Court-appointed receiver finally set to auction off domain names.
The long saga of John Zuccarini’s domain names might be winding to a close.
On April 8, 2011, court-appointed receiver Michael Blacksburg will auction off dozens of domain names to satisfy a cybersquatting judgment against Zuccarini. Zuccarini also owes the IRS significant taxes.
Most of the domain names are typos and might be problematic to buyers. For example, 50cen.com and 50sent.com could be a problem with rapper 50 Cent depending on how they’re used. Some of the typos are generic but it could still be a challenge to hold on to them as a “new registrant” in a UDRP or court action (e.g. astology.com.)
You can see a complete list of the domain names here (pdf).
At one point last year Rick Latona planned to auction the domains off at a TRAFFIC conference, but that plan was canceled.
Jp says
Geesh they are auctioning off hisname.com? For what?
Uzoma says
Perhaps the receiver should first purchase FORSALEBYCOURT.COM from me first. I may sell it at a good price.
John Berryhill says
So, did anyone ever figure out:
1. Where has the parking revenue gone all of this time, and
2. Who is really behind the organization which bought the Office Depot judgment?
Kevin Murphy says
Knowing how much he likes appearing in court, who’s going to be brave enough to buy johnzuccarini.com?
Andrew Allemann says
@ Kevin Murphy – I typed in Zuccarini.com last night. The funny thing is the links that show up at the bottom of the parked page — they’re all related to domain disputes.
Domainer Extraordinaire says
>1. Where has the parking revenue gone all of >this time, and
>2. Who is really behind the organization >which bought the Office Depot judgment?
DS HOLDINGS, LLC,
Could it be?
John Berryhill says
Yes, the plaintiff is identified as “DS Holdings LLC”. Taking a line from Butch Cassidy & The Sundance Kid… “who are those guys”?
It would have been entirely possible for John Z to set up a shell corporation for the purpose of purchasing a judgment against himself, using it to get the names, and then auction them off. Given the apparent enmity in this case, that does not appear to happen. But given that the trustee is one of the plaintiff’s attorneys own clients, there are other self-dealing scenarios possible here.
John Z says
Okay, so you mean is it me. No
The domain names earned about $182,000 while in possession of the receiver. The first $92,000 went to the irs. The next $90,000 went to kron. The next $72,000from the auction goes to kron, after that everything goes to the irs.
kron’s name and people who work for him are all over the registration paperwork for the creation of ds holdings, so if it is anyone else but him who is the principle owner it would be a total surprise.
John Berryhill says
Is DS Holdings and it’s agents, officers, etc. allowed to participate in the auction?
Or is shill bidding permitted?
Using a court-ordered sale to launder cybersquatting would be an awesome strategy, though.
John Z says
John,
Hello,
To clarify kron and ds holdings can bid on the domain names.
kron can use the $72,000 as a credit to bid on the domain names
Certainly as there is no money actually coming out of krons pocket he could throw the $72,000 out to any or a number of domain names he wants.
Yes, this could appear to be a form of shill bidding, it’s play money to him.
If there’s a name he wants, such as badcreditloans.com, he could just throw the 72,000 at it to start and see if anyone else wants to bid.
There’s no money coming out his pockets, but as I recall there was something in the California statue that he sited which allows him to do it.
badcreditloans.com, when I had it was bringing in between $3500 – $5000 a month for me, that’s in addition to what the company that monetized the name was making, so it was really making between $7,000 – $10,000 a month.
Of course that was before the collapse of the real estate market, so I’m not sure what specically it is bringing in now.
But it is still probably the most valuable of all the names being auctioned.
I’m not sure if anyone other than kron is going to show up at the inpromptu event, I imagine a few people.
The domain names were earning between $10,000 to $15,000 when I had them, that though was as mentioned before the collapse of the real estate market and as I understand before reduced revenues in general from domain monetization.
Most recently the names being auctioned were earning around $5,000 a month for the total of the traffic. I don’t have the specifics of each domain name.
John Z says
Andrew,
Wow, links to domain disputes, I don’t know if they’re big money makers or not 🙂
John Z says
John,
Yeah, court sanctioned cybersquatting, that’s definitely a trip and a half…
It’s come full circle, it’s like I woke and somebody said to me, “We were just kidding with you… we really love what you did.”
Thank you….
John Z says
Of course, the trademarks were a problem, but the generic misspellings can’t be anything but legal.
I should’t have done the trademarks and extra popups, but I was just like alot people who register domain names, I was totally addicted to it and wanted to register everything in site till I fell off the chair and landed on the cushions..
