Congress Frets Over Loosened Reins for Internet

     WASHINGTON (CN) – The California nonprofit charged with the Sisyphean task of governing the Internet is not yet ready to do so without congressional oversight, industry stakeholders testified Wednesday in front of the House Subcommittee on Courts, Intellectual Property, and the Internet.
     ICANN, short for the Internet Corp. for Assigned Names and Numbers, has been managing the Domain Name System, IP addresses and other structural functions of the Internet since 1998.
     The private-sector nonprofit’s impending separation from its overseers in the subcommittee and the Department of Commerce, a move the Obama administration announced last year, is supposed to go into effect in September.
     While ICANN’s independence is a shared goal, subcommittee members commiserated with stakeholder witnesses in a three-hour hearing Wednesday about how ICANN has not proved itself capable of moving forward with accountability and transparency.
     The act of severing the government oversight in place since ICANN’s inception cannot be undone, subcommittee chairman Darrell Issa said.
     “We cannot overstate the importance of the transition if it is to occur,” said Issa, a California Republican.
     Drawing from popular Cheez-It commercials, subcommittee vice-chair Rep. Doug Collins, R-Georgia, said ICANN was not mature enough to go out on its own.
     With the eight witnesses assembled before the subcommittee, Issa said it was the largest panel he had seen since the beginning of his time in Congress. Those witness list featured Mei-Lan Stark, immediate past president of the International Trademark Association; Paul Misener of Amazon.com; Steven Metalitz, counsel for the Coalition for Online Accountability; John Horton of LegitScript; Philip Corwin, counsel for the Internet Commerce Association; Steve DelBianco of NetChoice; Bill Woodcock of Packet Clearing House, an Internet infrastructure organization; and Jonathan Zuck, president of ACT, The App Association, a group of app companies and information-technology firms.
     Businesses and users of the Internet like those that the eight witnesses represent are part of the global community of “multistakeholders” governing ICANN.
     The model is supposed to ensure that the running of the Internet is not unduly influenced by one particular country or company.
     Stark said the multistakeholder members believe in the idea of the model, but trust and accountability are essential. ICANN is supposed to foster innovation and promote fair competition, but it cannot succeed in those goals without holding itself accountable to its stakeholders.
     LegitScript, the online pharmacy-monitoring company of which Horton is president, has filed complaints with ICANN about several pharmacies that are selling drugs illegally, but Horton said ICANN has closed the complaints without taking action or explaining what the registrar of the pharmacy’s domain did in response to the complaint.
     ICANN’s refusal to explain the response process gives the impression that ICANN is participating in a cover-up, Horton said.
     A central topic of the hearing was the release of new generic Top Level Domains, or gTLDs.
     Stark said the rollout has demonstrated many of ICANN’s inefficiencies. The “.sucks” gTLD in particular has caused significant controversy since ICANN auctioned it off to Vox Populi Registry Ltd. While most gTLDs start their pricing around $10, basic .sucks domains are being sold for $249, and premium .sucks domain names are being sold for $2,499, prices that Issa called “legalized extortion.”
     The high .sucks prices specifically target businesses that want to purchase domain names with their trademark to avoid having others use their mark in an abusive manner.
     Creating a website dedicated to legitimate criticism of a business or other entity is protected free speech as long as the content does not infringe on a business’ trademark.
     Issa joked that “congress.sucks” would probably be highly successful, but the overly high prices of the .sucks domain appears to specifically target businesses with trademarks whose rights protections allow them first choice on purchasing domain names with their trademarks.
     A business could spend tens of thousands of dollars trying to protect itself from .sucks domain names. If Vox Populi sold a .sucks domain name to each of the 36,000 trademarks represented by the ITA, Stark said the company would make $90 million a year.
     Vox Populi’s actions are not illegal, the subcommittee recognized, but it seems to violate the spirit of the Trademark Clearinghouse agreement that is intended to protect the rights of intellectual property owners. The unnecessarily high costs of the .sucks domain will be passed down from business owners trying to protect themselves to the consumers, Stark said.
     “This turns out to be a tax on businesses, on innovation and on consumers,” Stark said.
     Amazon balked when ICANN created .amazon as one of its new gTLDs. Misener testified that the company went through a three-year process to buy the domain, but the Brazilian and Peruvian governments pressured ICANN to deny the application. The U.S. government abstained from the issue, and ICANN denied Amazon’s application.
     With the U.S. government severing its control over ICANN, Amazon worries that ICANN will then simply be subject to control by other governments, Misener said.
     In an interview after the hearing, ICANN chief contract compliance officer Allen Grogan said he takes all the criticism offered at the hearing seriously.
     Since acquiring his office in October, Grogan said he has been working hard to develop more common understanding amongst registrars and intellectual property owners. As part of such a complicated community of multistakeholders, Grogan said he would like to see clear standards developed for what makes a valid complaint against a registrant accused of illegal activities on the Internet, and what should be the minimum requirements for an investigation of any complaints.
     When ICANN receives complaints like it does from LegitScripts about an illegal pharmacy, it informs the registrar that oversees that pharmacy registrant of the complaint, Grogan said. Unfortunately, many times the issue is too complicated for either the registrar or ICANN to clearly see whether the registrant is actually breaking a law in its jurisdiction. Working in Internet commerce, a company may have its domain name registered in one country, its headquarters located in another company and its products sold in a third country.
     There are a lot of illegal activities in the world that ICANN’s multistakeholder community probably doesn’t want it to police, Grogan said, such as free speech or blasphemy in countries where those actions are unlawful. It’s a complicated issue, and Grogan said he needs to do more outreach to explain what ICANN’s compliance team can and cannot do.
     Regarding the issue of the .amazon rejection, Grogan said a consensus of ICANN’s entire international government committee, which represents more than 100 countries, recommended the rejection. ICANN management acts on consensus recommendations from the committee, and the U.S. government did not step in to oppose that consensus.
     Zuck said ICANN is capable of being ready for independence from government oversight, if it strengthens its mechanisms for enforcing accountability. As each witness testified, ICANN has the potential to govern the Internet smoothly, if it maintains transparency and listens to the concerns and suggestions of its multistakeholder community.

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