Facebook gunning for Web.com in latest $27 million-plus cybersquatting lawsuit

Facebook has sued what it believes is a Web.com subsidiary, claiming the company has been engaged in wholesale cybersquatting for well over a decade.

The complaint, filed in a Pennsylvania District Court, alleges that New Venture Services Corp current owns 74 domains, and has previously owned 204 more, that infringe its Facebook, Instagram and WhatsApp trademarks.

While no other named defendants are listed, the complaint makes it abundantly clear that it believes NVSC is a subsidiary of Web.com and a sister of Network Solutions, Register.com, SnapNames and Perfect Privacy.

Facebook is suing partly under the Anti-Cybersquatting Consumer Protection Act, allowing it to claim $100,000 damages per infringing domain, so we’re looking at a floor of $27.8 million of potential damages should the lawsuit be successful.

But it’s also looking for NVSC to hand over any profits it’s made from the domains in question, which are generally parked with ads and listed for sale via the SnapNames network for premium fees.

While NVSC is registered in the British Virgin Islands and uses a Pennsylvania post office box as its mailing address, there’s a wealth of evidence going back to 2007 that it’s been affiliated first with NetSol and then Web.com.

Web.com’s last regulatory filing before it went private in 2017 lists NVSC as a subsidiary, which is probably the most compelling piece of evidence establishing ownership.

It appears that NVSC is a shell company that Web.com uses to hold potentially valuable or traffic-rich domains that its customers have allowed to expire. The names are then parked and put up for resale.

Example domains listed in the complaint include httpinstagram.com, faceebbok.com, facebooc.net, instagram-login.com, and installwhatsapps.com.

One would have to assume these names were captured using a fully automated process; even a cursory human review would clock that they’re useful only to bad actors.

The lawsuit is the latest in Facebook’s crusade against mainstream registrars it believes are profiting by infringing its trademarks, which has already ensnared Namecheap a year ago and OnlineNIC in October 2019.

Namecheap recently filed a counterclaim in which it tries to get some of Facebook’s trademarks cancelled.

Facebook has all but admitted that putting legal pressure on registrars is part of its strategy when it comes to getting the policies it wants out of ICANN on privacy and Whois access, where there’s currently an impasse.

Here’s the complaint (pdf).

Registrar giant created as Web.com merged with Endurance

Clearlake Capital Group, which has taken Endurance International private and recently took a big stake in Web.com, has merged the two registrar stables to create a new company it’s calling Newfold Digital.

By my reckoning, Newfold has probably become the second-largest registrar group by domains under management, with around 16.5 million gTLD names across just its best-known half-dozen brands, leapfrogging Namecheap and Tucows in the registrar league table.

That number’s probably a big understatement. It doesn’t capture ccTLDs and does not take into account that the company now has hundreds of active ICANN accredited registrars, largely due to Web.com’s drop-catching business.

Its best-known registrar brands are Register.com, Network Solutions, Domain.com, BuyDomains, BigRock, PublicDomainRegistry and CrazyDomains. Its BlueHost and HostGator brands are both pretty big deals in web hosting.

Clearlake says Newfold has 6.7 million customers worldwide.

The privatization of Endurance, which sees it delisted from the Nasdaq stock exchange, was announced in November and cost Clearlake $3 billion. The value of its Web.com stake, which it acquired last month, was not disclosed.

Siris Capital, which bought Web.com in 2018, continues to have a stake.

Newfold will be led by two Web.com execs — CEO Sharon Rowlands and CFO Christina Clohecy.

The deal follows Web.com’s unsuccessful attempt to buy Webcentral last year.

There’s no word on (presumably inevitable) layoffs as the two companies come together.

Web.com is kicking out a racist web site. How long before it winds up at Epik?

An American news site for white nationalists says it’s been given its goose-stepping orders by Web.com unit Network Solutions, and it’s looking for a new registrar.

VDare, named after Virginia Dare, a semi-mythological American folk hero, has been publishing anti-immigration material on vdare.com under NetSol’s wing for 20 years, but the site claims the registrar has given it 10 days, until June 25, to GTFO.

According to the site, NetSol told VDare that it was in violation of its acceptable use policy and “we consider your continued use of our services a serious issue and risk to our business and corporate reputation”.

That seems plausible, given how corporate America is currently bending over backwards to prove that they support the Black Lives Matter movement.

The move seems to have come due to pressure from the Lawyers’ Committee for Civil Rights Under Law, a campaigning group that persuaded NetSol to dump racist forum Stormfront as a customer a few years ago (it found its new home at Tucows).

The Committee has reportedly written to NetSol twice recently, urging the company to cut Vdare loose.

Vdare says it’s looking for a new registrar, but has also obtained a .onion domain in case it needs to retreat to the “Dark Web”. The .onion space is only accessible to users of the Tor browser.

