Chat11.com: Someone Is About To Register A Variation Of Your Domain Name

NEWS FLASH: [Morgenstern FTC Story From February 15 2001]?Create

This is old news! This took place back in 2001! So much for Crime-Research .org being a reliable source of current news!

The story, written by Ludmila Goroshko, claims that at least 27,000 web site owners were duped in a "domain scam" invented by Darren Morgenstern. Morgenstern faxed owners of a domain names a notice titled "URGENT NOTICE OF IDENTICAL DOMAIN NAME APPLICATION BY A THIRD PARTY." A couple of names were used in the letterhead, either Electronic Domain Name Monitoring or Corporate Domain Name Monitoring.

The fax goes on to warn that a domain name application has been "submitted to the National Domain Name Registry (NDNR) for registration," for the registration of a similar domain name. The article gave the example of the owners of reuters.org being warned of an application to obtain reuters.net.

The fax goes on to say "Consequently, it is our opinion that this application may have been submitted in bad faith. . .." The news story says that four reasons were listed in the fax, including, "disrupting the business of a competitor," or an attempt to create confusion with a similar web address.

The fax then goes on to offer to obtain the name for a fee of $70. In case the customer is thinking of not responding, the fax adds, "NDNR WILL NOT BE LIABLE FOR THE LOSS OF DOMAIN NAME LICENSE, IDENTICAL OR CONFUSINGLY SIMILAR USE OF YOUR COMPANY'S NAME; OR INTERRUPTION OF BUSINESS ACTIVITY OR BUSINESS LOSSES."

The story goes on to say "Indirect costs were almost zero despite of usual cybersquatting (taking domain names conformable to "famous" names)."

It is unclear what the reporter Goroshko means by this. It is not the same as saying Morgenstern had already registered the copycat names and was actually cyber-squatting and attempting to extort clients.

According to the story, Morgenstern (who, in an example of biased reporting is refered to as "the swindler"), raised about $2 million dollars before the Federal Trade Commission took action.

"The Federal Trade Commission has asked a U.S. District Court Judge to halt an Internet domain name scheme that dupes consumers into needlessly registering variations of their existing domain names."

According the FTC, they are asking the court to issue preliminary and permanent injunctions to bar the deceptive marketing practices, to freeze the defendants' assets to preserve them for consumer redress, and to shut down Web sites used to promote the domain name scheme.

"The defendants named in the FTC suit are Darren J. Morgenstern, 1268957 Ontario, Inc., and 1371772 Ontario Inc., doing business as National Domain Name Registry, Electronic Domain Name Monitoring, and Corporate Domain Name Monitoring. The companies are based in Toronto, Canada, with an office in Atlanta, Georgia."

"The Commission vote to file the complaint was 5-0. It was filed in U.S. District Court for the Northern District of Georgia, Atlanta Division, yesterday."

What I Think About This

I can't say what I really think about this! This case is so messed up, it is total nonsense. Well, that's not really what I think, but it's the best I can do on a family website like this.

I think this is a case of out of control government. There is not enough information there for me to tell if the guy committed a crime. Did he not really register the copy-cats and give them to the companies that decided to pay? The original news story doesn't say.

From the original story, it doesn't seem like this guy is doing anyone any harm. If anything, he's performing a valuable service to educate these domain name owners. If they have a domain name worth protecting, they should have registered the variants long ago. I never thought to register all the variants of some of my domain names. And consequently they are now owned by others. In some cases, these others are doing businesses disturbingly similar to my own.

The last time I checked, there was no law setting maximum or minimum prices for domain name registration. Some companies give away a "free domain name registration", if you buy their $100 or more annual hosting product. Arguably, this is even more expensive than what Morgenstern was offering.

And $70 is the same fee Network Solutions used to demand for a domain name registration. Thank goodness there is now competition like GoGarnet?Create that offers domains for just $10 a year, one year at a time. With Network Solutions, you used to have to register for 2 years at $35 per year.

"The Federal Trade Commission has asked a U.S. District Court Judge to halt an Internet domain name scheme that dupes consumers into needlessly registering variations of their existing domain names."

Needless? It all depends on how strongly a company wants to protect their name. If some named Bob Reuters registers the Reuters.org, Reuters.com might have trouble getting the name from him, especially if Bob doesn't try to make his site into a news service. If he was a plumber, Roto-Reuter plumbing would be more of a threat to the owner of the "roto-rooter" trademark than it would be to Reuters news.

Given how asleep most legal departments, and internet consultants are, I'd say this guy probably informed a lot of companies of a very cheap way to avoid problems in the future.

If someone paid, did he actually register the domain name for them, in their name? Then the only "crime" is selling an overpriced domain name registration service. Guess what, Network Solutions does that all the time! But I guess the fact that the government gave them a monopoly makes it ok.

And nothing here says that the owner of the main name couldn't just go out and register the extra domains for themselves. If the guy wasn't cybersquatting, then nothing prevented the recipient of the fax from avoiding paying the $70 fee. If they did pay the fee to him, then he made a reasonable markup for his time to make the domain name painless for the clueless owned of a business.

Additionally, owning extra domains gives a company the opportunity to create extra feeder sites that direct traffic to their main site. All the biggest sites do this with simple redirects.

The only place this guy went over the line is with the claim of a registration attempt by a third party. But everything else in what he was doing, including his capitalized disclaimer, is not a problem. Nothing wrong in what he said. There is no claim that he was actually cybersquatting.

Anyhow, this case is nonsense! They might as well accused him of being a terrorist. That makes as much sense as anything else about the problem the FTC is having

Disclaimer: I'm not a lawyer, just a long time internet consultant, and fellow citizen who gazes in wonder at the ever increasing government power grabs, and the attorneys who help implement them.

Someone Is About To Register A Variation Of Your Domain Name

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What I Think About This

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