New top level domain applicant unhappy with ICANN’s response thus far, so it takes its complaint to court.
One of new top level domain name company Donuts’ subsidiaries has sued ICANN in an effort to postpone the auction for .web and potentially disqualify one of the participants.
Donuts and at least two other applicants are concerned that someone is bankrolling applicant Nu Dot Co’s application for .web. They believe there might be a change of control to the entity and new people involved, which they allege might require a change to Nu Dot Co’s application. They want this week’s auction of last resort for .web postponed while the matter is investigated.
Nu Dot Co, set up by Juan Diego Calle of .co fame, has traditionally settled contention sets by participating in private auctions in which the losers split the proceeds. That could be millions of dollars each in the case of .web. But Nu Dot Co declined to participate in a private auction for .web, forcing all other applicants to an ICANN auction in which the proceeds will be held for an as-yet-unspecified use.
ICANN says it has already investigated the matter and determined that there’s no reason for Nu Dot Co to file a change to its application, which is what Donuts and others are demanding.
(As a side note, Donuts was smart to apply for each domain through a subsidiary. Among other benefits, if the ownership, board makeup, etc. changes at Donuts, all of the subsidiary applications don’t need to be changed.)
In its lawsuit (pdf), Donuts argues that ICANN is not halting the auction because it stands to gain if the auction is an auction of last resort. I suspect even Donuts doesn’t believe the issue is about money. ICANN would much rather not have to deal with it and has always urged applicants to settle contention sets on their own. Still, Donuts’ argument is probably the right argument to make to convince a judge or jury.
Donuts wants to find out who is behind Nu Dot Co’s application. If it’s arch enemy Verisign, perhaps that will affect the strategy of the other applicants.
Some applicants and industry observers think .web is the one top level domain that could really catch on and make a run at .com. Of course, they also thought the hundreds of other top level domains would have made a serious dent in .com by now. That hasn’t happened.