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August 27, 2012

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Here's the The Lowdown from DN Journal,
updated daily
to fill you in on the latest buzz going around the domain name industry. 

The Lowdown is compiled by DN Journal Editor & Publisher Ron Jackson.

Messy Divorce: Moniker Founder Monte Cahn's Multi Million Dollar Lawsuit Against Oversee.net Could Get Ugly + One Domain Conference Cancelled, Another Scheduled

I had heard this was coming and Wednesday (May 4) the rumor became a reality when Moniker.com founder Monte Cahn filed a multi-million dollar lawsuit (PDF file) against his former employer, Oversee.net, as well as that company's co-founder Lawrence Ng and its President and CEO Jeff Kupietzkty who were named as individuals. That sets up a domain 

industry version of Clash of the Titans (Cahn, Ng and Kupietzky have all been profiled in DN Journal Cover Stories, with the Cahn article dating all the way back to our first year of publication in 2003 when he was already one of the most widely known figures in the industry).

Cahn had joined Oversee as Moniker's President when they purchased Moniker for $35 million in a deal announced in January 2008. Cahn parted ways with Oversee at the end of 2010 when his contract expired and now alleges that they violated the contract terms of a Management Incentive Plan under which he could have earned as much as $13 million (but wound up receiving nothing). Cahn also alleges that Oversee did not pay him a commission he was due for the sale of Restaurants.com in February 2011, even though he claims to have written evidence of the commission agreement. 

Moniker Founder Monte Cahn 

Oversee VP Mason Cole

In Oversee's response to Cahn's suit, Mason Cole, the company's Vice President of Corporate Communications wrote (in a passage I first saw Wednesday night on the Domainers Magazine website): 

"Predictably, the path Monte Cahn has chosen is needlessly confrontational and provocative. Regrettably, his perceived dispute with Oversee is a result of his own falling short of expectations. This action will do nothing to further his cause and will only result in the needless expense of time and attorneys fees. It is unfortunate that Monte’s actions will impact employees and clients of Moniker, the company he helped found. Monte’s unfounded claims are well overstated and singularly without merit. We will vigorously defend this action and we look forward to resolving this in court at the earliest possible opportunity."

The unusually pointed nature of Cole's response came as a bit of a surprise to me. I have known Mason for a number of years now and have always found him to be a very professional and even tempered person. I have never seen this tone in his corporate communications which indicates to me that, while there is naturally some animosity in just about any lawsuit, there seems to be a higher than usual level of friction between the parties in this one. I asked Cahn about Cole's response but he had no comment, noting that we will all have to wait and see how it all pans out.

Unfortunately, lawsuits like this tend to drag on for at least a couple of years and frustration with the slowly unfolding process and unresolved dispute will likely produce more divisions within the domain community. Cahn is a well liked and widely respected industry pioneer (which is why Oversee wanted him to be part of the package when they acquired Moniker), so you can expect his supporters to be very vocal in his defense, with Oversee backers on the other side of a debate that could quickly get ugly on the blogs and in forums. 

We already know what to expect in that respect because Oversee, over the past couple of years, has already been the target of a number of detractors due to widely publicized incidents involving shill bidding by a SnapNames executive (whom Oversee is now suing) and a privacy breach by a Moniker employee (who is no longer with the company). The lawsuit gives Oversee's opponents more ammunition to fire against them.

Still, while people will have their say on both sides of the issue, in the end it will be up to the court to decide who is in the wrong in this particular instance - that is if the suit goes that far - and that is a big if. While both sides feel they are in the right and will ultimately prevail, the seemingly endless cost and aggravation of being involved in a lawsuit frequently wear down both sides, leading to a settlement before the court rules (as happened last year when the long, drawn out case between DomainTools founder Jay Westerdal and the company that bought DomainTools, Thought Convergence, was settled). If I had to make a prediction that is what I would guess will happen here. 

A couple of other notes today regarding domain conferences. The DomainConvergence conference that was scheduled to run next week (May 12-13) in Montreal has been cancelled by organizer Frank Michlick due to a lack of  registrations. Michlick said, "All paid registration fees will be refunded and sponsors will be compensated"

Meanwhile, Daniel Dryzek, who stages Europe's MeetDomainers conference tells us the date and location for the 2011 event have now been set. This 5th edition of the event will be held in Warsaw, Poland on Friday, October 14, 2011 at the Polonia Palace Hotel. The date falls two days before the 2011 T.R.A.F.F.I.C. connference will be held in the U.S. on Ft. Lauderdale Beach.

(Posted May 5, 2011) 

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