On Tuesday, April 12, 2016, the Honorable R. Gary Klausner of the Central District of California granted a preliminary injunction in favor of our client DotConnectAfrica Trust (“DCA”). The preliminary injunction prohibits defendant Internet Corporation for Assigned Names and Numbers from delegating the rights to the generic top-level domain (“gTLD”) “.Africa” until the case resolves.
As a initial issue to the preliminary injunction motion (and central to ICANN’s opposition), ICANN argued that DCA was barred from pursuing any court-related relief as a result of a provision included in the gTLD application Guidebook. The relevant portions of the provision are as follows:
"Applicant hereby releases ICANN…from any and all claims by applicant that arise out of, are based upon, or are in any way related to, any action, or failure to act, by ICANN…in connection with ICANN’s…review of this application…Applicant agrees not to challenge, in court…any final decision made by ICANN with respect to the application, and irrevocably waives any right to sue or proceed in court…on the basis of any other legal claim against ICANN….with respect to the application.”
DCA argued that because the provision barred relief from any and all claims arising out of the application process – including fraudulent or intentional wrongdoing - the release was void as a matter of law pursuant to Cal. Civil Code §1668. Section 1668 provides that “[a]ll contracts which have for their object, directly or indirectly, to exempt anyone from responsibility for his own fraud, or willful injury to the person or property or another, or violation of law, whether willful or negligent, are against the policy of the law.” The Court agreed with DCA, finding the provision “against the policy of law” by exempting ICANN from fraudulent or intentional wrongdgoin. The court rejected both of ICANN’s arguments that (1) the release had to affect public policy to be void, and (2) because DCA’s motion for a preliminary injunction was not based on DCA’s claims for fraud, the provision was enforceable here. The Court held that DCA alleged intentional misconduct and those allegations sufficed for purposes of finding the provision unenforceable.
Continuing through its analysis, the Court found serious questions as to the merits of DCA’s declaratory relief claim that ICANN be ordered to follow the decision of its internal review process and continue to process DCA’s .Africa application in accordance with ICANN’s bylaws and articles of incorporation. Agreeing with DCA, the Court emphasized the fact that .Africa can only be issued once; if DCA’s application was improperly processed and ICANN is not barred from delegating the .Africa rights, DCA could suffer irreparable harm losing the chance to control the .Africa domain. Balancing this fact against any potential harm to ICANN, the scales tipped sharply in DCA’s favor. Finally, with respect to the public interest involved in the issuance of a preliminary injunction, ICANN claimed that delay would prejudice the African community. ICANN put forth a declaration to support this claim from Moctar Yedaly – the head of the AUC’s Information Society Division of the Infrastructure and Energy Department. As the AUC was alleged to have improper involvement in the processing of DCA’s application, the Court noted Mr. Yedaly's conflict of interest and gave little weight to the declaration. The Court stated that “it is more prejudicial to the African community, and the international community in general, if the delegation of .Africa is made prior to a determination of the fairness of the process by which it was delegated.”
A copy of the order can be accessed here.