154 comments

[ 4.3 ms ] story [ 159 ms ] thread
But will this increase the web designer's chances to get paid? I don't think so.

While it sure provides negative publicity for the store owner, it would probably not further the career of the web designer either.

While it's really clear who the customer is, I do not see the name of the designer anywhere.
I am pretty sure that, it is by design.
Yeah, I don't think I'd make it link to my portfolio if I just pulled a website down.
It's only a quick whois search away. With the name & city, the designer's website is easy to find. It's a Flash-only website (second clue about the designer).

  whois nycfreshmarket.com
Onemine 710 West End Ave 3d New York City, ny 10025 US
> But will this increase the web designer's chances to get paid? I don't think so.

Why wouldn't it? If the store owner doesn't let emotion cloud his judgement, he should figure out very quickly that it would be better to pay up rather then face further negative publicity.

> it would probably not further the career of the web designer either.

It should have about zero negative effect on the career of the designer, and may have a positive effect. Any company that has been in business long enough has been screwed before, and most people would root for the little guy in this scenario.

He has nothing to lose, and a payment to gain.

> If the store owner doesn't let emotion cloud his judgement, he should figure out very quickly that it would be better to pay up rather then face further negative publicity.

Disputes like this should be handled where they belong, in small claims court, not by damaging (possibly irreparably) one parties reputation.

If I were the store owner (which I'm not, and I'd have paid that bill if the work were done as agreed upon) and we'd be in a dispute over something and you'd pull a stunt like this then I would most certainly rake you over the coals.

This is a dis-proportionate response in the eyes of many, quite possibly in the eyes of the judge handling the case which could lead to all kinds of misery for the designer. One thing you don't do in a dispute is to hand your opponent ammunition.

Truth is a valid defense in any libel or slander case.

If someone who owes you doesn't pay you, you are well within your rights to tell people about it.

What probably happened is a small business wanted a website, so the web designer designs the website and buys them a domain name. The deliverables are a finished website along with a domain name and hosting.

If the client doesn't pay, then they own neither the domain name, the hosting, nor the design, and the web designer can do whatever the hell he wants with all three.

I'm continually fascinated by these comments (there's one on every story like this) that try to second-guess the decision based on no actual information. Doesn't it seem likely that the person who did this is in a better position to judge the potential consequences than you?

Unless OP is right on the threshold of being hard up for work, it makes no real difference to his dealflow, and it has a nonzero probability that it will shame somebody into paying.

Hmmh, I have no clue why my opinion sounds like a judgement.

I just think this confrontation in public (with one side as yet unidentified) will not work towards a solution.

> Doesn't it seem likely that the person who did this is in a better position to judge the potential consequences than you?

In fact, no. If there is a dispute and you forego the legal option you might get your ass handed to you. Things like this blow up in the face of the party doing them as often as they lead to some kind of settlement.

The damage to the client could outweigh the amount owed (assuming there is one) very rapidly.

> Unless OP is right on the threshold of being hard up for work, it makes no real difference to his dealflow, and it has a nonzero probability that it will shame somebody into paying.

It also has a non-zero probability of him/her being sued for (substantial) damages.

> But will this increase the web designer's chances to get paid?

The customer has a choice: pay for the product he had developed and approved of, or look for another web developer to do it over again.

Finding a new web developer will be tricky given this situation (who wants to work for someone that has a reputation not to pay up?) and would take a lot of time before a new site is delivered.

Not necessarily only these two options...

About 10 years ago, I started working in for a small metal fabrication company who had their website done just before I joined. The boss never paid the developers' final invoice, and one day they did something similar: they replaced the front page of the website with a message saying saying something like "those people do not pay their bills". Although I knew nothing about web development, I did have a good general IT knowledge, and used FTP before, so my boss, who paid for the hosting account, dug the details up, I logged in and realised they only renamed the index.html page and uploaded a new one. Within minutes the FTP login details were changed and the situation reverted. I truly think there was a way for the developers to get paid before they pulled this trick, but not after. To me, although I wasn't happy with my boss not paying his bills, what they did felt wrong.

Fast forward to present day, and I'm a full-time freelance web developer. In the last 7 years of me being one, I had only two customers who didn't pay their final invoices. I could have done something like that, or could have even hinted that I am able to do this, but didn't, for two reasons: 1. I pride myself in my professionalism. This is unprofessional to me and I will not stoop down to this level. 2. In the last three or four years, I didn't have to look for work at all, it all came to me via current or past customers. Therefore, my reputation is the most important asset I have, and I want all my customers, even the ones who didn't pay in full, to have nothing negative to say about me.

