ICANN: The Jones Day Part of the Story

On September 30, 1998, a legal assistant in Jones by an entity that had input and support from a wide Day’s Los Angeles office filed the incorporation array of Internet users. Jon retained Jones Day to documents with the State of California establishing assist him in the development of the entity that even- ICANN as a “nonprofit public benefit corporation.” tually became ICANN. The Articles of Incorporation were signed by a Jones Day partner. Shortly thereafter, the incorporators per- Since ICANN’s formal incorporation, Jones Day has formed the ministerial task of electing those persons continued to serve as its primary outside counsel, who had been selected (with the active involvement offering its services on a discounted basis. Over this of Jones Day lawyers) to sit on the first Board of last decade, Jones Day lawyers from all over the world Directors of ICANN, and that Board held its first meet- have successfully dealt with every legal challenge that ing in the “distinguished” quarters of the Holiday Inn ICANN has faced—and there have been many, rang- JFK in New York (a convenient location for a gathering ing from contract and labor claims to antitrust claims. of folks from around the world). At that meeting, the Board elected its first Chairman (Esther Dyson) and To understand ICANN, one has to understand the its first President and CEO (Mike Roberts). Jones Day Domain Name System. When the Internet was just provided all the required legal support on a pro bono being created in the 1970s, the individual numeric basis, as it had months earlier when ICANN was incor- addresses for locations on the Internet could be (and porated. From that very tenuous beginning, ICANN were) kept by and in a notebook by then graduate has now become an organization with an annual bud- student, later Dr. Postel. But with the development get of over $60 million and over a hundred employees of the protocols called TCP/IP by Vint Cerf (another located throughout the world. Today, ICANN supervis- UCLA graduate who later became ICANN’s Chairman es numerous aspects of the Internet’s domain name for many years) and Bob Kahn, the technology system, all the while maintaining the security and sta- advanced rapidly. All of this development was done bility of the Internet, and creating competition in the largely in connection with government grants from the domain system in order to stimulate innovation. Defense Advanced Research Projects Agency and the National Science Foundation. The Early Years. Jones Day was originally retained by one of the great founders of the Internet, Jon Postel. As the list of addresses proliferated, the Domain During the early years of the non-commercial Internet, Name System was created in the mid-1980s, with the Jon was a UCLA graduate student who literally kept goal of assigning strings of letters (easier to remem- all of the Internet’s addresses on a notepad. This was ber) to the numeric addresses that were being used not terribly difficult because there were only a handful to identify specific locations. This too was done under of Internet addresses, mostly associated with major a grant to Dr. Postel, who had become a University universities. As the Internet grew, and as the demand of Southern California professor of computer sci- for Internet names increased, Jon (and the U.S. gov - ence, and he created a database that he called the ernment) understood that the technical aspects of the Internet Assigned Numbers Authority (IANA). It was still Internet’s Domain Name System had to be operated just Jon Postel and a few helpers, but it sounded a lot more substantial (and undoubtedly made the government claiming (as always) to represent the common man, also grant authorities feel better about continuing to provide the objected that they had no say in all this. As a result of all funding). these forces, this first effort collapsed, but it was now obvious to everyone that some new solution was needed. At that time, there were only seven Top Level Domains (TLDs) to be used for domain names throughout the world—“.com” By now, the agency within the U.S. government that had (intended as the commercial TLD), “.org” (intended for non- the lead on this was the National Telecommunications and profits), “.net” (intended for network operators), “.mil” (military), Information Administration of the Department of Commerce, “.edu” (education), “.int” (international organizations), and but the NSF, the Pentagon, the State Department, and the “.gov” (government). Until ICANN was created, .com was the U.S. national security apparatus all remained interested in only TLD for commercial organizations, and thus it became how this turned out. Jon was advised to get some help, so almost synonymous with the Internet, even though in reality it (naturally) he turned to the Internet and literally searched for was just one of a growing number of TLDs. For example, Jon law firms that appeared to have corporate (he needed help Postel was also the DNS evangelist, trying to find people in in creating an entity), antitrust (since any new entity would every country in the world to take on the responsibility of run- have ultimate control over the addressing infrastructure of ning what he called country code Top Level Domains. These the Internet), litigation (he anticipated a lot), and Washington were TLDs intended to serve the people of a particular coun- (for obvious reasons) expertise. try—e.g., “.us” for the United States, “.fr” for France, and “.cn” for China. There are more than 250 country code TLDs today, Dr. Postel contacted Joe Sims of Jones Day, who consult - and some (“.de” for Germany, for example) are very large and ed with his partners Jeff LeVee, Mike Weinberg, and Louis active. ICANN has even created a “regional” TLD for Europe. Touton. (Louis Touton later became ICANN’s first employee and its general counsel for a number of years; he has now The Netscape IPO, the first significant financial event tied to returned to Jones Day.) They went out to meet with Dr. Postel the Internet, took place in 1995, really the seminal event of in his offices in Marina del Rey, California (where ICANN the commercialization of the Internet. Dr. Postel realized that remains headquartered today); Jon gave us a tutorial about having a single person managing the entire Internet address- how the Internet was created and his role in it, and we were ing system was not a long-term practical solution, and so he fascinated. We agreed to help him put together an entity that began to organize an effort to establish a nonprofit organi- could take over responsibility for the IANA, thinking naively zation that would be headquartered in Geneva, Switzerland, that this might take a few months and a minimal amount of to take over this responsibility. He would have remained lawyer time, and agreed that we would do so on a pro bono involved, thus lending his expertise and credibility to the basis, including the costs associated with international trav- new venture, but this would be a permanent infrastructure el, if necessary. That was the beginning of an incredible ride that would survive him and become a permanent part of the that, now 13 years later, continues to fascinate an increasing Internet environment. number of Jones Day lawyers.

