Domain name game goes international.

• Author: Sanders, Carol McHugh

An American-based Internet domain name registration company was not able to overcome sovereign immunity in its suit against the Republic of South Africa in a dispute over the use of a uniform resource locator on the Internet. In Virtual Countries Inc. v. Republic of South Africa, 300 F.3d 230 (2d Cir. 2002), the Second Circuit affirmed the U.S. District Court for the Southern District of New York's dismissal of the company's claims based on a lack of subject matter jurisdiction under the Foreign Sovereign Immunities Act of 1976 (FSIA).

Virtual Countries, a Seattle-based company that owns Internet domain names for various countries, had been using southafrica.com since October 1996 to publish travel news, weather and tourist information about the southern region of Africa. The Republic of South Africa owns southafrica.net.

Central to Virtual Countries' lawsuit was a press release that the Republic of South Africa issued in October 2000 announcing that it could be the first country in the world to claim the right to use its own domain name in the generic top-level domain of ".com." The release further stated that it intended soon to file an ownership claim to southafrica.com with the World Intellectual Property Organization, a United Nations agency that deals with intellectual property protection. The press release stated that sovereign countries have the first right to own their own domain names as national assets to help promote trade and tourism. South Africa also announced its intention to take up the issue before an international tribunal that supervises a non-binding arbitral system for resolving domain name disputes.

One week later, Virtual Countries filed suit in a U.S. federal court, asserting that the Republic of South Africa could not use southafrica.com and seeking to enjoin any arbitration or court proceeding in any forum worldwide that challenged its right to that name. Moving to dismiss the action, South Africa maintained that it was immune from suit in the United States because it was engaged in international diplomacy concerning the use of sovereign nations' domain names when it...