Eventually, both customers paid in full, without me having to even make a hint of threat, so I do believe I handled things correctly.

One thing I did learn is to put two clauses in my contracts: 1. That the code will be hosted on my server, and will only be released to clients' server(s) once a full payment has been made. 2. That the code is my property, regardless of the server it hosted on, until full payment has been made.

The second is to cover the possibility of me releasing the code before the full payments. Even then, if I ever get to the stage where I feel that I need to take a similar action, I would rather delete the files (or some files) from the customer's server and not post anything defamatory about the customer on their website. But I find it hard to believe I will ever even go that far.

I agree that defacing is not the best way to go about this, but taking down the site and/or holding your own work hostage until a payment is made seems fair to me.
> it would probably not further the career of the web designer either.

It would mean people who are inclined to try to stiff developers would give this person a miss, meaning they have more time to focus on paying customers. Sounds like a great career boost, imo.

I remember googling my professor at university one year to find out that he had been criminally convicted for hacking the site of client that never paid him. I would never have guessed otherwise, he was a jovial guy. Screwing people out of money quickly brings out an aggressive response in most.
> an aggressive response in most.

The word you're after is defensive. If you've been ripped off, you are not the aggressor.

Indeed, but aggressive defense is not an oxymoron.
That entirely depends on the action you choose to take after being ripped off. Being ripped off doesn't give you a blank check to do whatever you want. If someone fails to pay you, you can prevent delivery of the service they failed to pay for. Anything beyond that and you are the aggressor.
how much was the sentence ? was it worth it in the end or was it such an angry reaction that your prof forgot to anticipate the cost ?
That's why you move the website to the customer's server only after you've been paid in full.

Before that it's only a showcase on the developer's server.

I would certainly listen to somebody with "smallscalethief" as nickname, in matters of money.
(comment deleted)
The definitive advice on the subect, Mike Monteiro's "Fuck You, Pay me!": http://vimeo.com/22053820
Love this video!
I knew a guy who didn't pay me and who then posted that video to his Facebook wall when he, in turn, didn't get paid.
Thanks for that substance on the subject, the vid is great
I don't know, this is a new site: https://www.google.com/#q=site:nycfreshmarket.com

There is no cache, so I think this is an over-reaction at this point by the designer and only discredits their business sense and will most likely result in not getting paid for this job.

The phrase 2 wrongs don't make a right comes to mind. WE already have a legal system in place to handle these issues, no reason to defame on the internet, which is truly a permanent record.

The legal system is a realistic option only if there was a written contract in place, which is not always the case.
Really? AFAIK in my country (Netherlands), a 'verbal agreement' is also legally binding. Is that different in US? Of course it may be harder to proof, but at the end of a website building job there's often enough paper and email trails to make your case.
A verbal (oral) contract is a contract in the US - though very hard to prove. Chain of custody of the code is one way.

Intellectual property rights are all the rage these days and that would mix into this.

I'm not an american, but yes, I believe verbal contracts do apply in the US. I called it unrealistic because it's much harder to prove. As you pointed out, it's possible.
With respect to contract enforceability, writing is helpful for evidentiary purposes, but outside of a few specific areas governed by the statute of frauds, not required at all - an oral agreement is every bit as much a contract.
Having a proper contract is the responsibility of the contractor. If he didn't bother to present one, he doesn't get to make up for it by holding the website hostage.
Actually, he does. With IP contracts the onus falls on the buyer, not the seller, who is granted full ownership of their work from the moment of creation. Making sure you have clear title to the the work of another isn't the contractor's responsibility, it's yours.

That said, there are a ton of things having to do with the scope of work, reviews of work in progress, acceptance or rejection of completed work, and payment terms that are absolutly the contractor's responsibility. But again, securing clear title to the work is the buyer's concern, not the seller's.

So you think the contract designer now owns nycfreshmarket.com and the contents of the site unless its demands are met?

I would love to see a single case ever where a company's domain and website were turned over to a contract designer due to a pay dispute.

No, the inference you're drawing does not follow from what I said. I simply pointed out that, contrary to your assertion, the onus for securing clear title to the work rests with the buyer, not the seller. Assuming that the designer is also hosting the site, they are presumably free to limit access until they've been paid.
Everything you said is correct. But it has nothing to do with the issue here.

