VeriSign to Cease Deceptive Mailings

VeriSign and Go Daddy Software signed an agreement that forces VeriSign to not only stop sending solicitations to Go Daddy's customers, but also to the customers of all other registrars.

by Michael Singer of siliconvalley.internet.com [June 21, 2002]

Domain registrar VeriSign Wednesday entered a legal agreement that prohibits it from sending controversial domain name expiration notices to customers.

Mountain View, Calif.-based VeriSign and Scottsdale, Ariz.-based Go Daddy Software signed the order that forces VeriSign to not only stop sending the solicitations to Go Daddy's customers, but also to the customers of all other registrars

Arizona federal judge Mary Murguia entered the stipulated order into the courts, which effectively extends an injunction against VeriSign forcing it to abandon its current marketing campaign.

Earlier this month, the rival discount domain name registrar accused VeriSign of consumer fraud, deceptive advertising, and misappropriation of trade secrets.

"It is our hope that this order will send a strong message to anyone in this industry contemplating the use of such dubious marketing tactics to clean up their act," said Go Daddy founder and president Bob Parsons.

A VeriSign representative said the company would not be able to comment on any legal issues.

The suit stems from a direct marketing campaign launched earlier this year by VeriSign, which Go Daddy and Baltimore-based BulkRegister said duped their customers into believing their domain names were about to expire, and prompting them to pay VeriSign to take over their domains.

Go Daddy said it was forced to take this issue to court when VeriSign refused to respond to two formal requests to stop the mailings and comply with the ICANN Registrar Accreditation Agreement. This agreement limits the use of a registrar's customer contact database (Whois) to lawful purposes such as the inquiries necessary to register domain names or modify existing registrations.

VeriSign reported to Go Daddy that it stopped mailing the domain expiration notices on May 14, the day a preliminary injunction was entered in Maryland in a similar suit filed by BulkRegister. But customers of registrars like Go Daddy continued to receive the notices well into June, sparking the lawsuits.

Go Daddy said its customers had been "flooded" by the mailings, which were labeled "Domain Name Expiration Notices" and marked with "Reply By" dates that Go Daddy said bore no relation to users' actual domain expiration dates.

This is the second injunction rallied against VeriSign by a competitor and the fourth action spawned by the effort to date.

In May, lawyers at the Los Angeles law firm of Weiss & Yourman filed for damages on behalf of consumers, aiming to receive class-action status for the suit. In March, the non-profit California Consumers Action Network filed a similar complaint.

Despite the injunctions, both BulkRegiser and Go Daddy said they would continue seeking their legal cases for damages.

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