In a ruling issued on Thursday, Judge A Howard Matz dismissed
the main antitrust claim against the Internet Corporation for
Assigned Names and Numbers (ICANN), and refused to consider the
remaining contractual claims brought by VeriSign.
The dispute relates, at least in part, to VeriSign's surprise
launch of the controversial Site Finder service in September
2003.
This new service redirected surfers to VeriSign's Site Finder
search engine when they entered a web address that was not
registered on the internet or was inactive. The unilateral change
was made, according to VeriSign, to improve "the user web-browsing
experience."
But the alteration was heavily criticised. Network
administrators accused VeriSign of seeking not to aid the misguided
web user, but rather to generate more advertising revenue from its
search engine partners. Others criticised the effect that the
changes had on the working practices of the internet.
ICANN stepped in and, in the face of a threatened court action,
VeriSign agreed to suspend the service.
But VeriSign was already smarting from a battle over its attempt
to launch the equally controversial Wait Listing Service (WLS),
which invites reservations for domain names that speculators hope
to acquire upon expiry of their registration.
In February this year the Registry, impatient with delays and
interference, sued ICANN, alleging that the body had overstepped
its contractual authority and improperly attempted to regulate
VeriSign's business in violation of its charter and its agreements
with VeriSign.
The claims were dismissed by US federal court Judge Matz in May,
but VeriSign was given time to strengthen its complaint. It is this
amended complaint that has now been dismissed by the Court.
VeriSign attempted to argue that ICANN's structure – of advisory
boards, a Board of Directors and a President – was such that the
decision making process of ICANN was controlled by "economic
competitors who have conspired to injure VeriSign". In effect, it
feared that the advisory boards were the real decision makers.
Judge Matz rejected this.
"VeriSign's contentions are deficient," he wrote. "There is
nothing inherently conspiratorial about a 'bottom-up' policy
development process that considers or even solicits input from
advisory groups." He added, "'Participation' is not enough to give
rise to antitrust liability; control is required."
"The US federal court's decision serves as another important
affirmation of ICANN's multi-stakeholder participatory model, and
reaffirms the ICANN structure," said John Jeffrey, ICANN's General
Counsel. "ICANN is not subject to capture by any commercial or
other interest, including VeriSign."
The suit brought by VeriSign contained five other claims
relating to the registry agreement between VeriSign and ICANN. The
federal court did not consider these and VeriSign is likely to
re-file the contractual claims with the California state
courts.
According to eWeek, VeriSign's VP of government affairs, Tom
Galvin, said, "While the venue will change, our objective to gain
clarity regarding ICANN's appropriate role and the process for the
introduction of new services does not."
