A New Jersey man has been arrested on felony charges of theft, after he stole the domain name P2P.com from its lawful owners. To add insult to injury the thief than sold the domain name to an unsuspecting NBA player for $110,000. But that is not the entire story. What is amazing is that the domain names owner didn’t even know it had been stolen for some 13 months.

Here is what happened:

Marc Ostrofsky, one of the legitimate owners of P2P.com, estimates that the ownership group spent 30 months and $500,000 trying to reclaim the domain name. They have a pending civil suit against Goncalves and his brother, Madsen and Go Daddy Group, which runs the system Goncalves allegedly hacked.

Madsen, who did not know P2P.com was stolen when he bought it for $111,000, retains the domain name to this day. Madsen did not comment in response to a reporter’s calls.

“The reason this case is so important is that it brings to light the lack of specific laws protecting domain name owners,” Ostrofsky said, insisting that Go Daddy Group was slow to respond to the ownership group’s theft report.

Laurie Anderson, Go Daddy Group’s disputes manager, said safeguards exist. They include a 60-day waiting period before a transaction is finalized, during which time owners are sent an e-mail informing them of the pending sale.

The owners of P2P.com didn’t report its alleged theft in May 2006 for 13 months, she said. That’s one month after Goncalves allegedly sold it to Madsen.

It appears that someone was asleep at the switch when the lawful owners were told of the ownership change, even after being properly notified. The owners made it very easy for the theft to happen. Now that the case is being brought to public attention, it makes one wonder how many others have had their domain name stolen behind their backs.

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