Front Running

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Recommendation: Avoid
Avoid.jpg
Summary: Using inside info to register domain names others want
Outcome: Possible extortion or manipulation, conflict of interest,
loss of trust
Addressed by ICANN Policy: Y
Addressed by Legislation: N
Related to: No current article

Front Running as it relates to the domain industry is the practice of using insider information to register a domain name that someone else wants to register in order to charge a higher price for the domain name or to get the registrant to sign the name with a particular registrar.[1][2]

Public Perception

The public perception of domain name front running is that it is an unfair practice that harms the registrant. It is often seen as a conflict of interest for registrars[1] and compared to insider trading. [2] It is worth noting that there is debate over the existence of domain name front running.[1][2][3]

Outcome

The outcome of this practice is a lack of trust between registrants and registrars and possibly extortion if the accusations of front running are verified.[2]

Historical Use

  • In theory, domain name front running occurs when people interested in registering domain names use WHOIS or a popular registrar's website to see if their desired domain name is taken. [4] The registrar or another third party then uses this search data to register the name, making it unavailable except under the registrar or third party's terms and conditions.[1][4]
  • In 2008, Network Solutions was accused of front running because a protective service it used put domain names searched on their site on hold for 4 days after the initial search. [5] The result was that if a person wanted to register the searched for domain name, they would have to register with Network Solutions or wait for the name to become available again.[6] Network Solutions settled in a 1 million dollar class action lawsuit over the service.[7]

ICANN Policy

  • A study by ICANN's Security and Stability Action Committee (SSAC) found no proof of domain front running after completing more than 600 tests [3] and dismissed 120 complaints of possible front running.[2]
    • Despite not finding definitive evidence of front running, the SSAC did not disqualify the possibility of front running and expressed concern over the "deteriorating trust relationship between registrants and registrars and...loss of faith in the registration process." [2]
  • In addition, a clause in Specification 9 of the 2013 RA states that front running activities are prohibited.[8]

Legislation

  • Domain name front running is not specifically addressed by U.S. law at this time.

DNS Award

Awardees do not use inside or privileged information to engage in front running or other such behaviors that create conflicts of interest between the company and registrant.

Additional Resources

Related Articles

  • Another practice that may give registrars an advantage over registrants is Warehousing.

References

  1. 1.0 1.1 1.2 1.3 How To Keep Your Domain Name Searches Safe From Poachers by Michael Cyger (April 3, 2011), Domain Sherpa.
  2. 2.0 2.1 2.2 2.3 2.4 2.5 Security and Stability Advisory Committee (SSAC): Domain Name Front Running (PDF), Internet Corporation for Assigned Names and Numbers (ICANN)
  3. 3.0 3.1 Results of Domain Name Front Running Study (August 4, 2009), Internet Corporation for Assigned Names and Numbers (ICANN)
  4. 4.0 4.1 Network Solutions Scam by Louis J. Bruno (March 7, 2008), PC News Digest
  5. Editorial: Where Network Solutions Went Wrong by Andrew Allemann (January 9, 2008), Domain Name Wire
  6. Lawsuit targets Network Solutions, ICANN over the 'front running' of domain names by Paul McNamara (February 25, 2008), Network World
  7. Network Solutions Front-Running Leads to $1 Million Class Action Settlement by Adam Strong (April 29, 2009), Domain Name News
  8. ICANN Registry Agreement