Founders out as Com Laude gets equity injection

Corporate registrar Com Laude is losing four company founders as part of a new investment from the private equity firm PX3 Partners.

The company said last week that founders Nick Wood and Lorna Gradden will exit the firm, along with Penny Hearn and Andrew Lothian, who founded Demys, which Com Laude acquired in 2018. Wood will stick around to consult for a while.

The privately held, London-based registrar did not disclose the size of the investment or the new ownership structure, but it did say that former investor Vespa Capital is also out.

Com Laude focuses on the corporate market and brand protection services and has over 211,000 gTLD domains under management at the last count.

CEO Glenn Hayward said in a blog post that PX3 was picked for its “deep network of international relationships and experience in helping companies scale and internationalise”.

Claims UDRP has cost over $360 million so far

Trademark owners have splashed out over $360 million on UDRP cases over the 20 years the policy has been active, according to an intellectual property trade group.
Marques, a European body representing trademark owners, reckons $360 million is a “conservative” estimate.
It reached the figure by multiplying the number of UDRP complaints filed to the end of 2018 — 72,038 — by the $5,000 estimated total cost of each complaint.
The World Intellectual Property Organization, which handles well over half of all UDRP cases, charges at least $1,500 per case, but trademark owners have other fees, such as paying lawyers to draft the complaints.
WIPO, which basically designed and wrote the UDRP back in 1998, has been paid at least $63.8 million in filing fees to date, Marques calculates.
Across all UDRP providers, well over 100,000 individual domain names have been subject to UDRP. It’s likely much more, but the National Arbitration Forum does not publish data on unique domains.
The Marques claims were made in a letter (pdf) from council member (and Com Laude managing director) Nick Wood to ICANN last week, part of IP lobbying efforts in the face of UDRP reform efforts. He wrote:

This lowest-case estimate of $360m is a very significant financial burden. Registrants, on the other hand, pay only for their own defence, if any. They do not pay damages, or even contribute to the provider fees, if they lose – which across the five active panel providers appears to be majority of the time.

One proposal that has been put forward by IP owners is for registrants to pay a $500 fee when they are hit by a UDRP complaint, which would be refundable if they prevail.
I can see this idea going down like a cup of iced sick in the domainer community.
Rather than lobbying for any specific proposal, however, Marques is asking ICANN to create an “independent expert group” outside of the usual Policy Development Process, to highlight “priority issues and possible solutions” for the PDP to consider.
Marques thinks the group should comprise a small number of trademark interests, registries and registrars, and registrant rights groups. It wants WIPO to chair it.
It also wants ICANN to coordinate UDRP providers in the creation of a unified set of data on UDRP cases processed to date, to help with future reform discussions.
ICANN community volunteers have been working on the “PDP Review of All Rights Protection Mechanisms in All gTLDs” — the RPM WG — since March 2016.
The RPM WG expects to put out its “Phase One” initial report, comprising recommendations for reform of the Trademark Clearinghouse, Trademark Claims and Sunrise policies, in early June this year.
Only then will it turns its attention to UDRP, in “Phase Two”, with talks due to begin at the ICANN 65 meeting in Marrakech later that month.
The working group has been beset by all kinds of personal drama among volunteers recently, which continues to add friction to discussions.

Com Laude acquires Scottish rival

Brand protection registrar Com Laude has picked up smaller competitor Demys for an undisclosed sum.
Demys, based in Edinburgh, is an ICANN-accredited registrar that specializes in the UK automotive, retail/leisure, media and consumer goods sectors.
It also acts as the registry manager and exclusive registrar for .bentley, the lightly-used dot-brand of luxury car-maker Bentley Motors.
It had around 12,000 gTLD domains under management at the last count, about 7,200 of which were in .com.
It’s about an eighth the size of Com Laude in terms of gTLD domains under management.
Demys has a very light footprint in new gTLDs, with local geo .scot — where it is the largest corporate registrar and fifth-largest registrar overall — being a notable exception.
London-based Com Laude said it was also interested in the company for its brand monitoring services and dispute resolution work.
Two of Demys’ top guys act as arbitrators for UDRP and .uk’s Dispute Resolution Service.

