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ICANN confirmed today that Judge A. Howard Matz of the U.S. District Court, Central District of California has issued an order dismissing VeriSign, Inc.‘s anti-trust claims against ICANN, with prejudice. In dismissing VeriSign’s anti-trust claims, Judge Matz noted that VeriSign had failed in its first amended complaint to sufficiently allege an anti-trust claim.
Judge Matz held a hearing on ICANN’s motion to dismiss the lawsuit on Monday of this week. In issuing his ruling on August 26, the court tossed out VeriSign’s anti-trust claims and held that VeriSign has not alleged and cannot allege that the “co-conspirators” named by VeriSign controlled ICANN’s board. The court also held that VeriSign has not alleged and cannot allege (based upon the ICANN Bylaws) that those Supporting Organizations within ICANN’s structure that include VeriSign competitors dominate ICANN’s board.
“The U.S. federal court’s decision serves as another important affirmation of ICANN’s multi-stakeholder participatory model, and reaffirms the ICANN structure,” stated John Jeffrey, ICANN’s General Counsel. “ICANN is not subject to capture by any commercial or other interest, including VeriSign,” he added. ICANN was represented in the litigation by Joe Sims and Jeffrey LeVee, partners at the law firm of Jones Day.
The Court dismissed VeriSign’s original complaint on May 18, 2004 but had allowed VeriSign to file a first amended complaint to try to strengthen its legal arguments. With the Judge’s dismissal today of VeriSign’s anti-trust claims, VeriSign’s remaining causes of action based upon contractual based claims resulting from the ICANN/VeriSign registry agreements for the operation of .com and .net must be re-filed in California state courts.
The judge’s decision is available here [PDF].
ICANN’s motion to dismiss is available here [PDF].
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The claim that “ICANN is not subject to capture by any commercial or other interest…” does not negate the fact that the organization remains paralyzed by its own infrastructure. It is in essence a “captive” of its own bureaucracy. An attempt to bring order to the chaos was really the core of this case. Now that will happen in a state court as a contract matter. Beyond that fact, the international focus on ICANN’s continuing stream of problems may well encourage a voluntary restructuring of the organization as purely a matter of survival. The result of this decision will not make ICANN’s structural problems go away.