Update: Unstoppable Domains sues over Handshake .wallet domain

Company follows through on threats citing a “campaign of chaos”.

Earlier today I wrote about Unstoppable Domains threatening to sue Gateway.io for it offering .wallet top level domain names.

It turns out it followed through with that threat yesterday, filing a federal lawsuit (pdf) in Delaware. It names Gateway.io, which provides technical services for the domain, and its founder James Stevens as defendants. It does not name the registrant of .wallet, even though it’s my understanding that he has been in contact with Unstoppable Domains about the issue.

The lawsuit exposes Unstoppable’s belief that the first to market an alt-root domain name should have rights to it and that name collisions are a big flaw in alt-root domains. It states:

By being the first to make commercial use of the .WALLET mark, Unstoppable Domains has acquired the right to exclude others from using the .WALLET mark, or any similar mark that is likely to cause confusion in the marketplace.

.Wallet was created in Handshake before Unstoppable began offering domains, but it was not offered commercially for registration until after Unstoppable started marketing the domain. Unstoppable says it has grossed $5 million from .wallet registrations.

Some of those customers are apparently distressed by the conflicting domains:

comment from someone complaining about .wallet handshake domains

Unstoppable says the defendants are “engaged in a campaign of chaos” while pointing to the issue with all all-root blockchain domain names:

If a cryptocurrency account integrates with both Unstoppable Domains’ .WALLET domain name and Defendants’ .WALLET domain name, the conflict between two conflicting identical .WALLET domain names will result in the mis-routing of some users’ cryptocurrency payments; the only thing determining whether the payment went to the Unstoppable Domains’ version of the domain name or to Defendants’ version of the domain name would be the default settings of the application used to initiate the payment.

The same misdirection can happen when users of Unstoppable Domains’ .WALLET domain name sets up a website – Defendants’ same .WALLET domain name will cause untold website traffic to be misdirected.

And:

Defendants’ actions destroy the reliable functioning of Unstoppable Domains on partner applications by producing duplicate .WALLET domain names, rendering the use of Unstoppable Domains’ .WALLET domains unreliable and hazardous to partners’ users.

By causing chaos in partner applications, the Defendants’ actions injure all customers of these several hundred partner applications. This harms a collective customer base of over ten million customers.

The chaos that Unstoppable refers to will become a bigger issue when ICANN releases the next round of top level domain names. Those domains will be more accessible and many will conflict with Unstoppable’s domains. It’s becoming clearer that Unstoppable believes that if it launches alt-root domains before the next round, it should get some sort of leg up in the process to get those domains.

Post link: Update: Unstoppable Domains sues over Handshake .wallet domain

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