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NEWS RELEASE
FOR IMMEDIATE RELEASE Contact: William Bode
January 26, 1998 202/862-4300
VICTORY FOR INTERNET USERS:
Federal Judge Asks NSI and NSF to Freeze $50 Million Registration Fee Fund
PRESS CONFERENCE Scheduled for Thursday, January 29, 1998, 10:30 a.m.
Connecticut Building, 1150 Connecticut Ave., N.W., 9th Floor, Washington, D.C.
Sponsored by the Association of Internet Registrants of America (AIRA)
Washington, D.C. -- "Highway Robbery on the Information Superhighway." On
January 16, 1998, in a class action lawsuit filed on behalf of Internet
domain name registrants, U.S. District Court Judge Thomas Hogan asked
Network Solutions, Inc. (NSI) and the National Science Foundation (NSF) to
"freeze" the funds in the Internet "Intellectual Infrastructure Fund" until
he decides whether the fund was lawfully created. Judge Hogan will decide
by the end of the month whether the $100 registration and $50 annual
renewal fee paid by Internet domain name registrants constitute an
unconstitutional tax.
In the class action suit, Thomas et al. v. NSI and NSF, the plaintiffs
claim that:
· The 30% set-aside from the Internet registration and renewal fee is an
unconstitutional tax;
· The remaining registration and renewal fees are contrary to federal
statute (the Independent Office Appropriation Act) and the U.S.
Constitution; and
· NSI violated the Sherman Act (the principal antitrust law) in
administering the domain name function.
William Bode, attorney for the plaintiffs, explained that, "Under federal
law, no independent executive agency -- such as NSF -- can collect fees
that exceed the cost of providing the service they are administering. NSI,
the agent of NSF, spends less than $5 to register domain names, yet it
charges a registration fee of $100 and renewal fees of $50 per year." The
plaintiffs will file a second motion for preliminary injunction this week
asking the U.S. District Court to require NSI to return all registration
and renewal fees to Internet users, and to prevent NSI from collecting any
registration fees in excess of its costs and any renewal fees at all. Adds
AIRA President Howard Sartori, "The government has, in effect, unlawfully
given this [intellectual] property for free to NSI and permitted NSI to
make exorbitant profits -- at the expense of the Internet user. Worse, the
services these fees are supposed to fund are not meeting the needs of the
Internet user."
To attend the January 29, 1998 press conference, contact Judy Caruthers at
202/862-4341. For more information, contact Mr. Bode (202/862-4300) or Mr.
Sartori (202/917-2935).
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