What if your judgment debtor seems to hide their income and assets, yet they own a nice domain name and website? Can you have the Sheriff levy their domain name to satisfy your judgment? Theoretically yes, however in real life it might not be possible. This article is my opinion, and not legal advice. I am the judgment broker, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.
Over several years, I have often read that you can levy a judgment debtor’s domain name, however I have never seen it done in the real world. In the past, I attended a seminar taught by a lawyer telling judgment enforcers and lawyers how to levy domain names, with a sample court motion to accomplish this. The problem is, over the years, I have talked to several enforcers and lawyers that told me they followed that advice and motion template; and then judges denied their motions. Who knows, maybe website and/or domain name levies might become a standard legal procedure, with a checkbox on writs someday.
These days, it is not your domain name, it is what you do with it. For example, when you search on the web, you do not usually visit search.com. Although that is a great search site, instead you probably visit Google, Bing, or Yahoo – to search for things, because those companies worked to add value to their domain names.
I think the reason domain names themselves cannot be levied in real life is because they are rented, not really owned by their “owners”. This becomes clear if you do not pay for the annual registration and lose your domain. Rather than attempting to levy your judgment debtor’s domain name itself, try to find how the website for that domain makes income, and how to levy or attach that income. Try going after the site’s sponsors and see how they are paying the site owner.
In case you are trying to grab the domain name itself: Here is some theory about how to levy just a domain name:
California’s Enforcement of Judgments Laws (EJL) do not provide any way for a judgment creditor to “reach” the asset of a debtor’s domain name. The best theory seems to be that a noticed motion for a turnover order can result in a court ordering the judgment debtor to surrender all rights, title, and interest in a domain name; and to do everything necessary to accomplish this.
Such a motion might be named something similar to “Order Transferring Right To Domain Name”. A motion and proposed order will be on pleading paper, commanding the judgment debtor to contact their domain vendor to transfer their ownership interest in the domain by filling out whatever forms are necessary to cause the transfer. Such a motion and proposed order would specify that the judgment debtor will take an affirmative action to surrender such rights, title and interests (a bundle of rights) in their domain name. Just like any other debtor property levy, this asset will need to be sold by the levying officer.
Adding a proposed restraining order to such motions may be a good idea, with clauses that takes effect when the turnover order is signed. A restraining order clause might say that the judgment debtor cannot engage in any action that might transfer, hypothecate, alienate or otherwise encumber the right, title and interest in the domain name of example.biz, in favor of any other person or entity except the Sheriff of County, in order to be sold by auction; and it is further ordered, adjudged, and decreed: that any such action in violation of this restraining order shall be punishable as contempt of this court and its orders, upon proof of the occurrence of same by the judgment debtor.
Some judges do not like to sign orders that include contempt clauses for when the judgment debtor does not obey the court order, and that does not make sense to me.
You may be able to levy on a web site, but the answer will depend on whether or not the registrar is susceptible to your jurisdiction. A long time ago, Verisign handled all domains worldwide, and was located in Mountain View, California. When it was, one could simply get a writ of execution for Santa Clara County and then serve them with a levy on the domain name. However, Verisign moved to Virginia, which does not recognize levies on domain names.
California case law says you can levy on the registry (Verisign) or any registrar. If the registrar is located in California, you can probably make it work. Tucows is an example of a registrar located in California where you can levy. GoDaddy is based in Arizona. Sometimes people need to hire receivers to do domain name levies, and sometimes starting such a levy effort gets a debtor to pay.