Can you beleive how I missed registering dictonary.com, the best misspelling of dictionary.com.
I got some good ones, but some did get away.
Remember the days back in say 2000 / 2001 when you could still refresh your screen at netsol and see if a domain name dropped, you didn’t need scripts back then to register domain names, they stayed around for awhile.
So it was about 6:30 in the morning and I had been up all night. Back then I had a $1,000 limit a day on my debit card. Two domain names just showed they were about to drop, blahblahblah.com and dictonary.com
So I keep refreshing the screen for both of them, and all of sudden blahblahblah.com drops, so I register it. Right after I did I realized that I could be close to my $1,000 limit and thought I shouldn’t register anything else as dictonary.com may possibly soon become available.
So just a few minutes later dictonary.com
drops, I go to register it and I’m past my $1,000 limit and I can’t get it.
You can imagine I was totally out of it after that. My debit card didn’t renew to another $1,000 till 3:00 in the afternoon. almost 9 hours away. So I figure there’s just no chance that dictonary.com will still be around at that time.
I go to bed thinking, man that wasn’t a good thing that just happened, I’m really out of it at that point.
So I sleep till about 2:30, get up and just for the yeck start hitting the refresh button again for dictonary.com.
Couldn’t believe it, it was still available almost 9 hours later. Oh man, how could it be… I have just another half hour till my card refreshes…
Oh well, at 2:45 it was gone. Came up 15 minutes short…
As I say I did get some good ones, but what can you do… you try..
John Berryhill says
“kron can use the $72,000 as a credit to bid on the domain names”
Ah, an auction in which one of the bidders is allowed to use play money – brilliant.
I’m trying to remember the last time that a court decided to auction off the drugs seized from a drug dealer. There does seem to be an element of “this nasty man was hoarding and selling domain names, so we are going to take his domains and sell them”. Um, wait…
Adam says
Hey John Z, when are you going to write a book ?
I’m going after cupcakeparty.com 😉
Andrew Rosener says
Where is the auction taking place?
Andrew Allemann says
@ Andrew Rosener – details are in the pdf link
John Berryhill says
April 8, 2011 at 10:00 a.m. (PST) in Classroom A-2 of the Cubberley Community Center, 4000 Middlefield Road, Palo Alto, California 94303
Details of the relevant CA code sections describing auction terms are located here:
http://www.aroundthecapitol.com/code/getcode.html?file=./ccp/00001-01000/701.510-701.680
If the domains are characterized as personal property, then it appears that the terms are payment by cash or cashier’s check. If over $2500 then 10% at time of sale, net ten days. But I would check with Blacksburg.
All of the talk about getting the best price for the domain names appears to have flown out the window now that DS Holdings has $72K in funny money to play with.
Since there is a fixed distribution plan now, it appears that DS will use the funny money to win the domains at “auction” to DS Holdings, which will then likely monetize/sell them later.
It is also not clear whether the names are being sold individually or as one lot.
It’s kind of interesting that .eu names were seized by a US court here, though.
Josh says
I once called into a court ordered domain auction in Colorado only to hear the ladies voice that owned the company that went bankrupt.
I asked what she was on the line for, they said she was a bidder, I asked the judge if she was a creditor, he said yes and 80% of the proceeds would go to her. Nice little chance for her to shill bid eh.
All perfectly legal as she was now just a private citizen, I laughed and said goodbye.
As for John Z, were you ” guilty ” of just typo squatting, is that what brought about the whole case and loss of the names?
John Z says
Adam
That’s not nice, I love those cupcakes…
Give me.. Give me..
John Z says
John,
I argued that in the California District Court and the Ninth Circuit Appeals Court. It was as though they missed that part of what I filed. The Appeals Court in their decision wouldn’t even comment of acknowledge that part of my argument concerning the finding that the domain names had been found by the third circuit to unlawfully redirect Internet users.
The closest the District Court came is saying in an explicable statment, that the Court was concerned domain names, such as the mispellings of astrology.com, like astology.com, would redirect Internet users as Zuccarini had done, rather than be put to a legtimate use as the plaintiff has demonstrated.
I responded to the Court that as a misspelling, the domain name can do only one thing that is to redirect someone away from the correctly spelled website, no matter who owns the domain name, if that is the Courts concern.
I got no response to that statement.
As of yet I’ve received no notice of how the names will be auctioned, each individually or grouped together.
John Z says
The issue of the 14 .eu domain names being transferred to the reiver demonstrates how no one understood what the actual Order that supposedly ordered the domain name registrars to transfer the domain names to the receiver really meant.
