legal Looks like Grandma Powell lost the domain but might keep the email?

[equity78]

Ron Jackson reported:

A final hearing was held on that motion Wednesday (July 12) and I was shocked and saddened to see Heidi come back from it and have to report this on Facebook (where she is a friend): "It did not go our way...The judge approved the sale of my domain to her. Proof positive that if you have all the money in the world you can do anything to anyone and get whatever it is that your heart desires, no matter who you hurt in the process. A year process to be exact."

Heidi continued, "We may appeal if we can find pro bono representation that will take it but need to wait for the audio (from the judge's ruling) before that decision can be made. We believe the judge may have split the domain and my email up, where I would be keeping the email part of the domain and she would get the domain for website purposes but not even our attorney totally understood it. Very confusing. We will be sorting that out when the audio shows up in an estimated five or so days."

Read the full story http://www.dnjournal.com/archive/lowdown/2017/dailyposts/20170713.htm

 

[DomainVP]

I knew the lollipop bit would get you. Let's say a small toy you've had since you were a kid, it didn't have any significant value at time of bankruptcy, but afterwards there was a huge craze for it and the value sky rocketed.

Bankruptcy Toy Auction

 

[Keith]

It's not a 'theory' I'm 100% right. You are basically saying the same thing I just say but telling me I'm wrong

If she obtained a "notice of discharge of debtor" or gotten a fair market valuation from a professional showing zero (or negligible) value during the time of bankruptcy this would have never happened.

You can't just claim your things are worth whatever you say they are, and I certainly NEVER said that.

In todays market this would go different, which is WHY she lost the domain; the proper docs were not secured and NOW there is now a market for the domain property giving it an easy identifiable market value that he debtors can collect from.

Ah, so your grandmother's ring she gifted you is valued based on what I would pay? Not in this life...

 

[zurc.net]

Bankruptcy Toy Auction

Either your missing the point or ignoring it.

Before and after scenarios. Bankruptcy court doesn't come after you when you start doing well again in the future, unless scum bags like this go and give notice to something that didn't have any previous value.

 

[DomainVP]

Ah, so your grandmother's ring she gifted you is valued based on what I would pay? Not in this life...

I'm pretty sure you guys are doing some Friday night drinking at this point...
Nobody is saying these things...

A fair market appraisal from a professional is not "based on what I would pay". You used the 'ring' example, there are thousands of appraisers out there that would assign a value to that ring.

I'm not sure how that's foggy or unclear.

For a domain, the same process would have happened HOWEVER back when this woman was going through a bankruptcy the domain market was quite different and she could have easily obtained a zero value appraisal. Nobody would have contested it and the debtors would have likely discharged the asset not having nay clue that it had any value.

Agree to disagree, but again my major point is that you have to close your loopholes.

Again, I feel bad for the woman but the domain should have been addressed at the point of bankruptcy.

 

[Name Trader]

I never knew bankruptcy proceedings could be re-opened like this. Is there any statute of limitations on closed bankruptcy proceedings being re-opened?

PS: My heart goes out to the Grandmother. I think she was robbed.

 

[Keith]

I'm pretty sure you guys are doing some Friday night drinking at this point...
Nobody is saying these things...

A fair market appraisal from a professional is not "based on what I would pay". You used the 'ring' example, there are thousands of appraisers out there that would assign a value to that ring.

There isn't an appraisal system for things that have sentimental value. If your grandmothers ring is appraised at $10 by the "experts" should I be able to buy it for $20 if you file bankruptcy? I'm sure you would have a problem with that!

The domain in question isn't just another domain, it's her exact match name. It really has zero value if it was offered for sale before this fiasco started, which is why it wasn't claimed as an asset. Scary sequence of events here...

 

[DomainVP]

If your grandmothers ring is appraised at $10 by the "experts" should I be able to buy it for $20 if you file bankruptcy? I'm sure you would have a problem with that!

Yes. That's the whole point of bankruptcy.

It's not about what someone would have a problem with, it's about getting right with debtors because they mismanaged funds.

A family member of mine died in debt for $300k, sold off everything that was prized by them at auction. Some of the personal items I thought would go for thousands went for a few hundred bucks; some even less.

That didn't sit well with me, but the tax man cometh and taketh.

It really has zero value

Yes, I agree! She should have gotten documents supporting this fact at the time of bankruptcy!

The problem is that she didn't, and it was discovered as an concealed asset. That was the whole issue.