The seller is not "limiting access". They are not taking away the work they produced. They are instead publishing defamatory messages on the client's domain against the client's will. They are essentially claiming the domain as their own, which is the real issue here. This wouldn't be an interesting or controversial story if nycfreshmarket.com was a white screen, or a coming soon type thing.

> WE already have a legal system in place to handle these issues

If you've ever had to sue someone you'll know that it's a distraction and not a magical solution to problems. Even when you get judgement, you've then got to collect and there are people that will drag their heels making your victory a pyrrhic one.

The person that didn't pay their web designer deserves to be shamed. You can argue that it's unprofessional of the web designer (and it probably is), but it's also unprofessional of the client.

> WE already have a legal system in place to handle these issues,

And... it may take years, at best. I did work for someone in mid 2008, they didn't pay (I should have had a down payment). I filed a lawsuit in NYC, and it's now 5 years later and it's still in the queue. If I was to get a judgement next year, it might be several more years of trying to collect before I get paid, if ever.

IIRC, they changed the passwords as I was delivering the final work, although, at the time, I didn't know it was the final work, because there was some other stuff slated to be done the following week which was 'put on hold'.

I have all my source code posted nice and pretty with highlighting. I did that from so much skepticism, not really need, perhaps, possibly weird.

How do I blend all the help documentation with-in onto my website if I don't use plain text?

I have so much content that exists as text wit-in my operating system, I have no choice unless I mix glossy and austere styles.

Gordon Ramsay makes all his food look excellent. One thing he's good at is artistic eye and making shit look good. And videos. He's an excellent charismatic asset, too. (unintended pun)

God says... potentially I'm_God_who_the_hell_are_you LOL fight soap_opera what_luck illogical Wow cheerful grumble once_upon_a_time fake sports This_is_confusing when_hell_freezes_over so_let_it_be_written computers Is_that_your_final_answer rubbish adultery I'm_God_who_the_hell_are_you let's_see Zzzzzzzz you're_nuts choose_one not_too_shabby peace big_fish God_smack I_quit I_hate_when_that_happens scorning don't_worry

We do enjoy our public shaming, don't we!
Professional, very professional.
I'm all for staging payment, and requiring final payment before delivering the goods, or even pursuing clients in the courts if necessary for non-payment (though usually that's fruitless), but when in dispute with a client you should never take retaliatory action like this, because it reflects an intemperance and lack of professionalism which means others will think twice about hiring you even if they have every intention of paying for your work. The same goes for a client not paying - if I hear someone hasn't paid their bills (for whatever reason), I'm then hesitant to work for them in any capacity unless it's a very clear-cut case. News travels quickly in many industries.

If you've already given them all the work without being paid, and with no contract, you have no recourse, but that doesn't mean you should use your technical privileges to try to exact revenge if you still have access to their server. If it's their hosting you're probably on difficult legal ground.

If you have to do this, you chose the wrong client, so tell everyone you know not to work with them, take note of the warning signs you saw and the failures of process that led to this point, and move on.

Someone always types up this same response to any incident like this, and it always sounds like exactly what I'd expect to hear from the sort of person who stiffs people.
I think this is a common response because it's actually the right choice(s) to make. I mean yes, not getting paid is never fun. There's a video posted in another comment titled "fuck you, pay me" and I think it really addresses this for freelancers. The short version of the video is have a lawyer and write a contract and if they don't pay then enforce the contract. Just my thoughts.
For all we know this action may have been part of the contract and the client simply failed to read it, or didn't believe it would happen.
Yes, I agree it is possible this was part of a contract. I don't know the details of the two parties arrangement so I can't say with any certainty.
Might not have been able to get one if he's dealing with a horse and cart company. :/
What?

If you hand over the keys to a car and tell them that they can start driving it and then pay you when ready, would you post the same response?

Car dealerships don't work that way, you need to sign a contract to use the car - usually web agencies are similar and require full payment or atleast a "payment plan" in place for a website to launch.

> Car dealerships don't work that way,

Quite true. This isn't a car dealership. Doing website support for small businesses in medium and small markets often does work that way. They have a site, they would prefer that things are added to it, instead of a complete replacement. Back when I was doing webapps in this situation, the business would often insist on running the site from their T1 or ISDN line, refusing to spring for hosting someplace where they can't see the physical hardware to reassure themselves that there is something there.

