I Hope You Program Owners Arent Using NATs Right Now..

**Lee** · 08-24-2006, 09:06 PM

TRENTON, N.J. - Naked Rhino Media has filed a defamation and breach-of-contract suit in federal court against Too Much Media, creators of the NATS back-end affiliate program software, and the company's Chief Executive Officer John Albright.

Naked Rhino, which operates sites like BrandiLove.com and SinamonLane.com, alleges that the defendants are responsible for destroying the company's business through "intentional and reckless online Internet verbal assaults concerning the reputation and operation of Naked Rhino as well as [Too Much Media's] suspension of Naked Rhino's online payment processing, reporting, and affiliate management system (NATS)."

They are seeking $5 million in damages.

The dispute is centered around a post made by Albright on GFY.com's message board. In it, he publicly stated that he had suspended the NATS license for XclusiveCash, Naked Rhino's affiliate program, because he believed the company was shaving, or altering sign-up and re-bill statistics in order to cheat affiliates, after a discrepancy between the number of re-bills reported by payment processor CCBill and the number reported to the NATS system.

The board post has created quite a bit of conversation in the webmaster community.

"That's not how you handle your business, especially in an industry like this one. You can't just go online, as a business, and post something disparaging about somebody else. As pretty much all the posters on GFY have noted, you can destroy reputations and businesses like that," says attorney Al Zakarian, who, along with Michael Fledman and Rob Apgood, is representing Naked Rhino in the case.

"From what I've read on the posts, people are missing the point. It's not about 'why isn't XclusiveCash not coming on the boards and defending themselves'—the damage has already been done. It was done when [Albright] decided he was going to air it out [on the boards] before anything was fleshed out."

In the lawsuit, Naked Rhino alleges that Albright's statement was used not only to ruin the company's reputation, but to deflect attention away from NATS, which has been heavily marketed as being shave-proof. The complaint reads, in part, "the 'shave-proof' NATS program was the real likely cause of the missing re-bills."

The suit points to several previously reported NATS/billing company integration issues and situations where similar disputes were played out on message boards, such as NATS's feud with affiliate program Jason and Alex.

Since Albright's accusation, XclusiveCash has seen a mass exodus of affiliate traffic, according to President Chris Potoski. The company has been working to rebuild traffic through other means.

"We've taken every possible step to start generating our own traffic. I'm not going to let this situation ruin everything we've worked so hard to build," Potoski says. "Any good businessperson would look at this and say revenue is not going to be coming in from this source, at least for the foreseeable future, how do we make sure the business survives? We've taken steps to ensure that."

XclusiveCash will also launch its own proprietary back-end tracking system, which has been in development for the past year, in the next two months. But can they recover?

"I think once the facts are known, we'll be able to rebuild webmaster confidence. It's going to be a long process," Potoski says. "It's possible to come back from something like this, but it's going to take time and it's certainly going to cost us in the short run. Whether it costs us dearly in the long run remains to be seen."

As of press time, Albright had not returned several messages seeking comment.

To view a copy of the complaint, click here.

http://www.avnonline.com/index.php?P...tent_ID=274491

I have a feeling there is going to be a lot of fallout over this and im personally glad we arent utilizing the NATs backend at this moment in time, should be interesting to watch this case playout though for sure

Regards,

Lee

maxpower · 08-24-2006, 09:50 PM

I can’t feel sorry for NATS, after all any company that is charging us 20,000$ for a tracking program in my opinion has been fucking us all with out even a reach around for years now. I would love to see Ccbill or some other company step-up with a superior tracking program, at affordable prices or even included it in a processing package “Verotel if you read this, this is what you need to do to be #1”

Also god can’t we go a week with-out someone suing someone else for crap they say on some board. No wonder most big companies pay representatives to represent them, I am just shocked I have not been sued yet I guess.

BTW PLEASE don’t sue me :fugly:

**Squirt** · 08-24-2006, 09:55 PM

Originally Posted by Lee

"That's not how you handle your business, especially in an industry like this one...."

Isn't that what GFY is all about? :catfight:

CCBill vs. Epoch

GFY vs. Lee :worm:

The list goes on

It's all about drama and bravado there.

The whole NATS thing will be interesting to watch unfold and see what the truth really is. I hope it really does goto court and the truth comes out instead of someone getting paid hush money.

**collegeboyslive** · 08-24-2006, 10:13 PM

just goes to show to watch what you say about people on these boards. especially if you cant back it up.

**Lee** · 08-24-2006, 10:17 PM

Originally Posted by collegeboyslive

just goes to show to watch what you say about people on these boards. especially if you cant back it up.

