The Strange Case of Jeff Baron, Domain-Squatting Web Pioneer Turned Legal Crusader

JeffBaron.jpg
Lawless America
Jeff Baron
On November 9 at a downtown Dallas law office, some 153,000 Internet domain names hit the auction block. The winning bidder was an entity known as Trans, Ltd., which put down $5.2 million and scooped up the names over the objections of their previous owner, Ondova, LLC.

That auction never should have happened. The 5th Circuit Court of Appeals in New Orleans ruled on December 18 that a U.S. District cCourt had overstepped its authority by placing the assets of Ondova and its owner Jeff Baron -- indeed, even Baron himself -- into receivership. That decision enabled a federal bankruptcy judge to order the November auction. The ruling marks a rare victory for Baron in a legal battle that is as strange as it is convoluted.

The whole thing can be traced to 1999 when Baron, a graduate of J.J. Pearce in Richardson, was working for Mary Kay by day while taking computer programming courses at night. He used his newfound programming chops to develop software that quickly registers cheap Internet domain names. He soon quit his job at the cosmetics manufacturer and founded Ondova.

These were the heady days just before the dotcom bubble burst, and Baron was able to amass hundreds of thousands of domain names and a tidy fortune, pulling in a reported $1.5 million in profit per month.

Trouble came when he teamed up with a fellow entrepreneur named Munish Krishan, who runs Netsphere, a "domain development, marketing, and domain monetization company" based in California. Krishan, according to this decidedly pro-Baron account, promised to use his considerable resources and expertise to transform Ondova into a search engine to rival Google.

That never happened, and the partners soon had a falling out. Over the next several years, they would file a combined seven lawsuits, each blaming the other for the venture's failure. It wasn't until April 2009 that they jointly signed a memorandum of understanding that finally settled the dispute.

The settlement lasted all of a month. In May 2009, Krishan alleged that Baron and Ondova were violating the terms of the agreement and sued them in federal district court to make them stop. The next month, U.S. District Judge Royal Furgeson (aka the dean-to-be of UNT-Dallas' downtown law school) issued a preliminary injunction ordering all parties to comply with the agreement, later tacking on a $50,000-per-day fine if they didn't.

It was at this point that Furgeson went rogue, at least according to the set of fringe-y outlets that portray Baron as a victim railroaded first by an unscrupulous business partner, then by an out-of-control judiciary.

Invariably, Baron is described as an "Internet pioneer." He's also a "mild-mannered techie," "one of the nicest people you would ever want to speak with," and someone whose "business decisions were guided by the mistaken belief that the people he was dealing with would be honest and treat him fairly." Furgeson, on the other hand, is a tyrant who presides over a "Soviet-style" court. Here's Baron himself discussing his situation.

Baron may be a perfectly nice guy, and there are elements of truth to the latter charge. During one exchange frequently cited by the pro-Baron website is a bit of a tirade from June 2009 in which Furgeson exhorts Baron to comply with the injunction.

"You want to challenge the court order, I have the marshals behind me," Furgeson says, per this transcript. "I can come to your house, pick you up, put you in jail. I can seize your property, do anything I need to do to enforce my orders. I'm telling you don't screw with me. You are a fool, a fool, a fool, a fool to screw with a federal judge, and if you don't understand it, I can make you understand it. I have the force of the Navy, Army, Marines, and Navy behind me."

And then there's the order to put all of Baron's assets into receivership, which even the 5th Circuit concluded was beyond the pale. For one, their ruling noted, much of the property in question -- personal bank accounts, cell phones, homes, the money Baron, a diabetic, needed to pay medical bills -- had no connection to Baron's legal case. More fundamentally, there's the fact that, while receivership is a common enough remedy in criminal cases, its use to punish a party in civil litigation is without precedent.

But Baron's story is far more complicated, starting with the idea that he's an "Internet pioneer." He's certainly an entrepreneur, one who had the wherewithal to notice a weakness in the domain name market and exploit it, but look at Ondova's business. It essentially squats on domain names and profits from the ads people click when they accidentally visit one of the sites. Some of the domains are generic, like phonecards.com. Others are simple combinations of as few as two letters. More are common misspellings of popular websites. A sizable percentage are, according to court documents, simply, sometimes disturbingly, pornographic. I've lost track of the specific citation in the mountains of documents, but think along the lines of hotchildsex.com.

Then there's Furgeson, who, in the 5th Circuit's opinion, was acting not out of a thirst to exercise dictatorial power but from a completely understandable desire to stop Baron from being an unbearable little shit. (That's our phrasology. The 5th Circuit prefers "vexatious litigant.")

