01 December 2016

ICANN New gTLDs' Covenant Not To Sue Sinks Donuts, DCA Trust Next?

Oyez! Oyez! Oyez! Take notice all ye new gTLD applicants, the Applicant Guidebook's Covenant Not To Sue means what it says, you waive your rights to sue ICANN, so rules the Honorable Percy Anderson, U.S. District Court Judge: 
Covenant Not To Sue in New gTLDs Applicant Guidebook 
Final paragraph of Judge Anderson's Order in Ruby Glen vs ICANN (highlighting added), dismissing with prejudice Ruby Glen's First Amended Complaint (FAC):

The District Court's Order and Judgment are embedded below. Further, in a footnote, Judge Anderson stated: [1] The Court does not find persuasive the preliminary analysis concerning the enforceability of the covenant not to sue conducted by the court in DotConnectAfrica Trust v. ICANN, Case No. 2:16-cv-862 RGK (JCx) (C.D. Cal. Apr. 12, 2016).

The Ruby Glen (affiliate of Donuts Inc.) lawsuit involved new gTLD .WEB. The DotConnectAfrica Trust (DCA Trust) lawsuit involves new gTLD .AFRICA, and has been remanded by the U.S. District Court to a California state court in Los Angeles. Ruby Glen and Donuts also have a pending CEP (Cooperative Engagement Process) proceeding in connection with the .WEB last resort auction won by Nu Dot Co. For more see .AFRICA, .WEB, ICANN Litigation Update, IRP & CEP Status Report (15 Nov 2016).

Whether Ruby Glen (Donuts) will appeal is unclear, although Jon Nevett, Donuts co-founder and Executive Vice President, released a statement according to DomainNameWire.com, stating "Donuts disagrees with the Court’s decision ... Donuts will continue to utilize the tools at its disposal to address this procedural failure."

If  Ruby Glen (Donuts) does appeal, that could be doing ICANN a big favor as ICANN would like a published Ninth Circuit Court of Appeals opinion affirming Judge Percy Anderson and enforcing the Covenant Not To Sue, which could then be cited as legal precedent in any case brought by new gTLD applicants, now, or in future rounds of new gTLDs.

Order dismissing (pdf):



Final Judgment (pdf):




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