July 25, 2006 7:03 AM PDT

Registrars accused of hoarding 74,000 domain names

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EURid, the organization that administers the .eu top-level domain, has suspended 74,000 domain names after launching a lawsuit against 400 American registrars for "breach of contract."

The domains in question were all registered for three U.K.-based companies: Ovidio, Fausto and Gabino. Among them, the three companies registered 74,000 names, EURid said.

According to EURid, the three companies are a front for a "syndicate" of 400 U.S.-based registrars, which stand accused of "warehousing" the domain names--registering them speculatively for resale, rather than following a client's request.

EURid said Monday that abusing the registration system could lead to a "risk that the perceived value of .eu will decrease, not only for the almost 2 million legitimate holders of .eu domain names but also for all fair registrars."

"As a registrar, you should have an end user ask you to register a domain name for you before you can register it," EURid communications manager Patrik Linden told ZDNet UK on Monday.

"Since they cannot do that in their own name, we say they have registered the domains using these three companies as a front...Also, as they are American, they could not have done this, but that is a separate issue," he added.

Linden noted that legitimate purchasers of .eu domains have not had their domains suspended. "If you are the holder, you're not affected," he said.

A search on the Web site of Companies House--the U.K. government's registry of U.K. companies--lists Ovidio, the only company of the three to appear there, as a business that does "market research, opinion polling."

However, EURid claims the three companies "can be regarded as one and the same," and a look through their static-page Web sites displays identical text, with only the names of the companies differing.

The Web sites did not list phone numbers or e-mail addresses for contact.

The companies' sites were all registered through a U.S. company called Domains By Proxy.

Domains with a .eu extension became generally available earlier this year, following a "sunrise period" when European companies and organizations got first option on their names and trademarks.

The launch was nonetheless plagued with complaints--including one from registration company GoDaddy founder Bob Parsons--that registrars were stockpiling domains by the thousands.

David Meyer of ZDNet UK reported from London.

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