Verisign lost its appeal Wednesday to the 4th U.S. Circuit Court of Appeals of District Judge Claude Hilton’s 2015 dismissal of the domain name registry’s false advertising lawsuit against registry XYZ. Verisign claimed XYZ violated the Lanham Act by claiming entities couldn't get desired .com domain names from Verisign, and that XYZ’s .xyz top-level domain was “the next .com.” Hilton dismissed the lawsuit in the Alexandria, Va., court, saying XYZ’s statements about its rising registration numbers were “verifiably true." When XYZ “stated they were a market leader in new TLD’s and that they had the most new registrations than any other TLD, they were basing that information off of an accurate zone file,” Hilton said in his ruling (in Pacer). A three-member 4th Circuit panel affirmed Hilton’s ruling Wednesday. Verisign’s analysis of XYZ’s claims “suffers from what we have identified as a ‘fatal flaw’ in calculating Lanham Act damages: It assumes rather than demonstrates that every .xyz registration during the relevant time period was the result of XYZ’s allegedly false statements,” said Judge Pamela Harris for the three-member panel. Judges Henry Floyd and James Wynn joined Harris in affirming the district court ruling. XYZ’s claims about the availability of .com domain names couldn’t be considered false or misleading under the Lanham Act, the 4th Circuit ruled. “XYZ’s statements concerning the availability of desirable .com names constitute opinion or puffery, not statements of fact on which reasonable consumers could rely,” the court said. “XYZ’s YouTube video claim that it is ‘impossible to find the domain name that you want’ … we conclude, cannot be interpreted as a verifiable statement of objective fact.” Verisign and XYZ didn’t immediately comment.
ICANN Ombudsman Herb Waye urged participants to consider whether they're being “respectful and constructive” in criticizing the leaders of the organization's various multistakeholder policy development processes. Those leaders are expected to be able “to handle critique, dissent, aggressive questioning of decisions, and many other challenges to their leadership,” but not “abusive criticism” or “counterproductive, irritating or frivolous comments,” Waye said in a Friday blog post. “I am not asking people to go easy on leadership. Hold them accountable for their decisions. Demand transparency. Enforce application of policy.” But that criticism should make leaders “feel you want to be part of a solution rather than merely an opponent,” Waye said. “By offering constructive criticism rather than simply criticizing, you are treating the leadership with respect. You are legitimately challenging them and at the same time demonstrating an interest in opening a conversation with them about improvement or change. Comments should focus on the problem not the people.”
ICANN updated a draft version of its gTLD marketplace health index to include statistics from the first half of 2016. ICANN said it plans to release an update to the index biannually “to track progress against its goal of supporting the evolution of the domain name marketplace to be robust, stable and trusted.” An advisory panel is refining the index's metrics before the rollout of a formal "version 1.0," the nonprofit said. Domain name registrars and others urged the organization in September to further revise its gTLD marketplace health metrics (see 1609120060). The index now measures marketplace health based on geographic diversity, overall changes in the number of registered gTLDs, changes in the number of registrars, accuracy of WHOIS records and dispute resolutions.