Unfortunately, Jon was a scientist, not a policy or business First, ICANN had to gain the U.S. government’s approval. The guy, and he underestimated the various tsunamis that were person charged with the principal oversight on this was Ira precipitated by this effort. Governments were just starting to Magaziner. Ira was an essential supporter because he want- wake up to the notion that the Internet would have enormous ed this to be a private-sector initiative with minimal govern- consequences for society, and some of these governments ment involvement. This was also the view of most businesses raised questions about whether this important technology that were paying attention, but it was definitely not the view should be under private control as opposed to governmen- of the public-sector groups who purported to speak for con- tal control. Large businesses, especially in the U.S., were not sumers, nor of most other governments in the world, which happy to see this important technology potentially headed saw this as an inherently governmental activity. for governmental control; they rallied U.S. political opposition by claiming that Dr. Postel was trying to “steal” the Internet We spent several months in 1998 working with Dr. Postel to and move it to Switzerland. And political interest groups, create an entity, with a corporate structure and bylaws, and publishing various drafts for the world to comment on – in courts in California, New York, Florida, Texas, Missouri, mostly critically. We went to innumerable meetings all around Canada, India, France, and elsewhere. Over the past few the world (including Geneva, Berlin, and Singapore), and we years, the disputes have extended even to China. met with a number of governments. There were groups that were formed for the purpose of creating proposals that com- ICANN’s long-term survival was not really predictable until peted against Dr. Postel’s proposal – the most significant one final test. In 2000, VeriSign acquired NSI in a transac - was an entity known as the Boston Working Group – but Dr. tion valued at that time of more than $20 billion. At that point, Postel’s proposal always was viewed as most likely to suc - VeriSign operated .com, .net, and .org, the three most promi- ceed. Finally, in October 1998, the U.S. government recog- nent Top Level Domains. Having made such a significant nized ICANN as the provisional body to work with it to try to investment, VeriSign sought over the next few years to maxi- privatize the management of the DNS. mize the value of those domains, and that produced a variety of disagreements with ICANN, and eventually an antitrust suit As it turned out, gaining U.S. approval was only the begin- filed against ICANN. Jones Day lawyers (led by Jeff LeVee) ning. Since ICANN has no governmental powers, all of consistently defeated this attack, getting the antitrust suit ICANN’s management of Internet addressing has to be done dismissed not once but twice. While the last dismissal was by private contract. ICANN still operates on this basis today on appeal in 2005, the parties entered into a comprehensive since it has no “governmental” authority and cannot simply peace agreement – ending the final serious battle of a sev- require compliance. It took some time (and help from vari- en-year struggle by ICANN for its long-term survival. Perhaps ous sources) to persuade the various private entities that not surprisingly, the settlement between VeriSign and ICANN had already become involved in the Internet that they should was itself the subject of an antitrust lawsuit, which again was agree to contracts giving ICANN oversight authority over their defeated on a motion to dismiss but which was not ultimately operations, but eventually those contracts began to be put in resolved against VeriSign until 2011. place. This was particularly true with respect to the entity that had for several years had a government contract to operate Since 2005, ICANN has both increased its funding and the .com, .net, and .org (then referred to as Network Solutions, professionalism of its operations. ICANN’s CEOs have reflect- Inc. or NSI), which had zero interest in the notion that com- ed this evolution. The most recent two CEOs were former petition for the domains it managed would be created in the government officials. From 2004-09, ICANN’s CEO was a DNS. It took months of negotiations to get NSI to enter into former Australian government official who was Australia’s contracts with ICANN (and parallel contracts with the USG), representative from the very beginning of the ICANN story; but it did so, and those initial contracts served as the basis under his direction, ICANN stabilized and became a more for the creation of competition so that, today, a consumer well established part of the Internet infrastructure. During can subscribe to a domain name on the Internet for a dol- this period, ICANN established a handful of new Top Level lar or two a year. By contrast, in 1998 NSI (the only seller) Domains (mostly “sponsored” TLDs that were promoted by a charged $35/year for each name. The savings to consumers sponsorship organization to benefit a defined Internet com- worldwide literally runs into billions of dollars. munity.) In addition, ICANN accredited hundreds of regis- trars (organizations like GoDaddy and Register.com that sell In the meantime, ICANN had to start operating as a func - domain names to businesses and individuals), coordinated tioning entity, with employees, an office, and all of the bells- with the individuals and organizations that operate the 13 and-whistles that a small business must have. Much of this root servers (the computers that