Virginia Court Says Domain Names Are Not Property
from the so-can-they-be-seized? dept
There's an interesting blog post by Venkat Balasubramani about a little noticed ruling in Virginia from last year concerning a bankruptcy proceeding, which came to the conclusion that domain names are not property, but rather a contractual right. The ruling is somewhat specific to the bankruptcy context, but basically says that phone numbers and domain names are not really property:Although the Fourth Circuit has not specifically addressed this issue, it is well-settled that the contours of the property interests assumed by the trustee are determined by state law.... Accordingly, Appellant cites the Virginia Supreme Court's relatively recent decision in Network Solutions, Inc. v. Umbro International, Inc. for the proposition that a judgment debtor has no property right in its telephone numbers and web address. In Network Solutions, the Virginia Supreme Court held that a web address and telephone number could not be garnished by a judgment creditor because the debtor lacked a property interest in them... (stating that "a domain name registrant acquires the contractual right to use a unique domain name for a specified period of time" and that a domain name is not personal property, but rather "the product of a contract for services").Venkat looks at what this means from a bankruptcy context and concludes probably not that much... But I'm wondering what it means when it comes to domain name seizures done by Homeland Security and its ICE division. Those were all based on laws concerning the ability to seize property supposedly used in the commission of a crime. Yet... if domains aren't property, can they be seized in this manner? While this ruling only applies to the state of Virginia, since .coms are registered via VeriSign, and VeriSign is based in Virginia, an argument can be made that all .coms are not "property" under this ruling. That, potentially, leads to a whole host of other problems, so I wouldn't jump to the conclusion that this is automatically a good thing. But it conceivably leads to another way for cites that are seized by the US government to fight back.
In the absence of controlling Fourth Circuit precedent, this Court refers to Network Solutions to define a debtor's property interest in its web address and telephone numbers in Virginia. Although ACG argues that Network Solutions is distinguishable because it relates to a garnishment proceeding rather than a bankruptcy, the garnishment context does not change the Network Solutions court's holding that the use of a domain name is a "contractual right" that does "not exist separate and apart from [the provider]'s services that make the domain names operational Internet addresses." ... While telephone numbers and web addresses are important branding tools and certainly have value to those who use them, that subjective value does not equate to ownership under Virginia law. The Virginia Supreme Court confirmed in Network Solutions that neither telephone numbers nor domain names were wgarnishable personal property because "neither one exists separate from its respective service that created it." ... Therefore, because Virginia does not recognize an ownership interest in telephone numbers and web addresses, neither were property of Alexandria International's estate and neither were subject to sale by the trustee (nor would they be subject to sale in any future proceeding).
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Filed Under: bankruptcy, domain names, property, virginia
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Oh wait, it isn't 2020, yet.
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OBVIOUS DECISION. News only to Mike who thinks links to infringing content are "free speech".
Where Mike daily proves the value of an economics degree. (39 of 195)
04:09:26[f-82-8]
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Re: OBVIOUS DECISION. News only to Mike who thinks links to infringing content are "free speech".
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Re: Re: OBVIOUS DECISION. News only to Mike who thinks links to infringing content are "free speech".
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Re: Re: Re: OBVIOUS DECISION. News only to Mike who thinks links to infringing content are "free speech".
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And then you have some recourse because you can sue the domain name provider for breach of contract rather than having to try and deal with the government, and if the courts agree and say the domain provider is at fault for giving up the domain, you can then use that to appeal to the government who took the domain.
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"A famous example in the United States is Bovard v. American Horse Enterprises (1988),[1] in which the California Court of Appeal for the Third District refused to enforce a contract for payment of promissory notes used for the purchase of a company that manufactured drug paraphernalia. However, the items sold in this contract were not actually illegal, but the court refused to enforce the contract for public policy concerns."
http://en.wikipedia.org/wiki/Illegal_agreement
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So much for the stakeholders policy...
I wonder if Mark Jeftovic from easyDNS would be willing to run the A root server? I'll be willing to chip in a few bucks.
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Here is another way to look at it. Imagine it as a property owner that contracts a management company to manage renting apartments in an apartment building where some of the renters sublet the apartments they rent to other people. Next imagine that this property is in a city that not only has a law that says that apartment rentals can work this way but have to work this way and follow very specific guidelines (ie. Property owners and apartment managers have to get a permit from the city to rent property.) ICANN is like the city. The property owner is like Verisign and the management company is like a registrar. The individual renters who sublet don't need a permit from the city but they can resell through an apartment manager who allows them to.
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And if you are worried about ICE, it's much easier than that. Get a domain on a TLD that is not managed by a US company or one that can be compelled by their government to do whatever the US requests of them.
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As far as changing Root A server from a US based company, if enough people complain and a willing party is available, I'm sure they would put it up to vote before bowing down to a move by the ITU.
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The Seizure now becomes government interference in contract.
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Yes and no. While you can Transfer your .com from Godaddy to Name Cheap, or NameSilo, or any other register, you can not transfer your name out of Verisign
They are the Sole Master Register of all .com names, As such it is not "property" but a contractual obligation between you and really ICANN, through your selected provider be it GoDaddy or NameSilo,
Then ICANN contracts with Verisign to provide the infrastructure
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I bet the following 'non-owners' will be glad to hear this!
Microsoft.com
Apple.com
GE.com
Netflix.com
Amazon.com
. . . and millions of others . . .
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The quantum nature of domain names
They are non property when it is otherwise convenient for them not to be property.
This is like how you 'own' or 'license' music / movies depending on which is most convenient for the 1% and least convenient for you.
It's either property or non-property.
It's either owned or licensed.
But don't try to measure it because that will affect it.
It's a particle. It's a wave. But don't try to measure it because that would affect it.
I hope that clears up any prior lack of confusion.
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Re: The quantum nature of domain names
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Wait
Contractual from whom? This implies that registrar owns AND licenses proprietary names such as techdirt or google.
Since they don't own, they can't enter into contracts granting rights to use in the first place. It is rather contract to service usage of these names instead.
Or, am I missing something here?
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Re: Wait
It all starts with ICANN who authorizes and grants contract to companies to manange name servers for top level domains (.com, .net, .org, etc) as well as setting the rules all the way down the line.
Technically, then the domain name itself, which is actually a service, is from the company that manages the name servers for the TLD who has a contract between them and the specific registrar that has a contract with the registrant to resell access to that service. Sometimes there is even another level in between where a company isn't an ICANN accredited registrar is reselling access through another registrar that is ICANN accredited.
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Stinks right there.
Schmuck and Shyster LLC is now Shyster and Schmuck LLC.
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Hold in hand
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