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What to do when a past owner sells your domain name

A couple years ago I received a phone call at 9 p.m.; a friend of mine was literally being extorted by her IT guy. It was too late to save her, and she ended up losing her website, and barely somehow managed to keep the domain name. I wrote about that in hope that it would help someone to keep her website and domain name. Years later, people still read this post often, and because of it they send questions to my email or in the comment section. Today I was reviewing those questions, and found another disturbing issue that had occurred.

Looking for some advice and you seem like the kind of nice person who might help me out. I purchased a domain through GoDaddy last October, started building a website and then got pulled away on a work project so had to ignore it for 6 months. I intended to pick it up again last month (April) but was surprised to find out (after some digging) that the original seller re-sold the domain to someone else in February, and re-sold it through GoDaddy no less!! Originally, GoDaddy offered to try and get a refund from the seller, but when I insisted that what I want is the domain, since I am the rightful owner, they became defensive and unresponsive. I finally suggested I’d retain a lawyer if they wouldn’t help me and then they offered to try and get the domain back. However, today they said they’ve contacted the seller twice but have gotten only “vague” responses from him. If you were me, what would you do next?

Wow…

Lea, first of all, I am so sorry I haven’t seen your question earlier.

It’s hard for me to understand what exactly happened, but it seems that you bought a “used” domain name on the secondary market, and you did it through GoDaddy?

If so, when you buy a domain name on the secondary market, it is very important to do due diligence on the domain name and domain name owner. A good deal of “things to watch” when looking for a new name is listed at the bottom of this post, but I’ll summarize them here for the case of “buying a domain name on the secondary market.”

5 things to watch for when buying a domain name on the secondary market

  1. Is the domain name that’s available for registration, a registered trademark? Check with USPTO and WIPO
  2. If you are buying a domain from someone else, is that person the rightful owner? Check whois and nameservers, communicate strictly through the owner’s email address.
  3. If you are buying a domain from someone else, do it with Escrow
  4. Was the domain name used for illegal purposes in the past, and do any “bad” websites link to it? Check Ahrefs and Archive.org
  5. Search the domain on Google with quotes -> “SomeDomainName.com”

Once you end up buying the domain, be sure to update the whois information as soon as possible. Also, a good idea (if possible) is to transfer the domain away to a different registrar. This does seem counterintuitive, because if the transfer is made to the same registrar it “just” changes owners, so it’s quicker and cheaper. But then again, due to errors (and Lea points this out with her problem) it can easily slip back into hands of the old owner. If this does end up happening, you are going to have a hard time proving what exactly happened, and getting the domain name back to your ownership.

Read Goran Duskic‘s answer to Is it a good thing to buy a website from Flippa.com

How do I know I am not buying damaged goods?

Big companies like GoDaddy, Sedo, and even Flippa give buyers a (false?) sense of security. Make no mistake about it, you are not buying a domain name from the marketplace itself, in almost all cases, you are buying it from an individual, and that individual may not be who he pretends to be. Have you ever seen a fake listing on eBay, where you can buy 160GB USB flash drive for $19? The same can happen when buying domain names and websites. And then you look at the comments and ratings, only to realize the listing has 1/5 stars with outraged comments. When a certain domain name is taken off the market, it’s hard and costly for someone who is not fluent in the domaining language to find out what happened with that particular domain name in the past. You could pay a fee to look at historical records for a certain domain name, but if you did that every time, you would probably go bankrupt. I recommend doing this only when you are seriously interested in a domain name, and when you are prepared to pay $50 to get information on a single domain name (here) or if you want to get partial information (try here).

Oebar.com for sale at $2495. You can't let the price be determining factor on the history of a domain name. You have to do your own due diligence and research.
Oebar.com for sale at $2495. It’s a great idea to buy a clean brand on a .com domain, but, you can’t let the price be the determining factor on the history of a domain name. You have to do your own due diligence and research or work with a reputable company.

To give you an example, a domain name could have been used for something illegal 2 years ago, and sold on the aftermarket today as a regular domain name. People are picking up trash, and reselling it as if it was recycled, but it’s not. It’s your responsibility as a buyer to perform a complete due diligence on the domain name, the content it showed, and who the previous owner was. You don’t want past owners to haunt your inbox / voice mail / office insisting that you give them back their domain name. Hopefully, I don’t have to remind you that if you buy stolen goods, they will come and take it from you.

Is today’s domain marketplace, out of place?

After everything I said, one begins to suspect today’s domain marketplaces, and if anyone is buying domain names at all? Last I checked, Sedo had a million registered users, so although most of them are missing seller ratings, comments and verifications they are doing very nicely for themselves. Here’s just a short list of some of the more established marketplaces (in no particular order).

  1. Afternic
  2. Sedo
  3. Snapnames
  4. Namecheap
  5. NameJet
  6. GoDaddy
  7. Flippa
  8. Igloo (formerly Aftermarket)
  9. Huge Domains
  10. Domain Market
  11. Fabulous Domains
  12. Domain Name Sales
  13. Cax
  14. 4.cn
  15. Nokta Domains

If you go through this list, you will probably notice that some of them sell their portfolio domains, and some are marketplaces where everyone can come and sell their domain names. People also sell domains on forums like Namepros, they sell domains with logos that they personally own (my portfolio), and they sell them on marketplaces like eBay. The least problems you can expect comes when a company that deals in domain sales is selling you a domain name, and they are the owner. But that doesn’t mean you should put your guard down. Due diligence and Escrow services go a long way, and if you are dealing with a large sale, write a contract and get an invoice for the provided services.

Closing tips and advice

Buying (and even reselling) a domain name on the secondary market, or from another individual, is a great idea, and can make you and the seller a lot of money! However, it can also lose you a lot of money in exchange for a good headache. A domain name is truly and only yours if your contact details, and even more importantly, your email address is listed in the whois records. Additionally, the domain name should be locked and registered for several years in advance with a reputable domain name registry. If you are not sure if buying a certain domain name is a good idea (if someone is offering it to you, or if you found it yourself) contact a domain name specialist; when the problem occurs it is often too late to prevent it.

As for Lea, her options are limited, and I am at a disadvantage here because I would need more information on the transaction in order to help her. It’s easy to say it’s GoDaddy’s responsibility, but we don’t have all the pieces and we would need to know what exactly is a “vague” response and their explanation. My gut feeling tells me that this was either an engineering glitch or some sort of social engineering on behalf of the previous owner towards GoDaddy support or both.

Furthermore, this problem easily falls into the category easy to prevent, hard to cure. Her best chance would be to gather all possible evidence that prove she is the rightful owner of the domain name, and that she purchased it. She needs to communicate this to GoDaddy (obviously we would have to check the whois to see the current registrar and the owner) directly or through a lawyer if it makes sense financially. Unfortunately, the second option is to leave all this behind and rebrand.

Written by Goran Duskic

I am the founder and CEO at WhoAPI. Entrepreneur for more than a decade in the hosting and domain industry. Sold my previous company. 500 Startups and StartLabs alumni. Author of a white paper "Domain Disclosure: Dirty Dozen" and eBook "26 Fundraising Questions for Startups".

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