Swiss registry gets more traffic than Google, kinda

Switch, the Swiss ccTLD registry, has started publishing a monthly list of the .ch domains with the most DNS traffic, a list that Switch itself currently tops.
The list ranks the top 1,000 .ch domains by the number of DNS resolvers that have queried them over the course of a calendar month.
By that measure, switch.ch is the runaway number one, with 792,958 resolvers. That’s a long way ahead of Google’s google.ch, which comes in at #4 with 529,846 resolvers.
It seems pretty clear that it’s traffic to Switch’s name servers that is likely responsible for its comprehensive lead.
That’s underlined by the composition of the rest of the top end of the list, which is dominated by registrars and hosting companies.
At #2 is the brand-protection registrar Com Laude, a rank seemingly earned due to the fact that the registrar hosts many of its clients’ high-traffic domains (most of which are .com names) on, among others, a comlaude.ch name server.
Switch said its data is collected from its two primary nic.ch name servers and covers all types of traffic. Other such rankings, such as Alexa, measure only web traffic.
By counting the number of unique IP addresses doing DNS queries over the course of a month, Switch said it avoids pitfalls associated with low time-to-live (TTL) settings that could occur if it was counting the number of queries.
More details on its methodology can be found here. The data itself, which goes back 12 months, can be freely downloaded as CSV files here.

DI implicated in .sucks “gag order” fight

Vox Populi, the .sucks registry, terminated Com Laude’s accreditation last week due to its belief that the brand protection registrar had leaked a “confidential” document to Domain Incite.
Vox Pop CEO John Berard tonight denied that the company he works for was carrying out a “grudge” against Com Laude, which in January led a charge against a Vox “gag order” on registrars.
As we reported on Friday, Vox terminated Com Laude‘s ability to sell .sucks domains directly, due to a then-unspecified alleged breach of the Registry-Registrar Agreement that binds all .sucks domain registrars.
It now turns out the “breach” was of the part of the .sucks RRA that states that Vox registrars “shall make no disclosures whatsoever” of “confidential informational”, where such confidential information is marked as such.
Berard told DI of the termination: “It was a specific act, violating a specific clause of the contract that had to do with breaching confidentiality, and that’s why the action was taken.”
The specific act was Com Laude allegedly sending DI — me, for avoidance of doubt — a confidential document.
“They have not said they didn’t do it,” Berard said.
He said that, given the amount of scrutiny Vox is under (due to the controversy it has created with its pricing and policies), “it would be crazy of us to ignore a contract breach”.
He declined to identify the document in question.
He said that Vox Pop deployed “forensic research” to discover the identity of the alleged leak.
“It was clear that something that was confidential was distributed, we wanted to know who distributed it,” he said. “We wanted to know who breached confidentiality.”
DI has only published one third-party document related to .sucks this year.
This is it (pdf). It’s a letter drafted by the Registrars Stakeholder Group and sent to ICANN. Here it is (pdf) as published on the ICANN web site.
DI has received other documents related to Vox Pop and .sucks from various parties that I have not published, but I’ve been unable to find any that contained the word “confidential” or that were marked as “confidential”.
According to the .sucks RRA (pdf), “confidential information” is documentation marked or identified “confidential”.
Everything I’ve ever written about .sucks can be found with this search.

.sucks terminates Com Laude as “gag order” row escalates

Vox Populi, the .sucks gTLD registry, has terminated the accreditation of brand protection registrar Com Laude as part of an ongoing dispute between the two companies.
Com Laude won’t be able to sell defensive .sucks registrations to its clients any more, at least not on its own accreditation, in other words.
The London-based registrar is transferring all of its .sucks domains to EnCirca as a result of the termination and says it is considering its options in how to proceed.
The shock move, which I believe to be unprecedented, is being linked to Com Laude’s long-time criticisms of Vox Populi’s pricing and policies.
The registrar today had some rather stern words for Vox Pop. Managing director Nick Wood said in a statement:

We have always been critical of this registry and particularly its sunrise pricing model which we regard as predatory. We have advised clients where possible to consider not registering such names. We hope that all brand owners will think twice before buying or renewing a .sucks domain. After all, it is not possible to block out every variation of a trademark under .sucks. In our view, fair criticism is preferable to dealing with Vox Populi.

