Latest news of the domain name industry

Recent Posts

Kirikos lawyers up after ICANN etiquette fight

Kevin Murphy, October 25, 2018, Domain Policy

Domain investor George Kirikos has hired lawyers to send nastygrams to ICANN after a fight over the rules of etiquette on a working group mailing list.

Kirikos claims there’s a “campaign of intimidation” against him by fellow volunteers who do not agree with his opinions and forthright tone, but that he “has not done anything wrong”.

In response, ICANN CEO Goran Marby this evening revealed that he has assigned his general counsel and new deputy, John Jeffrey, to the case.

Even by ICANN standards, it’s a textbook case of a) manufacturing mountains out of molehills, and b) how it can become almost impossible to communicate like sensible human beings when everyone’s tangled in red tape.

The dispute started back in May, when Kirikos got into a fight with IP lawyer Greg Shatan on the mailing list of the Rights Protection Mechanisms working group.

Both men are volunteers on the group, which seeks to refine ICANN policy protecting trademark owners in gTLDs.

The argument was about the content of a World Intellectual Property Organization web page listing instances of UDRP cases being challenged in court.

Kirikos took a strident tone, to which Shatan took exception.

Shatan then reported Kirikos to the working group’s co-chairs, claiming a breach of the Expected Standards of Behavior — the informal code of conduct designed to prevent every ICANN discussion turning into a flame war and/or bare-knuckle alley fight.

Under GNSO PDP rules, working group volunteers have to agree to abide by the ESB. Group chairs have the ability to kick participants who repeatedly offend.

At this point, the sensible thing to do would have been for Shatan and Kirikos to hug it out and move on.

But this is ICANN.

What actually happened was a pointless procedural back-and-forth between Kirikos, Shatan, and working group chairs Phil Corwin of Verisign and Brian Beckham of WIPO, which resulted in Kirikos hiring two lawyers — Andrew Bernstein of Torys and regular ICANN participant Robin Gross of IP Justice.

It’s believed to be the first time a WG participant has hired counsel over a mailing list argument.

Far too boring to recount here, Corwin’s timeline of events can be found from page 24 of this transcript (pdf) of remarks delivered here in Barcelona during ICANN 63, while the Bernstein/Kirikos timeline can be found here (pdf).

The rub of it is that Kirikos reckons both Corwin and Beckham are biased against him — Beckham because Kirikos voted against his chairship, Corwin because of a similar dispute in a related working group earlier this year — and that the ESB is unenforceable anyway.

According to Bernstein: “Mr. Kirikos has strong concerns that whatever process ICANN purports to operate with respect to Mr. Shatan’s complaint, it will not be fairly or neutrally adjudicated.”

He added that Kirikos had said that “due to the precise language of Section 3.4 of the Working Group Guidelines, Mr. Shatan lacked a basis to initiate any complaint”.

That language allows complaints to be filed if the ESB is “abused”. According to Corwin’s account, Kirikos — well-known as a detail-oriented ICANN critic — reckons the correct term should be “violated”, which rendered the ESB “null and void and unenforceable” in this instance.

Bernstein has since added that the ICANN board of directors never intended the ESB to be anything but voluntary.

The sum of this appears to be that the dispute has had a chilling effect on the RPM working group’s ability to get anything done, consuming much of its co-chairs’ time.

Kirikos lawyering up seems to have compounded this effect.

Now, as ICANN 63 drew to a close this evening, CEO Marby said in a brief prepared statement that the WG’s work has “more or less stalled for the last several months” and that he’s assigned general counsel John Jeffrey to “look into the issues surrounding this matter”.

ICANN “takes the issue very seriously”, he said.

As well it might. The Kirikos/Shatan incident may have been blown waaaaay out of proportion, but at its core is a serious question about civil discourse in ICANN policy-making.

Personally, I hold out hope it’s not too late for everyone to hug it out and move on.

But this is ICANN.

Amazon offered $5 million of free Kindles for .amazon gTLD

Kevin Murphy, October 23, 2018, Domain Policy

Amazon offered South American governments $5 million worth of free Kindles, content and cloud services in exchange for their endorsement of its .amazon gTLD application, it has emerged.

The proposal, made in February, also included an offer of four years of free hosting up to a value of $1 million.

The sweeteners came during negotiations with the eight governments of the Amazon Cooperation Treaty Organization, which object to .amazon because they think it would infringe on their geographical and cultural rights.

Amazon has sought to reassure these governments that it will reserve culturally sensitive strings of their choice in .amazon, and that it will actively support any future applications for gTLDs such as .amazonas, which is the more meaningful geographic string in local languages.

I’ve reported on these offers before, but to my knowledge the offer of free Kindles and AWS credits has not been made public before. (UPDATE: Nope.)

According to a September letter from ACTO, published (pdf) this week, Amazon told it:

as an indication of goodwill and support for the people and governments of the Amazonian Region… [Amazon will] make available to the OTCA governments credits for the use of AWS services, Kindles preloaded with mutually agreed upon content, and similar Amazon.com services and products in an amount not to exceed $5,000,000.

Amazon also offered to set up a .amazon web site “to support the Amazonian people’s cultural heritage” and pay up to $1 million to host it for four years.

These kinds of financial sweeteners would not be without precedent.

The applicant for .bar wound up offering to donate $100,000 to fund a school in Montenegro, after the government noted the string match with the Bar region of the country.

The ACTO countries met in August to consider Amazon’s offer, but chose not to accept it.

However, they’re not closing off talks altogether. Instead, they’ve taken up ICANN on its offer to act as a facilitator of talks between Amazon and ACTO members.

The ICANN board of directors passed a resolution last month instructing CEO Goran Marby to “support the development of a solution” that would involve “sharing the use of those top-level domains with the ACTO member states”.

