Domain owner dismisses case after domain buyer agrees to not contest her ownership.
The owner of Calculator.com has dismissed her lawsuit with prejudice against Stands4 Ltd.
Stands4 bought the domain name for $180,000 in June. But it turns out—at least on the face of it—that the domain name was stolen and the company unknowingly bought it from the thief.
Chloe Alston, who originally registered the domain with her father, filed a lawsuit after discovering that the domain name was in Stands4’s name. Stands4, which also owns Grammar.com, Lyrics.com and Scripts.com, spent $50,000 developing a new site on Calculator.com. That site was only briefly on the web before a judge in Florida issued a Temporary Restraining Order.
The dismissal states:
Stands4 hereby gives notice that it will no longer contest the Plaintiff’s ownership of the mark and domain name calculator.com, and Plaintiff hereby states that she is satisfied that Stands4 did not act in bad faith in relation to the acquisition of the calculator.com domain name.
This suggests that Alston understands that Stands4 didn’t know it was buying a stolen domain, and that Stands4 now agrees that the domain was stolen and it belongs to Alston.
What happens next? Stands4 is out $230,000. I can’t see them dropping the matter here.
Observer says
Dan.com said that it was “100% sure” that Chloe owned the domain, and that Chloe explicitly authorized this transaction.
So Dan.com clearly has some explaining to do.
JZ says
Where did DAN send payment and to who? That should make it pretty obvious
John Berryhill says
They could think of taking every penny of that money out of Dan.com, who provided a “100% sure” warranty of title.
Reza says
Nice try, but that’s not going to fly.
You don’t know the ins-and outs if this case.
They brought this transaction to DAN and asked us to handle the transfer.
The domain wasn’t even listed in DAN before they involved us with their already negotiated transaction.
We have executed a smooth transfer and 7 days after the transaction was completed some issues started occurring.
We assisted the buyer extensively in that period.
Our TOS is clear on this subject. The buyer and seller have to do their due diligence before they acquire a domain on our platform. DAN is exclusively a facilitator that provides a service to assist with a change of domain ownership. We have very strict processes in place which allow(ed) us to handle over 200,000 successful domain ownership transfers in the past 6 years.
There’s no place for opportunism here.
Observer says
Yes, but if the due diligence is between the buyer and seller, then why was it necessary for DAN.com to offer “100% assurance” to the buyer that the seller was legitimately Chloe and thereby not stolen?
And what is the explanation for DAN.com claiming that it was “100% sure” that it was legitimately Chloe when in actuality it was the thief all along?
Please elaborate on these points.
Nick says
Am I reading it wrong? How is Stands4 out $230,000? Doesn’t dropping the lawsuit mean Stands4 gets the domain?
Andrew Allemann says
No, the lawsuit was against Stands4 to recover the domain name. Stands4 has agreed that the domain rightfully belongs to the plaintiff and effectively agrees that the domain was stolen.
Observer says
Why is this a dismissal and not a settlement?
John Berryhill says
A settlement is simply an agreement between parties to resolve a dispute. As a condition of a settlement, the parties will typically agree to file a stipulation of dismissal with the court, but there is no need to file the entire settlement – along with whatever other terms to which the parties may have agreed – with the court.
Bossy says
Something fishy going on, maybe the lawsuit would have shed light on it.
John Berryhill says
It still might. There are “Doe” defendants remaining in the lawsuit.
It would be worthwhile for Stands4 to offer to compensate the plaintiff for continued costs in keeping the proceeding alive long enough to obtain third-party discovery from the registrars and other service providers, in order to see what, if any useful information might be gained from it. Obviously, they have more of an interest in finding out where their money may have gone.
But if they used some dodgy unlicensed escrow in the Netherlands, well… you get what you pay for.
Steve says
Could Dan take / survive a 230k+ hit should Stands4 look to them for their money back?
John B. — to your knowledge, has anyone ever successfully gotten their money back under such circumstances?
Andrea says
If I were Stands4 Ltd. I would sue DAN.com in court to get back their $230,000, because they provided a “100% sure” warranty of title.
Mr Reza Sardeha said in that case they were just a “facilitator”, so why providing a useless and dangerous warranty of title on which the buyer often relies?
That’s borderline, shady business …
Furthermore, and most importantly, every company providing Escrow services MUST have a license, both in many US states and in EU (PSD Directive).
As far as I can see, DAN.com is NOT LICENSED to provide escrow services, so it’s basically operating abusively, infringing both US and EU laws.
The Netherlands are well-known for and live off international corporate tax dumping and avoidance … so I’m not that surprised …
Personally I wouldn’t do business with Dan.com not even under torture and I suggest everyone to AVOID them.
Paying a 9% fee to operate through an UNLICENSED escrow company is pure stupidity, masochism … if something goes wrong you’ll be left holding the bag …