ICANN received minimal but mixed stakeholder response through Monday on its proposal to implement a revised policy for consistent labeling and display of “thick” WHOIS registration data for all generic top-level domains. Thick registration data includes data associated with the domain name itself, along with the registrant and other contacts of the domain name. Thin registration data has only data associated with the domain name itself. The revised labeling policy plan ICANN proposed in October doesn't require registries to implement a registration data access protocol (RDAP) service to achieve consistent labeling, which was criticized by the Registry Stakeholder Group (RySG), ICANN said. RySG said it “supports the removal” of the RDAP requirement from the labeling policy plan. RDAP “is outside the scope of the Thick Whois PDP recommendations,” the stakeholder group commented: “The RySG’s concerns with the inclusion of RDAP were compounded by the introduction of a requirement to implement the RDAP in accordance with an Operational Profile that was introduced unilaterally by ICANN staff” in the policy plan. The Internet Architecture Board urged ICANN to remove “all barriers to the deployment and use of RDAP.” The protocol “was developed within the IETF [Internet Engineering Task Force], by technical contributors whose affiliations include registries, registrars, and other WHOIS users and providers, to resolve the technical shortcomings of WHOIS,” IAB said. “Given the well known issues with WHOIS, the IAB strongly encourages ICANN, Registrars, and Registries to begin experimenting with RDAP as soon as possible.” The Generic Names Supporting Organization's IP Constituency (IPC) said it “has no substantive objections” to the revised policy plan but believes the decision to not include the RDAP requirement is "a 180 degree reversal” by ICANN. “While this requirement has been a consistent feature of the CLD [consistent labeling and display] implementation plan throughout the drafting process, ICANN staff completely reversed its position on it within days” of RySG's objection, the IPC wrote. “Wholly apart from the merits of the RySG objections, IPC empathizes with its frustrations regarding staff unresponsiveness. IPC will certainly bear this precedent in mind the next time the ICANN staff fails to heed IPC’s well-considered and repeatedly-voiced objections to a proposed course of action.” Verisign urged ICANN to include provisions in the labeling policy plan to allow extensions to the plan's Aug. 1, 2017, effective date. “It is possible for legitimate issues to arise during the implementation of the [CLD] Policy (include security and stability concerns) which may impact the ability of Registry Operators to comply with the” effective date, the company commented.
U.S. District Court in Los Angeles granted ICANN's motion to dismiss a lawsuit by domain registry Donuts against the organization over the controversial auction of the .web generic top-level domain. The company's Ruby Glen subsidiary sued in July, claiming ICANN intentionally failed to adequately investigate what the company believed ahead of the .web auction to be changes in ownership or control of rival bidder Nu Dot Co (see 1608090036). Nu Dot Co won the .web auction and .com registry Verisign subsequently said it had funded the $135 million purchase with the understanding that control of .web would pass to it (see 1607250051 and 1607270027). ICANN filed its motion to dismiss in late October, saying in part that Donuts was barred from suing the organization due to a covenant placed in all gTLD applications (see 1610270037). Donuts claimed the anti-suit covenant was void under California law. Judge Percy Anderson ruled the covenant was allowed because it wasn't created to exempt ICANN from facing claims of fraud, willful injury or violating the law. “The nature of the relationship between ICANN and Plaintiff, the sophistication of Plaintiff, the stakes involved in the gTLD application process, and the fact that the Application Guidebook ‘is the implementation of [ICANN] Board-approved consensus policy concerning the introduction of new gTLDs’ … militates against a conclusion that the covenant not to sue is procedurally unconscionable,” Anderson said in his ruling (in Pacer). Without the anti-suit covenant, “any frustrated applicant could, through the filing of a lawsuit, derail the entire system developed by ICANN to process applications for gTLDs,” Anderson said. “ICANN and frustrated applicants do not bear this potential harm equally. This alone establishes the reasonableness of the covenant not to sue. As a result, the Court concludes that the covenant not to sue is not substantively unconscionable.” Donuts “disagrees with the Court’s decision that ICANN’s required covenant not to sue, while being unconscionable, was not sufficiently unconscionable to be struck down as a matter of law,” said Executive Vice President Jon Nevett in a statement. “It is unfortunate that the auction process for .WEB was mired in a lack of transparency and anti-competitive behavior. ICANN, in its haste to proceed to auction, performed only a slapdash investigation and deprived the applicants of the right to fairly compete for .WEB in accordance with the very procedures ICANN demanded of applicants. Donuts will continue to utilize the tools at its disposal to address this procedural failure.”
ICANN plans to begin making reports on the organization's recent activities publicly available, said CEO Göran Marby in a Tuesday blog post.The executive team has been creating reports on each of the organization's departments before each of ICANN's five to six board workshops per year but will now begin making the reports public as part of “our continued commitment to increased transparency,” Marby said. The reports include a summary of ICANN's legal activities, engagement with governments and intergovernmental organizations, financial activities, contractual compliance and global stakeholder engagement.
The FCC cleared Call Catchers (Freedom Voice) license transfers to GoDaddy Operating as part of the domain name registrar's takeover of the cloud-based communications company. A Wireline Bureau public notice said the approval came after DOJ and other executive branch departments (“Team Telecom”) notified the FCC Monday they were no longer asking the commission to defer action on a license-transfer application. "The Executive Branch Agencies state that, based on the information provided to them by the Applicants and their analysis of potential national security, law enforcement, and public safety issues, they have no objection to the Application," said the PN in docket 16-171 listed in Thursday's Daily Digest.