Ouch!
The termination is believed to be linked to controversial changes to the .sucks Registry-Registrar Agreement, which Vox Pop managed to sneak past ICANN over Christmas.
One of the changes, some registrars believed, would prevent brand protection registrars from openly criticizing .sucks pricing and policies. They called it a “gag order”.
Com Laude SVP Jeff Neuman was one of the strongest critics. I believe he was a key influence on a Registrar Stakeholder Group letter (pdf) in January which essentially said registrars would boycott the new RRA.
That letter said:

It’s ironic for a Registry whose slogan is “Foster debate, Share opinions” has now essentially proposed implementing a gag order on the registrars that sell the .sucks TLD by preventing them from doing just that

While the RRA dispute was resolved more or less amicably following ICANN mediation, with Vox Pop backpedaling somewhat on its proposed changes, Com Laude now believes the registry has held a grudge.
Its statement does not say what part of the .sucks RRA it is alleged to have breached.
Vox Pop has not yet returned a request for comment. I’ll provide an update should I receive further information.
Com Laude said in a statement today:

Jeff Neuman, our SVP of our North American business, Com Laude USA, led the effort in the Registrar Stakeholder Group to quash proposed changes to Vox Populi’s registry-registrar agreement, in order to protect the interests of brand owners and the registrars who work with them. Since then, Vox Populi has accused Com Laude of breaching the terms of the registry-registrar agreement, a claim we take seriously and refute in its entirety. We are now considering our further options.

Wood added:

We have informed our clients of the action being taken and all have expressed their support for the manner in which we have handled it. We are pleased to have received messages of support from across the ICANN community including other registry operators. Clearly there is strong distaste at the practices of Vox Populi.

Strong stuff.

Registrars say Amazon is “closing” open gTLD

A group comprising some of the largest domain registrars has claimed Amazon is attempting to close off a new gTLD that it previously indicated would be unrestricted.
The 12-strong group, which includes Go Daddy, Network Solutions and Tucows, also claims that the company’s proposal for a “Registration Authentication Platform” is anti-competitive.
The complaints follow Amazon’s filing of a Registry Services Evaluation Process request with ICANN in March.
The RSEP speaks in broad terms about rejigging the conventional domain registration path so that all .moi sales are funneled through Amazon’s registry site, where registrants will have their eligibility verified and then be offered a set of add-on “technology tools” before being bounced back to their chosen registrar.
Amazon hasn’t said who will be eligible to register .moi domains, nor has it explained what technology tools it plans to offer. I expect the tools will include things such as hosting and security, where many registrars currently make money.
Unsurprisingly, many registrars are not happy about these vague proposals.
In a comment (pdf) to the RSEP filed yesterday, they said:

Ultimately, the use of pre-registration verification and “optional” value added services will negatively impact competition. By tying both practices in a TLD, a TLD Operator can create a “captive audience” via the pre-registration verification and then offering optional services. This will effectively bypass the existing registration and purchase process, putting TLD Operator in a privileged position. The TLD is set up to capture customers earned via the Registrars marketing efforts to promote its own tools and services.

It’s not unusual for “sponsored” or “restricted” gTLDs to implement registry-side verification, they admitted, but said that .moi is meant to be “open”.
They wrote:

While this practice is not explicitly prohibited under gTLDs, we believe that post-delegation inclusion of these practices should only be allowed in compelling circumstances because they are, in effect, retroactively “closing” what was applied for and approved to be operated as an open, generic TLD.