ACTO secretary general Jacqueline Mendoza has responded positively to this resolution (pdf) and invited Marby to ACTO headquarters in Brasilia to carry on these talks.

Co-founder Nevett leaves Donuts

Kevin Murphy, October 18, 2018, Domain Registries

Donuts executive vice president of corporate affairs Jon Nevett has left the company, Donuts said yesterday.

He’s the last of the four co-founders of the new gTLD portfolio owner to step aside from their original roles over the last couple of years.

There’s no word on whether he’s got a new gig lined up, but given the recent acquisition of Donuts by Abry Partners, which gave the founders the opportunity to dispose of their shares, Nevett presumably will be in no rush.

Donuts said in a statement that Nevett, who led policy at the company, will continue to act as an advisor.

He follows Dan Schindler and Richard Tindal as co-founders who have since left the company.

Founding CEO Paul Stahura stepped into the executive chair role a couple of years ago to make way for Bruce Jaffe, who led the firm through its merger with Rightside and subsequent sale to Abry.

Jaffe himself will leave next month to allow former ICANN bigwig Akram Atallah into the hot seat. Former ICANN CEO Fadi Chehade is one of Abry’s lead overseers of Donuts.

Donuts loses to ICANN in $135 million .web auction appeal

Kevin Murphy, October 16, 2018, Domain Registries

Donuts has lost a legal appeal against ICANN in its fight to prevent Verisign running the .web gTLD.

A California court ruled yesterday that a lower court was correct when it ruled almost two years ago that Donuts had signed away its right to sue ICANN, like all gTLD applicants.

The judges ruled that the lower District Court had “properly dismissed” Donuts’ complaint, and that the covenant not to sue in the Applicant Guidebook is not “unconscionable”.

Key in their thinking was the fact that ICANN has an Independent Review Process in place that Donuts could use to continue its fight against the .web outcome.

The lawsuit was filed by Donuts subsidiary Ruby Glen in July 2016, shortly before .web was due to go to an ICANN-managed last-resort auction.

Donuts and many others believed at the time that one applicant, Nu Dot Co, was being secretly bankrolled by a player with much deeper pockets, and it wanted the auction postponed and ICANN to reveal the identity of this backer.

Donuts lost its request for a restraining order.

The auction went ahead, and NDC won with a bid of $135 million, which subsequently was confirmed to have been covertly funded by Verisign.

Donuts then quickly amended its complaint to include claims of negligence, breach of contract and other violations, as it sought $22.5 million from ICANN.

That’s roughly how much it would have received as a losing bidder had the .web contention set been settled privately and NDC still submitted a $135 million bid.

As it stands, ICANN has the $135 million.

That complaint was also rejected, with the District Court disagreeing with earlier precedent in the .africa case and saying that the covenant not to sue is enforceable.

The Appeals Court has now agreed, so unless Donuts has other legal appeals open to it, the .web fight will be settled using ICANN mechanisms.

The ruling does not mean ICANN can go ahead and delegate .web to Verisign.

The .web contention set is currently “on-hold” because Afilias, the second-place bidder in the auction, has since June been in a so-called Cooperative Engagement Process with ICANN.

CEP is a semi-formal negotiation-phase precursor to a full-blown IRP filing, which now seems much more likely to go ahead following the court’s ruling.

The appeals court ruling has not yet been published by ICANN, but it can be viewed here (pdf).

The court heard arguments from Donuts and ICANN lawyers on October 9, the same day that DI revealed that ICANN Global Domains Division president Akram Atallah had been hired by Donuts as its new CEO.

A recording of the 32-minute hearing can be viewed on YouTube here or embedded below.

ICANN says it can spend quarter-billion-dollar auction fund however it likes

Kevin Murphy, October 12, 2018, Domain Policy

ICANN can tap into its $236 million new gTLD auction fund whenever it wants, and there’s nothing the community can do about it, according to its board of directors.

The board this week said it has a “legal and fiduciary responsibility” over the money, and would be obliged to spend the cash to meet ICANN’s obligations if it ever needed to.

The statement came in a letter to the leaders of a community working group that this week published a set of preliminary recommendations (pdf) for how the money should be distributed.

The group — a cross-community working group or CCWG — laid out a few options for how the money should be administered, either by ICANN alone or in conjunction with a charitable third party, and distributed.

The money was collected from new gTLD applicants that participated in ICANN’s “last-resort” auctions to settle their contention sets. Over half of the money came from Verisign’s winning bid for .web, which is still being contested.

The CCWG said that the money should be used to:

  • Benefit the development, distribution, evolution and structures/projects that support the Internet’s unique identifier systems;
  • Benefit capacity building and underserved populations, and;
  • Benefit the open and interoperable Internet

But the CCWG could not agree among itself whether ICANN Org or community groups such as the GNSO or GAC should be able to grab some of the cash, which is currently held in a special fund, separated from ICANN’s operational budget.

The group asked the board for its opinion, and the board responded (pdf):

ICANN maintains legal and fiduciary responsibility over the funds, and the directors and officers have an obligation to protect the organization through the use of available resources. In such a case, while ICANN would not be required to apply for the proceeds, the directors and officers would have a fiduciary obligation to use the funds to meet the organization’s obligations.

In other words: it doesn’t matter what rules you put in place, it’s our money and we’re duty-bound to spend it if we have to.

The board added, however, that ICANN Org “currently does not foresee a situation where it would need to apply for the proceeds”.

ICANN is pretty well-funded. It would have to hit hard times indeed before it needed to crack open the auction nest egg.

The board also said that supporting organizations and advisory committees would not be able to apply for funding because they’re not legal entities and wouldn’t pass the due diligence.

The CCWG’s initial report is now open for public comment until November 27.