The entire case was based in the California District Court having in rem jurisdiction over the domain names, as VeriSign the registry for .com and .net domain names was headquarted in California. Only the .com and .net domain names were suppose to be transferred, if that is what the Order even meant.
But all the domain name registrats transferred all my domain names, no matter what the top level ending was.
Network Solutions transferred, freemovies.org.
Enom transferred the .co.uk domain names I owned.
DomainDiscount24.net transferred all the .eu and .de domain names, because they said they thought they were ordered to.
I filed a motion with California District Court to return all the domain names to my ownership, in stating that they never should have been transferred to begin with.
The District Court stated, yes I was right, they never should have been transferred and the Court said “they never ordered the .eu domain names to be transferred.”
Then the Court said however, since they have already been transferred and the domain names are here, we’ll keep it that way.
My motion to have the domains returned was denied.
John Z says
What I meant to say was,
I filed a motion with California District Court to return all the .eu domain names to my ownership, in stating that they never should have been transferred to begin with.
Josh says
The law makes it a federal crime for “whoever knowingly uses a misleading domain name on the Internet with the intent to deceive a person into viewing material constituting obscenity” and “whoever knowingly uses a misleading domain name on the Internet with the intent to deceive a minor into viewing material that is harmful to minors on the Internet”.
John,
Assuming the above is what you were found guilty of…did you only use .com to do this, do you feel the extension mattered. Was it simply a matter of the squatting getting thrown on top of the above offense.
Mr.Berryhill, if I may ask sir, is there a state in which one can commit a murder or violent offense with a weapon (gun) and and some point own a weapon (gun) again.
John Berryhill says
@Josh
Mr. Zuccarini accepted a plea deal in that criminal prosecution, which is not related to the civil judgment in the Office Depot case resulting in this auction. Mr. Zuccarini served his time for that conviction. There are specific laws about guns, so “argument by analogy” when it comes to ongoing restrictions is not the point in relation to these domain names. You can be convicted of hitting someone with a hammer, serve your time, and you are not forever barred from owning hammers.
The full history of the various legal actions involving Mr. Zuccarini is complex, and can’t be treated well in a blog comment. For example, an entirely separate FTC action bars him from certain activities in connection with domain names. That FTC proscription is, not surprisingly, also somewhat internally inconsistent. But, suffice it to say, THIS action – the one resulting in this auction – is limited to DS Holdings’ purchase of a civil judgment won by Office Depot many years ago, and a levy upon remaining domain names that were owned by Mr. Zuccarini.
The point here is that Mr. Z has racked up impressive judgment debts and liens. DS Holdings came up with an interesting scheme to make a buck off the back of those liabilities, but Mr. Z has a legitimate interest in seeing that the levied assets go as far as possible toward satisfying those liabilities.
What we have here is a poorly noticed auction being held under circumstances where DS Holdings can walk away with a bunch of domain names using what amounts to free money, and then flip those domains for more later. That said, similar things can happen at foreclosure auctions.
@John Z
The court ruled against you. You have to deal with that as does anyone who receives a judgment. Whatever logic and reason your arguments may have, and despite my comments to Josh above in this post, you do not walk into a legal proceeding with a reservoir of goodwill and trust. To your credit, you have recognized that your historical behavior was odious and I, for one, appreciate that. However, it is very much like the child who killed his parents, and then begged the court for mercy because he was an orphan. The overall circumstances here are, at root, circumstances of your making.
I agree there has been considerable shenanigans on the plaintiff side of this thing. The trustee finessed the nature of his relationship with the plaintiff’s attorney when he took the appointment, and both the trustee and the plaintiff made frivolous threats against others in a lame attempt to cover his ass when the trustee breached his fiduciary responsibilities by negligent custodianship of the domain names. That was a pathetic move on their part, but it really doesn’t change the one thing that a lot of people fail to understand about courts.
Above all else, courts want to get stuff off of their dockets. While civil litigants want to believe the world revolves around them and whatever piles of money are being greedily clawed at in their actions, a federal court has to handle everything from soup to nuts, including the trying of serious crimes, sweeping injustices, and matters of significant social importance. At some point, and this case is a prime candidate, a court is motivated primarily to get the clown car out of the circus. When a case gets to that point, what is being tried is not the arguments of the parties, but the patience of the court to listen to another round of whining.
Some people get addicted to this stuff and become perpetual litigants. Such people need to take a good hard look at their circumstances, consider how they got there, and decide to move on and get a life.
John Berryhill says
Missed one….
“Assuming the above is what you were found guilty of…did you only use .com to do this, do you feel the extension mattered.”
