ICM Registry Operator of .XXX, Asks Court To Dismiss Manwin, Operator of YouPorn.com 2nd Amended Complaint

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from www.thedomains.com – ICM Registry (ICM) , operator of the .XXX extension asked the court to dismiss the suit brought by Manwin LICENSING, INTERNATIONAL, Operator of YouPorn.com against ICM and ICANN on antitrust grounds.

In a “response memorandum in support of its motion to dismiss the case” filed last Friday, ICM asked the court to dismiss the case against Manwin based on “glaring factual differences” between this case and an appellate court ruling involving VeriSign.

In its 2nd amended complaint Manwin’s cited the federal appeal courts decision in a case brought by Coalition for ICANN Transparency, Inc (CFIT) against Verisign, which held that the registrar violated the Sherman Act by colluding with ICANN to eliminate competition for the registry contract.”

You may remember we wrote about this case back in 2009 when that federal court ruled in favor of CFIT, which was later dropped the suit after funding for it ran out.

According to the memorandum ICM says:

“Manwin makes very clear that they have a single-pronged strategy for surviving defendants’ motions to dismiss: to try and convince the court that this lawsuit is a carbon-copy of another antitrust case involving ICANN and a TLD registry operator”

“In the antitrust suit, Manwin alleges that ICM Registry received the original and renewal registry contracts without competition, is charging above-market .XXX prices, imposes other anticompetitive .XXX sales restrictions and has, because of its ICANN contract, precluded other adult-oriented top-level domains from operating.”

“ICANN approved the .XXX application through a process that Manwin admits was fully open to other applicants.”

“The activities found predatory in the VeriSign case, included a lobbying campaign, financial pressure, and litigation threats, but, critically, all of this conduct was alleged to have led directly to ICANN’s decision to forego competitive bidding and award the renewed 2006 .com contract to VeriSign on favorable terms.

“Although Plaintiffs have tried to mimic those allegations, the facts alleged here get in their way. ”

“As the Amended Complaint itself makes clear, all of ICM’s purported lobbying efforts were unsuccessful; ICANN responded to them by rejecting ICM’s .XXX TLD proposal on three separate occasions.”

“ICM Registry points out that Manwin’s complaint identifies no other registries which sought to operate a .XXX TLD ”

“Despite Plaintiffs’ attempt to blur these fundamental distinctions, they preclude reliance on VeriSign as a basis for sustaining the Amended Complaint. And no other plausible grounds for permitting this case to proceed appear in the Opposition.”

“Having now had two opportunities to formulate its copycat VeriSign claim, Manwin is not entitled to a third,”

ICM goes on to say that Manwin failure to buy any .XXX domain names precludes their claim as well:

“Plaintiffs contend that their failure even to seek to purchase defensive or affirmative registrations in .XXX does not preclude a finding of antitrust injury, since all they need to show for injunctive relief is “threatened loss or damage.”

“The problem with this argument is that antitrust plaintiffs (even those seeking only an injunction) must demonstrate that their threatened injury is (1) due to unlawful conduct by the defendants; and (2) concrete and imminent, not mere conjecture about future possibilities. ”

“Thus even if Plaintiffs’ failure to seek defensive or affirmative registrations in .XXX could be linked to any aspect of ICM’s operation of the registry, the purported “injury” that may result would not be attributable to any unlawful conduct by a defendant.

“Moreover, having been unable to identify a single instance of “diversion of profits” or “lost business opportunities” due to the absence of an .XXX registration, Plaintiffs plainly have not met their burden of pleading an imminent and tangible threat of any harm, much less harm to competition in some relevant market”

“Plaintiffs’ only response is to suggest that ICANN was somehow duty-bound to have another round of competition for the .XXX registry contract itself, after ICM had invested 10 years of time and money into getting .XXX approved over ICANN’s repeated rejections. ”

“Plaintiffs cite no authority for this remarkable assertion because none exists.”

“VeriSign itself is clear that “competitive bidding is not required” to enter “exclusive” agreements even for existing, established TLDs like .net—much less a completely new one like .XXX.”

The court filing asks the court to dismiss “The Amended Complaint with prejudice.”

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