Legal & Tax Implications of the Sex.com Decision
 

I was just thinking with the Sex.com case now creating case law defining a domain as property what will be the tax and legal consequences of this decision.

For example are domains now seizable in a court judgment?

Can you depreciate your domain portfolio like other business property for tax purposes?

Do domains now create litigation risks by someone claiming they were injured from virtually visiting your property?

Anything else anyone can think of?

now THAT is a scary thought.

Gotta remember you cant physically put your body on a domain name, therefore you arent on the property, so you cant really file a claim for being injured on their property..

Its a contract right. Only as good as your maintenance of this contract right.

WARNING: THIS WEBSITE MIGHT CAUSE EPILEPTIC SIEZURES

mental injury....


anyway, I have a problem with this.... and that is that it's not YOUR property..,. it's basically leased. Don't pay your yearly fee and you lose your lease. How can the court say it's your property when you can't ever actually own it?

If domains are now considered property...can the IRS come in and tax it accordingly?

While some domains can maybe be depreciated, what about domains which grow in value?

And, maybe they could be used in litigation, just as music is being blamed for murderous impulses.....aren't there certain people claiming sexual addiction from adult sites?

if domains were a one time buy (at whatever price.. doesn't matter... $10 bucks or $900k).... even if you were making payments on it like real estate, it could be considered "your" property.... but since that's not the case..... you can;t ever truly OWN a domain name, how can this be right?

that's a possibility. i remember kids getting seizures from certain nintendo games.....since it's site design that would be involved here, people might be held liable for something like that.

Tell that to the judge. LOL

I'm being serious here. From a legal standpoint with domains classified as property it truly does open a pandora's box of new untested issues that might need to be resolved in a courthouse.

Yep, that's one of the things I was thinking also.

I haven't read the Sex.com court ruling only the article. But now what the court in essence is saying you do have property i.e. ownership rights.

the fucking court is wrong then.

I'm thinking a company getting a judgment or a government agency could use this ruling to declare your domains to be property subject to seizure.

From the article it says this:


Comparing Internet domain names to property such as homes and cars, a federal appellate court ruled Friday that Web registry Network Solutions Inc. could be liable for damages after a convicted forger purloined ownership of www.sex.com from an e-commerce entrepreneur.

If Web site names are property, the court contended, domain name registries should be responsible for safeguarding them ? no different from a valet who guarantees a client's car won't get stolen from a parking lot.

i thought that had already been done.

just take a look at jerome baker and all the head shops that were shut down.....the domains were seized.

But that's where it would fall apart.... don't you see it? Okay... suppose some kid claims he got a fucking seizure from looking at a site I had. The feds "seize" my domain. Who are they going to "seize" it from? Me? I don't own the domain..... you can't seize something from someone that doesn't own it. They can terminate my lease.... but that doesn't prevent someone else from leasing it... so how are they going to seize the domain?

I stick by my finding.... the court is wrong. Cars and homes can be owned. Domains cannot be owned. There is no comparison. The court is wrong.

That was a criminal case. But now this might open the same thing to happen in civil cases. And we all know who could jump on this obviously.

It's a pretty simple math issue really.....


how many payments must I make before I OWN any given domain name? Answer that with a finite timeline or number and ownership is established. Until then, it's a lease.

I'm not saying the Feds since they can do whatever they want usually.

But lets say you design a site Amp. The guy says this design sucks I want my money back. You tell the guy to fuck off and die. The guy files a civil suit in his home state. You don't show up. The guy gets a default judgment. The guy could take Ampiezza.com easily from afar under a court order for the judgment since now domains are property.

take it from where? Who are they taking it from? I don't own it.... I just rent that domain for a fee every year... if I stop paying the fee I lose the rental and someone else can move in. So who are they seizing it from? Are they going to make the registrars destroy that domain?

It's no different that someone sayig they could seize your leased Buick. Sure, maybe they take it away from YOU.... but you don;t OWN the car.... so who are they "seizing" it from? The dealer? It's their damn car....

btw, I haven't read the sex.com case files yet either KRL.... but if this was the ruling, then I must say, I think the court is wrong, and given the right case, it WILL be overturned.... if this was the decision that gave Kremen back the domain, then he should've, by all rights, lost the fucking shit.

it wasnt....just a decision about damages.

but i agree with you about the ownership issue. i think the courts are going in the wrong direction with their decisions.

The whole premise of this case was could a registrar be held liable for damages cohen caused Gary by the registrar not affording his domain i.e. property proper protection.

NSI's legal position was domains are not property therefore we can not be held liable for our careless fuckups.

The court held domains are property and a registrar can be held liable if they fuckup your property. They cited the valet case. When you hand your keys to a valet to park your car regardless of whether it is a leased car or a owned car, you have the legal protection and expectation that the valet at that point is responsible for protecting your property.

I think we're better off having them recognized as some kind of property, since they can be so valuable. You wouldn't want Network Solutions to just get away with a big screwup.

so, nsi owns all domain names just becasue the own a registration technology and process? i thought the internet was a new frontier; stake your claim, set up your shop, make your money if you can.

registering a domain name and building a business around the properties of that name seems to make it more than just a shop address on main street usa that one would rent for a brick and mortar business for example. a 'name' of a business online can be just as powerful as, say 'ford' is to that company. denying rights of ownership is like saying the entire ebusiness model thingy is dynamic and can change at any time -maybe it can. but what if nsi did the same thing to yahoo or amazon? think there would be an ownership battle for those names?

So was the idiot patent officer who issued Acacia's patents to them, but look at how far they're taking it and running with it...

(note for the anal freaks: actually he issued it to two other guys, whom Acacia then bought out.)

well under US GAAP an intangible asset with an indefinite useful life cannot be amortized.

The domain was a business expense and you should have written it off when acquired. Each renewal fee is also deductable to a business. If you sell it the gain will be taxable income. Nothing has changed unless the IRS comes up with a new theory or regulation.