Ad.com Lawsuits

Good Evening Folks!!
The following is a guest post by my friend and partner Howard Neu and his
take on the ad.com lawsuits. Tomorrow it will be my take. It is quite
different. Howard attacks the legal aspects. I attack the industry and others
for forming a circular firing squad. This is much bigger than just the 4
parties.



All of the litigation that has started up due to AOL’s wrongful attempt
to hijack a legitimate generic domain is going to cost the parties huge legal
fees which may or may not be recoverable in court. The U.S. Federal
District Courts have what is known as Rule 11 Sanctions. These sanctions
may apply when a spurious law suit is filed or when there are allegations
contained in a law suit which are false and the falsity of which should have
been discovered by the Plaintiff prior to filing the law suit.




I truly believe that the seller’s law suit is misdirected as the real
culprit (fly in the ointment) (black hat bad guy) is not being sued. AOL
has made spurious claims in a bald attempt to interfere with the sale of the
domain to SKENZO. If this were a WIPO action, it would be obvious Reverse
Domain Hijacking. AOL claims that it has a common law trademark on
Ad.com, but it has never used it in commerce and has never been known by Ad.com.
Slang words for registered domains don’t cut it. If the courts should
somehow agree with AOL, the entire domain structure will come tumbling down and
the aftermarket will disappear overnight.


I can only assume that
SKENZO will join AOL as a third party defendant. Neither the seller nor
the buyer were aware at the time of the sale of any ersatz claims being made by
AOL. Though the domain was previously put up for auction, AOL never
communicated with the Seller or with the auction house MONIKER that it had any
kind of claim. I wonder if it was AOL’s high-priced legal counsel or some
goof-off in the company who decided to make this spurious claim. In either case, Time-Warner needs to take remedial action when the s**t hits the
fan and AOL gets the kind of negative publicity out of all this that will drive
users away in droves


Howard Neu





13 thoughts on “Ad.com Lawsuits

  1. Dan Bell

    It’s unfortunate this deal had to go this way for both buyer and seller. This was a sweet deal. Both parties should come to an agreement and fight AOL together. There’s a lot at stake here and everyone is trying to protect their own interest, but the best action is to secure this industry.
    With AOL being the unwanted business, it’s obvious it’s their last ditch effort.
    -Dan

    Reply
  2. Soundly Reasoned

    “Slang words for registered domains don’t cut it.” HN
    Exactly. Thank you!!

    Reply
  3. David J Castello

    This decision will be a milestone in our industry and I have no doubt that many other companies are watching it closely. Let’s just hope that fairness prevails and it goes the right way.

    Reply
  4. M. Menius

    This ranks as possibly the most outlandish case in internet/domain name history. The most absurd claim in history hands down.
    For AOL to win would be the equivalent of electing Hitler president, and he’s been dead over 50 years.

    Reply
  5. Sergio Igartua

    Fairness will prevail. AOL doesn’t have a leg to stand on and I can see this as a win for the industry in the long haul. There’s too much at stake and interests go way beyond the involved parties.

    Reply
  6. Marcos Guillen

    Hi Howard,
    Great article, just one quick point: I can’t sue AOL, at this point I have no valid legal standing to do so. They did not sue me (or Skenzo), the only thing they’ve done so far is sending a letter. They threatened Skenzo with some hypothetical future litigation, litigation based on a pending trademark that the USPTO has just denied. Skenzo overreacted, and stalled.
    Yes, I know what you are thinking; I could sue for interference and damages. But no, I can’t claim damages from AOL unless I do my best to enforce the transaction, I can’t abandon it. The truth is, from a strictly legal point of view, the only one who is breaking the rules is Skenzo, no matter how sympathetic their position could be. That means I’m force to sue Skenzo, who has no legal or contractual reason to avoid payment. I can’t just say, hey, you know what? I don’t want you to honor your contract anymore, and then go on and sue someone else for interference. I would need to show damages, and I will not have any unless Skenzo keeps on stalling, and forces me to spend a lot of money getting them to pay.
    There is another way out of this mess for us, of course. Skenzo could close the transaction, get the domain name, and wait for the next AOL move, if any. Keep in mind AOL is already battling Advertise.com, Skenzo doesn’t need to be the one biting that bullet.
    Cheers,
    Marcos Guillen

    Reply
  7. Mike

    In a perfect world domainers would unite and launch these class action law suits against corporate domain bullies of the world. Unfortunately, that is not the world we live yet. I happen to think that Marcos is correct in his assessment of the situation. As long as he had no prior knowledge of the forthcoming move by AOL (even as ridiculous as it is) a contract is a contract.
    As for AOL’s case, it’s total rubbish.

    Reply
  8. HOWARD

    Marcos, you are absolutely correct. It IS SKENZO who must bring AOL in as a 3rd party defendant in your law suit if it wants to prevail in not going through with the purchase. Just because someone threatens a buyer with litigation if the sale goes through doesn’t give the seller any standing to sue the party threatening the litigation.

    Reply
  9. jeff schneider

    Please lets all of us not lose sight of the bigger picture here. Howard hit the nail on the head.The big picture tells us all that these UDRP filings cause irreparable damage and chaos to the secondary domain business. It affects the validity and trust factor in buyers minds. A hesitant buyer is a low ball buyer in any marketplace where the threat of piracy of the winnings is at stake.
    We as an industry need to cut the cancer from our marketplace before it spreads to a terminal state for our industry. AOL needs to be made an example of in this farce of farces. I am not an attorney but I do know there needs to be a precedence set and soon !!

    Reply
  10. John Berryhill

    “AOL has made spurious claims in a bald attempt to interfere with the sale of the domain to SKENZO”
    That is indeed the point. A”spurious claim”, as you put it, is no excuse for Skenzo not to perform. We all know the claim doesn’t hold water, and suing AOL to prove that point is of academic insterest and does not get the domain sold.

    Reply
  11. jeff schneider

    Hello John,
    As you have said in your post above, AOL along with many others in the past have made spurious claims by filing UDRP claims. These claims have become nothing more than obstructions to internet commerce. The greatest percentage of these domains that have been pirated through the process of UDRP filings sit on the shelves of the victors collecting dust. Never to be developed to spur competition and only hoarded as blocks to competition.
    There are many laws put into place to protect the interests of those in power. UDRP filings are, in my opinion, a supreme example of such laws.
    So how do you stop spurious UDRP filings short of suing the filers. I agree with Howard sue the pants off AOL and set a precedence for others to chew on, when contemplating the land grabbing practice of UDRP filings.

    Reply
  12. Stephen Hammond-Parker

    Rick as with many things in this life when a company gets to big it is the ‘big guys’ stampming on the smaller and we have zip to chance to reverse the situation. What ever happened to loyality and being open in business

    Reply

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