For starters, Baron had Ondova declare bankruptcy in July 2009, thus putting the legal battle with Krishan on hold. This just so happened to occur on the day before a scheduled hearing to determine if Baron should be held in contempt of court for violating the previous month's injunction.

Then, there was Baron's nasty little habit of hiring attorneys and firing them a few days or weeks later without paying them. This parade of new lawyers not only ground the Krishan case to a virtual halt, but it simultaneously threw a wrench in Ondova's bankruptcy proceedings, since at least 45 of them went on to file claims on the company's assets. The attorneys Baron was screwing over weren't fresh-faced law school grads, either, but established, high-powered litigators like Jeff Rasansky and Charla Aldous.

It was only after Baron ignored the court's order to stop that Furgeson brought down the hammer and gave Baron such a legal reaming that he had to borrow a friend's clothes to travel to D.C. And that's what the 5th Circuit takes issue with.

"Here, the record supports that the circumstances that led to the appointment of a receiver were primarily of Baron's own making," its opinion concludes. "The district court had an array of fairly onerous remedies to apply but chose another remedy that it did not have. The manner in which the district court responded to those circumstances was errant, but the court's perception was reasonable that a vigorous response was required."

In other words, Baron deserved to be legally smacked around, just not in the precise way Furgeson decided to do it. So now the ball -- and the case -- are now back in Furgeson's court.

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15 comments
idocumenttragedies
idocumenttragedies

I appreciate your comment about my use of  the word "tragedy".  I have used that word in my work over the past 34 years since I never could come up with any better word.  Let me ask you this. . .Adolph Hitler killed millions of innocent people.  That was a tragedy.  Since his killings began with ONE how many more do you say he had to kill before you would call what he did a tragedy?  When every person of color were not only owned by others it was illegal for them to have a book in their possession.  How many black people do you say would need to be owned by others before you would call that a tragedy.  Of course, it would be appropriate to characterize the murdering of those precious little children in Connecticut a tragedy unless someone could come up with some word that would be even more horrific.   I believe I understand your feelings about me using "tragedy" to describe Jeff Baron being made a slave, but at this point all research can not find any other person who has been made a slave since 1865.  My point is. . .he may be the first.  So, how many more people need to be made a slave before you would consider it a tragedy.  I can speak with the utmost authority about the murdering of little children since my 10 year old daughter was murdered.  If you have children I can only hope and pray you are never put in a situation where you found your child murdered. I can only say that the word "tragedy" does not even come close to describing what that is like.  I would appreciate you letting me know the word you would prefer people used about your situation  should you be the second person to become a slave since 1865 or, God forbid, should you find your child murdered.  I do appreciate you comment. Michael Collins                   

Montemalone
Montemalone topcommenter

Obviously not a believer in Karma. The entire domain-squatting industry should be illegal.

idocumenttragedies
idocumenttragedies

I am an old man who was born and raised in a rural community in west Texas. After serving in the Army and graduating from the University of Colorado in Boulder I made that rural community my home since I became vice president of the local bank. The one thing about my decades in Eastland County that made a life-long impact on my life was serving as a juror on over a hundred civil and criminal trials. Serving in that role so many times I began to see something about our judicial system that bothered me. It bothered me so much that In 1979 I left my 20 year banking career and moved to the DFW area where I created a unique service for all types of tragedy victims. Since there was no title for my new service I named it Forensic Documentation.
For a while I actually believed my laudable undertaking would make a difference in how litigation was being handled. Now after three decades of working with tragedy victims deep in the bowels of the legal system I realize that I could not change a system that was designed strictly by and for lawyers and disciplined solely by lawyers, which includes those who lawyers choose to wear black robes.
An old lawyer once told me, shortly before his death, that “lawyering” is a game that is played on lawyer field, its rule book was written by lawyers, all referees were lawyers, and the time clock and score board are owned and controlled by lawyers.
About a year ago I was considering leaving my most rewarding line of work, but before I could quit I heard about a tragedy that was happening to a man named Jeff Baron. I was not hired by Jeff Baron but am doing what I am doing because it is the right thing to do.
After months of studying thousands of pages of the Jeff Baron Tragedy I am well into writing a book which I believe contains everything it needs to become a hit television series, as well as, a big screen movie.
I will refer to only one or two points Eric Nicholson, the reporter of the January 2, 2013 article in Dallas Observer has written. I don’t know where he got his information but I do know that most of what he has written is incorrect and some may even be slanderous. Nicholson wrote, “On November 9 at a downtown Dallas law office, some 153,000 Internet domain names hit the auction block. The winning bidder was an entity known as Trans, Ltd., which put down $5.2 million and scooped up the names over the objections of their previous owner, Ondova, LLC.” In my work as a Forensic Documentalist I learned that there was not one but two “bidders”, both from the same off shore island. The bids were for about 5 cents on the dollar of their appraised value were clearly “inside” bidders.
Nicholson went on to write, “That auction never should have happened. The 5th Circuit Court of Appeals in New Orleans ruled on December 18 that a U.S. District Court had overstepped its authority by placing the assets of Ondova and its owner Jeff Baron -- indeed, even Baron himself -- into receivership. The ruling marks a rare victory for Baron in a legal battle that is as strange as it is convoluted.
One reason Eric Nicholson may believe this legal battle is “strange and convoluted” is that the District Judge made Jeff Baron property of one of the officers of the judge’s court. I happen to believe that one does not have to be a lawyer to know that legally owning another person ended when slavery became illegal in 1865.

