NEW YORK, NY – This will be a controversial subject for many if not all domain name owners, however, in light of the France.com domain seizure, every Geographic domain name ‘taking’ could be imminent.
Sound insane? Read on.
While researching how in the world this atrocity could have happened to the owner of France.com, (Jean-Noel Frydman), as a GEO domain name owner, I wanted to research the possibility of this happening to others, myself included. Since I’m in the State of New York, I started with the states constitution, and although it may seem far-fetched, I concluded that it is plausible or possible, or at least conceivable, that states, counties or local governments could have the opportunity, in my opinion, to petition to utilize “Eminent Domain”, to carry out the seizure of an exact match geographic domain name in order to increase interest in and promote tourism to the targeted region.
The obvious end-result would be to increase tourism taxes and revenue.
Upon research I found that many states have used Eminent Domain to seize personal property which is outside of your ordinary expectations such as land and real estate. For instance, I found that states such as Connecticut have seized “contract rights” by acquiring certain bus transportation routes and that California used Eminent Domain to seize underwater residential loans. Sound even crazier? Just ask Bob Irsay, owner of the then Baltimore Colts, who in 1984 moved his entire sports team to Indianapolis under the cover of night to avoid the teams seizure. Just hours after the team had left, the city began condemnation proceedings. [providing access to recreation to its residents in the form of spectator sports is an appropriate function of city government.] Holy Smokes! And Irsay wasn’t the only sports team owner that was targeted with Eminent domain; it started in 1980 in Oakland, California with the Oakland Raiders in order to prevent them from moving to Los Angeles.
Below you can find some of the snippets of information out there on Eminent Domain and how it can and has been used to take property, and there is a lot more references out there if you dig around looking for them.
Local governments shall have power to take by eminent domain private property within their boundaries for public use together with excess land or property but no more than is sufficient to provide for appropriate disposition or use of land or property which abuts on that necessary for such public use, and to sell or lease that not devoted to such use.REF: https://www.dos.ny.gov/info/constitution.htm
Because contract rights, patents, copyrights and intellectual property are all subject to eminent domain, the Federal government could, theoretically, use eminent domain to seize [even] Facebook and turn it into a public utility, to protect people’s privacy and data.REF: https://www.investopedia.com/terms/e/eminent-domain.asp
Such eminent domain power is not restricted to real property; indeed, it may extend to intangible property. Further, various state supreme courts have held, for example, that the doctrine of public use extends to “matters of public health, recreation, and enjoyment.”REF: https://www.americanbar.org/newsletter/publications/aba_health_esource_home/joyal.html
The Takings Clause of the Constitution states that “private property [shall not] be taken for public use, without just compensation.” The government’s power to take property for public use without the owner’s consent is called eminent domain. Virtually every kind of real or personal property and every type of interest in property may be taken under the power of eminent domain.” The power of the government to exercise eminent domain, however, is subject to the payment of just compensation.REF: http://digitalcommons.law.uga.edu/cgi/viewcontent.cgi?article=1218&context=jipl
This argument states that broader eminent domain powers (i.e., allowing governments to use eminent domain for redevelopment in order to increase employment or to increase the tax base) provide state and local government’s additional means through which to increase their overall size. The city of New London argued that the redevelopment plan fulfilled the public purpose interpretation of the takings clause because redevelopment would increase employment and increase the tax base. For example, governments in states with low or slow-growing revenue may be more likely to utilize eminent domain in order to increase their revenue.REF: https://asp.mercatus.org/system/files/Kerekes-Eminent-Domain.pdf
So what is then, “Just Compensation”?
That being said, the exercise of eminent domain is not limited to real property; governing bodies may also seize personal property, such as supplies that could be used for the military during times of war. Furthermore, a governing body can also seize intangible property such as copyrights, trade secrets, patents and contract rights. Although the Fifth Amendment requires the delivery of payment of “just compensation” to the original or rightful owner of the attached property or right, American courts have held that the proper measure of compensation is the good’s attached “fair market value.” Fair market value refers to the price that a willing, but un-pressured buyer, would pay for the underling piece of property, right, or item. This approach also takes into the account the property or right’s highest and best use, meaning its most profitable use, which is not necessarily the item’s current use.REF: https://cyber.laws.com/understanding-eminent-domain
The Connecticut Department of Transportation (DOT) recently sequestered through eminent domain licenses long-ago purchased by four private bus companies to operate on a particular route (which, seemingly by chance, parallels the New Britain to Hartford busway). In so doing, the DOT for the first time expanded the power of eminent domain to include intangible property. Connecticut’s statue allows the state to use eminent domain to seize “land, buildings, equipment, and facilities.” The bus companies rightly challenged the DOT in court, but the judge referee ruled that the licenses were “facilities,” since they facilitated business, and therefore subject to eminent domain.REF: https://ctmirror.org/2015/03/12/op-ed-connecticuts-misuse-of-eminent-domain-must-end/
This is the first time a government entity has implemented a novel concept that some law professors and a for-profit company have been advocating and shopping to many local governments as a solution to the mortgage crisis. Rather than waiting to defend individual eminent domain actions in state court, last week bank trustees of many RMBS [residential mortgage backed securities] sued in federal court in San Francisco to stop the City’s seizure program. The City’s legal strategy is based on California and federal law that allows use of the eminent domain power to condemn intangible property, such as a note secured by deed of trust, if the condemnation is for a valid public use.REF: https://www.dlapiper.com/en/us/insights/publications/2013/08/city-attempting-to-seize-underwater-mortgages-vi__/
Probable? Hopefully not. Plausible? In this day and age, I wouldn’t be at all surprised.
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About The Author: John Colascione is Chief Executive Officer of Searchen Networks Inc. and Internet Advertising Inc. He specializes in Website Monetization, authored a ‘how to’ book called ‘‘Mastering Your Website’, and is a key player in several Internet related businesses through his holding company Searchen Networks®