Feeds

VeriSign sued again for domain cock-up

Dotcom owner sees nightmare unfold

  • alert
  • submit to reddit

The essential guide to IT transformation

VeriSign is seeing its nightmare come true with a California lawsuit brought by Optima Technology for wrongful handing over of the company’s domain name to a former employee.

The suit, which demands $3 million in compensation, comes after the company that owns and runs the .com registry failed to act properly when Michael Decorte seized control of the domain optimatech.com in 2001. He sent a letter to VeriSign that lacked the required authorisation and the company claims it was not properly consulted. It won back the domain the following year.

"We are taking this action now, after notifying Network Solutions on several occasions that its actions caused our company a great deal of damage and lost revenue,” said Barry Eisler, Optima’s president, who says the domain was originally registered in 1990 - the same year the company was formed.

However, the case only comes following the hard-fought-for precedent won by the owner of Sex.com, Gary Kremen, who saw his domain given away in 1995. It took him six years and a legal battle that involved the Supreme Court for VeriSign to be held accountable in July this year.

The decision by the United States Appeal Court saw domains become property in law for the first time and its judgement held VeriSign responsible. The decision was widely expected to cause a glut of lawsuits against the company from other furious domain owners. Optima is the first to take advantage of the new law.

"I am happy that this is finally happening," Gary Kremen told us from Sex.com’s headquarters in San Francisco. "It’s about time."

In the lawsuit, Optima alleges that DeCorte along with another former employee, Raymond Martin, stole the domain and used it to divert traffic and revenue from the company.

Using an analogy originally put forward by Kremen’s lawyers, Eisler was quoted as saying: "This is no different than parking your car with the valet, giving your key to the valet attendant and coming out after a wonderful dinner only to find your car was stolen as the valet gave your keys to a crook without checking to see if you authorized the theft."

Meanwhile, Kremen is due to return to court with VeriSign to assess the damages the company has to pay him for handing over Sex.com to Stephen Michael Cohen, currently a fugitive from justice and believed to be living in Tijuana, Mexico.

The Appeal Court suggested that VeriSign be liable for $40 million in lost profits that Kremen won from Cohen in April 2001. Kremen is also expected to demand punitive damages on top of that figure.

Kremen was delighted with the lawsuit: "I agree with Optima in this case - VeriSign must be held accountable. I believe that in the next several months, more cases like this will come out." He added: "We are aggressively going after VeriSign for damages. In fact, we just filed a very strong case management statement today."

Jack Geering, Optima’s senior vice president, said the situation raised serious questions over Internet governance: "To be fair, competition has to be based on a level playing field – companies must compete on the basis of innovation and according to the laws of the land. All we ask is that Network Solutions play by these rules and stop conducting damaging and possible illegal actions against domain holders like Optima."

VeriSign is under increasing pressure from elsewhere as well after it received a lawsuit this month from GoDaddy over its widely criticised SiteFinder software that redirects unregistered domains to its own webpage. It has turned its back on demands by overseeing organisation ICANN that the service been withdrawn pending a review. And just last week VeriSign was again lambasted by the FTC over its misleading email campaign to steal competitors domains by forcing them to "renew" domains with it.

With domain owners seeking to punish VeriSign for its sloppy and unhelpful approach to illegal domain transfers, the most powerful company on the Internet may soon find itself humbled. ®

Related stories
VeriSign slammed for domain renewal scam
VeriSign stands firm on Site Finder

Secure remote control for conventional and virtual desktops

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
Banking apps: Handy, can grab all your money... and RIDDLED with coding flaws
Yep, that one place you'd hoped you wouldn't find 'em
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
Primetime precrime? Minority Report TV series 'being developed'
I have to know. I have to find out what happened to my life
prev story

Whitepapers

A new approach to endpoint data protection
What is the best way to ensure comprehensive visibility, management, and control of information on both company-owned and employee-owned devices?
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.