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Register.com v. Domain Registry of Canada

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ComputerWire: IT Industry Intelligence

Register.com Inc is suing a competitor for allegedly using deceptive tactics to lure away its domain name registration customers. But defendant Domain Registry of Canada Inc seems to think Register.com is using very similar tactics itself,

Kevin Murphy writes

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Register.com sued DROC in its native New York this week, alleging unfair competition, false advertising, breach of contract and misappropriation of trade secrets. The larger firm alleges DROC engages in a "deceptive and misleading scheme" - a marketing practice known as "domain slamming" - that is costing it thousands of customers.

Slamming is the name given to the practice when a registrar sends a solicitation to a customer of a competitor, asking them to transfer their business, but makes the solicitation look like a renewal notice or an expiration notice, to confuse them into making the switch.

"These solicitations do not mention that it was Register.com, and not any of the defendants, that originally registered the customers' domain names," the complaint reads. "Nor do they explain that customers who accept defendants' solicitation will actually be transferring their domain name registrations to a direct competitor of Register.com."

The company said that in a sample week this August, about 15% of all the customers that transferred from Register.com to another registrar transferred to DROC, which is a reseller for Washington-based eNom Inc and also trades as Domain Registry of America Inc.

This is a large percentage, considering there are 122 accredited registrars and thousands of resellers on the market currently. Register.com says it has already lost thousands of customers, each of whom pay around $30 a year for a domain, and is in danger of losing thousands more if DROC continues its mailshots.

A copy of a DROC letter sent to a rival's customer, seen by ComputerWire, is entitled "Important Notice" and encourages the registrant to "renew" their domain with the company. It does not use the word "transfer", but explicitly says that it is not an invoice, and alludes to the fact that other registrars are available.

But DROC says that it is doing nothing wrong. The company is suing Tucows Inc, another rival, for defamation over claims Tucows told customers its mailers were misleading and could not be trusted (Tucows is countersuing, alleging slamming). DROC also says Register.com engages in similar practices.

"They were the first company that ever did it," a DROC spokesperson said. "This is nothing new."

A copy of a Register.com mailer seen by ComputerWire is entitled "Domain Expiration Notice", and invites the registrant to "renew and transfer" their name to Register.com. Like the DROC mailer, it does not mention the original registrar by name, but it does use the word "transfer".

"All the mailers sent out make it very clear it's a transfer," a Register.com spokesperson said. "We make sure there are a certain amount of references to 'transfer'."

While this may be true, the Register.com notice looks very similar to direct mail that VeriSign Inc was enjoined from sending out two months ago, after it was sued by two rivals. The notice from VeriSign, the market leader, made less references to "transferring" domains to another registrar than the Register.com letter.

© ComputerWire

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