Indeed :thumbsup:

Im sure we'll be hearing more news about suits being filed against companies and individuals for slander on the boards over the coming few weeks also

Regards,

Lee

**collegeboyslive** · 08-24-2006, 10:20 PM

/me goes back though the old posts.. I love Lee, I love lee, I love lee

**basschick** · 08-24-2006, 10:24 PM

i read the threads in question last week. john did NOT at any time indicate that xclusive cash was shaving. he stated that they were not helping him resolve an issue with the rebills. the issue could have had other causes and he didn't at any time say it was there fault. they did not help him with the issue but instead he said they were rude and hung up on him.

i'm not sure why avn's reporter wrote that but if you read the initial post, it very clearly makes no accusations beyond saying they were rude and he was willing to reinstate them if they allowed him to resolve the issue and none other were found,

maxpower · 08-24-2006, 10:26 PM

Originally Posted by collegeboyslive

/me goes back though the old posts.. I love Lee, I love lee, I love lee

LOL Please don’t sue me too Lee, but of course it would be hard to prove my opinion really caused damage to anyone’s company.

**Lee** · 08-24-2006, 10:27 PM

Patti,

I agree that John didnt say that they 'were' shaving however, the mere implication that is what they 'could' have been doing is more than enough to warrant this suit.

We all know how GFY'ers are when it comes to actually 'reading' a thread, they read the first post, then scroll to the end of the thread where inevitably, someone is posting that 'X Company' was 'obviously shaving'.

Its unfortunate but, at the same time, m sure John knew what he was doing when he posted that over on GFY, he'd have to be a complete moron not to think that is what GFY'ers would infer was happening $0.02

Regards,

Lee

**gaybucks_chip** · 08-25-2006, 04:02 AM

Originally Posted by Lee

I agree that John didnt say that they 'were' shaving however, the mere implication that is what they 'could' have been doing is more than enough to warrant this suit.

Lee,

Sorry, but I strongly disagree. Truth is an affirmative defense to defamation, and defamation suits are nearly impossible to win, because the plaintiff has to prove that the defendant said something false AND that the defendant *knew* or should have known that the statement was false when it was stated, This action will ultimately fail on those tests, whether or not Naked Rhino is shaving, because John never made any statement to that effect, and what he did say was (presumably) a truthful statement.

Even if it turns out that there was a software error or something that caused the discrepancy, it's highly doubtful that John's statement would be actionable, because he (presumably) did not make the statement knowing that it was false.

If I publicly say "So-and-so is a child molester who has personally abused 10 kids" and I know or should have known that statement is false, then the statement is defamatory. If I say "I contacted the police because I've seen so-and-so with a dozen children and some of the behaviors I've seen concerned me that there might be child abuse going on", I've not said anything defamatory and the statement is not actionable.

John was extremely professional in the the way he handled the matter. He never said anything remotely actionable. He simply said that TMM found a discrepancy, that they'd tried to resolve it with NR, and that NR told him to "fuck off" and that they'd terminated the NATS license until the discrepancy could be resolved.

NATS makes clear in its terms of service that it will monitor sales and if it finds irregularities, it will terminate the license for use of NATS. If I were an affiliate, this would give me more confidence in the NATS program because I'd know there's an independent third party out there doing its best to keep the sponsor from shaving me, and I'm sure that's why John made the report.

If you look at this on the face of it, it's clear that it's a blatant publicity move on the part of NR. They really didn't have any other choice; they waited more than 5 days after John made his statement to respond at all, and that did far, far more damage to their credibility than anything John said.

The stupid thing is, EVEN IF THEY WERE GUILTY OF SHAVING, if they'd simply addressed the issue immediately, said "We've talked to NATS, discovered an error in the way our rebills were being reported, and have taken immediate steps to resolve this and will be properly compensating affiliates from now on", the damage would have been minimal. But they didn't. Even when they did post a response, 5 days after the fact, they had no answers to offer, only a vague statement that they'd "be looking into the situation."

As far as I'm concerned, anyone who was totally innocent would be burning the midnight oil to go through all the records, get statements from CCBill and NATS officials explaining what happened, and issue a joint statement -- and in a hell of a lot less than 5 days, even if they were responding from the remote regions of the African congo.

For that matter, anyone who was totally innocent probably wouldn't have blown John off in the first place, and NR's response didnt' deny that had happened.

I have no idea if NR shaved or not. But I don't think NATS post was inappropriate, and, from my vantage point, a $5 million defamation action where there's absolutely nothing actionable is nothing more than a desperate publicity stunt to try and salvage credibilty.

