"...but they are not affiliated at all. It was operated by a completely separate entity"
Well if what you say is true, then it seems like they are affiliated and the CTO's above statement seems off. Of course you can be a separate entity and still be affiliated.
I would say "not affiliated" if said company was just paying them a flat fee per month to run their stuff on a subdomain. If they are, however, getting a percentage of revenue, it's a classic affiliate model.
I don't know the financial deal that is in place, but I don't see how it impacts the affiliation.
From my perspective the accounts are not shared, so you needed to register there to create an account. We don't share databases. Also, it is not our company and operates completely independent from us. This is what I meant by not affiliated. Hope that clears it up.
Appreciate your answer. Parts of your post make it seem like you have next to nothing to do with this; while other parts make it seem like you do have responsibility for this.
Also, it is not our company and operates completely independent from us.
Do you mean by this that the SaaS chat application deployed at chat.youporn.com is developed by a different entity to youporn? If so, then I understand the different entity part. But does that entity also own the users and serve its own TOS than you guys for chat.youporn users? If you are merely deploying a SaaS but have your own TOS and own the users, then it seems like while YouPorn may not be at fault for the technical goof up, but you are still responsible overall since the users belonged to YouPorn(not the parent entity).