The dark side of granting “lease to own” domain sales II

[Peter45]

Hi,
there was a thread about LTO dealing with the danger for the lessor of getting the domain damaged - and in particular lost - because of the lessee’s behaviour

The point is that the terms do acknowledge, correctly, that the domain name could end up being lost as a consequence of the buyer's actions. But the terms DO NOT, anywhere I can find, state that the buyer remains liable to the seller for the value of the domain name.

I think there is another danger intrinsic to LTO deriving from the fact that the lessor guarantees to the lessee the availability of the domain, so that as long as the lessee comply with the LTO terms of service he has the right to use the domain.

I was thinking about the lessor losing a UDRP: domain goes to the Complainant, lessee must replace it with another one, that domain was a substantial part of lessee's brand.
Is the lessor accountable for the lessee’s financial losses?
I hope to be wrong but I think he is.
Am I wrong?

 

[Peter45]

The Complainant contacted Namesilo regarding the disputed domain name and Namesilo promptly suspended the domain, but within the next few days the disputed domain name was reactivated.

The Complainant contacted Namesilo again, and the disputed domain name was suspended again

Namecheapx.com UDRP: Namesilo threatened with “retaliation” ​

So the seller/lessor can be made financially accountable by the buyer/lessee not only after losing an UDRP, but also when company X contact the registrar and convince them about the plausibility of their claims on the leased domain.

The registrar would suspend the domain before - i.e. without - a UDRP.


The domain get suspended and taken away from the lessee who incurs in financial losses.
Whom would the lessee hold accountable for those losses?
The registrar? No
X? No.
The seller/lessor? I think yes

Of course the lessor could later go after X, but beside the fact that meanwhile they could have gone broke, good luck with that.

X could even take back their claims and don’t go into the UDRP, but with the temporary suspension of the domain the buyer/lessee would have already incurred financial losses, which the seller/lessor would be accountable for.

Of course this is unfair for the seller/lessor - that's why I hope I'm wrong - but who would be otherwise accountable for the financial losses of the buyer/lessee in case he gets deprived of the domain without his fault?


It’s all about the consequences of the general principle implicit in the Terms of Service of every LTO that the seller/lessor must guarantee to the buyer/lessee the availability of the domain.

Feel free to chime in