Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Domain name holder alleges Verisign, ICANN hold illegal monopoly over.com registry, (Sep 9, 2026)

By Lynn Stanton, TR Daily

The suit challenges both Verisign’s monopoly over the authoritative database that makes every.com website and email address on the Internet and the written contract that makes its extraction possible: the.com Registry Agreement between Verisign and Internet Corporation for Assigned Names and Numbers.

A domain name registrant has filed a lawsuit against.com domain registry operator Verisign, Inc., and the nonprofit Internet Corporation for Assigned Names and Numbers (ICANN), alleging that the agreement between Verisign and ICANN allows Verisign to charge monopoly prices while making payments to ICANN that “by 2020, … accounted for nearly 30% of ICANN’s total revenue.” Jeff Kessler, a California resident, has owned six.com domains since 2019 and is seeking class certification for his lawsuit filed with the U.S. District Court for the Central District of California (Kessler v. Verisign, Inc., Case 2:26-cv-09960 (C.D. Cal. Sept. 4, 2026)).

“This is a case about a company that acquired a monopoly and then ensured no competitive process would ever threaten it. Defendant Verisign, Inc. (‘Verisign’) purchased control of the.com registry, the authoritative database that makes every.com website and email address on the internet functional, coerced the organization responsible for overseeing it into a contract that eliminated every competitive safeguard, and now charges supracompetitive prices to consumers who have no alternative. This action challenges both Verisign’s monopoly and the written contract that makes its extraction possible: the.com Registry Agreement between Verisign and Defendant Internet Corporation for Assigned Names and Numbers (ICANN), a private California nonprofit organization created in 1998 at the direction of the United States government to promote competition in the domain name marketplace,” the lawsuit says, Jeffrey Kessler v. Verisign, Inc., and Internet Corporation for Assigned Names and Numbers, No. ___ (C.D. Cal. Filed Sept. 4, 2026)).

“Verisign’s monopoly generates over $1.6 billion in annual revenue from its captive customer base. Its SEC filings indicate an approximate per-domain cost of $3.096, which means that, at the current wholesale price of $10.26, Verisign’s markup is approximately 232% over cost. The company’s operating margins exceed 67%, higher than Apple, Microsoft, or Alphabet, and more than five times the S&P 500 average,” it adds.

“Verisign spends just six cents of every revenue dollar on research and development. In 2024, its CEO received $14 million in compensation for overseeing a workforce of approximately 930 employees. In 2025, the company returned over $1 billion to shareholders through buybacks and its first-ever dividends. These results would be impossible in a competitive market,” the lawsuit asserts.

The lawsuit argues that.com domain name registry services and the.com top-level domain (TLD) “is the most valuable and widely used top-level domain in the world. As of Q2 2026, there were approximately 166 million.com registrations, representing over 41% of all domain registrations worldwide. Verisign is the sole operator of the.com registry. No other entity can provide.com registry services, and no registrar or registrant can obtain.com domains from any source other than Verisign. Verisign’s market share within the.com registry services market is 100%.”

It argues that the costs of switching to a different TLD are “prohibitive” and that “[a]bandoning a.com domain means losing accumulated search engine optimization, inbound links, customer goodwill, and email continuity (and risking that a competitor will acquire the abandoned domain).”

New generic TLDs (gTLDs) have failed to introduce competition, the lawsuit says. “Despite the introduction of over 1,200 new gTLDs since 2012,.com’s dominance has only strengthened,” it adds. Verisign’s history of price increases confirms its monopoly status, the lawsuit argues.

It also alleges “insurmountable barriers to entry. Only one entity can operate the.com registry at any given time; the right to do so is conferred solely through the Registry Agreement with ICANN. The presumptive right of renewal contained in that agreement ensures that Verisign’s monopoly is self-perpetuating. No potential competitor can enter this market without displacing Verisign through a competitive bidding process that, as a practical matter, will never occur under the current agreement.”

The lawsuit alleges injury to the plaintiff and similarly situated individuals and entities due to paying “higher prices for.com domain name renewals than they otherwise would have paid but for Defendants’ conduct.”

“During the last four years, Verisign has maintained and further entrenched its monopoly over the.com registry services market by enforcing the presumptive renewal provision that forecloses competitive bidding, by raising wholesale prices to the contractual maximum in every permitted year, and by continuing to benefit from the exclusionary conduct alleged herein. … Throughout this period, Defendants have jointly maintained and furthered their conspiracy to monopolize the.com registry services market,” the lawsuit says.

The lawsuit alleges violations of section 1 of the Sherman Antitrust Act’s prohibition on unreasonable restraint of trade.

“The contract, combination, or conspiracy alleged herein consists of the.com Registry Agreement between Verisign and ICANN, most recently renewed in November 2024, a written contract between two private parties whose terms foreclose competitive bidding for the.com registry, grant Verisign a presumptive right of perpetual renewal, prohibit ICANN’s governance processes from prescribing or limiting the price of registry services, and authorize Verisign to raise wholesale prices by up to 7% annually in four of every six years without cost justification,” it says.

The lawsuit also alleges violations of section 2 of the Sherman Antitrust Act by monopolizing the.com registry services market.

“As more fully alleged above, Verisign has willfully and intentionally engaged in conduct that has had the anticompetitive effects of allowing Verisign to unlawfully acquire, maintain, and enhance its monopoly in the.com registry services market and preventing rivals from competing for.com registry operations. In particular, Verisign engaged in a coercive campaign against ICANN to eliminate competitive bidding, secure a presumptive right of perpetual renewal, and replace cost-based pricing with open-ended authority to raise wholesale prices, and has maintained and entrenched its monopoly through the successive renewal and amendment of the.com Registry Agreement on anticompetitive terms, most recently through the November 2024 renewal that extended the agreement through 2030 without competitive bidding,” it says.

The lawsuit alleges violations of section 2 of the Sherman Antitrust Act by conspiring to monopolize the.com registry services market.

“Beginning no later than 2006 and continuing through the present, Verisign and ICANN entered into and engaged in a combination and conspiracy to monopolize the.com registry services market, with the purpose and effect of maintaining and entrenching Verisign’s monopoly over.com registry services and foreclosing all actual and potential competition for operation of the.com registry,” it says.

The lawsuit also alleges violations of California’s Cartwright Act (section 16720 of the California Business and Professions Code), citing an unlawful combination in restraint of trade and a conspiracy to monopolize trade and commerce in the market for.com domain name registry services, and violations of California’s Unfair Competition Law (sections 17200 et seq. of the California Business and Professions Code).

Companies: Verisign, Inc.; Internet Corporation Assigned Names and Numbers

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