Despite expressing sympathy for the plaintiff, who was bombarded with more than 1,000 unwanted e-mails advertising a pornographic website, the Ninth Circuit affirmed the dismissal of a “novel and creative” suit against a domain site registrar because it was erroneously premised on a third-party beneficiary theory.
In Balsam v. Tucows, Inc. a spam victim alleged that the defendant domain site registrar utilized a system to hide the identity of spammers, and that the plaintiff was an intended third-party beneficiary of the Registration Accreditation Agreement (“RAA”) between the defendant and the Internet Corporation for Assigned Names and Numbers (“ICANN”). The RAA permitted the defendant to sell domain name registrations to third parties, who thereby became registered name holders. The provision in question (¶ 22.214.171.124) provided as follows:
“A Registered Name Holder licensing use of a Registered Name according to this provision shall accept liability for harm caused by wrongful use of the Registered Name, unless it promptly discloses the identity of the licensee to a party providing the Registered Name Holder reasonable evidence of actionable harm.”
The plaintiff alleged that he attempted without success to learn from the defendant the true identity of the website operator sending the unwanted e-mails, but that the defendant refused to reveal that information because it afforded anonymity to the spammer pursuant to a “privacy feature” that allowed website operators to remove their identity information from the ICANN database. The plaintiff sued as an alleged third-party beneficiary of the RAA between ICANN and the defendant, on the theory that the defendant (the nominal registered name holder) was required to accept liability for harm caused by the spammer’s wrongful use of the pornographic website.
The District Court had dismissed the plaintiff’s claims, agreeing with the defendant’s challenge to the plaintiff’s status as an intended third-party beneficiary. The Ninth Circuit affirmed, finding that the contract provision in the IRAA did not support a claim that the parties to the RAA (ICANN and the defendant) intended to benefit or confer any rights upon third parties such as the plaintiff. The Ninth Circuit was persuaded that ¶ 126.96.36.199 of the RAA did not trump another provision in the agreement which expressly stated that the RAA was not to be construed to create any obligation to any non-parties. The court also found fault with the plaintiff’s argument that ¶ 188.8.131.52 of the RAA created liability on the part of the defendant for its actions as a registered name holder, since the defendant had entered into the RAA not as a registered name holder but as a registrar of domain names. The Ninth Circuit noted that there is “no simple remedy for the vast number of unsolicited emails . . . that fill our electronic inboxes daily,” and that spammers “continue to find new ways to advertise.”