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The Honorable Stephen V. Wilson has issued a verdict in the first trial between Monte Cahn and his former employer, Oversee.net.

The decision was extremely narrow, covering just one aspect of Cahn’s claims against the company.

Cahn had a bonus plan that was essentially an earnout from when Oversee.net bought Moniker from Seevast. It provided up to $13 million over three years.

One of the bonus measures was an overall Oversee EBITDA number that was to be set each year by the board. When business conditions deteriorated, the board never ended up setting the goal specific to the incentive plan.

However, it did set a company budget that had an EBITDA goal. This goal was used for other management at the company. Cahn argued that this is the number he should have been held to under his incentive plan.

The judge issued his findings solely about one question:

“whether Oversee promised Cahn that his Performance Goal under the MIP [incentive plan] would be identical to a target (the “Company Budget”) used as part of the process for determining bonuses for Oversee legacy management employees.”

The court decided that Oversee did not make this promise.

Oversee.net provided evidence from its negotiations with Cahn before he joined the company that showed the company explicitly said it would not hold Cahn’s bonus measures to be consistent with the rest of management. Its goal, as stated in the incentive plan, was to reward “significant contributions toward the continued or improved profitability and growth of the Company ”

MonikerOversee.net’s 2008 EBITDA “budget” goal was $51.1 million. That goal was reduced by more than 50% to $23.9 million for 2009. Since the earnout was designed to reward growth, the judge said it wouldn’t make sense for this budget number to apply to Cahn’s bonus plan.

Oversee.net later offered Cahn an alternative bonus plan when it realized the existing one wouldn’t give him much of an incentive because he was unlikely to hit the lofty numbers. Afterall, the company slashed its own projections by half. Cahn was able to receive a bonus under the old plan or the new plan.

In 2009, Cahn received a bonus under the new plan (with reduced targets) that was about 10% of what he would have gotten under the old plan.

The judge questioned how Cahn would have accepted this reduced bonus if he thought he was due $1 million or more under the original bonus plan.

As I stressed at the beginning of this post, this is just one narrow issue in the case Cahn brought against Oversee. There will be much more to come.

You can read the judge’s decision here.

© DomainNameWire.com 2011.

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Related posts:

1. Monte Cahn gets a court victory as judge denies summary judgment
2. Oversee.net: We Don’t Owe Monte Cahn Anything for $13M Management Incentive Plan
3. Oversee.net Asks Court to Dismiss Monte Cahn’s Claims

One slimy tactic I’ve witnessed and heard about are people who agree to buy a domain name (whether it’s at an auction, aftermarket venue, or private acquisition), and before paying, they try to sell the domain name to other companies. If they can’t find a buyer for the domain name at a profitable level, they don’t pay for their purchase.

I’ll share an example of this with you. Recently, I was involved in an auction at NameJet, and someone offered to sell me the domain name before the auction was over. The person ended up winning the auction but was a non-paying bidder, presumably when he couldn’t find a buyer. NameJet lost out, and someone who bought it to re-sell it likely lost out since this person probably reached out to many prospects already.

Recourse for the domain owner is generally limited to litigation and/or having that user banned from the platform in the future. Litigation can be expensive, so most people generally let it go without doing much of anything. It’s very frustrating to have a deal fall through, and it’s especially annoying to find out that the buyer has gone out to contact leads for your domain name, potentially hurting your chances of selling the name in the future.

In my opinion, trying to sell a domain name you don’t have the intention of buying unless you can flip it is wrong. If you are new to the domain industry, I caution you to not do this.

HEB Grocery Company, headquartered in San Antonio, is the first complainant to win a uniform domain name dispute resolution (UDRP) case for a .xxx domain name.

Atlanta resident Eric Gonzales registered the domain name after he claims to have contacted the grocery chain to see if they were going to register it.

