
How Groupon Bought The Domain Groupon.com - AndrewWarner
http://mixergy.com/domain-business-tip/
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ig1
Um. They should speak to lawyers right now, the UK has something called
"Groundless Threats" protection for trademarks. The guy in question could
quite possibly sue Groupon for a substantial amount and get the domain name
back.

Groupon knew the guy had the name and the intention to use it for a coupon
service, and they then went ahead and registered the guys (unregistered)
trademark with full knowledge that the guy was planning on using it (+ with
the intention of forcing him to give up the domain). They then used the
trademark to make him give up the domain. How could Groupon's lawyers not have
warned them that this was a bad idea ?

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gojomo
They didn't 'force' or 'threaten' him to do anything. Groupon got the
trademark first -- by active use even before trademark registration. The other
guy got the domain name first. Then the two parties struck a mutually
beneficial deal based on their distinct rights.

The domain-owner's 'intent' doesn't count for much; everyone with a domain
name has a plausible 'intent' to use it for a related web project.

And the suggestion they 'speak to lawyers right now' is goofy -- they
certainly consulted much better legal counsel than is available in this
discussion thread before spending $250K for an international domain purchase.

~~~
ig1
I doubt they would have given a public interview on the topic if they had a UK
trademark attorney to warn them they may be in grey territory. Even if there's
a low probability of facing a lawsuit, as we've seen in the case of facebook,
where there's money there's lawyers.

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dotBen
Two thoughts come to mind:

1) I wonder if they would have got the domain via the first contact if they
had offered $250k, or even $125k there and then (ie no trademark route). When
people email me about domains "asking if I'm interested in selling" it's
usually because they are looking to pay $500 range. If it's worth $250k to
you, use a lawyer and then the other person knows you're serious. I would have
thought almost all unused domains are for sale at $250k.

2) No one seems to be thinking about the risk here, which is that they
invested a lot of time, effort and money into the Groupon brand (inc
trademarking it) but they didn't own the domain.

That seems like quite a risk because, despite common assumption, you are not
entitled to a domain just because you own the trademark (the other party could
have other circumstances). Mr A R Mani legitimately owned and held armani.com
until they had to privately buy him out and this dude could say he was
building a community for roof-top gardeners (Gro Upon.com). Put up a dummy
site for that and their case is tough.

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a2tech
Not really a very cool way to get the domain.

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paolomaffei
tl;dr

Company doesn't offer enough for a domain that's their own company name .com.

Domain name is probably worth less then $25k.

Company launchs and grows really big.

Company trademarks the domain and manage to buy it for $250k.

They manage to call it a success.

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silvia77
Question: what if you have a launched business + the trademark to the name and
someone still owns and won't sell the .com URL? We own the .co and all other
extentions but the .com is preferred, would you go about thr same way groupon
did it in this case?

~~~
jackowayed
You can't _force_ them to relinquish it. They should know that because you
have the trademark, they can't launch anything with that name. They're
probably just hoping that the longer they wait, the more invested you'll get
in the name and the more you'll be willing to pay.

~~~
paolomaffei
Are you sure they can't just call themselves "name.com"?

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Mc_Big_G
I believe dropbox did exactly the same thing. The lesson here is that you
should get a trademark in addition to the domain. Essentially, this makes
squatting pretty useless without the trademark.

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vegashacker
Well, $250,000 for a non-executed idea isn't a bad payout.

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Mc_Big_G
Absolutely. However, it's an edge case.

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d4ft
Wow, is .25MM cheap for a domain name.. ever? I can't think of a scenario in
which it would be. Could anyone enlighten me as to the economics of this?

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AndrewWarner
I think he meant that it's cheap in comparison to what they built.

They built a business with huge revenues. When I asked him if he could at
least say that Groupon generates over $100 million, I think he laughed and
said that $100 million is small.

~~~
djb_hackernews
Hmm. I did some math here-> <http://news.ycombinator.com/item?id=1338758> a
while ago. I figured 175M revenue. If 100M is small, I must have been way off.

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TotlolRon
groupon.com Created on: 29-May-02

As domainers would say - _ding-ding-ding we have a winner!_

