Manwin Asks Judge to Dismiss ICM Registry's Counterclaims

Feb 20, 2013 11:45 AM PST

LOS ANGELES — Manwin urged a federal judge in oral arguments Friday to dismiss counterclaims brought by ICM Registry, arguing the .XXX operator did not have standing to bring counterclaims in the antitrust suit because it cannot show it was injured.

ICM Registry, in its countersuit, accused Manwin of trying to destroy its “commercialization of .XXX” because the top-level domain “poses a potential threat” to Manwin's dominance of adult websites.

But at Friday's hearing, U.S. District Judge Phillip Gutierrez was unsure whether ICM Registry had properly alleged an antitrust injury in counterclaims, according to Law360.com.

ICM Registry filed counterclaims in September, alleging that Manwin illegally attempted to “maintain a monopoly and market power” by pulling ads and video clips submitted to its .XXX tube sites and encouraging a “wholesale boycott” of the .XXX extension in the adult entertainment industry.

“Direct dealers and suppliers” of goods to an affected market have standing, Gutierrez told ICM Registry's attorney, Richard Sybert. “You're an indirect seller [of domain names] ... there are cases that ... basically state that indirect sellers don't have standing."

Sybert argued that as a direct result of Manwin's alleged boycott, the .XXX operator has been injured in terms of its ability to “supply goods and services to others.”

But Manwin attorney Kevin Gaut said it had alleged only that there may be “impediments to putting adult websites on .XXX.”

“We are not a competitor with ICM,” Gaut said. “ICM sells domain names; we do not. ICM does not sell websites; we do.”

“At most, there's harm to .XXX, not a harm to the market, not a harm to the competition,” he said.

ICM Registry won approval in 2011 from ICANN, also a party to the original antitrust suit, to provide .XXX registry services. Manwin and Digital Playground alleged in their antitrust suit that the approval process was unfair and ICM Registry engaged in anticompetitive practices, including price-gouging trademark owners who must purchase "defensive registrations” of .XXX domain names.

Gutierrez at the hearing said that he would take Manwin's motion to dismiss counterclaims under submission.

"A ruling will be issued after full consideration of the submitted pleadings," he said.

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