Gonzales’ approach is certainly interesting. Here’s how the World Intellectual Property Forum panel summed it up:

Respondent is an individual, located in the U.S. state of Georgia, who indicates that he was doing “extensive research for a TV news report on businesses that have not registered .XXX domains with possible variations close to their names.” Respondent states that he contacted several businesses that bought .XXX domains after he brought the matter to their attention but that Complainant was not one of them so he bought the disputed domain because of Complainant’s failure to exhibit a proactive approach. Respondent states that he was later contacted by counsel for Complainant “DEMANDING” he relinquish control over the disputed domain but that Complainant never asked. Respondent states “Everything would have been avoided if they would have asked.”, because then he “would have gladly GIVEN” them the domain. Respondent noted several policies involving the .XXX gTLD which cause him to question the general availability of domain sites if they are allowed to be taken away by companies that fail to block the initial purchase. Respondent stated that he could have avoided dealing with this legal issue and consulting legal advice if Complainant had taken steps to block his purchase.

Another strike against Gonzales: he admitted he’s not part of the sponsored community (adult sites).

I have a feeling Mr. Gonzales flushed a lot of money down the drain with his .xxx purchases.

© DomainNameWire.com 2011.

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Related posts:

1. Disabled American Veterans Wins DAV.com Domain Name Case
2. BlackBerry Wins 101 Domain Names in Single UDRP Case
3. Ari Goldberger Wins A Short But Sweet UDRP

Remember Swoopo.com, the auction site where you had to pay for each bid? It shut down amidst controversy, and now a competitor has purchased its domain name via Sedo. UK based DealDash Ltd paid 10,000 euros for Swoopo.com and now forwards it to DealDash.com.

This was just one of many “end user” domain purchases over the past week. Here’s a look at 22 others. All took place at Afternic unless otherwise noted.

College Travel Experts bought FallBreak.com for $1,500. That’s a very smart purchase at a great price.

Property management company The Landlord’s Agents, Inc. paid $1,688 for RentalSuccess.com.

Publicly traded Pethealth Inc. bought PetsLocal.com for $2,000.

St. Louis based Automation Service bought AutomationServices.com for $3,788. Its main web site is AutomationService.com.

Digital Measuring Service, Inc bought DigitalMeasuring.com for $1,695.

College social networking site CampuSquare.com made a very necessary purchase, picking up CampusSquare.com for $1,500.

UMB Financial Corporation bought UMBBank.com for $2,000 at Sedo. This is interesting given that the company recently used UDRP for a domain name — and lost. (It was a different domain.)

The Land of Nod bought LandofNod.org for $795 at Sedo with the help of domain recovery firm CitizenHawk.

VisionCritical bought InnovationForum.com for $3,188.

McKinley Mortgage Company bought BackyardBanker.com for $1,095.

Law Bulletin Publishing Company paid $1,595 for LawyerPort.com

Someone bought Egg.org for 3,500 GBP. Was it Citibank, which owns Egg.com?

Freight company MegaPack bought SingleDelivery.com for $1,195. That’s a clever domain for a freight company.

TFH Gazebos, a UK company that sells pop-up Gazebos, bought PopupGazebos.com for $1,500. A perfect domain purchase.

Proactive Publications Ltd, which owns InsideIndustry.net for its magazine Inside Industry, bought InsideIndustry.COM for $1,650. Smart move and a cheap price.

Jorge Cruise, who promises to help you lose weight, bought SixPackDiet.com for $1,788.

Real estate firm LJ Hoocker Palm Beach bought PalmBeachHolidayRentals.com for $1,688.

Germany’s Metalive covered its bases by purchasing Metalive.com for only $1,000. It owns Metalive.de. Very nice buy for Metalive.

LCNB National Bank bought YourHometownLender.com for $2,588.

Aircraft Owners and Pilots Association bought FlightTraining.org for $5,977.

Aqua Laboratories, Inc. shortened its domain from AquaLaboratories.com to AquaLabs.com for $3,900 at Sedo.

Cole Street Consulting also shortened its domain. It bought ColeStreet.com for $1,488. It currently uses ColeStreetConsulting.com.

© DomainNameWire.com 2011.