Amazon’s application for .moi, like all of its new gTLD applications, is not entirely clear on what the company’s plans are. There’s vague talk about eligibility, but no details and nothing substantial to suggest a tightly restricted zone.
The signatories to the registrar comment represent the majority of registered domain names. They are: Astutium, Blacknight Internet Solutions, Domain.com, EuroDNS, GoDaddy.com, OpenproviderNetEarth One, Key-Systems, Netistrar, Network Solutions, Nordreg, Realtime Register, Tucows Domains.
One registrar, Com Laude, whose sister company Valideus handles Amazon’s gTLD applications, wrote a comment (pdf) expressing the opposite view.
Com Laude says that it’s not unusual for registries to require registry-side verification. It points to .bank, .pharmacy and .travel as examples.
The company also claims that the 12 registrars are in essence complaining about the idea of vertical integration — where registries and registrars are under common ownership — which is already in place at companies such as Uniregistry and Rightside.
Com Laude’s Jeff Neuman wrote:

We do not believe that it is unacceptable for a company like Amazon to do what these other companies have been doing for some time. To apply different standards to Amazon Registry than it does for each of the other vertically integrated entities would single them out for disparate treatment – especially when there is no factual basis to believe that Amazon Registry has not adhered to its vertical integration-related obligations under the Registry Agreement.

What’s going on here, I suspect, is a bit of a proxy war.
Neither Amazon nor the registrars care a great deal about .moi, I think. The gTLD is merely a canary for Amazon’s 30-odd yet-to-be-launched gTLDs. The company has the rights to potentially more attractive strings, including .book, .song and .tunes.
Amazon originally wanted to make these strings “closed generics”, or what ICANN calls “exclusive access” gTLDs, where only Amazon could register names.
It has since disavowed such plans, but still hasn’t said who will be able to register names in its portfolio or how they will prove eligibility.
.moi was not originally identified as a closed generic by ICANN, but it could represent a model for what Amazon plans to do with the rest of its stable.

Jeff Neuman quits Neustar for Valideus

Neustar’s top domain name guy is moving to UK new gTLD consultancy Valideus.
Jeff Neuman, who’s been with Neustar for over 15 years, will become Valideus’ senior vice president for North America, starting this coming Monday, according to Valideus managing director Nick Wood.
I don’t know who’s replacing him at Neustar, where he’s been in charge of the company’s domain name business for the last couple of years, overseeing the company’s business as a registry back-end provider and registry for New York’s .nyc new gTLD.
Neuman was previously Neustar’s longstanding VP of policy, a role which also saw him heavily involved in ICANN’s GNSO Council and Neustar’s application for and launch of .biz, back in 2000.
He’s been quite a pivotal and sometimes outspoken figure over the years.
Valideus is the new gTLD service provider sister company to Com Laude, the brand-focused registrar. It provides application consulting and ongoing registry/registrar management for dot-brand gTLD applicants and registries, Amazon among them.
I gather that Neuman will remain based in the US, as his new job title implies.

ICM picks new sunrise partner for .xxx launch

ICM Registry has hired IP Rota, a new London-based company, to handle trademark validation in the sunrise periods of the forthcoming .xxx top-level domain.
IP Rota is the work of NetBenefit co-founder Jonathan Robinson, who also currently sits on the boards of Nominet and Afilias, .xxx’s back-end partner.
The company replaces Valideus, which was originally recruited to design and implement ICM’s sunrise policies, apparently due to grumblings from rival registrars. ICM said:

Valideus was originally retained by ICM to assist with the design of the .XXX launch but graciously withdrew from implementation of the initial rights protection mechanism because of the potential for perceived conflict of interest with a related domain name registrar, Com Laude.

Com Laude is a registrar specialising in corporate brand protection. It shares ownership with Valideus.
ICM is planning three sunrise periods for .xxx, including one that would let trademark holders not in the porn business to pay a one-time fee to have their brand.xxx placed on a reserved list.
The .xxx TLD contract still has not been approved by ICANN, of course. Barring last-minute surprises, that could happen as soon as the ICANN board meeting, March 18.
The registry is IP Rota‘s first client.

