Judge says GoDaddy must disclose details about prior clawbacks and disputes.
A federal judge has ordered (pdf) GoDaddy to turn over information about other domain auction reversals in an ongoing lawsuit over domains that were clawed back months after being won at auction.
Two companies sued the registrar after they say domains they purchased through GoDaddy Auctions were taken away after they had begun making plans to use them.
Crisby Studio AB won the auction for calor.com, while Prime Loyalty LLC bought butane.com. Both domains had previously been owned by the U.K. energy company Calor Gas Ltd and were ultimately returned to that company.
In a recent order, the judge resolved several discovery disputes between the parties.
First, the plaintiffs sought examples of other domain auction reversals GoDaddy attributed to an “unexpected error” during the past five years. GoDaddy argued that producing this information was unnecessary. The court disagreed, finding that such examples could be relevant to the plaintiffs’ claims. However, the judge limited the request to reversals that occurred in the 18 months before the disputed clawbacks rather than the full five-year period.
Second, the plaintiffs asked GoDaddy to identify all lawsuits, arbitrations, or administrative proceedings during the past five years involving disputes over post-auction reversals or cancellations. The court again narrowed the scope, ordering GoDaddy to provide information covering the past two years.
Third, GoDaddy sought documents about Prime Loyalty’s discussions with suppliers, distributors, and other business partners related to plans to launch a butane.com-branded business. The company argued that these communications were relevant to the evaluation of the plaintiffs’ claimed damages. The plaintiffs countered that they are not seeking damages for lost profits tied to those business plans. The judge agreed that, on that basis, discovery into the non-party business partners was unnecessary.
Finally, the court addressed a dispute over attorney-client privilege tied to GoDaddy’s discovery of the alleged auction error. The plaintiffs asked for details about when and how GoDaddy learned of the issue, who was involved, what corrective actions were taken, and whether GoDaddy believes registrar 123-Reg contributed to the problem.
GoDaddy argued that internal communications with counsel are privileged. The judge agreed that the communications themselves are protected but ruled that the underlying facts must still be disclosed. He wrote:
Defendants must disclose when GoDaddy first discovered the error, and they must disclose how they discovered it as well, even if that discovery occurred in the course of a conversation with counsel. If that were the case, the Court will not deem privilege to be waived beyond the answer itself, and Defendant need not divulge any of the communications themselves. Defendants also must identify the persons involved in identifying the error, other than any counsel. Any nonprivileged communications describing the error are also to be disclosed, as are the corrective actions taken. Finally, Defendants must disclose whether GoDaddy believes that 123-Reg contributed to or caused the error and why it believed that, excluding any communications with or advice of counsel on that issue.
Can we all help the plaintiffs by providing all our Godaddy clawbacks in the last 5 years?
Has plaintiff created a tipline and/or email to receive this help?
They are not looking at clawbacks because domains were renewed. They are only looking at clawbacks due to an “unexpected error.”
This sounds the tpe of case I just love. When litigating I was often accussed of trying to set a “Litigation Trap”, and of course I was lol. I just love those “games” to trap the other side (Defendants) in to Lying on oath , then I can leverage that easily.
It’s simply astounding that GoDaddy continues to fight this suit. The prior registrant, who allowed the names to lapse, has not uttered one syllable about wanting the names back, and the only thing GoDaddy seems to be fighting for is to establish that (a) domain names are not property and (b) they can do whatever they want with your domains. Fighting for either of these points does not endear them to their customers, and there would have been utterly no penalty for GoDaddy to have simply agreed to abide by the auction of the names in the first place.
The only apparent reason why GoDaddy continues to litigate this matter, or indeed devoted resources to it in the first place is out of purely muscle reflex. Some moron with check-issuing authority was told by the legal department ‘we’re being sued for something’ and so they keep signing the checks to Cozen O’Connor for no commercially rational purpose.
It’s astounding how many people rise to positions of “authority” in these types of large organizations, who come to a realization that their authority doesn’t really mean anything and that “do what the lawyers say” is the safest way to avoid jeopardizing their position. What they don’t realize is that “the lawyers” act largely out of the same instincts of self-preservation and self-justification of their bloated income, but that the lawyers have figured out that they can scare the executives into continuing to sign the checks.
Meanwhile, the market value of the company as a whole continues to find new bottoms of the barrel and these “I’m doing what I’m supposed to be doing” types have absolutely no clue why.