Conflicts of Interest

One of the phrases that has stuck with me since law school is this one having to do with ethical guidelines:

"Avoid even the appearance of impropriety."

Following this advice means to stay far enough on the safe side of the line that most risks are reduced significantly. It also means that you are less likely to take advantage of a situation where the benefits flow in only one direction.

I can't help but wonder how different the domaining industry might be if it reflected the values expressed in those words. When I look at the DomainTools.com daily update showing past domain name drops from my company portfolio that have been picked-up immediately following deletion,  I am puzzled when I see the new record owner is a registrar or third party affiliated with the registrar I initially used to register the domain.* The first question that goes through my mind is this one:

What does this company know that I don't? Coincidence? Perhaps, but unlikely.

My suspicion is that the company probably knows plenty - including the following:

• WhoIs look-ups
• Site traffic
• Parking Revenue (from registrar parking)
• CTR (Click Through Rate)

Clearly, if I was provided access to such information, it's highly unlikely that I would have ever let certain names drop. What disturbs me the most is that domain registrations from my company and from thousands of others provide the continuing infusion of cash that these companies need to stay alive. Does customer loyalty have to be legislated before I should expect (or demand) that a registrar or affiliated third party not act inconsistent with my own business interests?

When my children were young, was telling them not to steal from the supermarket motivated because I wanted to instill in them a sense of right and wrong? Or was it because I was afraid if they were caught, there would be legal consequences that would affect both their lives and my wallet?

All contracts contain an implied covenant of good faith and fair dealing. On this basis alone, I don’t believe it's unreasonable to expect that a registrar or affiliated third party should not be using in-house information to its own advantage in a way that ultimately thwarts the very purpose for which a domain registration agreement is made. Waiting for the domain to be deleted from my account makes it no easier to understand. The failure to make information accessible that could have been meaningful in making the decision to renew or drop domain names should not financially benefit a registrar or affiliated third party when to do so is to act to the exclusion of my company’s own financial interests. Try that when brokering the sale of a piece of real estate and see what happens.

Even if a registrar was not interested in registering a domain following deletion, is there any rationale for not granting access to information that could help me better manage my domains? After all, I am a customer. Right?

Never mind that I could park, develop or sell my company inventory of domain names. That has nothing to do with the issue presented here. What’s more, the example discussed in this post is just the tip of the iceberg. What else is there?

How about these two for starters:

1. When I choose not to park my domains, but a registrar chooses, nonetheless, to feed ads to those same registrations for its own account, does the registrar understand the increased risks and/or potential for conflict with trademark holders to which it exposes me?
2. When a domain drops and goes to auction, but my company receives absolutely nothing from the proceeds, does the registrar understand the message it sends to its customers?†

“Greed is good. You don’t matter. Go away.”

IMHO, stealing a candy bar from the supermarket is neither as calculated nor as offensive an act as what I’ve described in this post. “Avoiding even the appearance of impropriety,” would have provided clear, ethical guidelines for resolving both situations without need of discussing either criminal or contract law. What is so difficult about doing the right thing?

* I use multiple registrars, so knowing the underlying registration data of any specific domain or domain names I have registered does not point the finger at any specific registrar or third party affiliate.

† I’m aware that Fabulous.com offers a program in which it does share the proceeds from drop auctions. That’s a huge first step in creating a meaningful relationship between the registrar and registrant.