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Website Purchase

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mjr161

Junior Member
What is the name of your state (only U.S. law)? Pennsylvania

I purchase income generating websites as investments, and purchase a lot of them through the site sitepoint.com. I came across an auction for a free image hosting site that makes money through ad revenue with such companies as Google Adsense. The seller claimed that the site received 350k unique visitors a month, which would generate about $700/mo in ad revenue. I agreed to purchase the site for $7500 and complete the transaction through escrow.com. We agreed to work outside of sitepoint.com, which is a common practice since sitepoint is both a free service, and a bit of a pain to work through functionally.

With the purchase of the site he agreed to make a few changes for me to get the site compliant with the ad networks since some of the pictures that people upload are adult related and you can't display ads on these pages. We worked out the specifics through Yahoo Instant Messenger (I have the logs) as well as email, and he setup the escrow.com transaction. He also convinced me that as soon as the domain was changed over, but before the site changes were done I should approve the transaction at escrow so he could be paid. I thought no big deal, I have possession of the domain and the current website so what could really happen.

Well two weeks later he is almost impossible to reach over email, and hasn't been seen on instant messenger. He has made none of the changes he agreed to. I'm not as concerned about that as I can have the changes done myself, my big concern are his lies about the 350k visitors a month the site was getting. After looking at the site logs, he is PAYING for random hits, when he promised me that the site is getting all it's hits virally (from hotlinks on other sites). In a nutshell what he appeared to do what create a website, purchase 300k+ hits per month for about $300-$500/mo for two months, and sell the site to the sucker for $7500. Because of this the site is practically worthless to me, and he has disappeared. Since I've purchased the paid hits seem to have died down, and the site is getting 3k/day or 90k uniques a month already, and I'm sure will plummet much more in the next few days as the paid hits expire.

In review...

1. He does not get 350k uniques on this site.
2. He paid for all the hits that the site does get, none of them were linked in from other websites (viral) like he claimed
3. He promised to have all the changes made, I have seen nothing.
4. He promised to have everything uploaded and working by Monday Dec 29. It is now Jan 10th and there are still issues and he's been avoiding my emails.
5. He deliberately hid the referral log from me during the buying process because he was paying for hits and didn't want to show me.
6. He lied to me saying he only had two months of logs, because the "log files were too large"
7. He deliberately made the escrow.com transaction for the domain only so he could fulfill that obligation and get his money in a day instead of when he made the promised changes to the site which he never intended to do.

I am in PA, and he's in Newark, DE. Do I have any course of action here?
 
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Zigner

Senior Member, Non-Attorney
Additionally - you used an escrow company. Why can't you just work with THEM?
 

mjr161

Junior Member
Additionally - you used an escrow company. Why can't you just work with THEM?
Seller was very clever when he setup the transaction for the domain name only. He transferred the domain, as far as escrow is concerned the transaction was successful.

Isn't there any law against intentional deceit? I have all our chat logs and emails, is this sufficient for an argument in court?
 

JETX

Senior Member
Isn't there any law against intentional deceit?
Yes. It is called 'fraud'.

I have all our chat logs and emails, is this sufficient for an argument in court?
Absolutely!!! You can use them to argue in court all you want. Whether they are sufficient to convince a court of fraud would depend on what they contain... and what the defendant says.
 
Seller was very clever when he setup the transaction for the domain name only. He transferred the domain, as far as escrow is concerned the transaction was successful.
Did you have something in writing that stipulated what the sale was for besides the escrow agreement? If not, you're really going to have a devil of a time proving it - after all, you did indicate to escrow that you were satisfied with the agreement.

Isn't there any law against intentional deceit? I have all our chat logs and emails, is this sufficient for an argument in court?
Yes, but where is this guy located? I have sold a couple of domain names through SP and all of them have been to foreign people.

Frankly, if you do this often, I am really shocked that you would release escrow before being absolutely happy with the entire arrangement. I had a guy hold up for WEEKS to inspect everything - including traffic stats - before I got my $$$. If you're not doing this, then you're not conducting business safely.
 

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