Jul, 2000 : Afternic.com Drops Lawsuit, Agrees to ICANN's Terms

(July 7, 2000) The Internet Corporationfor Assigned Names and Numbers (ICANN) announced today that Afternic.com,Inc., has agreed to voluntarily dismiss its lawsuit against ICANN,and to accept ICANN's terms under which a separate company, eXtraActive,would be accredited.

Under the agreement, Afternic.com will:

• Drop its lawsuit against ICANN;
• Withdraw Afternic.com's application forregistrar accreditation; and
• Substitute the registrar accreditationapplication of eXtraActive, an affiliate of Afternic.com thatwill be required to operate as a separate enterprise from Afternic.com.

The terms of the agreement are identicalto those offeredby ICANN to Afternic.com on April 7, 2000, approximatelytwo months before Afternic.com filed its federal lawsuit againstICANN.

"Today's agreement represents a totalvindication of ICANN's position. We are pleased that Afternic.comhas agreed to resolve its dispute on ICANN's original terms,"said ICANN President and CEO Mike Roberts. "ICANN is committedto a fair, open, and consensus-based policy process; we do notlook kindly on efforts to sidestep that process through litigation."

According to Louis Touton, ICANN's generalcounsel, "The agreement allows the accreditation of eXtraActiveas a registrar, not Afternic, provided that the two entitiesare fully and actually separated in their operations. ICANN willbe monitoring eXtraActive and Afternic.com very closely to ensurethat the conditions of the agreement are met."

"Afternic.com's application for registraraccreditation presented a novel set of issues: Where an accreditedregistrar also acts as a domain name auctioneer, does the registrarhave an obligation to protect against the use of its site forillegal cybersquatting? Should accredited registrars be ableto use their privileged access to the authoritative registrydatabase for the benefit of a domain name auction business, orshould registrars be neutral intermediaries?" said AndrewMcLaughlin, ICANN's chief policy officer: "By ending itslawsuit on ICANN's terms, Afternic.com has agreed to resolvethese issues through the ICANN policy process, rather than inthe US courts."

Background on Accreditation Process

Since April of 1999, ICANN has accreditedover 100 registrars as a way of introducing competition to thedomain-name registration business. Under an agreement ICANN hasentered with Network Solutions (which operates the central databasefor domain names ending with .com, .net, and .org), registrarsaccredited by ICANN have the ability to put names directly intothe database. In accord with this privileged position, accreditedregistrars agree to abide by policies developed through the ICANNprocess in consultation with the Internet community.

About ICANN

The Internet Corporation for Assigned Namesand Numbers (ICANN) is a technical coordination body for theInternet. Created in October 1998 by a broad coalition of theInternet's business, technical, academic, and user communities,ICANN is assuming responsibility for a set of technical functionspreviously performed under U.S. government contract by IANA andother groups.

Specifically, ICANN coordinates the assignmentof the following identifiers that must be globally unique forthe Internet to function:

• Internet domain names
• IP address numbers
• protocol parameter and port numbers

In addition, ICANN coordinates the stableoperation of the Internet's root server system.

As a non-profit, private-sector corporation,ICANN is dedicated to preserving the operational stability ofthe Internet; to promoting competition; to achieving broad representationof global Internet communities; and to developing policy throughprivate-sector, bottom-up, consensus-based means. ICANN welcomesthe participation of any interested Internet user, business,or organization. See http://www.icann.org.For more information on ICANN's At Large Membership, see http://members.icann.org.