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Domain Tasting: Big Multifaceted Action on Bad Actors

Reported in the Washington Post no less: “Dell Takes Cybersquatters to Court”. As reported a few weeks ago, this is a very thorough action targeting certain practices and practitioners.

From the Washington Post report:

“The complaint names three registrars as defendants—BelgiumDomains, CapitolDomains, and DomainDoorman—as well as what Dell claims are nearly a dozen Caribbean shell companies that allegedly served as the entities registering the domains.”

The rumor is that several of these registrars would buy obvious trademark domains that get traffic… keep them active and resolving to paid-search parking pages powered by Google… and then dump them on day 5, only to repurchase them at another one of their registrars for another five days. Like a piston engine, churning through obvious “problem names”, never paying for them, and pawning of the brand intent traffic.

Further more from the Washington Post report:

“According to one example cited in Dell’s lawsuit, on May 25, 2007, DomainDoorman registered ‘dellfinacncialservices.com.’ On May 30, the registrar deleted the domain from its stable of Web site names. Minutes later, that same Web site name was snatched up by BelgiumDomains, which then dropped the name on June 4. That same day, dellfinacncialservices.com was grabbed by CapitolDomains, which in turn relinquished it on June 9, the same day that site was re-registered again by DomainDoorman. The complaint further charges that the registrars created and controlled a series of shell corporations in the Bahamas to act as the entities registering the domains, including Caribbean Online International, Domain Drop S.A., Domibot, Highlands International Investment, Keyword Marketing Inc., Maison Tropicale, Marketing Total S.A, Click Cons Ltd., Wan-Fu China Ltd. and Web Advertising Corp.”

“Thank God” they chose the Bahamas and not the Caymans—I’ve got enough confusion problems in my neighborhood. The bummer reading this list of co’s like “Highlands International Investment” is that all these co’s actually hold good generic domain names as well. In fact Highlands related co’s were held out as the 2nd largest holder of domain names back in 2001. These guys own a lot of really good stuff.

I’m surprised a suit this thorough didn’t name Google as a co-defendant. Then again, maybe it’s not that surprising because Google offers a well liked product, has a lot more money; and a search partnership with Dell that allows Dell to share in the profit when its users engage in “right of the dot” typosquatting on Dell keyboards. It’s funny, because one day, Dell could find itself on the defendant’s side of the courtroom, defending unfair competition charges relating to shared typosquatting profits on keyboard fat-finger search partnerships.

The single biggest thing that struck me reading this story and lawsuit, is how the domain holder is such a patsy in this… like a mule in the drug trade.

I remember hearing about conversations at the Puerto Rico ICANN meetings relating to domain tasting. Attorney’s for corporate clients like Dell were pleading with ICANN to “do something” about domain tasting. Rather than engage in a constructive dialog about the tasting problem and creating a timetable to stop it, ICANN basically stonewalled these lawyers. “We’ll do a PDP to study the problems” (code for we’ll ignore the problem for two years). What a pity. Let’s hope these registrars above don’t fail due to this lawsuit, leaving millions of retail registrants in a Registerfly-style lurch because of ICANN’s shortsighted ambivalence.

Why would ICANN ignore an obvious problem? Everybody profits on this: VeriSign makes millions on this defendant’s portfolio of typosquatting names (on his kept registrations) and assured renewals on good names from the “churning effect”... they don’t want ICANN to change the rules. ICANN gets considerable fees on each of the millions of kept registrations too, so it turns a blind-eye, promising to “study the tasting problem” (basically ignoring it), Google makes millions and millions more fencing the so called “stolen traffic”... especially frustrating because the plaintiff is permitted to steal that same type of traffic with impunity in keyboard redirect applications which send same traffic to the same “fence”; Google.

And the cybersquatter, makes money too… but he or she takes all the risk! What a deal!

If any good comes from this action, it will be that the chain above gets people to re-examine and discuss—to rethink the tasting issue and wholesale inequity of typo error-search takeovers. ICANN’s hands are not clean in this, neither are VeriSign’s. Google’s hands simply can’t be considered clean and I view the Plaintiff as a thief punishing another thief. Should the alleged ne’er-do-well registrant take the fall alone? Let’s see what the courts say and what the river brings.

By Frank Schilling, Founder

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Keynes  –  Dec 1, 2007 4:26 PM

Tasting has always been a loophole that became a business model which brought out the worst in the domain market. Between Google’s improving filters, changes in contextual PPC pricing and legal pressures, I think we’re seeing a slow death for Wan-Fu China and his Caribbean doorman…

Suresh Ramasubramanian  –  Dec 4, 2007 2:31 AM

What, a slow death?  Its a carribbean shell company and the guy being sued is apparently a front man / gofer. The real principals will probably set their next shell company up in outer mongolia or somewhere.

Keynes  –  Dec 5, 2007 2:02 AM

Suresh, yes you’re right. What I’m saying is that this is quite possibly an impetus toward ICANN revising its existing deletion refund policy once and for all.

Suresh Ramasubramanian  –  Dec 5, 2007 2:09 AM

In which case, my other prediction - about T.R.A.F.F.I.C getting hosted in a Days Inn and catered from the local Wendys would probably come true.

Deletion refund and AGP getting eliminated .. ICANN doesnt want to do that either. Any more than it wants to fix whois (well, not that anybody at all can come to consensus on that - OPOC was a horrible mess, and the sunset clause mere wishful thinking…).  So the domain tasters are quite safe in resort hotels for now I guess.

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