Domainmonster.com Industry News

News > April 2007

18-Apr-2007

Ban On Domains Resembling US Agencies

Daniel O'Donnell, (president of the San Francisco company that owns the Web site irs.com), was to announce trading on the American Stock Exchange this week. In Washington, the House was scheduled to vote on legislation clarifying the law which bars for-profit companies using names which sound like official government agencies.

Twice in the three weeks, Mark Everson (the Internal Revenue Service commissioner), has warned about their official Web site of his agency and commercial firms playing off the confusion. A Web industry trade group, (the Computer and Communications Industry Association), issued a statement warning customers that Web sites like irs.com, irs.org and irs.net "make money by offering services that, in many cases, taxpayers could get for free through the IRS's official Web site, irs.gov."

Intersearch.com, (owner of irs.com), say they are complying fully with the law and see no reason to inform shareholders of pending legislations, said Jennifer Faye Drimmer, (legal counsel). She noted the firm had disclaimers on their home page stating it is not an official government site. She also said the firm did not believe the law applied to Domains.

The 1994 law stops "any" use of Treasury and Internal Revenue Service names and initials, logos and other symbols to solicit business. The law also states a disclaimer is no defence against civil or criminal action. The House vote should clarify the law by specifying the prohibition against this includes a Web address.

Claudia Crowley, (chief regulatory officer for the American Stock Exchange), said the exchange had assigned special investigators to look into Intersearch's disclosure statements. Last month, an image of the Treasury building in Washington was top of the irs.com home page. On Monday, after being asked about the site, the firm changed disclaimers making them more prominent, including putting "NOT" underlined on the top left of the home page.

Drimmer also said she was confident the company had properly reported two major tax software firms to the Securities and Exchange Commission its relationships with H&R Block and Intuit. "As part of our growth strategy we will continue to increase revenues generated" from advertising by H&R Block and Intuit, Intersearch.com mentioned in its report to the SEC filed March 30.Intersearch.com also added it was "transitioning our existing commercial relationships to terms more favorable to us."

Intuit said in interviews it had ended the relationship with Intersearch.com in April and the total revenue paid for advertising on the irs.com Web site was under $10,000. H&R Block said it ended the relationship on Oct. 31.

Intuit also sent a letter on March 5 demanding Intersearch.com stop asserting two firms continue to have a relationship. O'Donnell, responding to the letter, said Intersearch would not use Intuit's name and logo, but could not guarantee that because of the search engine. Drimmer said the language was appropriate due to business with Block and Intuit last year.

Intersearch.com reported revenue last year rose from $17.5 million in 2005 to $25.6 million and attributed the majority of the increase to purchase of the irs.com site in September 2005. They paid $12.9 million for the domain name. The irs.com site directs customers to affiliated sites, (including ones directly owned with no disclaimers). One of those sites encourages people to pay $89 for having their tax returns filed for them.