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Nominet may owe its members millions, top lawyer says

Kevin Murphy, September 28, 2022, Domain Registries

Nominet has been charging its thousands of members annual subscription fees unlawfully for the last quarter-century, it has been claimed.

Ian Mitchell KC, who you may recall was hired by a handful of members to opine that Nominet’s voting system may be illegal, has now delivered a follow-up opinion saying that any subscription fees it has collected since 1997 should not have been paid.

Nominet non-executive director election candidate Jim Davies, one of the members who obtained the opinions, is now calling for Nominet to postpone its Annual General Meeting and the election, scheduled to take place next week, while these legal issues are addressed.

Mitchell’s opinion states that Nominet’s Articles allowed it to set a membership fee for members prior to August 29, 1997, barely a year after the company was founded, but that subsequent fees had to be set with a bylaws change approved by 75% of the membership.

That never happened, he says, meaning:

there has been no basis within the terms of the articles for subscriptions to be set and collected from and after 31st August, 1997. It follows, therefore, that the subscriptions which were collected ought not to have been paid.

Nominet has about 2,500 members, each of whom pay a £400 application fee and a £100 per year subscription. Clearly, over 25 years, that could amount to many millions of pounds.

But Mitchell also suspects Nominet could be protected by the UK’s statute of limitations, reducing its exposure to just the last six years and around £1.5 million.

Mitchell’s opinion was paid for by member Dulwich Storage, owned by former director Angus Hanton, as part of the Davies-led WeightedVoting.uk campaign, which is calling for Nominet to scrap its system that gives its members more votes depending on how many .uk domains they have registered.

Davies says he informed Nominet’s board about Mitchell’s latest opinion last week but has not received a response. So he’s now also written to Civica, the election services company that oversees Nominet ballots, to “to step in and adjourn the AGM”.

Postponing the AGM would also postpone the NED election in which Davies, former reporter Kieren McCarthy and CentralNic lawyer Volker Greimann are vying for an opening seat on the board. Voting closes in a couple of days.

While Mitchell called the subscriptions situation a “recipe for litigation”, Davies says he has no intention of suing Nominet. He says he wants, in Mitchell’s words, for “members [to] come together to see if it is possible to find a consensual way out of the mess which has undoubtedly been created”.

It’s not entirely clear what a solution would look like.

Scrapping the voting system in favor of one-member-one-vote would likely disadvantage candidates relying on winning with the backing of a small number of large registrars, which Davies believes is Greimann’s strategy.

Davies’ headline policy has been to slash .uk registration fees back to £2.50, while McCarthy and Greimann have platforms focused on transparency and member engagement.

Nominet has said that it believes its weighted voting system is lawful. The company has been contacted for comment on the latest legal drama.

Last-minute bombshell in Nominet election — it may be ILLEGAL

Kevin Murphy, September 15, 2022, Domain Policy

Nominet’s current non-executive director election may be illegal, according to a legal opinion commissioned by one of the candidates.

Candidate Jim Davies, along with fellow former director Angus Hanton, say barrister Iain Mitchell KC has said that elements of Nominet’s voting practices are “clearly unlawful”, and they’ve asked Nominet to scrap them.

If Nominet accepts the opinion, it could mean the election — which is going on right now — could become a one-member-one-vote affair rather than the current system where you get more votes based on how many .uk domains you manage.

Davies and the other signatories to a letter sent to Nominet believe the company’s extremely complex “weighted voting” system is illegal under the UK’s Companies Act. They write:

This is a very serious issue for Nominet, particularly as there is an AGM and Board Election happening soon. Based on counsel’s opinion, we believe the only lawful way to conduct that meeting (and future meetings) would be one member, one vote.

Should Nominet agree and change the system, it would mean that big registrars such as GoDaddy and Tucows would get the same number of votes — one — as individual Nominet members.

This would most likely advantage IP lawyer Davies and fellow candidate Kieren McCarthy, who is a reporter rather than a registrar, at the expense of third candidate Volker Greimann, who works for Key-Systems, the large registrar owned by CentralNic.

Davies, in echoes of the PublicBenefit.uk campaign that led to a boardroom bloodbath last year, has set up a web site at WeightedVoting.uk to encourage fellow members to read the opinion and sign the letter.

While confidence in the company has arguably improved under its new leadership, member hackles were raised recently with the admission that Nominet had spunked millions of dollars on a failed attempt to enter the security market.

Voting in the NED elections began on Monday and runs until the end of the month. The results will be announced October 5, the day before Nominet’s AGM.

UPDATE: A Nominet spokesperson reached out with the following statement:

We acknowledge the receipt of a legal opinion commissioned by one of our members. We believe that our long-standing election process and voting rights are lawful and are being applied in accordance with our founding documents. We believe they have served and continue to serve both Nominet and its members well. Therefore, the election and voting will continue as planned. We will consult with our legal advisers prior to responding to our member.

It’s hustings season at Nominet

Kevin Murphy, August 19, 2022, Domain Policy

Hustings are very much in vogue in the UK right now. Two Conservative politicians have been clouding our airwaves, bickering over who should lead the country, for weeks, and now two candidates to join the board of .uk registry Nominet are following suit.

