GoDaddy Misrepresents Web Hosting Services, Class Action Alleges

GoDaddy Inc. has been hit with a class action lawsuit alleging it misrepresents its web hosting services and overcharges for inferior service.

GoDaddy is an internet domain registrar and web hosting company. According to the class action lawsuit, the company offers various forms of server access including cloud hosting, “Virtual Private Servers” and “Dedicated Servers.”

Cloud hosting allows multiple users to share the resources of a single physical server, which are allocated based on demand. With cloud hosting, the performance of one website on a shared host can be significantly affected by traffic that is directed to other websites that share the resources of the physical server.

Virtual private servers are software-based servers that allow several clients to use the resources of the same physical server. Each VPS is allotted a portion of the resources of the physical server, and costs associated with VPS hosting are typically cheaper than the costs associated with dedicated server hosting.

Dedicated servers are designed for the sole use of a user, and grant the user complete control and access to one physical server. With a dedicated server, the performance of the user’s website is not affected by or dependent on any other user.

According to the GoDaddy class action lawsuit, dedicated server configurations are priced from $79.99 per month to $379.00 per month. On the other hand, the virtual private servers are offered at consistently lower prices than dedicated servers. The price of a virtual private server starts at $24.99 per month.

Plaintiffs Mark Schellenbach and William Ryder are website designers based in Los Angeles. According to the GoDaddy class action lawsuit, Schellenback and Ryder purchased a “Dedicated Server” hosting plan maintained by GoDaddy starting in December 2014. They upgraded their package after experiencing “crippling performance issues related to the server.”

When this upgrade did not improve their performance issues, they reportedly hired an independent server expert to figure out the problem. The independent server expert allegedly found that GoDaddy had actually provided them with virtualized servers.

According to the class action lawsuit, “GoDaddy is charging Plaintiffs for superior service while providing inferior service.” Schellenbach and Ryder claim that GoDaddy actively concealed the fact that it provided virtual servers to consumers who paid for the more expensive dedicated server services.

The GoDaddy class action lawsuit brings allegations of fraudulent concealment, negligent misrepresentation, and violations of the Arizona Consumer Fraud Act, California False Advertising Law and California Unfair Competition Law.

Schellenbach and Ryder seek to represent a nationwide Class and a California subclass of consumers who purchased or subscribed to “Dedicated Server” services provided by GoDaddy from October 2014 to the present and received a “virtualized” server.

The plaintiffs are represented by attorneys Kathryn Honecker of Rose Law Group, Stephen R. Basser and Samuel M. Ward of Barrack Rodos & Bacine, John G. Emerson and David G. Scott of Emerson Scott and Christopher D. Jennings of Johnson Vines.

The GoDaddy Dedicated Server Class Action Lawsuit is Mark Schellenbach, et al. v. GoDaddy Inc., Case No. 2:16-cv-00746-DGC, in the U.S. District Court for the District of Arizona.