Round-up of the ICANN new TLDs comment period

Today is the deadline to file comments on version four of ICANN’s Draft Applicant Guidebook for prospective new top-level domain registries.
Of the few dozen comments filed, the majority involve special pleading in one way or another – everybody has something to lose or gain from the contents of the DAG.
That said, I’ve read all the comments filed so far (so you don’t have to) and lots of good points are raised. It’s clear that whatever the final Applicant Guidebook contains, not everybody will get what they want.
Here’s a non-comprehensive round-up, organized by topic.
Trademark Protection
Trademark holders were among the first to file comments on DAG v4. As I’ve previously reported, Lego was first off the mark with an attempt to convince ICANN that the concerns of the IP lobby have not yet been resolved.
Since then, a few more of the usual suspects from the IP constituency, such as Verizon and InterContinental Hotels, have filed comments.
The concerns are very similar: the Universal Rapid Suspension process for trademark infringements is too slow and expensive, the Trademark Clearinghouse does not remove cost or prevent typosquatting, not enough is done to prevent deadbeat registries.
Verizon, a long-time opponent of the new TLD program and a rigorous enforcer of its trademarks, used its letter to raise the issue of cybercrime and hit on pressure points relating to compliance.
It brings up the KnujOn report (pdf) released in Brussels, which accused ICANN registrars of being willfully blind to customer abuses, and the fact that ICANN compliance head David Giza recently quit.
Two IP-focused registrars also weighed in on trademark protection.
Com Laude’s Nick Wood filed a very good point-by-point breakdown of why the URS process has become too bloated to be considered “rapid” in the eyes of trademark holders.
Fred Felman of MarkMonitor covers the same ground on rights protection mechanisms, but also questions more fundamentally whether ICANN has shown that the new TLD round is even economically desirable.
Felman has doubts that new gTLDs will do anything to create competition in the domain name market, writing:

the vast majority of gTLDs currently being proposed in this round are gTLDs that hide traditional domain registration models behind a veil of purported innovation and creativity

Well, I guess somebody had to say it.
Fees
There are concerns from the developing world that $185,000, along with all the associated costs of applying for a TLD, is too steep a price to pay.
The “African ICANN Community” filed a comment a month ago asking ICANN to consider reducing or waiving certain fees in order to make the program more accessible for African applicants.
Several potential TLD registries also think it’s unfair that applicants have to pay $185,000 for each TLD they want to run, even if it’s basically the same word in multiple scripts.
Constantine Roussos, who intends to apply for .music, reiterated the points he brought up during the ICANN board public forum in Brussels last month.
Roussos believes that applicants should not have to pay the full $185,000 for each non-ASCII internationalized domain name variant of their primary TLD.
He wrote that he intends to apply for about six IDN versions of .music, along with some non-English Latin-script variants such as .musique.
Antony Van Couvering of registry consultant Minds + Machines and .bayern bidder Bayern Connect both echo this point, noting that many geographical names have multiple IDN variants – Cologne//Koeln/Köln, for example.
Roussos also notes, wisely I think, that it appears to be a waste of money paying consultants to evaluate back-end registry providers for applicants who choose to go with an recognized incumbent such as VeriSign, NeuStar or Afilias.
Another request for lower fees comes from the Japan Internet Domain Name Council, which thinks geographical TLD applications from small cities should receive a discount, as well as a waiver of any fees usually required to object to a third-party application.
Contended Strings and Front-Running
Of the known proposed TLDs, there are several strings that will very likely be contended by multiple bidders. This has led to maneuvering by some applicants designed to increase their chances of winning.
Roussos suggested that applicants such as his own .music bid, which have made their plans public for years, should be awarded bonus points during evaluation.
This would help prevent last-minute con artists stepping in with “copy-paste” bids for widely publicized TLDs, in the hope of being paid off by the original applicant, he indicated.
Roussos thinks the amount of work his .music has done in raising community awareness around new TLDs has earned the company extra credit.
It’s a thought echoed by Markus Bahmann, dotBayern’s chairman, and his counterpart at dotHamburg.
The opposing view is put forward by rival .bayern bidder Bayern Connect’s Caspar von Veltheim. He reckons such a system would put “insiders” at an unfair advantage.
M+M’s Van Couvering also said he opposes any applicant getting special treatment and added that M+M wants an explicit ban on trademark front-running included in the DAG.
Front-running is the practice of registering a TLD as a trademark in order to gain some special advantage in the new TLD evaluation process or in court afterward.
(M+M’s owner, Top Level Domain Holdings, has reportedly been front-running itself – attempting to defensively register trademarks in the likes of .kids, .books and .poker, while simultaneously trying to fight off similar attempts from potential rivals.)
Roussos of .music responded directly to M+M this afternoon, presenting the opposite view and promising to use its trademarks to defend itself (I’m assuming he means in court) if another .music applicant prevails.

