WLS

WLS (Waiting List Service) was a proposed service provided by registrars to give potential registrants or subscribers the opportunity to reserve their desired domain names that are currently registered for one year. Under this service a registrant may purchase a one year subscription for a particular domain name under a registrar which will directly perform the transaction with Verisign GRS. A domain name being subscribed under the Waiting List Service will only be registered to the subscriber in the event that the owner of the domain name undertook normal operational processes of registration deletion. For example, the present registrant submitted a request for the deletion of his or her domain name with the registrar.

Background

Verisign proposed the Waiting List Service as a new registry offering to domain name subscribers to ICANN on March 21, 2002. In addition, the company also requested the body to change its .com & .net registry agreement to include WLS with a $35 subscription fee.

WLS Objections

Karl Auerbach, then At-large Representative of North America to the ICANN Board of Directors, believed that the WLS provided an unfair advantage to Verisign. He pointed out that, "The people who are affected by this, the registrars, don't have a voice in ICANN, and I think it's unfair that we keep changing the contract these people have with VeriSign, without having any role or participation in making those changes." Furthermore, he raised concerns over the issue that the identity of the interested buyer is unknown to the current owner of the domain name. He emphasized that this might cause damage to the reputation of the original owner of the domain name.

WLS Negotiations

On March 2002, during the ICANN Meeting in Bucharest, Verisign presented its revised proposal to the ICANN Board regarding implementation of its Waiting List Service. Under its new proposal, Verisign informed the Board that it included all the concerns and recommendations submitted by registrars to the Domain Name Supporting Organization. Verisign's revised proposal ignited contradicting reactions from the internet community. Some expressed their strong oppositions while others supported the WLS proposal. To resolve the issue,the ICANN Board adopted Resolution 02.100 on August 23, 2002 delegating it's president Paul Twomey and general counsel John O. Jeffrey to negotiate and make proper amendments to .com and .net Registry Agreement between ICANN and Verisign to be able to offer the proposed WLS under certain conditions:

1. A redemption grace period for 6 months for all deleted domain names to give opportunity to the domain owners who unconsciously let their domain name expired to retrieve it.
2. The WLS will be implemented on test run for one year.
3. There should be no preference or exclusion due to any registrar reservation service.
4. Current domain owners should receive notification that there is an interested buyer for his or her domain name, however the identity of the buyer will not be disclosed.
5. Registrars won't be able to include the domain name on the WLS more than 60 days from expiration.
6. Data from the WLS trial period should be collected to determine its relevance.

On October 16, 2003, Verisign asked ICANN Board to reconsider its conditions under Resolution 02.100 and subsequently on January 26, 2004 ICANN General Counsel John O. Jeffrey provided Verisign with the Conclusion of Negotiations regarding ICANN's conditions on the WLS proposal. A special provision required the approval of the Department of Commerce on the amendments that will be made to the .com, .net and .org registry agreement between ICANN and Verisign on May 25, 2001 to be able to give Verisign the permission to offer the Waiting List Service.

Verisign refused to make appropriate and necessary amendment to its .net agreement with ICANN and to secure an approval from the Department of Commerce which caused the delay in the implementation of the Waiting List Service.

Legal Charges Against ICANN

Domain Justice Coalition Vs. ICANN

In 2003, the Domain Justice Coalition, comprised of 23 domain name registration companies, filed a law suit against ICANN due to its agreement with Verisign regarding the WLS. The Coalition argued that the Board's approval of the WLS eliminated competition between registrars and it gave an unfair advantage to Network Solutions, Verisign's domain name registration subsidiary. According o them ICANN breached its terms of agreement with the registrars. The coalition filed a temporary injunction for the implementation of the WLS which was led by Dotster, Inc., GoDaddy Software, Inc., and eNom Inc. to the California District Court.

Then ICANN Spokesperson, Mary Hewitt, explained ICANN's position; she said, "The board voted for it because they thought it was a boon to consumers. This eliminates a ton of people pinging to see if the name is available at once. [As a consumer,] instead of me paying three different people to try to get a domain name I may not get, [with the WLS (wait listing service)], if I don't get it, I don't pay any money".

In November, 2003, the California District Court denied the group's request for a temporary restraining order against ICANN's approval for Verisign to implement the Waiting List Service. By December, Network Solutions, Register.com and BulkRegister expressed their enthusiasm to then ICANN President Paul Twomey to launch the WLS after the California District Court's denial on the temporary restraining order filed against the body. In addition, the companies also commented that the black out period for WLS is unnecessary and they emphasized that an adequate and enforceable safeguard is already present in the RAA.

Newman & Newman Vs. Verisign & ICANN

In 2004, another law suit was filed by Newman & Newman, a law firm which represented Register.com and several other registrars against ICANN and Verisign to stop the implementation of the WLS. The group accused ICANN and Verisign of:

1. Unfair Trade Practices Act Violations
2. Violation of California Business & Professions Code
3. Unlawful Tying Arrangement
4. Attempted Monopolization
5. Violation of Racketeer Influenced and Corrupt Organizations Act
6. Intentional Interference with Prospective Economic Advantage
7. Breach of Contract
8. Declaratory Relief

On November 16, 2004, Judge Gerald Rosenberg ruled that the Superior Court of California is not the proper venue to legally decide the case filed by Register.com against ICANN and Verisign regarding the issue of WLS. The court decided to dismiss or alternatively, stay the First, Fifth, Sixth, Seventh and Eight causes of action against Verisign on the basis of forum non conveniens. The court pointed that the state of Virginia is the proper venue for the complaint.

Verisign Vs. ICANN

On February 26, 2004, Verisign filed a law suit against ICANN alleging that the internet governing body seriously abused its technical coordination function. The company also stated that ICANN conducted a "blatant breach of the registry agreement, and an interference with VeriSign's contractual relations and prospective economic relationships." The company's allegations against ICANN was due to the internet governing body's directive to Verisign to stop its implementation of the Site Finder Service to the .com and .net domain name space which caused the weakening of the stability of the internet as reported by Internet Architecture Board (IAB) and Security and Stability Advisory Committee. In addition, Verisign also included in its complaint the issue regarding the delay of the implementation of the Waiting List Service until October 2003 which became indefinitely. It also cited that ICANN insisted the introduction of new procedures not required by the 2001 .com Registry Agreement, the price reduction for the intended WLS based on competitors suggestions and for Verisign to accept other conditions suggested by ICANN. Verisign argued that such conditions benefit the different Constituencies of ICANN but disadvantageous to the company's competition and service offering. The company also pointed out that ICANN's delay of the WLS deprived Verisign to gain profit from the service. Furthermore, Verisign claimed that other companies are offering similar services to the WLS which competes to Verisign's WLS.

United States District Court Judge Howard Matz dismissed the law suit filed by Verisign with prejudice on August 26, 2004. In its ruling the judge cited that Verisign failed to sufficiently prove its anti-trust complaint against ICANN. In response to the court's dismissal on the case, Verisign re-filed its anti-trust complaint against ICANN at the the Superior Court of California in Los Angeles.

=ICANN & Verisign Settlement Agreement

On February 28, 2006, ICANN announced its approval of a settlement agreement between Verisign in connection with the dispute on the .com registry agreement. Based on the settlement a new registry agreement for the .com domain space was made subject to the final approval of the Department of Commerce.