The London Domain Name Summit, a two-day, free-to-attend domainer conference in London next week, will host a debate between local lads Jim Davies and Kieren McCarthy, two of the three candidates for an opening non-executive director spot on Nominet’s board.

CentralNic lawyer Volker Greimann, the third candidate, who is based in Germany, will not be in attendance.

The debate between reporter McCarthy and IP lawyer Davies will take place next Tuesday at 1600 local time (1500 UTC) and will apparently be live-streamed for people not able to attend in person.

McCarthy, who according to Twitter chatter is a paid-up exhibitor, also gets a solo speaking spot on Monday at 1830 local time. Nominet, not an exhibitor, is hosting an event the same day.

All three candidates are standing for election at a time when Nominet has recently come under new leadership after several years of scandal that cumulated last year in a member coup.

The latest controversy emerged last month when it came out that Nominet blew about $23.5 million on an abortive attempt to get into the security market in the US, something the candidates all hope to address.

According to Nominet, all three candidates have their candidacy statements published in the members area of the web site. Davies and McCarthy have also published commentary on their respective blogs.

Voting opens September 12.

Nominet opens directorship nominations

.uk registry Nominet has opened the nomination period for one of its elected non-executive directors.

The are four elected NEDs on the company’s board, and Anne Taylor’s three-year term is up this year.

Only members may nominate, but you don’t need to be a member to be nominated.

Nominations are open until June 17, elections take place in September, and the winner takes his or her seat in October.

The pay is £37,000 per year, for up to 30 days’ work.

More details can be found here.

It’s pandemic continuity versus gender diversity in ICANN’s board wish-list

Kevin Murphy, January 13, 2021, Domain Policy

ICANN’s Nominating Committee will be asked to pit two fundamentally opposed principles against each other when they pick three members of the organization’s board of directors this year.

Board chair Maarten Botterman has asked NomCom to prioritize continuity — keeping experienced directors in place — while also increasing gender diversity in the male-heavy current line-up.

Botterman this week sent a letter (pdf) to NomCom chair Ole Jacobsen, offering guidance virtually identical to that found in a December 2019 letter (pdf) to his predecessor.

The two most significant changes concern the impact on the board’s work of the coronavirus pandemic.

Noting that it typically takes a year or two for new directors to learn the ropes, and that it’s useful to have a staggered mix of tenures among the board, Botterman goes on to say:

Continuity is particularly important this year given the recent departure of the Board’s longest-serving, term- limited member and the ongoing challenges arising from the pandemic, including uncertainties about when the full Board may be next able to move from its current remote schedule to in-person meetings.

The long-serving member who left was presumably Chris Disspain, certainly one of the most active directors in recent years.

Later, Botterman’s letter contains an entirely new paragraph explaining what a time vampire ICANN directorship can be:

We underscore the significant time commitment required of Board members. Applicants must be able to devote weeks and long hours throughout the year to Board service, and even more because of the challenges caused by the pandemic. Among many other key initiatives, one focus in the upcoming year will be understanding and evaluating the expected recommendations from the policy development process on Subsequent Procedures regarding the next round of new gTLDs (as well as implementation of several Board-approved recommendations from community groups).

That, at least, should provide some comfort to those champing at the bit to get the next round of new gTLDs up and running — ICANN clearly expects it to happen at some point in the next four years.

So there’s a definite, newly emphasized focus on continuity at ICANN.

That’s good news for Lito Ibarra, Danko Jevtović and Tripti Sinha, the three NomCom appointees whose current terms end this coming October. Ibarra is on his second three-year term, the other two on their first. All are eligible for reselection.

The Botterman letter is less encouraging for Ibarra and Jevtović, who are men. ICANN is still seeking to increase gender diversity on its board, which only currently has five female voting members of 16 total directors.

While the wording is slightly different to the 2020 guidance, the essence is the same:

The ICANN community has also expressed strong support for efforts to increase diversity along several axes, especially including gender diversity, across the ICANN eco-system. Without compromising the fundamental requirement to have Board members with the necessary integrity, skills, experience, the Board would find it helpful to have greater gender diversity on the Board.

NomCom may find this pressure is relieved slightly by the fact that current ccNSO representative to the board, Nigel Roberts, is being replaced by Katrina Sataki of the Latvian ccTLD registry this October, following an election last month.

The Address Supporting Organization’s rep, Ron Da Silva, is also ending his current term this year. He’s up for reselection against nine other candidates, three of whom are female.

It’s Drazek vs Dammak for GNSO Council chair

Kevin Murphy, September 28, 2018, Domain Policy

The chair of ICANN’s Generic Names Supporting Organization Council is contested this year, with a registry veep facing off against a software engineer.
The nomination from the contracted parties house is US-based Keith Drazek, Verisign’s VP of policy and government relations.
He’ll be opposed by non-contracted parties nominee and current vice-chair Rafik Dammak, a Tunisian working as a software engineer for NTT Communications (which is technically a contracted party due its dot-brand gTLD) in Japan.
Both men are long-time, active members of the ICANN community and GNSO.
The Council will pick its new chair about a month from now at the ICANN 63 meeting in Barcelona.
The winner will replace lawyer Heather Forrest, the non-contracted party who took the seat after an unopposed vote a year ago.

