The California law firm of Kabateck, Brown, and Kellner has filed a class action suit against Network Solutions and the Internet Corporation for Assigned Names and Numbers (ICANN), alleging the company has unfairly profited by temporarily registering domains as soon as someone conducts a search for their availability via the company’s Web site.
The Network Solutions practice—which the company rolled out with any explanation, but has since attempted to clarify on its Web site—puts a domain name “on reserve” as soon as a customer or potential customer searches for a .com domain for possible registration on the Network Solutions site. If the domain doesn’t exist, Network Solutions places a hold on it, meaning that if even a few seconds later the same user goes to another domain registrar and attempts to register the domain, it won’t be available.
If the domain isn’t purchased via Network Solutions within 4 days, it will be made available again for registration via any registrar.
Network Solutions’ fees for domain registration are usually higher than other registrars: where many registrars will set up a .com domain for something like $9.99, Network Solutions can charge nearly $35 for the same service.
Network Solutions says its policy is intended to stave off “front-running” and “tasting,” practices whereby scammers register for new domains, pack the sites with pay-per-click advertisements or malware/spyware sites, then never pay for the domain registration. During the five-day period between the registration and when the domains get yanked for non-payment, the scammers make money off visitors they’ve been able to draw to the sites, often though spam and other activities. Use of these five-day windows on domain registration is known as “tasting.” The five-day Add-Grace period is mandated by ICANN, which is why the organization has also been named in the suit.
ICANN charges a $0.20 fee to register a domain name, and is currently considering whether to keep that fee if a domain isn’t paid for during the Add-Grace period. The $0.20 cost could, in theory, make it much less lucrative for scammers to bulk-register domains, then renege on the registration fees.
Kabateck, Brown, and Kellner also handled lawsuits in a click-fraud case, as well as a class action suit over “bricked” Xbox 360 game consoles.
