poll Vote now – Selling a domain name you don’t own fair or foul?

[equity78]

So a debate is starting to stir on a topic I wrote about back in 2015. Selling A Domain Name You Don’t Own – Cool or Not Cool ? My article was sparked by a post written on AntiCareer.com. There was a blog post by AntiCareer.com which talked about buying and selling a name that they did not own. The post titled “Turning A No Into A Yes and a $5,000 profit. Morgan Linton had touched upon this … [Read more...]

That's on TheDomains.com

Vote here if you think it's legit or not

 

[DomainRecap]

It's not just losing a domain name via UDRP that is concerning. It's having to spend thousands of dollars defending a domain name because someone else tried to sell it without permission of the owner.

And the time, and the stress - on that note, I wonder if MediaOptions ever found out who "Mike" was.

 

[DomainRecap]

I see no reasons why is it illegal or unethical, it only become illegal when you can not deliver the name when someone purchased it from you.

Selling it is not illegal, as that's basic arbitrage, but this also assumes that a buyer is readily available for said property and you simply buy from one source to immediately sell to another.

But if you are actively searching for leads to purchase an already "for sale" domain, and you do not have the property owner's consent and authority to sell this property, then you could be hit under various laws including fraud (like George C Parker, the guy who kept trying to sell the Golden Gate Bridge), unlawful advertising, false pretense/fraudulent misrepresentation, etc., but this would be a civil case for damages, using obvious transgressions like the lack of consent, misrepresentation, lack of disclosure, and a ream of others.

That's why these fraud brokers hide behind "Mike" first names and Gmail accounts.

* not legal advice, just my own opinions.

 

[Lox]

Even winning/defending a UDRP dispute leaves you with the hot potato domain (for longer period of time).

 

[Internet.Domains]

George shared a couple UDRP filings above. This is not something that is easy to search for in UDRP decisions so there may be more. Here's an excerpt from a 2 letter .com UDRP from 2015 (https://www.wipo.int/amc/en/domains/search/text.jsp?case=D2015-1470)

Complainant:
"On July 9, 2015, the Complainant entered into an email exchange, which was initiated by someone called "Mike" using a "gmail" email address. The opening message read: "Hello Brian, Selling WI.com and it would be perfect for your company. Let me know if you are interested?" The Complainant replied: "Hello Mike, maybe depending on how much you ask for the domain." Mike replied: "Hi Brian, I was looking for USD700k but I am willing to negotiate and get a sale. Let me know your best offer?" The Complainant replied: "Hi Mike, could we agree on USD400." Mike responded: "Hi Brian You meant USD400k lol. How about USD650k?" The correspondence concluded with the Complainant's response: "Hi Mike, no we are talking by wrong dimension taking into account that WICOM is a protected trade mark and we can sue and get it by court order … (we did this already before). I would be willing to pay something to avoid law suit but it must be reasonable.""

Respondent:
"The Respondent states that until it received the Complaint it had never heard of the Complainant or his WICOM trade mark. It states that the email correspondence exhibited to the Complaint evidencing the sales approach to the Complainant, had nothing to do with the Respondent. The correspondence in question was initiated by someone using a gmail address, whereas the Respondent only corresponds via its MediaOptions.com email channel. It acquired the Domain Name legitimately by way of the terms of the brokerage deal described at section 4 above and has never used the Domain Name in any way that could remotely be said to be in bad faith, let alone bad faith towards the Complainant of whom it had never heard until it received the Complaint."

---

It's not just losing a domain name via UDRP that is concerning. It's having to spend thousands of dollars defending a domain name because someone else tried to sell it without permission of the owner.

I stand corrected.

 

[capybara]

The fact that someone else's unauthorized "selling activity" could pose risk for the genuine domain owner would be a serious flaw in the system. Not only there are plenty of people who may get triggered by simple "dislike" of their blog comment or forum post (or even just an absence of a "like") or any other form of their opinion disapproval and go thermonuclear to seek all sorts of digital vendetta, but more importantly, the primary potential beneficiaries – the trademark owners – could easily abuse this. You have a TM, there is a domain, but its older, so you can't get it easily and don't like the price. Send a letter to yourself from a fake email – boom – now there is "bad faith" and you can have it for the cost of UDPR. And we all know that it is not unusual when complainants base their encroachments on shameless lies, what could stop such people from starting doing this?

There are much worse things happening when authorities give too much credit and trust to the complaints (Wikipedia: Swatting).

However, from the example UDRP case above, I can't see that if it were not for the email, the case wouldn't have happened. It could still had been filed even without it. I believe, email or not, the risks for the genuine domain owner are within the standard range – any moment you may get hit with UDRP out of a sudden and you may not, you may have a complainant-biased panelist or you may have a sane one.

