VPN Firm Says It Didn't Know Customers Had Lifetime Subscriptions, Cancels Them (arstechnica.com)
- Reference: 0177472411
- News link: https://it.slashdot.org/story/25/05/12/2156258/vpn-firm-says-it-didnt-know-customers-had-lifetime-subscriptions-cancels-them
- Source link: https://arstechnica.com/gadgets/2025/05/vpn-firm-says-it-didnt-know-customers-had-lifetime-subscriptions-cancels-them/
> The owners told customers that they didn't know about the lifetime subscriptions when they bought VPNSecure, and they cannot honor the purchases.
[1] https://arstechnica.com/gadgets/2025/05/vpn-firm-says-it-didnt-know-customers-had-lifetime-subscriptions-cancels-them/
How about naming names? (Score:4, Insightful)
Who are these asshats that bought the company and what other companies are they contaminating?
Re:How about naming names? (Score:5, Informative)
From TFA:
> This week, users reported receiving a follow-up email from VPNSecure providing more details about why it made its bold and sudden move. Screenshots of the email shared on Reddit say that the acquisition by InfiniteQuant Ltd (which is a different company than InfiniteQuant Capital Ltd, an InfiniteQuant Capital rep told Ars via email) was “an asset only deal.”
Re:How about naming names? (Score:4, Insightful)
Which presumably mean they also didn't purchase the yearly subscribers from the previous company. I think a judge would be quite critical of a purchase of all customers except the ones that would be a long-term liability.
worked for broadcom (Score:2)
Why not for them?
Illegal in Germany (Score:1)
this would be illegal in Germany.
Re: (Score:2, Informative)
Everything is illegal in Germany.
Re:Illegal in Germany (Score:4, Funny)
Saying that everything is illegal in Germany, is illegal in Germany.
Re: (Score:3)
No. But fraud is.
Due diligence (Score:5, Insightful)
Gosh, I wish I could abrogate my due diligence and fiduciary obligations just by saying "I didn't know." That would save so much time and money.
Re: (Score:2)
> Gosh, I wish I could abrogate my due diligence and fiduciary obligations just by saying "I didn't know." That would save so much time and money.
[1]Prior Art [thehill.com]
[1] https://thehill.com/homenews/administration/5282771-trump-constitution-deportations/
Unless they just bought the assets (Score:4, Insightful)
When you buy a company, you buy its contracts and are bound by them.
Unless they just bought the assets of the company, in which case the original company is still on the hook.
Re:Unless they just bought the assets (Score:4, Interesting)
> Unless they just bought the assets of the company, in which case the original company is still on the hook.
IANAL. According to the article, they're claiming just that. I don't know if that is how it was structured, just that they claim it. Regardless, it sounds like there is might be enough going on here to consider successor liability.
Re:Unless they just bought the assets (Score:5, Insightful)
The company clearly hasn't abandoned the other ongoing monthly contracts, so it does sound like they're trying to have their cake and eat it too.
Choosing which contracts to honour and which do ditch, doesn't sound like a purely asset purchase. They even comment that they analysed the previous 6-12 months of financials, something they wouldn't need to do if they were "just buying the tech".
contracts (Score:5, Interesting)
It is conceivable that the new company bought the tech etc. without assuming the responsibilities of the original company, but in that case the original company is still obligated to provide the services that it contracted with the subscribers to provide.
Re: (Score:1)
> It is conceivable that the new company bought the tech etc. without assuming the responsibilities of the original company, but in that case the original company is still obligated to provide the services that it contracted with the subscribers to provide.
Good luck getting any money/services from the original company. I mean, impacted customers can try, but I suspect any money received for the assets has long been moved into other accounts and is now unavailable for recovery.
Re: (Score:2)
Unfortunately, that is probably true, but it means that the legal liability for the customers with lifetime subscriptions does not lie with the company that bought the assets.
Due diligence (Score:2)
Either the new owners didn't do due diligence, and are on the hook. Or the old ones didn't tell the truth, and are on the hook.
Congrats on your new class action (Score:2)
If they sincerely believe they can do this, it is shocking they haven't run their company into the ground yet.
Which means they're almost certainly full of shit, and hoping the lifetime serviceholders are naive and not interested in fighting.
Re: (Score:2)
They know it probably won't hold up in court - their gambit is that consumers won't care enough about a VPN service to file a lawsuit. This applies even more if there happened to be forced arbitration in the ToS before the purchase of the company.
Odd... (Score:2)
Assets include liabilities
Re: (Score:1)
No they dont. Dumbass!
Re: (Score:2)
Not in today's world, where black can be white, black, grey, purple or any of a rainbow of colors, depending on the situation and other supporting facts.
Just structure it that way and voila.
