Australia: Whose Domain is it anyway? The startling attempt to seize international top-level domain names via the US Federal Court

Last Updated: 7 September 2014
Article by Kim Leontiev and Patricia Monemvasitis

A recent ruling to issue "writs of attachment" (orders to seize assets) by the DC District Court in the long-running proceedings of Ben Haim et al. v Islamic Republic of Iran et al ("Ben Haim") has raised eyebrows and rattled the cyber-sphere in more ways than one.

The case of Ben Haim was commenced as a civil action lawsuit in the US Federal Courts by a group of terrorism victims and their families (the plaintiffs) seeking compensation against the government of Iran for its alleged funding of terrorist organisations at whose hands the plaintiffs had suffered. Despite the high-stakes of this international lawsuit, in June 2014 the plaintiffs managed to win a large sum of damages with the Federal Court judgments amounting to more than a billion dollars. To satisfy the judgments, the plaintiffs have embarked on enforcement proceedings seeking to seize all possible assets belonging to the Iranian State, targeting, and to varying degrees successfully seizing, assets like bank accounts and real property located in the US.

The latest ruling comes as a startling move to seize the internet domain names belonging to the Iranian as well as other governments pending final determination of the plaintiff's claims. The writ of attachment orders ICANN (Internet corporation for Assigned Names and Numbers) , the US-based international manager of internet addresses or domain names to hold all "country-code top level domains (ccTLDs) such as .ir (Iran), .sy (Syria) and .kp (North Korea) so that if successful the plaintiffs can seek to use these ccTLDs to recover their monetary awards.

The attempt to seize domain names in this way, not to mention the country-level domain names in relation to foreign governments, is truly unprecedented and has startled many in the IP and Internet regulation communities. ICANN itself has filed a response with the court essentially arguing that domains are not assets or property that is owned or possessed and accordingly domains cannot be "seized."

The question of whether domains are in fact property is not one previously considered by the courts and this might be a remarkable first. In the more day-to-day world of domain name legal disputes, domain names are regulated by various local authorities in cooperation with ICANN. In Australia, for example, auDomain Administration Ltd or auDA has, since December 2000, been the administrator of au domain names endorsed by the Australian government. Administrators like auDA, run the Registry of domains within a country and amongst other things, handle disputes over domains which, if relevant, will be referred for hearing before specific Dispute Resolution provider to be determined in accordance with the Uniform Domain-Name Dispute Resolution Policy (UDRP).

Administrators have long signalled their position on the question of whether domain names are property in one of its policies auDA states:

"There are no proprietary rights in the domain name system (DNS). A registrant does not "own" a domain name. Instead, the registrant holds a licence to use a domain name, for a specified period of time and under certain terms and conditions."

Despite this, the treatment of domain names can certainly be used as a case for their status as property. Under the UDRP, claimants that successfully prove bad faith use of an identical or confusingly similar domain to the domain of the legitimate rights-holder, can have the infringing domain name cancelled or transferred into their own name. The cancellation or transfer would be managed by a domain name Registrar – an organisation that services domain names on the internet in accordance with the Registry maintained by the administrator. Thus, almost daily domain names are being fought over and transferred according to demonstrated right – all for the most part without court intervention. In the US, the Anti-Cybersquatting Protection Act even permits trademark holders to commence property claim proceedings against owners of domain names infringing on the registered trademark holder's mark.

In its reply to the writ in the Ben Haim case, ICANN will seek to dispel any semblance of property that domains may have acquired. In establishing its case, ICANN will argue that domains consist of a name which is programmed via a line in the Root Zone database to be associated with a specific server upon which the domain name is registered. As such, it is not a thing, but literally a name that we give to this series of cyber-programmed associations and the contractual rights with the IT companies by which these associations are created and/or administered. The domains are (almost never) going to be located in any one place or jurisdiction, but are found in interlocking databases in a global network. ICANN's cascading submissions speak for themselves: the domains cannot be subject to a seizure order because they are not property and even if they were, they are not property of the US, ICANN or the defendant governments, and even if they were, they are not located in the US or anywhere else so as to be validly "seized".

Will these arguments succeed? In this unprecedented case there is little of which we can be certain. And whilst it is incredibly unlikely that there will actually be a final order seizing Iran's or any other State's ccTLD, whatever the outcome a theoretical and international controversy is a near certainty.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Kim Leontiev
Patricia Monemvasitis
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