9th Cir Revives .com Anti-Trust Case

The 9th Circuit issued its ruling in Coalition for ICANN Transparency v. VeriSign. It begins,

This appeal is about whether the plaintiff, Coalition for ICANN Transparency, Inc., using antitrust statutes drafted in the late 19th century, has successfully stated claims in connection with the administration of the Internet domain name system, so essential to the operation of our sophisticated 21st century communications network. The district court ruled that the plaintiff failed. With the benefit of extensive briefing, collegial discussions and amicus participation on appeal from other players in the domain name system, we hold that the plaintiff has stated claims under both Sections 1 and 2 of the Sherman Act, 15 U.S.C.

Congratulations to Bret Fausett who wrote a brief that deserved to win.

I'm also pleased to note that the court relied in a small but key part on an article I co-wrote with Mark Lemley,

CFIT has essentially alleged that ICANN is a private standards-setting body akin to the NFPA. ICANN administers the DNS and is responsible for entering into agreements with registry operators like VeriSign. According to the complaint, ICANN’s mission includes a commitment to promoting competition for the contracts. CFIT’s allegations further state that ICANN, like the NFPA, is a private body with no public accountability. These allegations are consistent with the view held by commentators on the subject, who have, indeed, identified Allied Tube as providing the strongest argument in favor of imposing antitrust liability on those who seek to coerce ICANN. See Michael Froomkin & Mark A. Lemley, ICANN and Antitrust, 1 U. Ill. L. Rev. 1, 72-73 (2003) (noting that “given ICANN’s private status, VeriSign will face antitrust liability for persuading a private company in a position of power to grant it control over a market,” and naming Allied Tube as the “closest analogue”). We hold, therefore, that pursuant to The Supreme Court’s holding in Allied Tube, CFIT has adequately alleged that VeriSign’s improper coercion of ICANN and attempts to control ICANN’s operations in its own favor violated Section 2.

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One Response to 9th Cir Revives .com Anti-Trust Case

  1. PHB says:

    One of the underlying assumptions in the award of the .com contract has always been that there could only be one registry per GTLD. So the only scope for increasing ‘competition was by expanding the number of GTLDs.

    This is of course not doing anything except to line the pockets of ICANN and various rentseekers who apply for the gTLDs. Off the top of my head, I cannot name any gTLD other than .com, .net and .org that has more than one DNS name that I could remember.

    A far better approach would be to break up the registry functions into three parts:

    1) Preparation of the domain, interfacing with the registrars etc.

    2) Contracts to provide constellation servers in various locations.

    3) A contract to monitor the performance of the constellation servers, payment being tied to performance. This would include random DoS testing targeted at individual servers to determine if there is sufficient capacity.

    While there is only one credible bidder for the .com contract as it stands, each of the functions listed above would be well within the capacity of many national ISPs. A competitive market could be established in a very short period of time.

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