Empty Whois a threat to the US elections?

Kevin Murphy, September 5, 2018, Domain Policy

Could a lack of Whois records thwart the fight against attempts to interfere in this year’s US elections?
That’s the threat raised by DomainTools CEO Tim Chen in a blog post, and others, this week.
Chen points to recent research by Facebook, based on an investigation by security company FireEye, that linked a large network of bogus news sites and social media accounts to the Iranian state media.
FireEye’s investigation used “historical Whois records”, presumably provided by DomainTools, to connect the dots between various domains and registrants associated with “Liberty Front Press”, a purportedly independent media organization and prolific social media user.
Facebook subsequently found that 652 accounts, pages and groups associated with the network, and removed them from its platform.
The accounts and sites in question were several years old but had been focusing primarily on politics in the UK and US since last year, Facebook said.
Based on screenshots shared by Facebook, the accounts had been used to spread political messages bashing US president Donald Trump and supporting the UK’s staunchly pro-Palestinian opposition leader Jeremy Corbyn.
Google’s research, also inspired by FireEye’s findings and Whois data, linked the network to the state-run Islamic Republic of Iran Broadcasting.
The actions by Google and Facebook come as part of their crackdown on fake news ahead of the US mid-term Congressional elections, this November, which are are largely being seen as a referendum on the Trump presidency.
Because the domains in question predate the General Data Protection Regulation and ICANN’s response to it, DomainTools was able to capture Whois records before they went dark in May.
While the records often use bogus data, registrant email addresses common to multiple domains could be used to establish common ownership.
Historical Whois data for domains registered after May 2018 is not available, which will likely degrade the utility of DomainTools’ service over time.
Chen concluded his blog post, which appeared to be written partly in response to data suggesting that GDPR has not led to a growth in spam, with this:

Domain name Whois data isn’t going to solve the world’s cyberattack problems all on its own, but these investigations, centering on an issue of global importance that threatens our very democracy, likely get severely impaired without it. And this is just the tip of the iceberg, a few uniquely important investigations among the hundreds of thousands of cyberattacks going on all day every day all over the globe by people and organizations that can now hide behind the anonymity inherent in today’s internet. It’s reasonable that domain names used for certain commercial or functional purposes should require transparent registration information. Whois is not a crime.

DomainTools is one of the founders of the new Coalition for a Secure and Transparent Internet, a lobby group devoted to encouraging legislatures to keep Whois open.
Representatives of Facebook and Iran’s government are among the members of the Expedited Policy Development Process on Whois, an emergency ICANN working group that is currently trying to write a permanent GDPR-compliant Whois policy for ICANN.

A third of mayoral candidates using .london domains

Londoners are going to the polls today to select a new mayor so, as a Londoner, I thought I’d check out how many of the candidates are supporting the local domain name.
Turns out four of the 12 candidates have registered .london domains for their campaign sites.
The four are favorite Sadiq Khan (Labour), Sian Berry (Green), Peter Whittle (UK Independence Party) and Prince John Zylinski (damned if I know).
The remaining candidates, if they have dedicated sites at all, use a mixture of .com, .org and .net domains. Not a .uk to be seen.
Will this influence anybody’s vote? No. Has it raised the profile of .london domains? Probably.
Whoever wins the election will find themselves with a degree of control over the future of .london.
While the registry is basically managed by Minds + Machines, the ICANN contract is held by London & Partners, a not-for-profit promotional agency funded by the mayor’s office. The mayor is also a partner in the endeavor.
The M+M outsourcing contract was recently renegotiated in light of M+M’s financial woes, but details have not been made available.

Crocker picked to lead ICANN

Kevin Murphy, June 24, 2011, Domain Policy

Steve Crocker has been elected chairman of ICANN’s board of directors, following the departure of Peter Dengate Thrush, whose term on the board expired today.
Described earlier this week by CEO Rod Beckstrom as “one of the uncles of the internet”, Crocker is the creator of the Request For Comment format for internet standards.
Replacing Crocker as vice-chair is fellow geek Bruce Tonkin, chief strategy officer of Melbourne IT, the Australian domain name registrar.
Both men were selected by secret board poll.
The board revealed the unsuccessful candidates for the first time too: Cherine Chalaby and Sebastien Bachollet stood for chair, while Bachollet and Ray Plzak stood for vice-chair.
Because Crocker’s term on the board ends in October, his long-term future depends now on whether the ICANN Nominating Committee decides to renew his term for another three years.
I expect it will. Last year, NomCom kicked out all three of its appointees whose terms were up, irking some. Declining to re-appoint Crocker this year could look like regicide by committee.
This leaves NomCom with only one pick in 2011. It will almost certainly be a woman from a region currently under-represented on the board. My guess is Russia.
Also joining the board today was .au’s Chris Disspain, who replaces Dengate Thrush as ccNSO appointee, and Canadian consultant Bill Graham, who replaces Rita Rodin Johnston from the GNSO.