ICANN scores win in single-letter .com lawsuit

A Los Angeles court has handed ICANN a victory in a lawsuit filed against it by a domainer who thinks he has the rights to register all the remaining single-character .com domains.

Bryan Tallman of VerandaGlobal.com sued ICANN back in August, claiming the Org was breaking the law by refusing to allow him to register domains such as 1.com and A.com.

He already owns the matching domains in Verisign’s Chinese, Japanese and Hebrew .com IDNs, such as A.קום (A.xn--9dbq2a) and 1.コム (1.xn--tckwe), and says previous Verisign statements mean this gives him the right to the equivalents in vanilla .com.

These domains would very likely be worth tens of millions of dollars apiece. Verisign has held almost all single-character domain names in registry-reserved status since the 1990s. A few, notably Elon Musk’s x.com, pre-date the reservation.

Tallman claimed unfair competition, breach of contract, negligence and fraud and sought a declaratory judgement stating that ICANN be forced to transfer to him all of the 10 digits and all 23 of the remaining unregistered letters in .com, along with some matching .net names.

Pretty outlandish stuff, based on some pretty flimsy arguments.

ICANN filed a demurrer last year, objecting to the suit and asking the Superior Court of California in LA to throw it out, and the judge mostly agreed. In a February ruling (pdf), published recently by ICANN, he threw out all seven of Tallman’s claims.

Tallman was given permission to re-state and re-file five of the claims within 30 days, but his demand for a declaratory judgement was ruled out completely as being irreparably broken.

Verisign gets approval to sell O.com for $7.85

ICANN is to grant Verisign the right to sell a single-character .com domain name for the first time in over 25 years.
The organization’s board of directors is due to vote next Thursday to approve a complex proposal that would see Verisign auction off o.com, with almost all of the proceeds going to good causes.
“Approval of Amendment to Implement the Registry Service Request from Verisign to Authorize the Release for Registration of the Single-Character, Second-Level Domain, O.COM” is on the consent agenda for the board’s meeting at the conclusion of ICANN 64, which begins Saturday in Kobe, Japan.
Consent agenda placement means that there will likely be no further discussion — and no public discussion — before the board votes to approve the deal.
Verisign plans to auction the domain to the highest bidder, and then charge premium renewal fees that would essentially double the purchase price over a period of 25 years.
But the registry, already under scrutiny over its money-printing .com machine, would be banned from profiting from the sale.
Instead, Verisign would only receive its base registry fee — currently $7.85 per year — with the rest being held by an independent third party that would distribute the funds to worthy non-profit causes.
ICANN had referred the Verisign proposal, first put forward in December 2016, to the US government, and the Department of Justice gave it the nod in December 2017.
There was also a public comment period last May.
The request almost certainly came about due to Overstock.com’s incessant lobbying. The retailer has been obsessed with obtaining o.com for well over a decade, but was hamstrung by the legacy policy, enshrined in the .com registry agreement, that forbids the sale of single-character domains.
Whoever else wants to buy o.com, they’ll be bidding against Overstock, which has a trademark.
It’s quite possible nobody else will bid.
When Overstock briefly rebranded as O.co several years ago — it paid $350,000 for that domain — it said it saw 61% of its traffic going to o.com instead.
All single-character .com names that had not already been registered were reserved by IANA for technical reasons in 1993, well before ICANN took over DNS policy.
Today, only q.com, z.com and x.com are registered. Billionaire Elon Musk, who used x.com to launch PayPal, reacquired that domain for an undisclosed sum in 2017. GMO Internet bought z.com for $6.8 million in 2014.
With the sale of o.com now a near certainty, it is perhaps only a matter of time before more single-character .com names are also released.
No gTLD approved after 2012 has a restriction on single-character domains.
As a matter of disclosure: several years ago I briefly provided some consulting/writing services to a third party in support of the Verisign and Overstock positions on the release of single-character domain names, but I have no current financial interest in the matter.

Have your say on single-character .com domains

ICANN wants your opinion on its plan to allow Verisign to auction off o.com, with a potential impact on the future release of other single-character .com domain names.
The organization has published a proposed amendment to the .com registry contract and opened it for public comment.
The changes would enable Verisign to sell o.com, while keeping all other currently unallocated single-character names on its reserved list.
The company would not be able to benefit financially from the auction beyond its standard $7.85 reg fee — all funds would be held by an independent third-party entity and distributed to undisclosed non-profit causes.
The arrangement would also see the buyer pay a premium renewal fee of 5% of the initial outlay, doubling the purchase price over the course of 25 years.
They would not be able to resell the domain without selling the registrant company itself.
It’s a pretty convoluted system being proposed, given that there may well end up only being one bidder.
Overstock.com, the online retailer, has been pressuring ICANN and Verisign to release o.com for well over a decade, and the proposed auction seems to be a way to finally shut it up.
The company has a US trademark on O.com, so any other bidder for the name would probably be buying themselves a lawsuit.
The proposed auction system does not address trademark issues — there’s no sunrise period of trademark claims period.
One party already known to be upset about lack of rights protection is First Place Internet, a search engine company that has a US trademark on the number 1.
It told ICANN (pdf) back in January that the o.com deal would “set a dangerous precedent” for future single-character name releases.
The ICANN public comment period, which comes after ICANN received the all-clear from US competition regulators, closes June 20.
As a matter of disclosure, several years ago I briefly acted as a consultant to a third party in support of the Verisign and Overstock positions, but I have no current interest in the situation one way or the other.