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LAI 2103619 V1 ICANN's Special Motion to Strike Verisign's Claims

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LAI 2103619 V1 ICANN's Special Motion to Strike Verisign's Claims 1 Jeffrey A. LeVee (State Bar No. 125863) Emma Killick (State Bar No. 192469) 2 Courtney M. Schaberg (State Bar No. 193728) Sean W. Jaquez (State Bar No. 223132) 3 JONES DAY 555 West Fifth Street, Suite 4600 4 Los Angeles, CA 90013-1025 Telephone: (213) 489-3939 5 Facsimile: (213) 243-2539 6 Joe Sims (admitted pro hac vice) JONES DAY 7 51 Louisiana Avenue, N.W. Washington, D.C. 20001-2113 8 Telephone: (202) 879-3939 Facsimile: (202) 626-1700 9 Attorneys for Defendant 10 INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS 11 12 UNITED STATES DISTRICT COURT 13 CENTRAL DISTRICT OF CALIFORNIA 14 15 VERISIGN, INC., a Delaware Case No. 04 CV 1292 AHM (CTx) corporation, 16 DEFENDANT INTERNET Plaintiff, CORPORATION FOR 17 ASSIGNED NAMES AND v. NUMBERS' SPECIAL 18 MOTION TO STRIKE INTERNET CORPORATION FOR VERISIGN'S SECOND, THIRD, 19 ASSIGNED NAMES AND NUMBERS, a FOURTH, FIFTH, AND SIXTH California corporation; DOES 1-50, CLAIMS AS STRATEGIC 20 LAWSUITS AGAINST PUBLIC Defendants. PARTICIPATION (CAL. CIV. 21 PROC. CODE § 425.16); MEMORANDUM OF POINTS 22 AND AUTHORITIES 23 [Filed Concurrently with Declaration of John O. Jeffrey] 24 Date: May 17, 2004 25 Time: 10:00 a.m. Courtroom of the 26 Honorable A. Howard Matz 27 28 ICANN'S MOTION TO STRIKE LAI-2103619v1 CV 04-1292 AHM (CTx) 1 PLEASE TAKE NOTICE that the Special Motion to Strike VeriSign's 2 Second, Third, Fourth, Fifth, and Sixth causes of action will be heard on May 17, 3 2004, at 10:00 a.m. or as soon thereafter as counsel may be heard at the courtroom 4 of the Honorable A. Howard Matz, United States District Judge, located at 312 5 North Spring Street, Los Angeles, California. 6 Defendant Internet Corporation for Assigned Names and Numbers 7 ("ICANN") moves this Court for an order, pursuant to California Code of Civil 8 Procedure section 425.16, striking VeriSign's second, third, fourth, fifth, and sixth 9 claims for relief. This motion is based on the grounds that these claims, which arise 10 from a letter that ICANN sent to VeriSign and other ICANN statements about 11 VeriSign's operation of the ".com registry" of the Internet, impinge on ICANN's 12 rights of petition and free speech under the United States and California 13 Constitutions and are therefore subject to a special motion to strike. Pursuant to 14 California Code of Civil Procedure section 425.16(c), ICANN also seeks recovery 15 of its attorneys' fees. 16 This motion is made following the conference of counsel pursuant to Local 17 Rule 7-3, which took place on April 2, 2004. 18 This motion is based upon this Notice of Motion and Motion, the 19 Memorandum of Points and Authorities filed herewith, the Declaration of John O. 20 Jeffrey, ICANN's General Counsel, the pleadings that ICANN filed on April 5, 21 2004 in conjunction with its motion to dismiss pursuant to Federal Rule of Civil 22 Procedure 12(b)(6) (which are specifically incorporated by reference), the papers 23 24 25 26 27 28 ICANN'S MOTION TO STRIKE LAI-2103619v1 2 CV 04-1292 AHM (CTx) 1 and records on file in this action, and upon all other matters and argument that may 2 appropriately be presented to the Court at or before the hearing. 3 JONES DAY 4 Dated: April __, 2004 5 By: Jeffrey A. LeVee 6 Attorneys for Defendant 7 INTERNET CORPORATION FOR ASSIGNED NAMES AND NUMBERS 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ICANN'S MOTION TO STRIKE LAI-2103619v1 3 CV 04-1292 AHM (CTx) 1 MEMORANDUM OF POINTS AND AUTHORITIES 2 INTRODUCTION 3 Pursuant to a May 2001 contract between VeriSign and ICANN, VeriSign 4 operates the "Internet registry" for the ".com" zone of the Internet. ICANN and 5 VeriSign disagree about several aspects of VeriSign's rights and obligations under 6 that contract. These disagreements have led ICANN to advise VeriSign that certain 7 VeriSign activities in its operation of the .com registry violate the contract. In the 8 past, VeriSign has alternately responded by proceeding in conformity with 9 ICANN's stated positions or by asserting its disagreement with ICANN’s positions 10 and ignoring them. Until its seventh claim for relief in this lawsuit, VeriSign never 11 invoked the contractually agreed dispute-resolution mechanism. 12 But VeriSign's instant lawsuit goes well beyond seeking judicial resolution of 13 the contract interpretation dispute. VeriSign’s complaint includes five other 14 contract and tort claims that seek to impose monetary and injunctive liability on 15 ICANN for merely stating its position. VeriSign's second, third, and fourth claims 16 for relief all arise completely from an October 3, 2003 "threat" to "initiate legal 17 proceedings." Compl., ¶ 37. VeriSign's fifth and sixth claims are also based on that 18 letter, as well as other instances in which ICANN made statements about 19 inconsistencies between VeriSign's operation of the .com registry of the Internet 20 and the parties’ contract. Thus, these five claims seek to impose liability on 21 ICANN simply for adopting and stating contractual positions with which VeriSign 22 disagrees. 