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Related posts:

1. Best Buy buys PhoneFreedom.com and other end user domain sales
2. Samsung Buys Chaton.com and Other End User Sales This Week
3. LiveDrive buys LiveCloud.com for $92,000 and 10 other domain sales

You can read a couple or articles about the controversy surrounding Swoopo here and here. There are plenty of others that I could find, but I think those two articles summarize the issue pretty well.

According to an entry on Wikipedia, “in March 2011, Swoopo’s website became inaccessible, and a notice page claimed that Swoopo was experiencing “technical issues.” On March 26, 2011, Swoopo’s parent company filed for bankruptcy. There is no information regarding whether the site will reopen or permanently close.”

It looks like the later part of that excerpt has been answered when you have a look at Sedo’s weekly sales report (via TheDomains.com). Last week, Swoopo.com sold for 10,000 EUR (roughly $13,000 USD). When you visit Swoopo.com, the domain name forwards to DealDash.com, which appears to be a penny bid auction website.

According to the DealDash website, “DealDash is the longest running penny auction site in America. DealDash´s Buy it Now option removes the risk of losing from penny auctions by allowing losing bidders to purchase the product at a fixed retail price and get a full refund of all the bids lost in the auction.”

This seems to be a wise (and cost effective) acquisition for Deal Dash, since there seem to be a significant number of references to Swoopo and quite a few inbound links. I don’t know if the company purchased any other intellectual property, but the domain name was a smart purchase.

Domain Name Wire’s 7th annual domain name industry survey has concluded with over 1,500 participants.

I’m busy collating and analyzing the results, which will be posted on Domain Name Wire throughout the month of February.

Here are data about the participants in this year’s survey:

1,593 survey takers

25.8% of people who took the survey own more than 1,000 domain names. 27 participants own more than 10,000 domain names.

The domain name industry is global. People from 79 different countries participated in the survey. The largest percentage were from the United States, but that still represents less than 1/3 of all participants. Other countries with a large number of participants are Canada, India, and Brazil.

73.6% of respondents consider themselves domain investors.

Stay tuned for the results…

© DomainNameWire.com 2011.

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Related posts:

1. Last chance to take 2012 Domain Name Wire survey
2. 2006 Domain Name Wire Survey results
3. Domain Name Wire Survey Results

National Arbitration Forum panelist Beatrice Onica Jarka got the “answer” correct in a recent UDRP case. But she really should have considered reverse domain name hijacking.

The case was brought by deals site Shopzooey, Inc.

Shopzooey, Inc was founded in 2011. Upon finding the domain name Shopzooey.com already registered, the company registered MyShopZooey.com in July 2011. ShopZooey.com was registered in September 2010.

Fast forward to 2012 and ShopZooey is frustrated that it can’t get in touch with the owner of the better domain name to try to buy it. So it files a UDRP.

Here are some of the complainant’s arguments:

“Respondent has failed to address continued overtures by Complainant in a good faith attempt to open up a negotiations dialogue for the possible purchase of the domain.”

“The domain name is being used in bad faith, as upon purchasing the disputed domain name, Respondent failed to put the domain to proper use. To date, Respondent has yet to make proper use of the domain and this misuse has continued for one year and four months.”

“…Respondent’s continued renewal and failure to properly utilize the domain qualifies as a deliberate attempt by Respondent to profit from diverting users to the Respondent’s myshopzooey.com website by causing mistake or deception as to the source of origin of the services and intentionally disrupting Complainant’s business.”

“Respondent utilized a third-party registration company (Domains by Proxy, Inc.) to shield the true identity of the Respondent. As such, Complainant submitted numerous requests to the third-party registration company to contact the Respondent to attempt to engage in a dialogue regarding the disputed domain name.”

My God, I think I might throw up.

If there ever is UDRP reform, arbitration forums should be required to throw out cases where the subject domain was registered before any claimed trademark rights.

In the mean time, panelists should call reverse domain name hijacking when they see it. Even if the respondent doesn’t have a lawyer and doesn’t know to ask for it.

© DomainNameWire.com 2011.

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