You can ignore a courts findings with conjecture, and that's fine, but if you ever find yourself in a bankruptcy situation for gods sakes get a "notice of discharge of debtor" or get a fair market valuation from a professional showing zero (or negligible) value.

Is there any statute of limitations on closed bankruptcy proceedings being re-opened?

The statute of limitations for concealing assets from a bankruptcy estate is five years from the time a debtor has received a discharge.

But it gets VERY grey, the entire statute is conveniently confusing. Meaning that anyone can, in essence, make it say whatever it wants. Here are three common outcomes:

(1) no limitations period applies; (2) the general five-year limitations period applies; or (3) the concealment is an ongoing offense that must be prosecuted within five years of when the last event that could be considered the functional equivalent of a discharge occurred.

This might be the most helpful bit of information:"If a corporate debtor conceals assets in a liquidation, or a debtor dismisses his or her case without the entry of a discharge, the triggering event will not have occurred."

So in this case, since there was no discharge the statute of limitations was never triggered. So no limitations period applies.


Was it right, no. Was it legal with caselaw to back it up, yes.

 

[Name Trader]

@DomainVP - Thanks for clarifying and muddying waters Not knowing all the facts, I'm assuming the actress was within her legal rights. So I am not accusing her of doing anything illegal. Maybe she just had a better legal team than the grandmother. It certainly sounds that way. But I think that this proves that the law can be an ass sometimes. I hope the grandmother files an appeal, with a better legal team.

 

[carob]

I'm still not clear how the sale is to proceed. The article on DNjournal says the audio of the judge's decision is awaited
http://www.dnjournal.com/archive/lowdown/2017/dailyposts/20170713.htm

We believe the judge may have split the domain and my email up, where I would be keeping the email part of the domain and she would get the domain for website purposes but not even our attorney totally understood it. Very confusing. We will be sorting that out when the audio shows up in an estimated five or so days."

The "celebrity" Heidi took advantage of that by telling the bankruptcy judge he should order the grandmother to sell the domain name to her and divide the money among her creditors.

Surely if the objective is to maximise the payout to creditors the domain should be valued and put up for auction? If a judge can just assign an asset to a particular buyer a lot can go wrong and creditors lose out.

If it goes to public auction the celebrity Heidi may find it very expensive.

 

[johname]

Would you want to use a personal email that your arch enemy owns the domain? My guess is the Fitness guru has to forward the email for a year or two to give Gramma time to unwind the email address.

 

[Silentptnr]

I wonder what would happen if the registrant just went ahead and sold the domain today on her own, and gave the money to the bk court. Sold it for let's say $25 or something.

 

[Silentptnr]

I would also like to know the procedure they will use to auction the domain. Who knows, I might want to bid.

 

[DU]

It should be noted that little old grandma that failed to pay her education bills and the indebted party was the Dept of Education (tax payers).... and she spent time while not paying off this debt allegedly gambling in casinos.

It should also be noted that domainers complaining the name was stolen should be aware that names are garnered the other way around by domainers. I've heard on this forum many times that the industry is about capitalism and isn't about morals and ethics... except when it isn't....

This story was always about getting sign-ups for the ICA.

 

[johname]

Perhaps the court knows the domain can be UDRP in the immediate future when anyone other than a HP is the highest bidder. So to prevent just a shilling the fitness guru domain auction (and also can easy hammer lower than highest fitness offer). Sell it to her at a price the judge approves.

 

[carob]

Perhaps the court knows the domain can be UDRP in the immediate future when anyone other than a HP is the highest bidder. So to prevent just a shilling the fitness guru domain auction (and also can easy hammer lower than highest fitness offer). Sell it to her at a price the judge approves.

The domain can be legitimately used for a gripe site or a fan site. Exluding bidders seems unfair to the creditors, and anyone else named Heidi Powell. The domain could be used for a site describing the case and the issues it raises about whether domains are property or licenses, and whether and how they should be appraised for value.

And how's this for a paradox: Grandma Heidi is no longer bankrupt, so what if she bid in the auction to buy her own name back?

 

[Aspiring Billionaire]

http://www.dnjournal.com/archive/lowdown/2017/dailyposts/20170206.htm

Original article.

In essence, they re-opened her BK case because the domain was not listed as an asset.

If it had value, she had to list it. The tricky part is was there value to it?

Dirty yes, BUT.... this case just proves...

