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Facebook’s war on privacy claims first registrar scalp

Kevin Murphy, July 22, 2021, Domain Registrars

China’s oldest accredited registrar says it will shut up shop permanently next week after being sued into the ground by Facebook, apparently the first victim of the social media giant’s war against Whois privacy.

Facebook sued OnlineNIC in 2019 alleging widespread cybersquatting of its brands. The complaint cited 20 domains containing the Facebook or Instagram trademarks and asserted that the registrar, and not a customer, was the true registrant.

The complaint named ID Shield, apparently OnlineNIC’s Hong Kong-based Whois privacy service, as a defendant and was amended in March this year to add as a defendant 35.cn, another registrar that Facebook says is an alter ego of OnlineNic.

The amended complaint listed an addition 15 squatted domains, for 35 in total.

This week, OnlineNIC director Carrie Yu (aka Carrie Arden aka Yu Hongxia), told the court:

Defendants do not have the financial resources to continue to defend the instant litigation, and accordingly no longer intend to mount a defense. Defendants do not intend to file any oppositions to any pending filing… Subject to any requirements of ICANN, Defendants intend to cease business operations on July 26, 2021.

But Facebook reckons the registrar is about to do a runner to avoid paying almost $75,000 in court fees already incurred and avoid the jurisdiction of the California court where the case is being heard.

Facebook had asked for $3.5 million in penalties in a proposed judgment and OnlineNIC had not opposed.

While it presents itself as American, it appears that OnlineNIC is little more than a shell in the US.

Its official headquarters are little more than a lock-up garage surrounded by builders’ merchants in a grim, windowless facility just off the interstate near Oakland, California.

Its true base appears to be a business park in Xiamen, China, where 35.cn/35.com operates. The company has boasted in the past of being China’s first and oldest ICANN-accredited registrar, getting its foot in the door when the floodgates opened in 1999.

Facebook is now asking the court for a temporary restraining order freezing the defendants’ financial and domain assets, and for a domain broker to be appointed to liquidate its domain portfolio.

If you’re a legit OnlineNIC customer, you might be about to find yourself in a world of hurt.

OnlineNIC had just over 624,000 gTLD domains under management at the last count. 35.cn had another 200,000.

The lawsuit is one of three Facebook is currently fighting against registrars, one prong of its strategy to pressure the ICANN community to open up Whois records rendered private by EU law and consequent ICANN policy.

OnlineNIC is the low-hanging fruit of the trio and the first to be sued. It already faced cybersquatting cases filed by Verizon, Yahoo and Microsoft in 2009. The Verizon case came with a $33 million judgment.

Facebook has also sued the rather less shady registrars Namecheap and Web.com (now Newfold Digital) on similar grounds.