ICANN Says It's Not Liable Under Antitrust Laws in Manwin Suit

LOS ANGELES — When U.S. Judge Philip Gutierrez hears arguments in ICM Registry and ICANN's motion to dismiss in Manwin's suit against the two groups, he will hear from defense attorneys that ICANN cannot be held liable under antitrust laws.

ICANN's counsel says that the Internet manager “does not engage in trade or commerce” and therefore antitrust laws don't apply to its approval of the .XXX top-level domain, according to court documents.

"[ICANN] does not sell Internet domain names, it does not register Internet domain names, and it certainly is not an Internet pornographer," ICANN counsel said in its motion to dismiss. "ICANN does not make or sell anything, it does not participate in any market and its bylaws expressly forbid it from participating in any of the markets referenced in the complaint."

Its its motion to dismiss, defense attorneys go on to say that the introduction of .XXX is pro-competition and that Manwin sued because it fears losing market share.

"The dispute between plaintiffs and ICM is a garden variety business dispute  that does not appear to implicate the antitrust laws in  any respect," ICANN counsel said. "This ... explains why plaintiffs  have not identified any viable antitrust  product market that could be dominated in any respect by ICM. 

"Plaintiffs claim to be upset with the manner in which ICM is operating the new .XXX registry, but since plaintiffs already operate [by their own admission] some of the most successful pornographic websites on the Internet, websites that will continue to operate irrespective of anything ICM might do, what the plaintiffs are really complaining of is the potential competition that their websites may face from the operation of .XXX. 

"Complaints  about an increase in competition cannot violate the antitrust laws, but even if the decisions th at ICM has made as to how it will operate  the new .XXX registry could somehow be imagined to raise legitimate antitrust issues, that does not and cannot create antitrust exposure for ICANN."

According to a declaration by ICM's Greg Dumas in separate court documents, Manwin demanded thousands of free premium .XXX domains and a veto over some registry policies. Dumas said that the demands came in September 2011, well after .XXX was approved by ICANN.

Manwin's managing partner, Fabian Thylmann, according to the declaration, demanded that ICM allocate a minimum of several thousand .XXX domain names to Manwin free of charge and commit to prevent IFFOR from making any policies that ban or restrict the operation of user-generated content tube sites on .XXX domains.

Thylmann also demanded across-the-board discounts on all .XXX domain registrations and allow Manwin to operate certain premium or high-value domain names, such as Tube.xxx, through a revenue-sharing arrangement between Manwin and ICM, Dumas said in his declaration to the court.

Gutierrez will hear arguments on ICM and ICANN's motion to dismiss on April 2 at U.S. District Court in Los Angeles.

ICANN Response