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NSI lower on DOJ probe
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May 5, 1999: 2:06 p.m. ET
Network Solutions confirms U.S. request for more data on customer lists
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NEW YORK (CNNfn) - Shares of Network Solutions Inc. tumbled Wednesday amid heightened concern about an ongoing Justice Department antitrust probe of the firm's exclusive right to its customer and electronic address lists.
A spokeswoman for Network Solutions confirmed that the Herndon, Va.-based company has received a request for additional information concerning its exclusive ownership of customer and Internet address lists accumulated during the last several years. The Justice Department likewise confirmed the investigation, but declined to comment further.
The company's stock was down 6-1/2, or nearly 10 percent, to 63 in early afternoon trading.
Until recently, Network Solutions (NSOL) has been the only company allowed to assign Internet addresses under an exclusive contract with the U.S. government.
In 1997, the Justice Department initially launched its Sherman Act antitrust investigation into Internet registration products and services. However, federal officials had come to no conclusions by the time Network Solutions' exclusive contract ran out last year.
Last month, five other companies, including America Online (AOL), were named Internet registrars as well. They reportedly have stepped up pressure on the Justice Department to complete its investigation and force the company to release its customer lists.
The other companies reportedly view the lists as a vital resource to contact and pitch their products to customers once they start assigning Internet addresses.
In a written statement released Wednesday afternoon, Network Solutions chairman and acting CEO Michael A. Daniels said it was "unfortunate that details of the ongoing investigation has been disclosed."
However, Daniels said the company would continue to cooperate with the investigation.
"Network Solutions believes that we are fully complying with the terms of the cooperative agreement" signed with U.S. officials in 1992, he said.
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Network Solutions Inc.
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