23 As shown in ICANN's motion to dismiss, dated April 5, 2004, VeriSign's 24 breach of contract and tort claims are legally unsupportable. But claims such as 25 VeriSign's, which seek to impose liability for simply stating a position, have an 26 additionally pernicious effect, especially in the context of a non-profit forum such 27 as ICANN, with respect to broad-based discussion about management of a public 28 resource (the Internet). Even in the context of purely private business affairs, the ICANN'S MOTION TO STRIKE LAI-2103619v1 1 CV 04-1292 AHM (CTx) 1 common law presumes—and the state and federal constitutions ensure—that parties 2 are free to express positions about their legal rights, subject to judicial resolution in 3 case of disagreement. These rights of free speech and to petition the government 4 assume added importance in the context of ICANN, which relies on candid public 5 discussions as important inputs to its decisions about how certain features of the 6 Internet should be managed, and about how ICANN should enforce its contractual 7 rights to implement those decisions. 8 California's anti-SLAPP statute (Cal. Civ. Proc. Code § 425.16) was enacted 9 to mitigate the chilling effect of such lawsuits directed against free-speech and 10 petitioning activities. It establishes a procedure—followed by federal as well as 11 state courts in California—for prompt review and disposal of state law claims 12 against a person arising from acts "in furtherance of the person's right of petition or 13 free speech under the United States or California Constitution in connection with a 14 public issue." Because VeriSign's second, third, fourth, fifth, and sixth claims arise 15 from ICANN's free-speech and petitioning activities in stating its contractual 16 positions and indicating that it would seek judicial redress if necessary, those 17 claims should be stricken under the anti-SLAPP statute. 18 BACKGROUND REGARDING ICANN 19 ICANN is a not-for-profit corporation organized under California law. 20 Compl., ¶ 6; see also ¶ 7 of the concurrently-filed Declaration of ICANN's General 21 Counsel, John O. Jeffrey ("Jeffrey Decl."). ICANN's mission "is to coordinate, at 22 the overall level, the global Internet's systems of unique identifiers, and in particular 23 to ensure the stable and secure operation of the Internet's unique identifier systems." 24 Id. In 1998, ICANN entered into a Memorandum of Understanding (MOU) with 25 the United States Department of Commerce (attached as Exhibit C to ICANN's 26 RJN) in which they agreed to "jointly design, develop and test the mechanisms, 27 methods, and procedures that should be in place and the steps necessary to 28 transition management responsibility for DNS [domain name system] functions ICANN'S MOTION TO STRIKE LAI-2103619v1 2 CV 04-1292 AHM (CTx) 1 now performed by, or on behalf of, the U.S. Government to a private-sector not-for- 2 profit entity." RJN, Ex. C. 3 ICANN seeks to develop consensus wherever possible, and the bulk of 4 ICANN's activity occurs either on the Internet or in meetings open to the public. 5 Jeffrey Decl., ¶ 9. ICANN maintains open and transparent processes, and it 6 regularly posts on the Internet its minutes, transcripts of its meetings, and other 7 important information and correspondence. 8 One of ICANN's functions has been to enter into contracts with the operators 9 of various Internet "registries." Those companies maintain the "zone" or "master" 10 file for the top level domains (TLDs) of the Internet. Id., ¶ 10. TLD registries are, 11 in some senses, similar to phone books in that the registry operators maintain a list 12 (and a variety of other relevant information) about each of the domains within the 13 TLD. Id. ICANN presently has contracts with a number of registry operators, 14 including VeriSign, which operates the ".com" and ".net" registries. Compl., ¶¶ 15, 15 22; see also Jeffrey Decl., ¶ 10. The current .com registry agreement between 16 VeriSign and ICANN was entered into in May 2001 (the "Registry Agreement"). 17 Compl., ¶ 22; Jeffrey Decl., ¶ 10; RJN, Ex. E. 18 BACKGROUND REGARDING VERISIGN'S CLAIMS 19 When most users of the Internet type in an address that has not been 20 registered in the registry, the users receive an "error” message or a "page cannot be 21 displayed" message that states in effect that the Internet site does not exist.
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