Anyone care to place a bet on how long it will be before vdare.com winds up at Epik?

Are ISOC’s claims about .org’s history bogus?

The Internet Society has started to fight back against those trying to put a stop to its $1.13 billion sale of Public Interest Registry to Ethos Capital.
Among the tactics being deployed appears to be an attempt to play down the notion that .org has always been considered as a home for non-profits run by a non-profit.
Apparently, it’s perfectly fine for .org to transition back into commercial hands, because not-for-profit ISOC was never intended as its forever home and the TLD was never intended for non-profits anyway.
Is that bullshit?
Yes and no. Mostly yes. It turns out you get a different answer depending on when you look in .org’s storied history.
ISOC, it seems, is starting in 1994, in an internet standard written by Jon Postel (who was ICANN before there was an ICANN).
A statement published by ISOC last week tries to characterize .org as a home for the “miscellaneous”, quoting from RFC 1591

I also want to address some other misconceptions about .ORG. Although .ORG has often been thought of as a “home of non-profits”, the domain was not actually defined that way. In 1994, RFC 1591 described it this way: “ORG – This domain is intended as the miscellaneous TLD for organizations that didn’t fit anywhere else. Some non-government organizations may fit here.”

It’s an accurate quote.
.org is described in other RFCs in a similar way. The earliest reference is 1984’s RFC 920 which says .org means “Organization, any other domains meeting the second level requirements.”
RFC 1032 says:

“ORG” exists as a parent to subdomains that do not clearly fall within the other top-level domains. This may include technical-support groups, professional societies, or similar organizations.

I can’t find any mention of non-profits in any of the relevant DNS RFCs.
ISOC goes on to note that .org was managed by a for-profit entity — Network Solutions, then Verisign — from 1993 until PIR took over in 2003.
Again, that’s true, but while it might have been managed by a commercial entity, NetSol was pretty clear about who .org was for.
When it went public in 1997, the company told would-be investors in its S-1 registration statement:

The most common TLDs include .com, used primarily by commercial entities, .org for nonprofit organizations, .net for network service providers, .edu for universities and .gov for United States governmental entities

That’s pretty unambiguous: the .org registry in 1997 said that .org was for non-profits.
In 2001, when ICANN inked a deal with Verisign to spin off .org into a new registry, there was no ambiguity whatsoever.
In announcing the deal, ICANN said that it would “return the .org registry to its original purpose” and .org would return to “to its originally intended function as a registry operated by and for non-profit organizations” (my emphasis).
The price ICANN paid for extracting .org from Verisign’s clutches was the very first “presumptive renewal” clause being inserted into the .com contract, which has seen Verisign reap billions with no risk of ever losing its golden goose.
The prize was so potentially lucrative that Verisign even agreed to give a $5 million endowment — no questions asked — to the successor registry, for use relaunching or promoting .org.
The only catch was that the new registry had to be a non-profit. Commercial registries — Verisign competitors such as Neustar — wouldn’t get the money.
ICANN and its community spent the remainder of 2001 and most of 2002 devising an RFP, accepting proposals from 11 would-be .org registries, and picking a winner.
The multistakeholder Domain Names Supporting Organization — roughly equivalent to today’s GNSO — was tasked with coming up with a set of principles governing who should get to run .org and how.
It came up with a report in January 2002 that stated, as its first bullet point:

The initial delegation of the .org TLD should be to a non-profit organization that is noncommercial in orientation and the initial board of which includes substantial representation of noncommercial .org registrants.

It went on to say that applicants “should be recognized non-profit entities” and to suggest a few measures to attract such entities to the bidding process.
These recommendations, which secured consensus support of the DNSO’s diverse stakeholders and a unanimous vote of the Names Council (the 2002 equivalent of the GNSO Council), nevertheless never made it into ICANN’s final RFP.
At some point during this process, ICANN decided that it would be unfair to exclude for-profit bidders, so there was no non-profit requirement in the final RFP.
As far as I can tell from the public record and my increasingly unreliable memory, it was Vint Cerf — father of the internet, creator of ISOC, then-chair of ICANN, and one of the few people currently cool with PIR being sold into commercial hands — that opened it up to for-profit bidders.
The decision was made at ICANN’s board meeting in Accra, Ghana, at ICANN 12. Back then, the board did its thinking aloud, in front of an audience, so we have a transcript.
The transcript shows that Cerf recommended that ICANN remain neutral on whether the successor registry was non-profit or for-profit. He put forward the idea that a commercial registry could quite easily create a non-profit entity in order to bid anyway, so it would be a kinda pointless restriction. The board agreed.
So in 2002, 11 entities, some of them commercial, submitted proposals to take over .org.
In ISOC’s bid, it stated that it would use the $5 million Verisign endowment “primarily to expanding outreach to non-commercial organizations on behalf of .ORG”.
ISOC/PIR took Verisign’s millions, as a non-profit, in order to pitch .org at other non-profits, in other words.
The evaluation process to pick Verisign’s successor was conducted by consultancy Gartner, a team of “academic CIOs” and ICANN’s Noncommercial Domain Name Holders’ Constituency (roughly equivalent to today’s Non-Commercial Stakeholders Group).
The NCDNHC was under strict instructions from ICANN management to not give consideration to whether the applicants were commercial or non-commercial, but its report (pdf) did “take notice of longstanding relationships between the bidders (whether for-profit or non-profit) and the noncommercial community available in the public record”.
It ranked the PIR bid as third of the 11 applicants, on the basis that .org money would go to support ISOC and the IETF, which NCDNHC considered “good works”.
ICANN’s preliminary and final evaluation reports were both opened for public comment, and comment from the applicants themselves, and on both occasions ISOC sought to play up its not-for-profit status. In August 2002, it said:

Overall, we believe ISOC’s experience as a not-for-profit, Internet-focused organization, combined with Afilias’ expertise as a stable and proven back end provider, enables us to fully meet all the criteria set forth by the ICANN Board.

In October 2002, it said:

We believe strongly that the voice of the non-commercial community is critical to the long-term success of .ORG. ISOC’s global membership and heritage and PIR’s non-profit status will ensure the registry remains sensitive to non-commercial concerns. Should the ICANN Board select ISOC’s proposal, PIR will execute extensive plans to ensure that this voice is heard.

ISOC’s application was of course ultimately determined to be the best of the bunch, and in October 2002 ICANN decided to award it the contract.
Then there was the small matter of the IANA redelegation. IANA is the arm of ICANN that deals with changes to the root zone. Whenever a TLD changes hands, IANA issues a report explaining how the redelegation came about.
In the case of .org, IANA echoed the previous feelings about .org’s “intended” purpose, stating:

the Internet Society is a long-established organization that is particularly knowledgeable about the needs of the organizations for which the .org top-level domain was intended. By establishing PIR as a subsidiary to serve as the successor operator of .org, the Internet Society has created a structure that can operate the .org TLD in a manner that will be sensitive to the needs of its intended users

So, does history tell us that .org is meant to be a TLD by and for non-profits?
Mostly, yes, I think it does.

Web.com got pwned

Web.com, which owns top 20 registrars Network Solutions and Register.com, got itself and millions of its customers hacked a few months ago.
The company disclosed last week that malicious hackers broke into its network in late August, making off with customer account information.
The attack was not discovered until October 16.
The compromised data included “name, address, phone numbers, email address and information about the services that we offer to a given account holder”, Web.com said.
“We encrypt credit card numbers and no credit card data was compromised as a result of this incident,” it added.
Customers are being told to change their password next time they log in to their services.
It’s not clear how many registrants were affected. The NetSol accreditation has over seven million domains in the gTLDs alone, while Register.com has almost 1.8 million.
Web.com said it brought on a private security firm to investigate the attack, and informed US law enforcement.

Three-letter .com owned by hospital “hijacked”

A California hospital has seen its three-letter .com domain reportedly hijacked and transferred to a registrar in China.
Sonoma Valley Hospital, a 75-bed facility north of San Francisco, was using svh.com as its primary domain until earlier this month, when it abruptly stopped working.
The Sonoma Index-Tribune reports that the domain was “maliciously acquired”, according to a hospital spokesperson.
It does not seem to be a case of a lapsed registration.
Historical Whois records archived by DomainTools show that svh.com, which had been registered with Network Solutions, had over a year left on its registration when it was transferred to BizCN in early August.
BizCN is based in China and has around 711,000 gTLD domains under management, having shrunk by about 300,000 names over the 12 months to April.
The Sonoma newspaper speculates that the domain may have been hijacked via a phishing attack. It’s not clear whether the hospital or NetSol, part of the Web.com group, was the target.
Three-letter .com names are highly prized, usually selling for tens of thousands of dollars.
Domain investors should obviously steer clear of svh.com, which will is probably already up for sale.
Not only is there a possibility of attracting unwelcome legal attention, but there’s also the moral implications of paying somebody who would steal from a hospital.
The hospital in question has now changed its name to sonomavalleyhospital.org. This transition, which includes migrating the email addresses of all of its staff, seems to have taken several days.
Anyone sending personal medical information to the old svh.com email addresses may find that information in the wrong hands.

