"Illegal"? That's ridiculous. Coupon sharing is expected shopper behavior. That's why retailers and other businesses put specific restrictions on coupons and promotions. NetSol has obviously handled this horribly.
The codes have been abused, yes, and the result has already turned ugly. I doubt actual fraud can be proven here in a court of law, or even be worth pursuing.
Where's our resident lawyer?
No it's not "illegal" - obviously. Illegal implies criminal law and slapping the cuffs on you.
This whole matter is basically contract law. A valid contract must consist of an offer, that is accepted, with consideration ("something of value") changing hands.
But, a business has a right to make terms and conditions for its offers, however the terms and conditions must be made clear. There is a classic case from 1892, Carlill v. Carbolic Smoke Ball Company, still studied to this day by first year law students, where a company published advertisements in newspapers claiming that it would pay a hundred pounds sterling (an enormous sum in those days) to anyone who got sick with influenza after using their "smoke ball" cold remedy. Well, one lady used the smoke ball, got the flu anyway, and tried to collect the £100., claiming that the advertisement created a binding contract (with offer, acceptance, and consideration) between her and the company. The company refused to pay, arguing that it was not a serious contract. The company also argued that it would be ridiculous to assume that the offer was open to the whole world.
Long story short, this smoke ball case wound up going all the way up the courts until it was decided definitively that this offer was binding for anyone who bought the product. The court held that this offer was not open to the whole world, but only to anyone who actually bought the product, which buying the smoke ball product constituted acceptance of the offer, and the consideration was the price paid for the product. The lady won her case, and collected her hundred quid.
This old case (and countless newer ones) stands for the proposition that if you make an offer, even to the general public, and they take you up on it and money or some sort of consideration changes hands, then you are bound to perform.
Now, if the company NSOL here is able to establish that this "offer" was limited only to the people they emailed the coupon to, and again, there might need to be some terms on the coupon that clarify this restriction, then I think they'd have a good case for rejecting any offers (rejecting orders) that came from those who did not receive the coupon via email. By rejecting orders, I mean straight from the gate, not processing or accepting the orders at all.
HOWEVER, I do believe that once NSOL accepts the orders for any domain transfers, that a contract has been completed and I do not believe they would have a leg to stand on for stopping the domain transfers. We'd have offer (the coupon), acceptance (placement of the order), and consideration (in this case, not money, since it was free, but, a promise to do something - transfer the domain and add a year to the registration expiration date - equals consideration).
In other words, my analysis of all this, is that NSOL MAY have had the right to reject the use of the coupons at the time that the orders were placed, if they were being used by people who had not received the offer. Once the orders were accepted I think that legally they were bound to perform: Especially, if the coupons do not clarify that they are good only for the specific recipient.
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As as far as NSOL's trying to collect monies from people who already had their domains transferred free, I think they have no legal case at all, for all of the above reasons. (Already a done deal.)
