On Monday, November 28th, Immigration and Customs Enforcement again seized a number of domain names that led to sites alleged to have sold goods infringing the intellectual property rights of others. Regardless of your views on the propriety of the use of Customs laws in this manner, this year’s domain name seizure offers some interesting insights into the process, and potential refinements based on prior crackdowns.
The first issue I found interesting was this statement in ICE’s press release: “Of the 350 domain names seized [in prior raids], 116 have now been forfeited to the U.S. government.” Stated another way, 234 domain names have not been forfeited. This means that fewer than fifty percent of the domain names seized have actually been forfeited. It seems to follow then, that the owners of more than fifty percent of the domain names seized have either protested the seizure or forfeiture proceedings have been abandoned by the government. This is an awful statistic for the government: more than fifty percent of the businesses it has shut down using this law may have been erroneously shut down. While the wheels of justice turn slowly, a statistic like this calls into question the essential fairness of the process. Even assuming that the seizures are appropriate, is shutting 234 businesses, some for more than a year, equitable?
Indeed, the press release issued by ICE points out that there are both administrative and judicial processes available to those whose domains were seized. However, this process, particularly as applied to domain names, stretches due process close to its breaking point. As an initial matter, it is often very difficult to provide notice to the owners of domain names. The statute used in these seizures is designed for seizure of physical property. Since the owner of a domain name doesn’t always “visit” their property, there is no way to provide physical notice. Last year, some registrars, including two very prominent registrars, failed to forward seizure notices to customers who had private registrations.
Second, the attenuated nature of the process leaves businesses shuttered while they attempt to reopen. An admittedly random sample of one of the domains seized in each of the last raids shows that none of the domains have been restored. As noted above, this means that those businesses have no source of revenue while they are seeking to preserve their rights. A fundamental question in this effort has to be whether the death penalty is appropriate for businesses alleged to engage in, or facilitate, infringement. Remember that no prior judicial review, other than what appears to be ministerial magistrate review, exists for these seizures.
Finally, no search engines were part of this raid. Last November, ICE shut down nine torrent search engines. Some of those shut down were actually offering content they were asked to distribute by the content owners. Given the outcry about that aspect of last year’s raid, it seems that ICE may have reconsidered whether search engines are an appropriate target for enforcement.
While I understand the impact piracy has on the owners of intellectual property, I believe that the judicial system is a better place for these disputes to be resolved. I continue to believe that these raids undermine the US economy by making the law enforcement process appear to be random, arbitrary, and without due process.
About David Snead
David Snead is a lawyer whose practice is focused on internet infrastructure providers. In his eleven years in this practice, he has represented clients including multinationals, middle tier hosting companies, and two guys, a server, a T-1 and a huge MasterCard balance.
A long-time WHIR contributor, David Snead is the Web hosting business's best-known legal expert. Through his WHIR blog, he offers a credible legal perspective on both specific actions in the Web hosting business and general developments in legislation.
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