[softball]

"I don't care whether they are required to or not, I care whether they are allowed to. DN was clearly allowed to do what they did and should be getting cheers for daring to buck the adult community in the name of getting rid of cp instead of getting boycott threats and such."

Perhaps a misinterpretation....however you also said DN was clearly allowed to do what they do....
The FSC disagrees, so obviously it is not clear....

"“DirectNIC has no remote prayer to legally justify their request. They are licensed to provide a service — not to police content. I would think that upon hearing this, most adult companies would transfer their domains [away from directNIC] immediately.”

"Douglas continued, “Again, under federal law they have no right to these documents, so now they have no protection from civil liability. They are immune from policing content under the law, but now by doing so they have created liability. DirectNIC is lawlessly intruding into their business.”