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The Federal Court stated that the Domain Companies were making false and misleading representationsto their customers and engaged in misleading and deceptive conduct. They targeted those individuals by capitalising on their lack of knowledge, awareness and understanding about the domain name system.
Between November 2015 and April 2017, the Domain Companies sent a series of letters to SMEs that were misleading customers into believing that they were renewing their existing domain names, but instead they were for the registration of new domain names, cost ranging from $249 to $275. As a result of this scheme, they made a revenue of approximately $2.3 million from 10,000 Australian SMEs that paid these illegal renewal notices. The Federal Court ordered that the domain registrars pay a combined total of $1.95 million in penalties for targeting and misleading SMEs about the domain renewal notices.