Internet Transition May Derail Over Property Question

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By Michaela Ross

Sept. 9 — One of the biggest legal questions swirling around an administration plan to relinquish oversight of technical internet functions is whether it amounts to a giveaway of U.S. property.

GOP critics of the plan say that it would transfer government assets—which, they argue, can only happen if Congress expressly authorizes it under its constitutional authority to “dispose of” it (U.S. Const. art. IV, §3).

“To put the matter very simply: the Obama administration does not have the authorization of Congress, and yet, they are endeavoring to give away this valuable, critical property, to give it away with no authorization in law,” Sen. Ted Cruz (R-Texas), who introduced a bill (S. 3034) in June to block the transition without congressional authorization, said in a Senate floor speech Sept. 8 (21 ECLR 36, 9/14/16).

That argument would be a main factor in any attempt to block the administration's move in a stopgap funding bill, as Cruz wants to do, or any litigation launched against the plan. But there's not universal agreement about whether the administration would actually be giving up property.

“It's still up in the air,” Philip Corwin, founding principal of Virtualaw LLC, told Bloomberg BNA.

The National Telecommunications Information Administration has been working to transition away from its role verifying and approving changes to the internet's root zone file, which acts as a phone book for the internet allowing computers around the world to find each other, to the Internet Corporation for Assigned Names and Numbers since 2014. Cruz and other critics of the move say it could open the door to more internet censorship by foreign countries.

Internet advocacy groups and others who favor the transition argue the root zone file databases cannot be considered government property because they are essentially lists of top-level domain addresses that are provided by companies that run those domains and published on ICANN's private computers.

The data compilation is not copyrightable and has no commercial value, A. Michael Froomkin, a professor at University of Miami School of Law and a leading specialist on ICANN's legal history, told Bloomberg BNA.

“I'd say this argument is as dead as the Cruz '16 campaign,” Froomkin said of the legal property concerns.

But critics of the plan don't see things the same way.

Apart from congressional civil action, private organizations that contract with ICANN might use the legal property argument to pursue litigation against ICANN if the property status of the root zone is not clear after a transition, Berin Szoka, president of TechFreedom, a free market think tank, told Bloomberg BNA.

Szoka said there are some domain name registrars or registries that contract with ICANN and are concerned about the organization's accountability after the U.S. removes its oversight of the organization. These groups could then use the premise that the root zone file transfer wasn't legal to file complaints against the corporation, which is an global body of businesses, governments, academics and trade groups, among others.

Potential House Lawsuit

Rep. Mike Kelly (R-Pa.) introduced a resolution (H. Res. 853) in the House Sept. 8 to authorize House Speaker Paul Ryan (R-Wis.) to go to court to try to block the transition. Kelly included language in the resolution observing that NTIA is going ahead even though the Government Accountability Office has not announced an opinion on the question in response to an earlier congressional request.

Matt Sparks, a spokesman for House Majority Leader Kevin McCarthy (R-Calif.), told Bloomberg BNA the resolution “has to go through committee before floor action is considered.” A spokesman for Ryan did not immediately respond to a request for comment.

In a Sept. 8 letter to Attorney General Loretta Lynch and Commerce Secretary Penny Pritzker, the Republican chairmen of four House and Senate committees also pointed to the fact that the GAO hasn't weighed in on the property question, and called for the transition plan to be reconsidered.

“Absent clear legal certainty, moving forward with the transition could have devastating consequences for Internet users,” Senate Commerce, Science, and Transportation Committee Chairman John Thune (R-S.D.), Senate Judiciary Committee Chairman Charles Grassley (R-Iowa), House Energy and Commerce Committee Chairman Fred Upton (R-Mich.), and House Judiciary Committee Chairman Robert Goodlatte (R-Va.) wrote.

The GAO told Bloomberg BNA Sept. 9 it had “not reached a conclusion yet on this request for a legal opinion.” A GAO legal opinion could be enforced by Congress or the executive branch.

The NTIA has said that it is “working closely” with the GAO on its review, and has determined there is no property involved in the transfer. In a July 18 letter to Cruz, Assistant Commerce Secretary Lawrence E. Strickling wrote “there is no evidence that the Department ever provided governnent property to ICANN or that contract termination would cause the transfer of government property to ICANN.”

To contact the reporter on this story: Michaela Ross in Washington at mross@bna.com.

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

For More Information

Text of H. Res. 853 is available at: http://src.bna.com/irk.

The chairmen's letter is available at: http://src.bna.com/ipO.

Strickling's letter to Cruz is available at: http://src.bna.com/ipS.

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