ICANN said it paid CEO Göran Marby $314,881 during FY 2016, including $196,154 in salary. Marby was an adviser from early April through late May, when he officially took over as a permanent replacement to former ICANN CEO Fadi Chehadé. ICANN's payments to Marby included $104,642 for moving and travel-related expenses, the organization said in a report. ICANN said it paid Chehadé $845,503 during the fiscal year, including $417,174 in salary and $208,814 for “at-risk pay.” ICANN board Chairman Steve Crocker and other board members received a total of $1.9 million in payments from the organization, including a combined $1.2 million in reimbursements of expenses related to the board's six face-to-face meetings during FY 2016. Crocker received $212,230 from ICANN, including $75,000 in salary. All other ICANN board members receive $45,000 salary per year.
ICANN filed a motion to dismiss domain name registry Donuts' lawsuit against the organization over the auction of the .web generic top-level domain. Donuts' Ruby Glen subsidiary sued in July in U.S. District Court in Los Angeles. The registry filed an amended complaint in August seeking damages of $22.5 million -- plus interest (see 1608090036). Donuts claims ICANN intentionally failed to adequately investigate what the company believed ahead of the .web auction to be possible changes in the ownership or control of rival bidder Nu Dot Co (see 1607250051 and 1607270027). Nu Dot Co won the .web auction, then Verisign said it funded the purchase with the understanding that control of .web would pass to the .com domain registry (see 1608010008). ICANN claimed in Wednesday's motion to dismiss (in Pacer) that Donuts failed to “set forth a plausible ground” for its claims. Donuts' claims are barred by its “agreement to pursue its claims in ICANN's accountability mechanisms” via the anti-lawsuit covenant placed in all gTLD applications, ICANN said. Donuts also failed to join Nu Dot Co in the suit, “which serves as an independent basis for dismissal,” ICANN said. Donuts sought limited discovery Wednesday from Nu Dot Co and Verisign seeking information that will allow Donuts to facilitate “the full and transparent investigation that is a critical component of any legitimate gTLD delegation process.” Limited discovery also will help resolve questions about Nu Dot Co's “eligibility to participate in the .WEB string contention” and provide Donuts with “information necessary to support a motion for a preliminary injunction to enjoin any assignment of rights in the .WEB gTLD until the resolution of this matter,” Donuts said in its motion (in Pacer).
CEO Göran Marby said he’s further restructuring ICANN’s leadership apparatus “to better support the community” in “an evolution, not a revolution.” All executives will now have a deputy, with Marby naming Global Domains Division President Akram Atallah as deputy CEO. Atallah “has tremendous experience and knowledge of ICANN,” in part because he was acting CEO between former CEO Fadi Chehadé’s departure in March and the start of Marby’s administration in May, Marby said in a Tuesday blog post. General Counsel John Jeffrey's portfolio will expand, adding oversight of a new complaints office. The new complaints officer “will receive, investigate and respond to complaints about the ICANN organization’s effectiveness, and will be responsible for all complaints systems and mechanisms across the ICANN organization,” Marby said. The officer will work closely with Ombudsman Herb Wayne. The complaints office “is an important role that will provide a focus point for the community if they have complaints about the ICANN organization,” Marby said: “It is an additional way to keep the organization and me accountable” to stakeholders but “in no way replaces or supersedes the important role of all ICANN’s formal accountability mechanisms.” ICANN’s Board Operations office will now be under Chief Operating Officer Susanna Bennett. She will lead an organizational review team that “will focus on the internal assessment and controls audit, and reporting of organization-wide performance, based on targets, to ensure best practices and alignment across the organization,” Marby said. He said he's also creating a new senior vice president-contract compliance and consumer safeguards role, which will replace the current chief contract compliance officer. Current CCCO Allen Grogan previously said he will retire in December. Diane Schroeder was promoted to senior vice president-global human resources, reporting directly to Marby, he wrote.