Based on working for decades inside the legal industry I have seen what I thought was just about every kind of government corruption, but what is happening to Jeff Baron is #1 and every other corruption I have seen is not even on the chart.
Even though I am disappointed and alarmed about what I am learning from court transcripts and filings I still believe justice for Jeff Baron will eventually prevail even though that will not happen until after the courts have done what the records shows their mission to be - take away every possession Jeff Baron ever owned and perhaps even his life.

In the meantime I strongly urge Mr. Nicholson to check for truth in every comment he writes.

Michael Collins

Brian Nesbitt
Brian Nesbitt

>>I've lost track of the specific citation in the mountains of documents, but think along the lines of hotchildsex.com.<<

In other words, "I'm too lazy to do my job as a reporter so I'm just going to make up a name that seems outrageous so that I don't have to spend too much time writing this drivel."

Guesty
Guesty

Federal judges are very protective of their orders, and for very good reason.  If people ignore the orders of a federal court, right or wrong, then there is no law in this country.  Imagine if the DISD told Judge Sanders that it wasn't going to obey his orders in Tasby, or if Nixon ignored the Court's order to produce his tapes.  Courts serve no purpose in society if they don't have the power to enforce their orders without exception.  

Did Judge Furgeson go over the line?  Hard for me to say.  It sounds like Baron was more than happy to knowingly ignore an order of the court, and the court was right to do anything within its legal powers to force him to comply.  It appears that the Fifth Circuit concluded the specific tool used by Judge Furgeson wasn't within those legal powers, which is different than saying Judge Furgeson wasn't right to take very serious action.  It's possible the Fifth Circuit would have approved of much harsher sanctions.  

TheCredibleHulk
TheCredibleHulk topcommenter

@idocumenttragedies 

Nice Godwin. Hitler trumps all, right?

Anyway, I would call Baron's situation misfortune. Unless you can prove to me that he is being forced to pick crops or break rocks under threat of violence or death, or that he is being bought or sold in some fashion, I cannot take the word "slave", as you use it here, seriously.


My condolences to you regarding the murder of your daughter. That truly is a tragedy.

TheCredibleHulk
TheCredibleHulk topcommenter

@idocumenttragedies 

What happened to the children at Sandy Hook Elementary School was a tragedy. The people that lost their lives and families in the tsunami a few years ago was a tragedy.


I strongly urge you to re-asses your definition of tragedy.

keepcensoringDO
keepcensoringDO

@idocumenttragedies "In the meantime I strongly urge Mr. Nicholson to check for truth in every comment he writes."

Not going to happen. If Eric had to write the truth, he'd be out of a job.

TheCredibleHulk
TheCredibleHulk topcommenter

@Guesty 

Well, with the power of the Navy, Army, Marines and the Navy behind him, you'd think Baron would think twice about messing with him.

idocumenttragedies
idocumenttragedies

@TheCredibleHulk @idocumenttragedies As you can figure out. . .This is the first time have ever responded to a newspaper article so I have a lot to learn about those who read such.  As to my use of the word "tragedy" I will refer to one of the philosopher Aristotle characterization, "a change of fortune from good to bad" and "any story with a sad ending" 
Exactly what constitutes a "tragedy", however, is a frequently debated matter. What is tragic about the Jeff Baron matter is not just that government lawyers misused a court to take ALL of his property because that is what lawyers do, but those who have the authority to stop such as that not only didn't stop it but participated in the corruption.  In conclusion, I may not be able to define "tragedy" but I know it when I see it.         

TheCredibleHulk
TheCredibleHulk topcommenter

@idocumenttragedies @TheCredibleHulk 

Not to be indelicate, here, but as long as we're playing word games with the term tragedy, how do you reconcile using that word as it pertains to Baron's situation in comparison to the murder of your daughter?


I find the meaning of the term "tragic" to be not overly specific, but there seems to be a pretty substantive difference between the untimely loss of a child to murder as opposed to the legal troubles of a would-be entrepreneur.


I only ask because of your staunch defense of your use of this term in your initial reply.

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