Website security company SiteLock has sued domain name registrar and hosting company GoDaddy (NYSE: GDDY) for breach of contract and trademark claims.
The two companies signed a reseller agreement in 2013 under which GoDaddy could sell SiteLock’s website security services. SiteLock charged per subscription and GoDaddy could mark up the price however much it wanted so long as it met a minimum retail price. For example, SiteLock charged GoDaddy $5 per customer for a basic annual site scan service. GoDaddy could sell it for $12 or more per year and keep the difference.
SiteLock claims that GoDaddy only paid it when a customer paid for and activated the service but did not pay if a customer paid for the service but did not activate it. It argues that GoDaddy should have paid even when a customer failed to activate the service. It also alleges that GoDaddy did not provide required reporting in an effort to obscure this.