The registrars had to refund dollars accepted during
Round 1 to avoid the Round 1 lottery scheme lawsuit. This left each registrar
with 3 options (with the understanding that each had to sign a revised agreement
with Neulevel holding them harmless if a lawsuit were to arise as a result of Round
2 - something Neulevel did not require as part of Round 1:1) resubmit for free
the Round 1 requests in a randomized fashion for Round 2
2) erase the slate and
do it all over for Round 2
3) not participate at all with Round 2 (and not sign
the agreement)
Many registrars from Round 1 chose number 1 above - in essance receiving
no pre-registration fees for Round 1 or Round 2. Register.com, for example,
accepted only one request per name in Round 1 yet refunded all dollars and resubmitted
the very same Round 1 requests. From beginning to end, to me this was the proper
way to do it. If each registrar would have done it this way from the very beginning
of Round 1 (i.e. no pre-registration fees and fcfs), all of this would have been
old history and w/o any lawsuits. Of course, it would have helped too if Neulevel
did not charge their ridiculous $2 pre-reg fee to the registrars but I still do not
understand why (most) of the registrars felt a need to turn around and charge $5
for this (60% profit margin for basically doing nothing).
Those registrars that
chose number 2 above fell into two categories. One category were those that
accepted pre-reg's for Round 2 on a fcfs basis but did not charge any fees (the correct
way). The second category were those that found creative ways to again charge
fees without calling them pre-registration fees. Most (but not all) of the
auction sites are the best example here where an upfront fee was charged just to
participate in the auction. Other registrars subjectively assigned a higher-than-retail
value to each of the 39000+ names that had to be paid if registration was successful.
Some charged upfront the 2 year registration fees where a credit would be provided
later (not a refund) if registration was unsuccessful. There were probably
a few other variations that fell into this category but none (to me) that appeared
to violate the lottery aspect of the Round 1 lawsuit (directly a charging pre-registration
fee per name and accepting multiple requests for the same name).
Now, if there
were a 100 gTLD's out there (excluding ccTLD's), would anyone really have cared about
the .biz Round 2? Without question, some ICANN accredited registrars instead
chose to prey on this. You can make your own list who these are.
Ray