Misrepresenting other people without their permission may be a criminal offense, but can't attributing some kind of behavior to you be considered a sort of slander too? If someone UDRPs you basing on the claims you've sent some silly emails to them, yet they don't have proof it was really you – can't this be used as a basis for a response legal action? To clear your name and cover your UDRP expenses and even more?

 

[Peak.Domains]

I'd be really curious to see what the answers would be if the poll options were phrased a bit differently (no offense to op)

Like "It's good" or "It's bad" or "Depends on the situation, it could go either way" instead of "should be illegal and is totally unethical" or "totally 100% a-ok legit all the time", or maybe having an option for somewhere in the middle. The way it was phrased made it tricky to answer, at least for me.

 

[Internet.Domains]

I'd be really curious to see what the answers would be if the poll options were phrased a bit differently (no offense to op)

Like "It's good" or "It's bad" or "Depends on the situation, it could go either way" instead of "should be illegal and is totally unethical" or "totally 100% a-ok legit all the time", or maybe having an option for somewhere in the middle. The way it was phrased made it tricky to answer, at least for me.

To be fair this subject contains so many variables that the options would be a mini novel.

 

[Peak.Domains]

To be fair this subject contains so many variables that the options would be a mini novel.

Good point! At first I had chosen "Totally legit" but after reading a lot of the discussion I was like, well, I can see situations and ways to go about this where it would be okay but I don't think it's totally legit all of the time... so I swapped to not legit, but I'm also not sure if it's necessarily unethical all of the time or should necessarily be illegal. Like you said, so many variables haha

 

[jstenn13]

Here's what I wrote on Twitter:

Domain arbitrage attempts are never ok. Why? Because too much damage can be done to a domain from this. The domain's value can be damaged, a UDRP can result, the domain owner's reputation can be hurt, etc. It's wrong to try & sell a domain you don't own, w/o permission. Period.

The possible damage that can be done is the real issue here. I question the morals and integrity of anyone that thinks it's ok to try and sell other people's domains to end users without their permission.

 

[eurorealtor]

Sounds unethical, but If the buyer and seller are both happy, why not. Some may get pissed off later to find out how much money they lost, but nobody force them to sell in the first place, right?

 

[jstenn13]

Sounds unethical, but If the buyer and seller are both happy, why not. Some may get pissed off later to find out how much money they lost, but nobody force them to sell in the first place, right?

What domain owner would be happy to find out someone was shopping their domain around without permission?

 

[carob]

What domain owner would be happy to find out someone was shopping their domain around without permission?

And we are focused on domainers here. In some ways it is worse if unauthorised people are trying to sell the domain of a functioning business - that hurts the business by implying it is about to shut down. We had an actual case of that here:

https://www.namepros.com/threads/tr...sulting-firm-enaming-com.855570/#post-5005701 where a business owner said:

We recently found one of our domains 50yearwater.com listed without our authorization as well.
What we find disturbing is that the eNaming website shows up in search results when looking for our website name and now people might get the impression that we are in the process of abandoning our domain name, website and business because 'it is listed for sale' on their website.

There is a whole other thread here about Enaming and listing/offering/soliciting without consent:
https://www.namepros.com/threads/anyone-listed-or-contacted-by-enaming-com.877829/

 

[eurorealtor]

What domain owner would be happy to find out someone was shopping their domain around without permission?

If you list domain for sale, someone buy it, and sell it to someone else, how do you know it's not this case?

 

[jstenn13]

If you list domain for sale, someone buy it, and sell it to someone else, how do you know it's not this case?

Obviously if you buy a domain name and then try and resell it that’s perfectly fine. We’re talking about trying to sell names you don’t yet own.

 

[ResoluteDomains]

So a debate is starting to stir on a topic I wrote about back in 2015. Selling A Domain Name You Don’t Own – Cool or Not Cool ? My article was sparked by a post written on AntiCareer.com. There was a blog post by AntiCareer.com which talked about buying and selling a name that they did not own. The post titled “Turning A No Into A Yes and a $5,000 profit. Morgan Linton had touched upon this … [Read more...]

That's on TheDomains.com

Vote here if you think it's legit or not

At first I voted that I didnt think it was wrong. Then I read every post up until my reply here and I changed my mind and changed my vote.

 

[eurorealtor]

Obviously if you buy a domain name and then try and resell it that’s perfectly fine. We’re talking about trying to sell names you don’t yet own.

And my point is if you are listing domain, you'll never know if your buyer haven't shopped around and found a buyer for much higher price before he/she brought it from you. If your domain is not listed for sale, it's a different case, but it not likely someone would offer your domain if it's not already on the market.