**Squirt** · 08-25-2006, 04:16 AM

I really like the way you think Chip!

Knowledgeable, informed and accurate.

Good job :bunny:

Originally Posted by gaybucks_chip

Lee,

Sorry, but I strongly disagree. Truth is an affirmative defense to defamation, and defamation suits are nearly impossible to win, because the plaintiff has to prove that the defendant said something false AND that the defendant *knew* or should have known that the statement was false when it was stated, This action will ultimately fail on those tests, whether or not Naked Rhino is shaving, because John never made any statement to that effect, and what he did say was (presumably) a truthful statement.

Even if it turns out that there was a software error or something that caused the discrepancy, it's highly doubtful that John's statement would be actionable, because he (presumably) did not make the statement knowing that it was false.

If I publicly say "So-and-so is a child molester who has personally abused 10 kids" and I know or should have known that statement is false, then the statement is defamatory. If I say "I contacted the police because I've seen so-and-so with a dozen children and some of the behaviors I've seen concerned me that there might be child abuse going on", I've not said anything defamatory and the statement is not actionable.

John was extremely professional in the the way he handled the matter. He never said anything remotely actionable. He simply said that TMM found a discrepancy, that they'd tried to resolve it with NR, and that NR told him to "fuck off" and that they'd terminated the NATS license until the discrepancy could be resolved.

NATS makes clear in its terms of service that it will monitor sales and if it finds irregularities, it will terminate the license for use of NATS. If I were an affiliate, this would give me more confidence in the NATS program because I'd know there's an independent third party out there doing its best to keep the sponsor from shaving me, and I'm sure that's why John made the report.

If you look at this on the face of it, it's clear that it's a blatant publicity move on the part of NR. They really didn't have any other choice; they waited more than 5 days after John made his statement to respond at all, and that did far, far more damage to their credibility than anything John said.

The stupid thing is, EVEN IF THEY WERE GUILTY OF SHAVING, if they'd simply addressed the issue immediately, said "We've talked to NATS, discovered an error in the way our rebills were being reported, and have taken immediate steps to resolve this and will be properly compensating affiliates from now on", the damage would have been minimal. But they didn't. Even when they did post a response, 5 days after the fact, they had no answers to offer, only a vague statement that they'd "be looking into the situation."

As far as I'm concerned, anyone who was totally innocent would be burning the midnight oil to go through all the records, get statements from CCBill and NATS officials explaining what happened, and issue a joint statement -- and in a hell of a lot less than 5 days, even if they were responding from the remote regions of the African congo.

For that matter, anyone who was totally innocent probably wouldn't have blown John off in the first place, and NR's response didnt' deny that had happened.

I have no idea if NR shaved or not. But I don't think NATS post was inappropriate, and, from my vantage point, a $5 million defamation action where there's absolutely nothing actionable is nothing more than a desperate publicity stunt to try and salvage credibilty.

**Chilihost** · 08-25-2006, 11:52 AM

regardless of whose suing who, its bloody nice to see a defamation lawsuit in this industry. I am personally sick and tired of webmasters recklessly posting comments on boards about other companies / programs / websites - those comments can harm a business to such a huge extent.

Maybe its about time the adult industry grew up and started acting like adults.

cheers,
Luke

**basschick** · 08-25-2006, 05:51 PM

luke - he didn't say anything derogatory about that company at all. he said they would not give him access to their server so he could find and fix the issue. they do not deny this. he didn't say they shaved - he said there was an issue that an affiliate came to him with. it was a statistical anomoly and he didn't say they caused it. he did say they were rude and hung up on him, and that is the only thing they did not deny as far as i know.

Originally Posted by Chilihost

regardless of whose suing who, its bloody nice to see a defamation lawsuit in this industry. I am personally sick and tired of webmasters recklessly posting comments on boards about other companies / programs / websites - those comments can harm a business to such a huge extent.

Maybe its about time the adult industry grew up and started acting like adults.

cheers,
Luke

**Squirt** · 08-25-2006, 07:07 PM

It's not the reckless posts on boards that piss people off.

It's the posts where people are publicly caught out and there's no place to hide that get's them pissed off

Originally Posted by Chilihost

regardless of whose suing who, its bloody nice to see a defamation lawsuit in this industry. I am personally sick and tired of webmasters recklessly posting comments on boards about other companies / programs / websites - those comments can harm a business to such a huge extent.

Maybe its about time the adult industry grew up and started acting like adults.

cheers,
Luke