Operation September Thrust leads to another million-domain Radix gTLD

Radix has become the first new gTLD portfolio registry to hit over one million domains in more than one TLD.
It said today that .site has crossed the seven-digit threshold, joining .online, which hit a million names in 2018.
It’s huge recent growth for .site, which had around 561,000 domains under management at the end of September.
Radix CEO Sandeep Ramchandani told DI today that the rapid uptick comes as a result of a marketing program internally code-named “September Thrust”.
This involved promotional pricing — Ramchandani said the cheapest a .site could have been obtained would be about $0.99 — and joint-marketing efforts with multiple registrars.
This mostly involved plugs on registrar home pages, email shots, and promotion in the “check availability” part of registrar storefronts, he said.
The latest transaction reports filed with ICANN show .site grew by about 120,000 DUM in October, with West.cn, NameCheap and Network Solutions (Web.com) the biggest beneficiaries.
NetSol’s .site DUM actually grew by about 10x in the month.
The $1 retail pricing was apparently available at some registrars prior to September, and continues to exist on storefronts today.

ICANN turns 20 today (or maybe not)

ICANN is expected to celebrate its 20th anniversary at its Barcelona meeting next month, but by some measures it has already had its birthday.
If you ask Wikipedia, it asserts that ICANN was “created” on September 18, 1998, 20 years ago today.
But that claim, which has been on Wikipedia since 2003, is unsourced and probably incorrect.
While it’s been repeated elsewhere online for the last 15 years, I’ve been unable to figure out why September 18 has any significance to ICANN’s formation.
I think it’s probably the wrong date.
It seems that September 16, 1998 was the day that IANA’s Jon Postel and Network Solutions jointly published the organization’s original bylaws and articles of incorporation, and first unveiled the name “ICANN”.
That’s according to my former colleague and spiritual predecessor Nick Patience (probably the most obsessive journalist following DNS politics in the pre-ICANN days), writing in now-defunct Computergram International on September 17, 1998.
The Computergram headline, helpfully for the purposes of the post you are reading, is “IANA & NSI PUBLISH PLAN FOR DNS ENTITY: ICANN IS BORN”.
Back then, before the invention of the paragraph and when ALL CAPS HEADLINES were considered acceptable, Computergram was published daily, so Patience undoubtedly wrote the story September 16, the same day the ICANN proposal was published.
A joint Postel/NetSol statement on the proposal was also published September 17.
The organization was not formally incorporated until September 30, which is probably a better candidate date for ICANN’s official birthday, archived records show.
Birthday meriments are expected to commence during ICANN 63, which runs from October 20 to 25. There’s probably free booze in it, for those on-site in Barcelona.
As an aside that amused me, the Computergram article notes that Jones Day lawyer Joe Sims very kindly provided Postel with his services during ICANN’s creation on a “pro bono basis”.
Jones Day has arguably been the biggest beneficiary of ICANN cash over the intervening two decades, billing over $8.7 million in fees in ICANN’s most recently reported tax year alone.

Wix.com obtains ICANN accreditation — bad news for Web.com?

Web site building tools provider Wix.com has got itself an ICANN accreditation, potentially bad news for current partner Web.com.
The Nasdaq-listed, Israel-based company popped up on the official registrar list in the last day or so with the IANA ID 3817.
That means it could before long start selling gTLD domains directly from the registries rather than going through its current business partner.
According to its domain services agreement and other online sources, Wix currently acts as a reseller for Network Solutions, a Web.com company.
Its retail prices are therefore, as you might expect, rather above the market average, pretty much in line with NetSol’s.
If it does choose to go solo, it could potentially pass on savings to its customers, or just pocket higher margins on domain sales.
While Wix says it has 110 million users, obviously it has sold nowhere near that number of domains.
Its relationship with NetSol is not lucrative enough for Web.com to count the relationship as a risk factor in its Securities and Exchange Commission filings, though Wix is listed as one of just a small handful of competitors.
If Web.com should lose Wix as a reseller, we won’t get to find out what impact that had on revenue; Web.com’s going private in a $2 billion deal.
Disclosure: I’ve had to listen to or skip through repetitive Wix ads on YouTube a dozen times a day for what seems like years, so I’m not naturally predisposed to like this company. Same goes for Grammarly. Grrrr!

Web.com to be acquired for $2 billion

Web.com is to go private in a deal valued at roughly $2 billion.
The company, which owns pioneering registrars Network Solutions and Register.com as well as SnapNames and half of NameJet, will be bought by an affiliate of Siris Capital Group, a private equity firm.
The cash, $25-a-share deal has been approved by the Web.com board but is still open to higher bids from third parties until August 5.
The offer is a 30% premium over Web.com’s 90-day average price prior to the deal’s announcement.
While Nasdaq-listed Web.com has briefly topped $26 over the last year, you’d have to go back five years to find it consistently over the $25 mark.