Apparently wildcard DNS is a trademark violation now,
says RylandDotNet of Metafilter. Yahoo! reportedly sent a cease-and-desist to the current owner of sex.com because its DNS was wildcarded: set up so anything.sex.com resolved to the sex.com site. That's, of course, before Yahoo! in the whole figured out it was in fact a wildcard, and not sex.com specifically setting up a yahoo.sex.com
domain--reportedly (in the MeFi discussion) Yahoo! is pursuing it no further.
Here's a good comment by MattD from the discussion:
What I find interesting..., as a corporate lawyer, is the apparent total discount between Yahoo's legal department and/or law firms and the people in Yahoo who have even the slightest knowledge about how the Internet works. ...[A]n absolutely [ludicrous] [legal claim was made] in Yahoo's name without anyone who knows anything about the Internet being consulted or signing off, or having the guts to say, "Hey, guys, let's wait a minute..."