Internet Lawyer: Internet Attorney: Internet Law Firm: SEDO Auction Error on domain?

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December 11, 2007



Although this is pure speculation, the scenario makes me wonder whether the initial "bidders" in the follow-up auction were just shills to drive the price up so Sedo could collect a higher commission. If so, it really speaks badly for them.

David: No doubt. Proving the claim is all in the details many of which don't come out until later. For instance, if SEDO can show irregularities in the auction as a result of an 'attack' on its servers to preclude bids, it makes them seem less self-serving. Of course, that just means their service is not what it should be, and the real result will be a loss of credibility and good old fashion market forces driving participant domain buyers and domain sellers to competing auciton sites.

.Mobi registry voids latest Sedo auction, will re-run in January. Constantine Giorgio Roussos said he was the rightful winner of at $66,000. Sedo’s servers had slowed to a halt in the last few minutes of the auction, which kept many bidders at bay. Sedo extended the auction for 2 1/2 hours and the domain was bid up to $616,000. Worse, the self-proclaimed new winning bidder for these premium .mobi domains publicly stated that he bought them as an investment, not to develop. Technically, that can be construed as against the auction terms.

After an investigation as to why Sedo’s servers slowed to a halt, the .mobi registry has decided to void the entire results of the auction and rerun it in January. They are contractually allowed to do this. Sedo’s investigation sheds new light on what happened:

-The server meltdown not only prevented bidders from placing new bids, but it kept valid proxy bids from being triggered

-The auction was “compromised”, according to Sedo. This likely means that someone performed a denial of service attack during the final few minutes of the auction. (This is my speculation based on Sedo’s official statement.)

The new auction will run on January 23, 2008, according to Sedo.

The biggest winner in this decision might be Alvaro Albarracin, who gets to rethink his decision to shell out over a million bucks on highly speculative domains.

Personally, I ain't optimistic. Unless they know, much more prove, something we don't know, I doubt they'll be able to show Sedo was up to any intended mischief.

But that's where it boils down to, doesn't it? Proving your claims? :D

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