance department.

The company had failed to pay over $10,000 in fees, and was not providing Whois services as required by the Registrar Accreditation Agreement, according to ICANN.

The registrar’s web site does not currently appear to resolve.

Best Bulk has until tomorrow to pick a registrar to take over its domains, or ICANN will pick one for it.

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Dot Africa needs a registry

Kevin Murphy, February 13, 2011, Domain Registries

DotConnectAfrica, one of the organizations planning to apply to ICANN to run .africa as a new top-level domain, has put out its feelers for a technical back-end partner.

In a press release, DCA today solicited expressions of interest from registry services providers. “Presence and/or experience in developing markets” is said to be “preferred but not a must”.

I expect there will be quite a few EOIs winging their way to the company in the next few days.

The whole of Africa only has about 110 million internet users currently. But with only 11% penetration, there’s pretty good growth potential. And chances are there’s not a great deal of ccTLD lock-in yet.

The nearest equivalent existing TLD is .asia, which has about 185,000 active registrations.

That’s less than half as many as .asia had post-landrush, but still represents a nice chunk of change for a back-end provider that does not have to pony up the cash for marketing.

DCA is one of two organizations known to be pursuing a .africa bid, and easily the highest-profile of the two. The other is called Dot Africa.

As a geographical name protected by ICANN’s new TLDs Applicant Guidebook, .africa will only be awarded to an applicant with proven governmental support.

That likely means that it will be the African Union, not ICANN, that ultimately decides the winner. In this slide deck, DCA says it has support from the AU and from 20% of African governments.

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Why ICANN dropped registrar ownership rules

Kevin Murphy, February 13, 2011, Domain Registries

ICANN has quietly published a list of 10 reasons explaining why it decided to start allowing domain name registrars and registries to buy each other.

Last November, ICANN’s board of directors voted to drop so-called “vertical integration” rules that previously prevented registries owning more than a small percentage of registrars.

Now, under the forthcoming new top-level domains program, the likes of eNom and Go Daddy will be able to apply to become gTLD registries, and registries like VeriSign and Neustar will be able to apply to run their own registrar businesses.

The decision was unexpected, appeared to be a U-turn, and ICANN’s explanation was not articulated sufficiently to sate critics such as the US Department of Commerce.

So now ICANN has published a “Draft Rationale” (pdf), a 17-page document that outlines some of the thinking that went into the decision.

In a nutshell, ICANN dropped the VI rules to increase competition, to avoid antitrust lawsuits, and because the harms that could arise due to cross-ownership are best addressed by other means.

Here are the rationale’s 10 major bullet points in full:

  • None of the proposals submitted by the GNSO reflect a consensus opinion; as a result, the Board supported a model based on its own factual investigation, expert analysis, and concerns expressed by stakeholders and the community.
  • ICANN’s position and mission must be focused on creating more competition as opposed to having rules that restrict competition and innovation.
  • Rules permitting cross-ownership foster greater diversity in business models and enhance opportunities offered by new TLDs.
  • Rules prohibiting cross-ownership require more enforcement and can easily be circumvented.
  • Rules permitting cross-ownership enhance efficiencies and almost certainly will result in benefits to consumers in the form of lower prices and enhanced services.
  • Preventing cross-ownership would create more exposure to ICANN of lawsuits, including antitrust lawsuits, which are costly to defend even if ICANN believes (as it does) that it has no proper exposure in such litigation.
  • The new Code of Conduct, which is to be part of the base agreement for all new gTLDs, includes adequate protections designed to address behavior the Board wants to discourage, including abuses of data and market power. Data protection is best accomplished by data protection tools, including audits, contractual penalties such as contract termination, punitive damages, and costs of enforcement, as well as strong enforcement of rules. By contrast, market construction rules can be circumvented and cause other harms.
  • Case-by-case re-negotiation of existing contracts to reflect the new crossownership rules will permit ICANN to address the risk of abuse of market power contractually.
  • In the event ICANN has competition concerns, ICANN will have the ability to refer those concerns to relevant antitrust authorities.
  • ICANN can amend contracts to address harms that may arise as a direct or indirect result of the new cross-ownership rules.

The document still needs to be approved by the ICANN board of directors before it can be considered official.

It appeared without fanfare on the ICANN web site a little over a week ago.

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