[registrars] Wired News : NetSol Hit With $1.7 Bil Suit

[gschuckman@register.com (Greg Schuckman)]

A note from Greg Schuckman:

   Interesting turn of events.  What do you all make of this?  Could we be facing the potential for becoming a regulated industry beyond ICANN accredidation?

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 From Wired News, available online at:
http://www.wired.com/news/print/0,1294,34959,00.html

NetSol Hit With $1.7 Bil Suit  
by Lynn Burke  

12:25 p.m. 14.Mar.2000 PST 
Internet address registrar Network Solutions was slammed with a $1.7
billion lawsuit Tuesday alleging the company's practice of charging
fees for Internet domain names violates federal law. 

The proposed class-action suit, filed in U.S. District Court in San
Francisco, seeks over $800 million in domain-name registration fee
refunds and another $900 million in antitrust damages. 

Everybody's got issues in Politics 
There's no biz like E-Biz

The eight named plaintiffs claim the 1995 agreement between NSI and
the National Science Foundation violates the Constitution by
permitting NSI to collect a $70 fee for every Internet domain name
registration, plus $35 in yearly renewal fees. 

"Under what basis are they charging that? That's just absolutely
outrageous," plaintiffs' attorney William Bode said. 

Bode said the new suit is broader in scope than the class-action suit
against NSI and NSF that was dismissed last year, which challenged the
constitutionality of the registration fee charged by NSI. 

Tuesday's suit is going after NSI for its perceived failure to observe
the Internet protocols that restrict top-level domains ".com," ".net"
and ".org" to, respectively, commercial companies, ISPs, and
nonprofits. 

Officials at Network Solutions were not immediately available for
comment Tuesday morning. 

Bode said NSI's failure to effectively regulate proper use of the
domain extensions indicates a breach of its contract with the
government. What's more, he said, NSI actually encourages companies to
register for all three extensions to protect themselves from
cybersquatters. 

"Requiring a company to register for three fees, with no added
economic value, is a patent abuse of monopoly power," Bode said. 

He said he's not worried that the District of Columbia Circuit Court
of Appeals already has ruled that the Internet domain name registry is
not a "quintessential government service." 

"The Internet is a public facility and the fees in question are
clearly unconstitutional," Bode said. 

Howard Sartori, president of the American Internet Registrants
Association, endorsed the suit. 

"The government may give NSI a monopoly over Internet domain name
registration, but it cannot vest it with monopoly profits at the
expense of the Internet community," he said in a statement. 

Virginia-based Network Solutions is the world’s largest Internet
registrar, with more than 8.1 million registrations.  

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