<h3>
<a href="http://www.circleid.com/posts/20110919_us_doj_rogue_internet_pharmacy_settlement_implications_registrars/" target="_blank">The US DOJ Rogue Internet Pharmacy Settlement: Implications for Registrars</a>
</h3>By <a href="http://www.circleid.com/members/4747/" target="_blank"><b>John Horton</b></a><div><a href="http://www.circleid.com/posts/20110919_us_doj_rogue_internet_pharmacy_settlement_implications_registrars/" target="_blank">http://www.circleid.com/posts/20110919_us_doj_rogue_internet_pharmacy_settlement_implications_registrars/</a><br>
</div>
<p>In the wake of Google's <a href="http://www.justice.gov/usao/ri/news/2011/august2011/google.html" target="_blank">settlement</a>
with the Department of Justice for permitting advertising by illegal
online pharmacies, what are the legal implications for Domain Name
Registrars and ISPs in the US and elsewhere?
</p>
<p>
In short, if you're a Registrar or ISP, it's a new ballgame. Here's why
it's critical for you to steer clear of criminal and civil liability by
making sure your registration services aren't used by rogue online
pharmacy criminals. (And, here's how to do it.)
</p>
<p>
<b>Defining Internet Drug Dealers</b>
</p>
<p>
First, what is a "rogue Internet pharmacy"? The vast majority of
websites that facilitate the sale of prescription drugs are illegal: the
National Association of Boards of Pharmacy (NABP) has consistently
found, as has <a href="http://www.legitscript.com/" target="_blank">LegitScript</a>, that about <a href="http://www.nabp.net/news/nabp-issues-rogue-online-pharmacy-public-health-alert/" target="_blank">96% of all Internet pharmacies</a>
don't require a prescription, aren't appropriately licensed, and sell
unregulated drugs — that is, drugs that are not part of the "closed
supply chain" required by most countries' laws, thus raising the risk
that the drugs are counterfeit or adulterated.
</p>
<p>
In other words, these are Internet drug dealers. And, their websites are dangerous.
</p>
<p>
A drug is classified as "prescription-only" for the simple reason that
it requires medical supervision to be used safely. Similarly,
unregulated drugs may be genuine or fake. LegitScript has received
numerous reports of individuals who have been hospitalized or sickened —
or even died — as a result of fake or counterfeit drugs shipped from
rogue online pharmacies.
</p>
<p>
In contrast to other forms of cybercrime like phishing and identity
theft, online pharmaceutical crime is in a category of its own for a
very simple reason: victims can die.
</p>
<p>
<b>Welcome to the New Ballgame</b>
<br>
The Google-DOJ settlement signals changing expectations by law
enforcement as to how Internet platforms (ISPs, Registrars, payment
service providers, etc.) should respond when put on notice about rogue
online pharmacies.
</p>
<p>
So what do Registrars need to know — and do?
</p>
<p>
Registrars that knowingly permit their registration services to be used
by rogue Internet pharmacies, including accepting registration or
re-registration fees for domain names that they have been put on notice
are being used in facilitation of illegal conduct, may be subject to
criminal or civil liability for facilitating and/or profiting from
criminal activity. For Registrars, reducing your liability and
disallowing the use of your services by these illegal websites means
suspending and locking rogue online pharmacy domain names once you are
put on notice.
</p>
<p>
If you're an ICANN-accredited Registrar, you have the sanctioned ability, and arguably responsibility, to do this. The <a href="http://www.icann.org/en/udrp/udrp-policy-24oct99.htm" target="_blank">Uniform Dispute Resolution Policy</a>
(UDRP), by which all ICANN-accredited Registrars are bound, requires
Registrars to prohibit the use of their domain names in furtherance of
unlawful activity (see Paragraph 2). That's important because it gives
Registrars the explicit authority to suspend online pharmacies operating
illegally. Indeed, as a contractual matter, there's a solid argument
that you're bound to act — not ignore the notification.
</p>
<p>
But how far do you have to go? DOJ's recent actions signal an
expectation that online platforms will take "reasonable steps" to avoid
facilitating criminal activity — but that doesn't mean you have to be
clairvoyant. After all, no Registrar can know what every customer or
website is doing. But if a Registrar is put on notice by a credible
source as to rogue online pharmacy domain names using its registration
services, a continued pattern of non-responsiveness may be viewed as the
turning of a blind eye to, or even willfully profiting from, criminal
behavior.
