ICANN-VeriSign Settlement Challenged

By Ed Oswald | Published November 29, 2005, 10:12 AM

Calling it a violation of antitrust law, an Internet business trade group on Monday filed suit to stop the proposed ICANN-VeriSign settlement from taking effect.

The agreement, which settled a dispute over the redirection of unused domains, also gave VeriSign control of the .com top-level domain through 2012. ICANN also selected VeriSign to continue managing the .net domain.

The lawsuit was filed by the World Association of Domain Name Developers, and claims that the deal creates a monopoly on .com and .net domain names, as well as allowing VeriSign to fix domain name registrations above the current market rate.

The group has accused ICANN of not acting in a "public or charitable purpose" as it is required to do as a non-profit public benefit corporation in the state of California.

"ICANN has chose to pursue its own revenue, and to protect the interests of VeriSign at the expense of Plaintiffs, other domain name registrants and the broader public," the suit reads.

Neither ICANN nor VeriSign were commenting on the matter.

The original dispute between the two companies stems from a service called "Site Finder," which redirected invalid domain names to a VeriSign-hosted Web site with advertisements. The move angered network administrators due to its potential to disrupt spam filters that discard messages from invalid hosts. Privacy issues were also raised, as VeriSign logged all of the error traffic that came its way.

VeriSign later scrapped the plan amid pressure, but then sued ICANN for forcing it to shut down Site Finder.