 

[BrandEntrance.com]

So a debate is starting to stir on a topic I wrote about back in 2015. Selling A Domain Name You Don’t Own – Cool or Not Cool ? My article was sparked by a post written on AntiCareer.com. There was a blog post by AntiCareer.com which talked about buying and selling a name that they did not own. The post titled “Turning A No Into A Yes and a $5,000 profit. Morgan Linton had touched upon this … [Read more...]

That's on TheDomains.com

Vote here if you think it's legit or not

4. Not without a prior broker agreement.

 

[BrandEntrance.com]

Rob Monster quote on that site got negative comment:
https://www.thedomains.com/2019/08/30/vote-now-selling-a-domain-name-you-dont-own-fair-or-foul/

There is a post today on Namepros where people were talking about quickest flips. Rob Monster gave a scenario:

"That’s easy.

We see these deals all the time:

1. Broker finds a buyer at Price X

2. Broker finds a seller at Price Y.

3. Simultaneous close via intermediary (e.g. Epik)

4. Broker banks the spread net of fees.

There are some smart domain guys doing this on a regular basis and banking large spreads with relatively little risk because they own the domain for about 1 minute.

And now you know."

Elliot Silver did not like the example provided by Rob, echoing a lot of the sentiments I wrote about back in 2015.

"Do you think it is ethical to solicit offers for someone else’s domain name without their permission?"
Rob Monster said Broker

"Do you think it is legal to try and sell someone else’s domain name without their permission?"
Rob Monster said Broker

I have seen quite a few UDRP cases where the complainant cites an outbound sales pitch as evidence of bad faith. Imagine if a UDRP was filed against your name because some unauthorized third party tried to aggressively sell your domain name to a trademark interest without permission from your or regard for harming your rights. Not only would defending a UDRP incur legal costs, but even if the registrant prevails, it could devalue the domain name because a future prospective buyer would know there risk for a subsequent UDRP exists.

The intermediary also runs the risk that one party backs out of the deal and he or she could be on the hook. If the buyer backs out, the person could be left with a domain name they bought for too much money hoping for that flip. If the seller backs out, they will not be able to fulfill their sale obligation.

By calling people who do this “smart domain guys,” it might encourage someone to think this is a widely accepted practice. I do not believe this is ethical (not sure on the legal aspect ), and I presume others might feel the same way as I feel. I also think this is a risky practice, especially if they are caught doing it.

I think this can be reputationally damaging, if not financially damaging.



So do you think it’s a legit practice to sell a name you don’t own, even if the name is listed for sale?
With a Broker Agreement, Absolutely because there will be rules from the owner and the broker will identify as a broker.

Suggested homework for article participants: Learn what "broker" means. (Maybe they think a broker is a 'broke stoner').

FYI
@Rob Monster

 

[lock]

More options really required on poll for a broader approach but as a general rule is you cannot sell something you don't have. You could advertise say top level domain and top keyword for your business and try get a one on one before a purchase hoping price is fixed but credibility is lost when you cannot come through.

 

[Joe N]

The only scenario where I can envision this being acceptable is one where you are fully disclosing your position to the potential buyer. Something along the lines of:

"I believe I may be in a position to acquire the name XYZ.com. If I am able, would you be interested in purchasing it for $XXXX?"

This is the only ethical way I can imagine trying to flip a domain that you don't currently own. That way you're not representing yourself as the owner of the name, or as the buyer's rep. Of course the risk still exists of being stuck holding the ball, but I can certainly see the appeal in trying to sell domains in this manner.

 

[FolioTeam]

I think it's wrong. But then, who knows the intentions of the person at the other end of a sale? Which is why in my opinion, you should set a BIN that you'll be happy with regardless of who the buyer is or what the selling price might be down the road

 

[Kai W.]

I'm not a lawyer, but it conceivably could fall under "Slander of Title", as it's clouding the ownership of the domain name (i.e. the unauthorized individual is holding themselves out as the owner, essentially):

https://en.wikipedia.org/wiki/Slander_of_title

[emphasis added]

legit.The definition of ownership is critical. If the third party is only profitable because the information is not passed smoothly - as the post says 'legal' - then this is legal.IMO

 

[GeorgeK]

Another UDRP was reported on today, which apparently was caused by someone else (not the registrant) trying to sell a domain (investigo.com) to a TM holder on an unauthorized basis, see:

https://domaingang.com/domain-law/i...d-to-sell-the-domain-to-the-trademark-holder/
https://www.adrforum.com/domaindecisions/1854793.htm

Respondent did not attempt to sell the Disputed Domain Name to Complainant at that time as it was a third party who contacted Complainant, alleging to have ownership of the Disputed Domain Name. Respondent’s willingness to sell the Disputed Domain Name for $45,000.00 in response to an anonymous inquiry is not evidence of bad faith.