Company upset that Verisign was dropped as registry services provider in favor of CentralNic.
Earlier this week I noted a lawsuit Verisign filed in Virginia against .XYZ and Daniel Negari. Thanks to a request by the defendants to remove the case to federal district court, I now have a copy of the lawsuit (large PDF).
As it turns out, Verisign originally sued Key Brand Entertainment, applicant for .Theatre, and CentralNic back in March in Circuit Court in Fairfax County. The basis of the lawsuit was that Key Brand Entertainment dropped Verisign as the registry services provider for the domain name and switched to CentralNic. Verisign said this switch was due to a third party, unknown at the time, acquiring the .theatre domain name.
That party was Daniel Negari’s .XYZ, already embroiled in a lawsuit with Verisign. .XYZ uses CentralNic as the backend for .xyz.
Once Verisign figured out .XYZ was behind the switch, it amended the lawsuit to name Negari and .XYZ and drop Key Brand. It also added claims for switching the backend provider for Symantec’s .security and .protection, two other domains for which the applicant originally entered into a services agreement with Verisign and .XYZ later acquired. (I don’t think Verisign sued Symantec over the matter. Remember that Verisign sold its security business to Symantec.)
Verisign is suing for tortious interference with a contract and business conspiracy.
A number of new top level domain names have different backend providers than originally contemplated, but I’m not aware of any lawsuits being filed over the changes.
Brad Newberg says
Having read both the original complaint and the new complaint, the lawsuit really does not seem to be about quite what your posting says it is about. It seems pretty clear that what the lawsuit says is that VeriSign had a contract with KeyBrand/Symantec and that the contract had provisions saying that any change to the back-end provider or any change to any language provided by VeriSign to answer the gTLD applications could not be changed without VeriSign’s approval or it would be an automatic breach. So, the lawsuit really isn’t about merely the change of a back-end provider from that originally contemplated, but a breach of specific contract provisions and whether .XYZ/Negari told KeyBrand/Symantec that they had to breach the contracts by switching providers or changing information given to ICANN without VeriSign’s permission.
Andrew Allemann says
OK, I thought that was clear in the story. They’re suing for interference with a contract. XYZ bought the domains and wanted them to by run by CentralNic rather than Verisign.
John Berryhill says
“So, the lawsuit really isn’t about merely the change of a back-end provider from that originally contemplated, but a breach of specific contract provisions…”
…which aren’t entirely clear from reading the complaint, since the underlying contracts are stated to have been filed under seal.
The relevant quoted portion seems to be at paragraph 21 (and the corresponding allegations elsewhere in the complaint), where it says that the applicant “shall not change any information data or document provided by Verisign” for use in the application or fail to use responses provided by Verisign to questions arising during review of the application.
Those provisions seem geared toward preventing the applicant from putting in its application, or responding to inquiries, things that would change the technical performance obligations of Verisign as the back end provider. In other words, the intent appears to be to avoid the applicant making promises to ICANN that would bind Verisign to do things that Verisign was not prepared to do. Obviously, as a back-end provider, you wouldn’t want the applicant amending what will be your technical and performance obligations in the event the application is approved.
While the situation would be clearer if the contracts themselves were available, on a first read it does not seem that any “change” was made to “information data or document provided by Verisign”. The amendments to the application did not “change” such things. They were instead fully eliminated from the applications.
It would seem that if the contract was intended to prevent a change in back-end provider in toto, then that would have been much more clearly expressed in the contract. The overall picture seems to be that Verisign is hanging its hat on a contract provision which, insofar as quoted in the complaint, addresses “changes” to the application which would impact Verisign’s technical performance obligations, and thus be a backdoor way for the applicant to impose additional obligations on Verisign without their approval.
yet another brilliant score on their fast track to spoil the only thing that holds it all together: the dot com contract.
please make them stop this behavior before a massive stock dump happens.
Peter T says
Verisign can litigate all it wants, but it can’t stop innovation.
Joseph Peterson says
Is innovation confined to .XYZ, .Theatre, .Protection and .Security?
