Monday, December 29, 2008

Versizon Nets Record Setting $33 Million Lawsuit Against OnlineNIC

Verizon last week was awarded a $33.15 million default judgment in a cybersquatting case against San Francisco-based OnlineNIC.

The default judgment of $50,000 for each of 663 addresses registered by the Internet company, OnlineNIC, was issued last Friday by United States District Judge Jeremy D. Fogel in San Jose, Calif. Judge Fogel froze OnlineNic’s assets and ordered the transfer of all the domains in question to Verizon. Verizon v. OnlineNIC, No 5:2008cv02832 (N.D. Calif.)

OnlineNIC registered at least 663 domain names that were identical or very similar to Verizon trademarks, such as,, and The court concluded that OnlineNIC registered these names in bad faith in an effort to lure Verizon customers to the sites.

"This case should send a clear message and serve to deter cybersquatters who continue to run businesses for the primary purpose of misleading consumers," Sarah Deutsch, Verizon vice president and associate general counsel, said in a statement. "Verizon intends to continue to take all steps necessary to protect our brand and consumers from Internet frauds and abuses."

A default judgment was handed down as no lawyers or representatives from OnlineNIC appeared in court to defend themselves.

According to Verizon's lawsuit, OnlineNIC's employees have gone to great lengths to conceal their identities. OnlineNIC's employees have used "numerous shell-entities, fictitious business, and personal names," in addition to covering basic tracks such as withholding accurate information from the company's public WHOIS database. Verizon believes that one or more of OnlineNIC's employees conduct business with various aliases and contact information.

OnlineNIC might face a lot more trouble. The company currently holds nearly 900,000 domains that resemble popular companies such as Yahoo, Google, Adidas and MySpace, and each one has the right to take OnlineNIC to court just like Verizon did.

While the Verizon lawsuit is amongst the largest of its kind its relatively unlikely that Verizon will every receive any of its money. Winning the case is one thing and collecting another.

1 comment:

  1. Anonymous2:25 PM

    When will ICANN yank china-channel (aka onlinenic)'s accreditation?

    As of early May, 2009, ICANN released this statement about the embattled, unethical, registrar:

    “Dear Sir/Madam:

    Thank you for contacting ICANN concerning your transfer issue with OnlineNIC. OnlineNIC is currently involved in a legal dispute. A court order was issued in this case and OnlineNIC has interpreted the court order to mean that it is prohibited from transferring any domains at this time. ICANN is closely monitoring the matter and upon receiving updated information, we will provide that information to you via e-mail. We will continue to work with OnlineNIC representatives to resolve registrant complaints. “


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