Josh, that’s not the point of the observation of the .com names. This case is a levy action against property. Such an action can be brought in a jurisdiction where the property is located. The premise here is that since Verisign has corporate offices in Mountain View, CA, the “location of the property” is the Northern District of California, as to the .com domain names.
The .eu TLD registry is not located in California. It is not even located in the United States. It’s not a question of “he did bad stuff with domain names, so why does it matter?” I would be willing to bet you’d find no shortage of Europeans to whom the proposition that any US court can seize .eu names matters a great deal. You have to set aside the visceral reaction to “Oh, it’s that crazy Zuccarini guy” and look at what is going on here with the assertion that any court, anywhere, can order the disposition of assets located anywhere else. Put yourself in the position of the EurID registry and/or the European Commission, and ask yourself whether a US court seizure of .eu names is appropriate.
I seem to recall more than a few people were uncomfortable with the notion that the State of Kentucky could purport to seize gambling-related domain names which were registered to people outside of Kentucky and which were being operated outside of Kentucky. Now, one could just as easily say, “oh, but those were scummy gambling people…” I guarantee you that everyone does something that some other person finds to be scummy. Nonetheless, we have rules for deciding whether a court in a particular location can exercise power over something located there or not.
Domainer Extraordinaire says
JB is the analogy king.
Josh says
@JB, excellent detailed explination, your time to reply is very much appreciated and insightful.
When I said..
“Assuming the above is what you were found guilty of…did you only use .com to do this, do you feel the extension mattered.”
I actually ment it with some sarcasm due to the fact he feels ripped off by losing other extension. If his conduct included misleading youth to obscene material via the dot com which in turn lead to losing other domains, from a moral stand point he has lost my sympathy.
John Z says
As John B knows these lawsuits become personal, and that’s what this was and more.
I owe money to the irs, everything was done by the opposing parties to avoid having any amounts gained from the auction or use of the domain names paid to the irs.
Actual criminal laws were broken in this case by certain parties in the non-notification to the irs of the creation of the California receivership.
It took 4 months of phone calls and my contacting the irs to get them to intervene in the case, so they would get what they are legally entitled to.
Believe me not looking for sympathy, but things happened to me because of certain laws, so is the law the law, or not.
If someone has a beleive in a hierarchy of what they consider a scale of lawlessness, that’s fine with me. I can understand that.
Really I do have a life, but this all started back in 2001 because I had alot of misspellings of domain names, mostly generic, but some trademarks, the trademarks got all the publicity. I was naive and wanted to challenge everyone in court. Of course that was a mistake. The negative publicity just grew from there. I made a thousand mistakes, I realize that.
As anyone who is familiar with the details knows, I did not direct to people to obscene material as was claimed, but I’m not going to split hairs on this.
John Z says
Want to leave the parents out of this though
John Z says
Let’s say the parents and the description. That’s too much.
John Z says
Hi Andrew,
I think maybe you to this in a thread you didn’t intend, it’s got to be tricky juggling 20 or so ongoing discussions.
Josh says
@JohnZ, are you saying the charge of directing youth to obscene material was not valid?
Clear something up if you can, what came first, the attack on you being a tm/typo owner/monetizer or the obscene material charge.
I just for the life of me cannot see why they would attack one guy who while having a nice group of tm/typos is no where near the top. I was always under the impression the obscenity issue lead to a full fledged attack on your work.
John Z says
To clarify, I had all the domain names seperated by non-adult going to non-adult material and adult domains going to adult domains. Then the initial action about the domain names happened to me and I was prevented from doing business with anyone in the U.S., that’s when I made the biggest mistake. There were at that time, in 2001 no non-adult affiliate programs outside the U.S., and I started redirecting almost everything.
John Z says
Other than the misspellings, I had on some domain names too many popups. That was another one of the problems that led to inital action.
John Z says
Things went to an all typographic warning page and it was easy to navigate away from going any further. That’s why I said I’m not going to split hairs on it. It was an obvious mistake to do that anyway, but when you get under pressure you do some things you regret and that was the biggest one I have.
John Z says
I had to many mispellings of all types of domain names, generic and trademarks. I was challenging the trademark people in the courts. I had too many popus. I was getting alot of publicity about all of it. Just the kind of thing that makes in vulnerable.
Josh says
Kind of a perfect storm, I understand clearer now, thank you.
John Z says
Anyway, related to the auction itself, I’ve found out the names will most likey be sold all together as one and not individually, unless there is a change of plans.
Janet says
John Z…
Am still sorry that it happened to such a nice guy. You know that James and I are always here and on your side. 🙂
And you know what we think of the corruption within the Court system.