Domains are an asset and gives credibility to the name.

IF.... IF.... she did not file for BK or disclosed it, it would never be an issue.

This case is truly a BK issue, and not a domain issue. UDRP failed obviously.

I concur with @maksimfa's and @DomainVP's view.

It's an irrefutable fact that a domain name is an asset that holds monetary value (since the late 90's). We all know that domain investing & the domain aftermarket is an ever-growing industry, rich in both history and stats. So the fact is that HeidiPowell.com has, always will have, and always did have value - how much value (past or present) is determined by the market (owners, buyers, resellers, etc.).

This was a case concerning the technicalities of bankruptcy (including: whether past value or present value should be used, whether the debtor "under reasonable thinking" was to know it's an asset, etc.), which is why a judge may have been needed to make a lawful decision that best benefits the most deserving (if not all) parties concerned. An appeal can and most likely will be made. That's what makes it fair (legally speaking).

@carob also makes a stellar point wrt the domain's value, as it may seem more fair on the creditors for the domain name to be auctioned on a renowned marketplace in order to reach it's true current market value (as opposed to handing it over to the first interested party for a self-determined price).

The issue about morality, entitlement, superiority, bullying, and the like from the "celebrity" Heidi Powell is a clear-cut case, but again doesn't have much to do with domaining (eg. the UDRP outcome). It could have been an e-commerce website or a non-branded app, the fact that it's a domain name has little relevance to the fact that there are unpleasant individuals in this world ... hence the law (civil and criminal that is).

Honestly though (celebrity bullies aside) if you owe creditors, then you should sell what has value in order to repay what you took from them, especially if the law says you should. It's rather vein to hold onto the domain in lite of the outcome. In retrospect, whether for sentimental reasons or otherwise, appealing the judgement now seems just as immoral as what the celebrity did (considering the creditors). It is just a name after all.

On a positive though, we now have another case in law that records a domain name as being an asset of value. That's a plus for the industry as a whole.

 

[DU]

On a positive though, we now have another case in law that records a domain name as being an asset of value

Be careful what you ask for....

 

[Keith]

I concur with @maksimfa's and @DomainVP's view.

It's an irrefutable fact that a domain name is an asset that holds monetary value (since the late 90's). We all know that domain investing & the domain aftermarket is an ever-growing industry, rich in both history and stats. So the fact is that HeidiPowell.com has, always will have, and always did have value - how much value (past or present) is determined by the market (owners, buyers, resellers, etc.).

This was a case concerning the technicalities of bankruptcy (including: whether past value or present value should be used, whether the debtor "under reasonable thinking" was to know it's an asset, etc.), which is why a judge may have been needed to make a lawful decision that best benefits the most deserving (if not all) parties concerned. An appeal can and most likely will be made. That's what makes it fair (legally speaking).

@carob also makes a stellar point wrt the domain's value, as it may seem more fair on the creditors for the domain name to be auctioned on a renowned marketplace in order to reach it's true current market value (as opposed to handing it over to the first interested party for a self-determined price).

The issue about morality, entitlement, superiority, bullying, and the like from the "celebrity" Heidi Powell is a clear-cut case, but again doesn't have much to do with domaining (eg. the UDRP outcome). It could have been an e-commerce website or a non-branded app, the fact that it's a domain name has little relevance to the fact that there are unpleasant individuals in this world ... hence the law (civil and criminal that is).

Honestly though (celebrity bullies aside) if you owe creditors, then you should sell what has value in order to repay what you took from them, especially if the law says you should. It's rather vein to hold onto the domain in lite of the outcome. In retrospect, whether for sentimental reasons or otherwise, appealing the judgement now seems just as immoral as what the celebrity did (considering the creditors). It is just a name after all.

On a positive though, we now have another case in law that records a domain name as being an asset of value. That's a plus for the industry as a whole.

Sure, domains hold value. In this case her assets should be valued based on when the bankruptcy was filed. At that point nobody wanted the domain so it had zero value. Maybe grandma should be able to pay creditors based on the single digit worth?!

This is like someone filing bankruptcy and not claiming a family photo as an asset. Then a year later I offer $50 for the picture and start a legal battle. It's absurd... her attorney isn't the brightest or he'd get someone like Rosener to give a valuation based on the timeline of the actual filing, when assets should've been exposed!

