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VeriSign Sued for $100 Million

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Sep 19, 2003 12:00 AM PDT    Text size: 
VeriSign, Inc. found itself in hot water this week after being slammed with a $100 million antitrust lawsuit filed on behalf of Florida-based Popular Enterprises, LLC, the parent company of Netster.com.

The Internet search company contends that Mountain View, Calif.-based VeriSign has been routinely redirecting misspelled IP and email addresses back to its own search site SiteFinder and in doing so has been stealing revenue from Popular Enterprises' coffeurs

VeriSign controls the majority of the Internet's traffic through its dominance of the .com and .net domain names. When a user mistakenly goes to a URL that does not exist VeriSign redirects the user to SiteFinder, which presents a list of alternate addresses. VeriSign is also able to profit from SiteFinder's search box.

The suit, which was filed in U.S. District Court for the Middle District of Florida, alleges that VeriSign is "hijacking traffic" from other similar services like Popular Enterprises' search service Nester.com and its search toolbar product SmartBrowser.

Popular Enterprises charges that VeriSign is involved in antitrust violations, unfair competition and violations of the Deceptive and Unfair Trade Practices Act. The company has also asked the court to order VeriSign to put a halt to the service.

VeriSign's launch of SiteFinder last week led to a flurry of industry grousing over issues of user privacy and SiteFinder's negative effect on anti-spam filters. Many industry watchers are concerned that VeriSign is using its position as a leading web address provider to unfair advantage over smaller services, and that these "hijacked" web addresses could be used for profit.

VeriSign's response to Popular Enterprises' suit has been that SiteFinder was designed to help people find their way back to the Internet, instead of ending up lost in cyber space.

Although VeriSign was not available for comment due to pending litigation, a spokesperson said that people mistype domain names an estimated 20 million times per day on the VeriSign network and don't get what they're looking for. SiteFinder was an attempt to rectify that situation.

Meanwhile, The Internet Software Consortium (ISC) plans to release an emergency software patch designed to block VeriSign's SiteFinder. The patch is scheduled for release next week, the ISC announced Friday.

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