actually hold the authorita- was accomplished by Louis Touton, who left Jones Day to tive lists of domain names), and oversaw the five Regional become ICANN’s first full-time employee and general coun- Internet Registries (RIRs) that actually manage the numeric sel. Louis found office space, hired other employees, and address stock for the Internet. functioned as ICANN’s webmaster, all the while flying all over the world trying to establish ICANN’s credentials. And virtually In 2009, ICANN hired its current chief executive, the former every time ICANN made a decision that affected the opera - Director of the U.S. National Cybersecurity Center. Under his tions of the Internet in any way, various affected entities filed leadership, ICANN has moved forward in several particularly suit, requiring Jones Day’s litigation team to defend ICANN meaningful ways. First, ICANN has started the transition from what is called Internet Protocol Version 4 (IPv4) to IPv6. The discussion. ICANN also has been concerned that some of use of IPv4 allows only about four billion numeric Internet the proposals may infringe on existing intellectual property addresses, and they are running out, perhaps as soon as rights, or that some of the proposals will offend a variety of 2010. Transitioning to IPv6 will permit 340 trillion separate “international standards.” Because these standards obvious- addresses. To give an idea of the scale, if all existing four bil- ly vary from country to country, ICANN needed to articulate lion IPv4 addresses could be contained inside a Blackberry “international standards” that are consistent with as many phone, the new IPv6 system would require a container the bodies of law as possible, a difficult task in today’s world. size of several thousand Earths. Since the transition has to be done by touching a very large number of servers and net- Working closely with Jones Day lawyers from around the works around the world, it is a multiyear process, but presum- world, ICANN’s Board developed the new gTLD program over ably it will pick up speed as we literally begin to run out of the past six years, and on June 21, 2011, voted to proceed Internet addresses. with this expansion of the DNS. Jones Day’s team was led by Jeff LeVee in our Silicon Valley and Los Angeles offices, who Second, ICANN has begun the process of introducing so- has become ICANN’s principal outside lawyer, and includ- called Internationalized Domain Names into the DNS, which ed Joe Sims, the lawyer originally in charge of the ICANN would allow people to create and find web sites using char- relationship, Pierre Heitzmann and Carroll Dorgan in Paris; acter sets other than the ASCII set that is the basis of what Meredith Wilkes in Cleveland; Peter Wang and Sebastien the DNS uses today. This is complicated because (among Evrard in Shanghai, Bernard Amory in Brussels; Jim King in other problems) many non-ASCII characters can have multi- Columbus; Jennifer Swize and Mike Fried in Washington; ple meanings, and the one thing that is critical for an Internet Kevin Espinola in Irvine; Karen Hewitt in San Diego; and Eric address is that it be unique. It has taken many years to fig- Enson, Chris Lovrien, Kate Wallace, and Cindy Reichline in ure out how to deal with this complication, and on October 9, Los Angeles. 2007, a test-bed using 11 different languages went live. Since that time, ICANN has approved domain names in numerous Jon Postel would have been very proud of what has been languages, including Arabic, Persian, Chinese, among numer- done, but he unfortunately passed away of heart problems ous others. literally days before the U.S. government recognized his cre- ation of ICANN in 1998. This was about as bad timing as you Third, ICANN signed a landmark document with the U.S. can imagine because it robbed ICANN of the single per - Government known as the Affirmation of Commitments. This son to whom it owed most of its credibility, but we were far document, the seventh amendment of the original document enough down the track that ICANN was able to obtain USG by which the USG identified ICANN as the entity that would recognition and begin its mission. Also, Jon had close friends privatize the DNS, committed ICANN to remain a not for profit from his early days at UCLA, including Vint Cerf, who became organization and declared ICANN to be independent and not ICANN’s second board chairman and helped guide the entity controlled by the USG or any other entity. In turn, ICANN com- that Jon created; several of those individuals continue to play mitted to continuously evaluate its performance via commu- very important roles at ICANN. nity-based evaluations. ICANN has come a long way from a simple idea in Jon’s head Finally and perhaps most significantly, ICANN has now to the organization that it is today with unquestioned author- approved a program that could create a new paradigm in the ity over the Internet’s name and number system. It is not an Internet naming system. As noted above, ICANN so far has exaggeration to say that Jones Day has been there since added only 13 new TLDs to the original seven, moving cau - even before the beginning, and can rightly take pride in its tiously to be sure that the addition of new TLDs would not contribution to the stability and security of the Internet, the destabilize the DNS. It now appears that many and perhaps most powerful force for communications and commerce the an unlimited number of additional TLDs can be added with- world has ever known. out a destabilizing effect, but of course the process and rules for such additions have been the subject of widespread

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