 

[Peak.Domains]

It's funny how the article describes one of the Heidi's as grandmother, and the other as "celebrity" with the quotes. You see this sort of stuff all the time in reporting stories, subtle ways to try to sway opinion.

 

[Name Trader]

It's funny how the article describes one of the Heidi's as grandmother, and the other as "celebrity" with the quotes. You see this sort of stuff all the time in reporting stories, subtle ways to try to sway opinion.

What's more shocking is the convoluted route the "celebrity" took to acquire the domain. As far as it goes, the "celebrity" has the law on her side.Thanks to her lawyers. IMHO, there are sufficient grounds for appeal. Assuming the "grandmother" gets a better attorney.

Disclaimer: I am a layman, not an attorney. If you are seeking legal advice. Consult a decent attorney well versed in the applicable (bankruptcy) law.

 

[DU]

Disclaimer: I am a layman, not an attorney. If you are seeking legal advice. Consult a decent attorney well versed in the applicable (bankruptcy) law

So how do you pass negative judgement on the "grandmother's" attorneys? I'm sure David Weslow appreciates that you found any time that he provided needed to be "better".

At that point nobody wanted the domain

And you know this how? Did you market the name for her?

I don't get the fuss... surely Heidi Powell can find something better to do with her time than pining over the sentimental worth of some apparently worthless digital asset.

 

[Name Trader]

So how do you pass negative judgement on the "grandmother's" attorneys? I'm sure David Weslow appreciates that you found any time that he provided needed to be "better".

Well. I haven't heard much of any counter-argument to the re-opening of the bankruptcy case. It seems, at least from what I've heard about it here, that there could have be grounds not to have re-opened that case. A quick search doesn't show him well versed in bankruptcy law. He's basically an IP lawyer. When I say, re-opened, that may not be correct term, if the case was never closed. What I'm saying is I don't hear much in the way of legal arguments against what the "celebrity" did to win the domain. Of course he may well have consulted a bankruptcy lawyer and used all the legal arguments possible. After all. He's a lawyer, and I'm not, and I wasn't there. And perhaps there isn't a chance in hell that the "grandmother" will retain this domain. But from what I see here, the "celebrity's" lawyers appear to have been more quick-footed than the "grandmother's" lawyers. IMHO.

 

[DU]

In this case her assets should be valued based on when the bankruptcy was filed.

http://digitalcommons.law.ggu.edu/cgi/viewcontent.cgi?article=2043&context=ggulrev

Well. I haven't heard much of any counter-argument to the re-opening of the bankruptcy case.

What counter argument should there have been?
Should we ask the Department of Education would they think? After all, they got stiffed.

Added Note:
I'm not sure Mr Weslow was involved at this juncture of proceedings but surely your issue is with the judge, not the lawyers .. or maybe the law... who really knows at this point.

 

[carob]

http://digitalcommons.law.ggu.edu/cgi/viewcontent.cgi?article=2043&context=ggulrev

Thanks, that appears to say that if a bankruptcy has not been closed and an asset has appreciated creditors can go after it even though it was excluded before.

CONCLUSION
Relying primarily on the Supreme Court’s decision in Reilly, the Ninth Circuit held in Gebhart that a Chapter 7 bankruptcy trustee may force a sale of a debtor’s homestead property that at the time of the filing was fully exempt, in order to realize equity in the property’s increase in value above the debtor’s claimed exemptions. It determined that a trustee’s failure to object to a debtor’s claimed exemption within the 30-day time period prescribed under Rule 4003(b) only removes an “interest” in the property from the bankruptcy estate equivalent to the specific dollar value claimed by the debtor at the time of filing; therefore,
the property itself remains in the bankruptcy estate.

As a result of Gebhart, debtors will be unclear as to the status of their property until either the trustee abandons the property or the bankruptcy case is closed, which might not occur until several months or even years after the petition is filed. Furthermore, in a llowing the trustees to collect the post-
petition appreciation value in the debtors’ homestead properties, the Ninth Circuit provided bankruptcy trustees an incentive to keep cases open longer than necessary, in hopes of collecting additional money for the creditors.

Could create a Catch-22 situation where your domain now has value because I made you an offer, so if you refuse to sell, the bankruptcy court can force a sale.

 

[Keith]

Thanks, that appears to say that if a bankruptcy has not been closed and an asset has appreciated creditors can go after it even though it was excluded before.

It doesn't refer to excluded assets but rather exempt assets. Big difference...