Rest assured that if we, as .MUSIC are faced with the possibility of being gamed and abused in a manner that we find illegal, we will use our trademarks and other means necessary to do what we have to do to protect ourselves and our respective community.

He said .music is trademarked in 20 countries.
Morality and Public Order
This was a hot topic in Brussels, after the ICANN Governmental Advisory Committee agreed that it did not like the “MOPO” objection provisions of DAG v4, but could not think of a better replacement.
MOPO would give a way for governments to scupper bids if they do not like the morality implications. Anybody applying for .gay, for example, would have to deal with this kind of nonsense.
Jacob Malthouse of BigRoom, one of the would-be .eco bidders, reckons ICANN should treat the GAC the same as it treated the GNSO on the issue of vertical integration – remove MOPO from the DAG entirely in order to force the GAC to come up with something better.
The GAC had previously said it would address the MOPO issue in its comments on DAGv4, but its filing has not yet appeared on the ICANN site.
There’s a GNSO working group over here, but M+M’s Van Couvering notes that no GAC members have got involved post-Brussels.
Terrorism
Two commentators objected to the idea that an applicant could be rejected for involvement in “terrorism”, a term that DAGv4 does not define.
I reported on this a few days ago, but since then Khaled Fattal of the Multilingual Internet Group has filed a surprising rant that seems to indicate he has way more beef than really necessary.
Here’s a few quotes mined from the full comment:

it will alienate many in the international community who will choose not to take part in future ICANN processes including its New gTLDs, distrusting ICANN’s motives, or actively choosing to boycotting it, and causing many to seriously start re-considering alternatives.
…
as a Syrian born Arab American would I pass the IvCANN terrorism verification check as they are? After all Syria, my country of birth, is on the U.S. Government list of states sponsor of terrorism? And I admit, I do know an “Osama”, does that disqualify me? I Forgot to add, “Osama Fattal” a cousin. So would I pass or fail this check?
…
The arbitrary inclusion of terrorism as a measuring stick without any internationally recognized laws or standards is wrong and offensive to many around the world. If acted upon, it will be seen by millions of Muslims and Arabs as racist, prejudicial and profiling and would clearly indicate that ICANN has gone far beyond its mandate.

Vertical Integration and .brand TLDs
The issue of whether registries and registrars should be allowed to own each other is a thorny one, but there’s barely any mention at all of it in the DAGv4 comments filed so far.
The DAGv4 language on VI, which effectively bans it, is a place-holder for whatever consensus policy the GNSO comes up with (in the unlikely event that its working group ever gets its act together).
Most efforts on VI are therefore currently focused in the GNSO. Nevertheless, some commentators do mention VI in their filings.
Roussos of .music wants .music to be able to vertically integrate.
Abdulaziz Al-Zoman of SaudiNIC said VI limits should be removed to help applicants who need to turn to third-party infrastructure providers.
From the IP lobby, Celia Ullman of cigarette maker Philip Morris notes that there’s nothing in DAGv4 about single-registrant .brand TLDs. She writes:

would this mean that trademark owners owning a gTLD would need to open the registration procedure to second-level domain names applied for to third unrelated parties? In this case, what would be the incentive of actually registering and operating such a gTLD?

Clearly, the idea that a .brand would have to be open to all ICANN registrars on a non-discriminatory basis is enough to make any trademark attorney choke on their caviare.
JPNIC, the .jp ccTLD operator, also points out that DAGv4 says next to nothing about .brand TLDs and strongly suggests that the final Applicant Guidebook spells out just what a registry is allowed to do with its namespace (lawsuits are mentioned)
Disclaimer
I’ve paraphrased almost everybody in this article, and I’ve done it rather quickly. Despite my best efforts, some important nuance may have been lost in the act.
If you want to know what the commentators I’ve cited think, in their own words, I’ve linked to their comments individually throughout.
I may update this post as further comments are filed.