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P2P.com domain thief gets 5 years in prison

Today computer hacker Daniel Goncalves was sentenced to five years in prison for stealing the domain name P2P.com from Internet entrepreneur Marc Ostrofsky and selling it on eBay.com for $121,000 to former NBA basketball player Mark Madsen.  Goncalves is the first domain thief in history to be criminally prosecuted in the United States. Ostrofsky and his partners Albert and Lesli Angel worked to track down Goncalves with the New Jersey Cyber Crimes unit. Goncalves was sentenced before Superior Court Judge Stuart Peim in Union County, N.J. following a guilty plea to multiple criminal counts.

This case sets a major precedent in that there are no laws currently in place to protect domain name theft. States like California consider an internet domain name similar to a piece of real estate – if it’s stolen, although it’s a long and expensive process, the owner may have a remedy to get it returned.  But most other states like New York or New Jersey consider the domain name a piece of “intellectual property” similar to a copyright or trademark, and owners have no legal recourse to get back that stolen asset.  Domain name owners hope that this case will instigate new legislature that will protect these valuable properties.

Ostrofsky, author of the New York Times best-selling book Get Rich Click!, The Ultimate Guide To Making Money Online, is listed in the Guinness Book of World Records for having bought the domain name Business.com for $150,000 in 1995 and sold it a few years later for a world record $7.5 million.   Transactions like the one involving Business.com helped to make transactions in domain names a hot investment prospect.  But laws creating remedies for victims of domain theft have lagged behind market progress.

Albert Angel, who spoke at the sentencing, said “in our effort to redress the injuries inflicted on us, we came to appreciate how undeveloped this area of the law is, and how victims of domain theft face an unmarked and totally uphill battle to get a remedy. Today’s sentencing helps to define a path for other victims and law enforcers to follow, and reinforces the likelihood that the theft of a domain can and will be prosecuted.”


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