In an asset only deal, you don't take any liabilities. That's the point.
Even if it doesn't meet your definition of "asset".
Re: Odd... (Score:2)
Really? So I could buy a property (assets only), and magically not be responsible for any liabilities on the property? Dream on.
Re: (Score:1)
So I could go to a restaurant or a car dealership and only buy lunch or a car as an asset but not buy the bill that comes with it because it is a liability? (Of course I may have to do that through a third party)
Re: (Score:2)
> Assets include liabilities
No, they don't. They are very much distinct. And when a company is dissolved, they can and often will sell the assets while the liabilities die with the entity.
So it depends how this company "acquired" VPNSecure. And it sounds likely they didn't acquire the legal entity. They bought the tech, the customer database, the delivery systems, and the brand... but that's it. They bought the furniture but not the house.
Re: (Score:2)
>> Assets include liabilities
> No, they don't. They are very much distinct. And when a company is dissolved, they can and often will sell the assets while the liabilities die with the entity.
> So it depends how this company "acquired" VPNSecure. And it sounds likely they didn't acquire the legal entity. They bought the tech, the customer database, the delivery systems, and the brand... but that's it. They bought the furniture but not the house.
Right. What this also means is that the existing customers should have to enter into a new contract with the new company. If they treated a subset of customers as ongoing contracts and continued to provide service, rather than forcing everyone to sign up for service fresh, they have a real problem, because that makes them look an awful lot like a successor company.
Re: (Score:2)
No. Suppose company A provides cloud storage. It uses a bunch of disk drives to provide the service. These are among its assets. It sells all of its storage hardware to company B, which uses it to run its own cloud storage service. This is perfectly legal and ethical. Company B is not bound by the contracts between company A and its subscribers. If company A fails to acquire replacement storage and stops serving its subscribers, the fault lies entirely with company A. For company B to have any liability, th
VMware perpetual license holders receive cease-and (Score:2)
VMware perpetual license holders receive cease-and-desist letters from Broadcom
Re: (Score:2)
I posted the same thing in response to an earlier comment, before reading this. I fully moved off VMware to Proxmox earlier this year. A lot of work, but very worth it, considering how Broadcom are treating their customers, and I'm not one for an abusive relationship.. I'd love for VMware to send me a cease and desist letter, as I would send them a very "spicy" letter in response, telling them exactly how I feel about all of it.
Re: (Score:2)
The cease and desist letters related not to what the company installed at the time they obtained the perpetual license, but what they downloaded after canceling support. VMWare apparently allowed downloads of updates from clients no longer paying support, probably so that they could trap them in precisely this fashion. Perpetual license does not mean free support, it means you can run what you have forever ... but if you need support or updates you still have to pay for those under whatever terms are requ
Oh you thought we meant *your* lifetime? (Score:5, Funny)
Nah.
Romain Brabant founded VPNSecure AND InfiniteQuant (Score:5, Insightful)
Unsurprisingly InfiniteQuant seems to be founded by none other than the founder of VPNSecure Romain Brabant. [1]https://web.archive.org/web/20... [archive.org].
So the protestations of InfiniteQuant that "they didn't know about the Lifetime Subscriptions" does not hold up to scrutiny since both companies are run by the same person. It is looking like the reason for the "asset only deal" two years ago was precisely to jettison these lifetime deals.
[1] https://web.archive.org/web/20210124193150/https://www.infinitequant.com/
Re: (Score:2)
> Unsurprisingly InfiniteQuant seems to be founded by none other than the founder of VPNSecure Romain Brabant. [1]https://web.archive.org/web/20... [archive.org].
> So the protestations of InfiniteQuant that "they didn't know about the Lifetime Subscriptions" does not hold up to scrutiny since both companies are run by the same person. It is looking like the reason for the "asset only deal" two years ago was precisely to jettison these lifetime deals.
Wow. If true, that looks an awful lot like outright fraud.
[1] https://web.archive.org/web/20210124193150/https://www.infinitequant.com/
Re: (Score:2)
As I understand it, it is not illegal. Companies are generally treated as entities unto themselves regardless of who owns them. Slimy things happen like this all the time. Early non-principal investors in commercializing technologies from universities are routinely left holding worthless stock. This is accomplished by shifting that patent that convinced a person to invest to another entity ... that also happens to be run by the same people. The old adage (sometimes misattributed to Warren Buffett) "If
No big loss (Score:5, Insightful)
Apparently their warrant canary tripped years ago. They've been co-operating with governments since 2018
[1]https://www.reddit.com/r/VPNTo... [reddit.com]
Also, to not know that for 2 years a significant number of your users have not been paying anything? They knew. They're in financial trouble.
