Copycats the world over have their eye on Groupon's wealth.
Well, that's what CEO Andrew Mason says in a blog post announcing a lawsuit his firm has filed against one of its clones. Mason is pointing the finger at Scoopon, based in Melbourne, for stalling Groupon's expansion into Australia, and for trying to filch a piece of its freshly raised capital.
Gabby and Hezi Leibovitch, the two brothers behind Scoopon, have purchased the Groupon.com.au domain name, registered the company name of Groupon Pty Limited, and tried registering the Groupon trademark in Australia.
Groupon offered the brothers nearly $300,000 for the domain and trademark, which they accepted but later declined—after Groupon shot down Google's takeover bid and was rumored to be raising $1 billion in capital. Mason believes they'll only sell the domain and trademark if Groupon buys the entire Scoopon business.
"The way we see things, this is a classic case of domain squatting—an unfortunate reality of the Internet business," he wrote. "As Groupon became internationally known, opportunistic domain squatters around the world started to buy local Groupon domain names, thinking that we'd eventually be forced to buy them at an insane price."
And for the most part, Groupon did. The firm has responded to competition by going on a global buying spree spanning from Chile to Japan. But this is the first time it's taken legal action against one of its clones, which number in the thousands and have gone so far as to rip off Groupon's site design.
It remains to be seen if Groupon's claim will hold up in Australian court, with intellectual property lawyers saying the process could take up to a year. In the meantime, Mason is locking up his billion-dollar war chest, and will certainly have the means to go after any other clones that step on his toes.
Last updated: Jan 5, 2011
VENURI SIRIWARDANE's work has appeared on Inc.com, and in the Newark, New Jersey Star-Ledger, USA Today, and The Philadelphia Inquirer, among other publications.