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VeriSign settles slamming charge with BulkRegister

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ComputerWire: IT Industry Intelligence

BulkRegister Inc and VeriSign Inc said yesterday they have settled a false advertising lawsuit that helped spark a US Federal Trade Commission investigation into a VeriSign marketing campaign that ended in May.

Terms were not disclosed, but it seems likely VeriSign will part with some cash. BulkRegister said it will reimburse any fees customers paid as a results of the VeriSign campaign, and will extend their domain name registrations for one year for free.

The lawsuit was over a direct mail VeriSign sent out to customers of rival registrars earlier this year. The mailshot, critics say, was misleading, as it looked like an invoice for a registration renewal, rather than solicitation to transfer business to VeriSign.

Critics call the practice of issuing misleading domain name solicitations "slamming", in reference to an outlawed practice among phone companies. Under the settlement, people who unwittingly transferred their business to VeriSign have the option of transfering back to BulkRegister.

When BulkRegister filed its complaint in its native Maryland, it said its resellers were losing large numbers of customers because of the mailing. The court granted a preliminary injunction against VeriSign, and the company stopped the campaign.

VeriSign still faces an unsettled lawsuit from Go Daddy Software Inc, another rival, over the same issues. In addition, VeriSign confirmed Tuesday that the FTC has made a request for information about the campaign. There are also a number of outstanding class action lawsuits related to the mailings.

© ComputerWire

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