[1] https://www.reddit.com/r/VPNTorrents/comments/r4tazv/psa_do_not_use_vpnsecure_vpnsecureme_warrant/
Asset acquisition? (Score:1)
Most business purchases these days are structured as asset acquisitions.
Can you take them to court for thsi? Sure you can, but it would be like taking your local coffee shop to court for writing "World's Best Coffee." As everybody knows, unlimited anything does not exist, it is just a marketing term.
The legality of this needs to be challenged (Score:1)
An 'assets only' sale of a corporation is a scam and needs to be treated accordingly by the legal system. Imagine creating a company that takes everyone's money, then giving that money and anything invested with that money to another individual or company, then filing for bankruptcy with the liabilities. The new corporate owner isn't just liable for those liabilities. But the claim that it's an asset only sale is no different than saying they're fully aware of the scam and challenging anyone to do somethi
Re: (Score:2)
I'm not sure that an assets only sale is always a scam, but it certainly can be. Perhaps we need a system kind of like the bankruptcy system in which sales that effectively shut down a company must be approved by a court, which will see to it that obligations to subscribers and creditors are satisfied.
Re: (Score:2)
If a company has debts, then the debtors can force the company into bankruptcy and the asset sale could be questioned. In this case, the liabilities were contracts for lifetime services and they waited 2 years post-sale to "find" these liabilities ... and went to some trouble to hide the fact that both companies are owned by the same individual (thank you Wayback Machine). There isn't enough money involved here to get an attorney interested, the lifetime contract holders could try and sue Romain Brabant fo
That is called fraud (Score:5, Informative)
Seriously. You buy a business, you buy all contracts it has and have to honor them.
Re: (Score:2, Interesting)
> Seriously. You buy a business, you buy all contracts it has and have to honor them.
Yep. Class-action lawsuit from current license-holders in 3 ... 2 ... 1 ...
Oh wait, the purchaser "didn't know" about the perpetual licenses? Because the sellers didn't tell them? Or because they didn't pay attention to the disclosures from the seller? Depending on the answer, maybe another lawsuit is coming.
Re: (Score:1)
It's called "lack of due diligence".
Re: (Score:3)
Tell that to Broadcom, who have been cancelling VMware "perpetual licenses" and even sending cease and desist letters.
Re: (Score:3, Informative)
> Tell that to Broadcom, who have been cancelling VMware "perpetual licenses" and even sending cease and desist letters.
No, they are not. It seems strange to defend Broadcom, but accuracy is important.
Broadcom is saying that they can continue using the software they have, with no updates, irrespective of how they acquired those updates. And there was an implication that Broadcom would audit the software they are running, to ensure no unlicensed updates have been installed.
Re: (Score:2)
A VERY small number of customers have true perpetual license agreements.
Broadcom came to my employer with the SAME letter, which was definitely a shakedown and 100% illegal in Japan. We have actually been moving away from them, so it was kind of funny.
Re: (Score:3)
Inaccurate.
Broadcoms cease-and-desist to perpetual license holders was in regards to applying updates after the support part of the contract expired. The perpetual licenses are still in effect, frozen at the last update that was included under the support part of the contract - perpetual license holders can extend the support contract separately.
Re: (Score:2)
Not necessarily.
One can acquire, for example, just the patents of a business, or their patents and a trademark, or just one of their manufacturing buildings.
In this case, the acquiring company claims they acquired “the technology, domain, and customer database—but not the liabilities” from VPNSecure. If true, the "lifetime subscribers" beef and remedy is with the owners of VPNSecure (which is probably devoid of assets).
Re: (Score:3)
If they had done that, then there would be no need to cancel anything...
Re: (Score:2)
They also acquired the customer lists.
The details are not clear, but it's certainly possible to acquire a customer base and a subset of customer subscription contracts without acquiring all of them.
Re: (Score:2)
Yeah liabilities *always* transfer with the business, especially if it leaves the seller unable to satisfy those liabilities. You cant phoenix assets. period.
This company really has only two options here. Either honour the contract, or refund it.
The vpn company may well be on the hook for not telling the buyer about those lifetime contracts but thats the customer is a third party to that dispute. They have an absolute right to not have the holder of their contract not default on it, without redress.
Re: That is called fraud (Score:2)
Liabilities don't always transfer. Haven't you ever heard of the Texas Two Step? Or an F-Reorg where liabilities go to the sellers entity and assets to the buyer' newco? That's a common setup.
Re: (Score:2)
You buy a business, you buy all contracts it has and have to honor them.
Not necessarily. Many times they do what's called an "asset purchase agreement." They buy all the business' assets, even its name, but they don't actually buy the business or any of its obligations. The obligations stay with the original owner and, hey, you're welcome to find and sue him.