</p>
<p>
<b>A Letter to Registrars on Behalf of Regulators</b>
</p>
<p>
So what's a credible source of information, and how can you know if an
Internet pharmacy is legal or not? The NABP, which represents the
government agencies that license and regulate pharmacies in the US and
elsewhere, has issued a <a href="http://www.legitscript.com/download/DNR-letter_10Feb2011.pdf" target="_blank">letter to Registrars</a>
endorsing LegitScript's listing of rogue online pharmacies as accurate
and reliable, and requesting that Registrars suspend and lock rogue
online pharmacy domain names LegitScript notifies Registrars about.
LegitScript currently offers this notification as a complimentary
service, and regularly submits information to several registrars
including GoDaddy, eNom, Dynadot, DomainContext, Directi and others.
</p>
<p>
<b>Liability may be Criminal...or Civil</b>
</p>
<p>
The risk of liability isn't just criminal — it's potentially civil as
well. One of these days, an enterprising civil attorney is going to ask
if a Registrar (who failed to act) was notified prior to her client's
overdose or wrongful death from drugs ordered online. In multiple cases,
the answer would be Yes. And it's not clear that the US Communications
Decency Act would protect a Registrar from a multi-million dollar
wrongful-death claim.
</p>
<p>
<b>Locking, Not Transferring</b>
</p>
<p>
Most Registrars we work with on this issue typically suspend and lock
the domain names, effectively shutting down the website and killing the
illegal business. However, we've seen a few situations where a Registrar
suspends the domain name, then lets it transfer to another Registrar
and continue selling drugs. Could a Registrar who does this be
criminally or civilly liable?
</p>
<p>
Our answer is Yes, for several reasons. First, permitting the transfer
to another Registrar, when you are on notice of the website's illegal
activity, is an affirmative step that helps the criminal continue their
behavior. Second, Registrars can't claim that ICANN requires them to
permit the transfer: after all, most Registrars do NOT permit the
transfer. And third, of course, the legitimacy of an online pharmacy
doesn't depend on where the Registrar is; rather, the key question is
what the website is doing. (Would you permit a child pornography site's
domain name to transfer?) A rogue online pharmacy doesn't magically
become safe by being transferred to an "offshore" Registrar.
</p>
<p>
In an effort to get the Registrar to permit the transfer, we've seen it
all — bad-actor Registrants who promise to remove the content; provide a
(genuine) pharmacy license; or argue that they are in fact operating
legally where they are physically located, and don't need to adhere to
the laws in the jurisdictions where they are shipping the prescription
drugs.
</p>
<p>
But remember, rogue online pharmacies are a multi-billion dollar business: some affiliate pharmacy marketers <a href="http://krebsonsecurity.com/2011/02/russian-cops-crash-pill-pusher-party/" target="_blank">pull in</a>
five- or even low-six-figures (USD) a month. They are highly motivated
to continue their illegal business: if they are willing to sell
prescription drugs without requiring a prescription, it should come as
no surprise that they'll be willing to lie about it. Moreover, a
pharmacy license alone is not proof of legitimacy: the drugs that these
websites sell have to come from somewhere, and an extra-jurisdictional
(but real) pharmacy is often the source — or pass through point. Put
another way, "fake" online pharmacies and "rogue" online pharmacies are
different problems. The former just takes your money and doesn't send
you anything. The latter sends unregulated medicines with or without a
prescription, putting the customer's health at risk.
</p>
<p>
<b>Wrapping It Up</b>
</p>
<p>
While it's true that Registrars and ISPs can't be expected to be the
"Internet police," the US Justice Department's recent actions indicate
that when it comes to illegal online pharmacies, Internet companies
can't turn a blind eye to criminals using their services. It doesn't
mean that Registrars need to monitor every single domain name, or be
telepathic about what their customers are doing. It does mean that they
need to have clear policies and procedures prohibiting illegal activity,
and more than that, enforce those policies.
</p>
<p>
If a Registrar or ISP is put on notice about such illegal websites, it
should take reasonable steps to enforce its Terms and Conditions and act
in accordance with ICANN's UDRP. In the online pharmacy sphere, where
roughly 95% of websites are accurately described as criminal entities,
this means suspending and locking the domain name, not turning a blind
eye to the activity or facilitating the transfer of the domain name to
another Registrar.
</p>
<p><b>By <a href="http://www.circleid.com/members/4747/" target="_blank">John Horton</a>, President of LegitScript. Visit the blog maintained by John Horton <a href="http://www.legitscriptblog.com/" target="_blank">here</a>.</b></p>