Even if you believe that those 4 nTLDs are innovative, and even if you believe innovation in .COM, .NET, etc. is (for some dim reason) impossible, I’m guessing you believe it’s possible to innovate using hundreds and hundreds of other nTLDs as well.
So if Verisign’s purpose were to stop innovation, as you imply, wouldn’t Verisign be suing hundreds and hundreds of other nTLDs?
Because Verisign isn’t doing that, it follows that Verisign’s rationale for this lawsuit ISN’T to stifle innovation but rather something else.
Maybe it’s about what it says it’s about: Breach of contract.
Joseph Peterson says
Keep in mind, Verisign itself would have been the back-end provider for those nTLDs in the original contract. If Verisign has a complaint here, it is that it WANTED to be involved with making those nTLDs work.
Reading this as .COM versus new TLDs is a misreading, in my opinion.
Verisign is going the Kodak route, unable to innovate and unable to accept change. History repeats itself.
Joseph Peterson says
Pooky the prophet.
Maybe history WILL repeat itself …
We might wake up to see that Tomorrow looks a lot like Yesterday. We might find the Future resembles the Past.
“Funny!” we’ll say, “Shouldn’t my email address be on a .WTF by now?”
“Why hasn’t LinkedIn.com relocated to a LinkedIn.enterprises?”
“E tu, Twitter? We had faith that you at least would become Twitter.Tube!”
“Why haven’t all the .COM’s accepted change? Pooky told us they would spontaneously burst into flame overnight while we slept.”
C.S. Watch says
There will be novel and good restaurants that pop up in Brooklyn or Queens—but folks will always ask, ‘Yes, yes, but what’s the most expensive and oldest restaurant.’ Because since the dawn of selling, that has always been society’s shorthand for ‘the best.’ And it’s pretty reliable shorthand, when you care about obsolescence or accountability.
Everything but dot-com is racket and racket getting louder. It only makes dot-com stronger because thieves can hide in a crowd. You want my credit card info? You want me to recommend your service to my manager? Invest in good real estate so I know you’ve got skin in the game.
“First they ignore you, then they laugh at you, then they fight you, then
Crying, denial and rage hidden in “funny” words. You either adapt or you are history, it always goes this way when it comes to progress.
Joseph Peterson says
Let’s see …
Gandhi steadfastly campaigned for the freedom and rights of half a billion subjugated people, as well as for the peaceful coexistence of Hindus, Muslims, and Seikhs. He eschewed not only violence but often food itself.
Daniel Negari, as I understand things, colluded with at least 1 registrar to stuff numerous unwanted .XYZ domains into individuals’ accounts without their knowledge or consent. Then he pointed to all those robo-registrations as evidence that .XYZ was amazingly popular and that his prediction of a million domains was coming true. In doing so, he deceived many observers, convincing them to buy his products, enriching both his bank account and his vanity.
Daniel Negari = Mahatma Ghandiv
Joseph Peterson says
Gandhi, that is.
C.S. Watch says
Since we’re talking Gandhi…there is a lot of innovation in India but not a lot of venture capital. In that very common position, the smart play is to milk the prestige factor of dot-com. (Microsoft.com has nine letters, there are 122.9 trillion dot-coms of that length, and only 123M registrations extant in all suffixes combined. So no whimpering, everyone can find a home in the dot-com.) Dot-com is like a Swiss bank account: every corporate giant uses it, and you do too. And thus are all men made equal. Don’t broadcast that your idea isn’t good enough to get investors to back you.
Every other suffix since the explosion of new suffixes has a huge vulnerability: they are at the mercy of trend. Are you making a quick buck selling .xyz to Gen Z? Best believe that those kids will turn on you and spit in your eye. Not if but when.
This is not to say there isn’t a place for novelty suffixes for business models whose life cycle is so short that trend death isn’t as relevant. Lots of social media plays know that they can’t avoid trend death anyway. (Geocities –> MySpace –> Facebook.)
Genius branding can work miracles with any TLD clay—but it’s a cash bleed. So if one is pushing other suffixes on underfunded entrepreneurs, who will constantly have to defend their viability, who will never be able to argue that they are an alpha corporation in the space, and who will have to relocate to avoid the stink of “.outdated”…well, it’s not like it’s the moral high ground.