A judge in Los Angeles has placed 53,000 applications for the
new .biz domain names on hold pending a decision on whether
NeuLevel, the .biz registry, ran an illegal lottery when allocating
the names.
Where there was more than one applicant for the same .biz domain
name, that name will be placed on hold, according to the ruling by
the court. Authorised sellers of the names have begun trying to
reassure their customers that the action will likely affect less
than 20% of all applications. More than 200,000 .biz domain names
will be activated as scheduled on 23rd October.
NeuLevel was chosen by the internet's technical co-ordination
body, the Internet Corporation for Assigned Names and Numbers
(ICANN), to deal with the registration of the new .biz domains. The
allocation process adopted by NeuLevel was based on parties paying
a small fee to reserve a particular domain name during a specified
period ending in September. However, applicants were not given any
domain name rights until the end that period and if more than one
request was made for the same domain, then the rights to that
domain will be determined by at random. The fee was not refunded
for unsuccessful applications.
The class action lawsuit argued that this process encouraged
applicants to make several applications and payments for each
domain name in an attempt to increase their chances of success in
the event of the domain names rights being determined randomly -
thereby amounting to a lottery.
NeuLevel received nearly 1.2 million applications for the 53,000
names which are now on hold, an average of 22 applications per
domain name. The winning applicant for each name was to be chosen
by 23rd October, but the judge has ordered that NeuLevel reviews
its procedures for doing so. NeuLevel has also been ordered to set
aside $3 million to cover possible refunds to applicants. A trial
date for the lawsuit has still to be fixed. Those bringing the case
will be asking that the preliminary injunction be made
permanent.