"You want to back up the database for testing? No, just connect to the production database."

"No, you don't have access to webserver config; just build it in a folder." (It turns out that they don't have such access, either, since they "had a disagreement" with the guy who set up the box for them before he left on bad terms. Asking about how to contact this guy is apparently suspicious).

"You want us to sign a contract? We'll look at it." (They never get back to you, since they can find a dozen other people who are grateful for the promise of payment).

"Pay before it launches? Oh, no, we pay net 60, but our site says 'New site coming Oct 1st!', so unless it's up then, there's no reason for us to pay you." (Of course, they put this up without consulting you after you agreed to start prototyping).

And this is to say nothing of the people who insist on detailed designs and specification documents, then say, "Actually, we're going to wait a little while", and then you find your designed system on their site creaking along like it was written by the nephew of the boss's secretary, who totally learned computer science stuff in high school this semester. Surprise! It was written by that guy, except they hired someone else at $15/hr to randomly change things until it worked, since he had to go back to school when spring break ended...

It's not that there are a few businesses that operate like this: this seems to be the majority of small-town businesses who need webapps. When I ran a business doing webapps and web design in the mid-2000s, I'm not sure I ever ran into an end customer who didn't try to pull something I found really shady, though for them it was just the normal way they think they have to deal with vendors so that they can stay in business.

When I gave up and got a salaried job in 2008, my stress evaporated, even though it was a job at a failing startup. :)

I'm sad that you think so. I would never stiff a client or customer (I'm a designer) and have friends who have gone unpaid so I know how distressing this is. I also abhor the idea of not paying people who work for me; I've never done that, and never would, even if unhappy with the work produced. I have stopped working for a client in the past because I found they didn't pay tradesmen working for them, so this is an important principle to me - if someone does work they deserve to be paid for it.

I just think this is absolutely the wrong response. As a freelancer or business your reputation is paramount - that reputation should be for professionalism and courtesy, even when others are not professional with you. This sort of incident teaches us the value of contracts, staged payments, and trust with your clients. If you don't have a good trusting relationship with clients, it's best to end that relationship and find other clients. If a client screws you, I think the best response is to make sure people know what they did, and adjust your process so that future clients can't do that, not abuse your power over their domain/server to post a partisan message like this.

So I'm afraid your assumptions about my motivations are completely unfounded - perhaps you'd like to rethink them and offer me an apology?

I saw no assumption about your motivation, he just found your response the same as that which he would "expect to hear from the sort of person who stiffs people". I happen to agree with him.

Noting this does not require thinking you are one of those people. There is an explanation that is at least equally plausible: You, like so many others, have been inculcated with contradictory views by a society which gives power freely to the dishonest, while purporting to value honesty, but in a form designed to further empower the dishonest.

If it doesn't apply to me, it's a meaningless response and a non-sequitur. I think it rather more likely it did and the insinuation (which you have extended with your own charming and baseless insinuation) was based on untested assumptions which could not be more wrong.
"Noting this does not require thinking you are one of those people."

Noting this does not require thinking that you are one of these people, in the context of strict logical inference.

Noting this is absolutely an (oblique) accusation in the context of a conversation in English.

Pragmatics is an interesting field.

>perhaps you'd like to rethink them and offer me an apology?

I'd definitely like to offer you the advice to never indulge in this sort of passive-aggression, it's very unprofessional and should make anyone think twice about working with you.

Without respect (since you aren't big enough to apologise for your entirely incorrect slander, even when anonymous), I disagree.
The reason someone always types up this response is because it's correct. This is not a good move for your freelancing career, however fun it might be to do, and no serious professional will ever do it. If you want to communicate unprofessionalism, fine, but there are a lot of good and experienced people on this forum trying to teach their business skills, and this one is pretty clear cut.
This depends on the value of repeat business. Here that value is really really small, both with this customer and potentially similar customers who might or might not hear about the incident. Also the web designer is a small player in a big pond, reducing further the risk to his reputation.

The customer - before the retaliation - believed the risk of non-payment to be worth it. Often in small contract work, the contractor can't profitably sue or they believe it's not worth the harassment.

Unless the customer can now sue the web designer for additional damages, this might be strategically the best thing he could do.

My preferred method back in my freelance days was to have a few clauses in my standard contract about copyright -- basically laying out that I wasn't doing work-for-hire, and would retain copyright in anything I produced, with an agreement to transfer copyright to the client upon receipt of payment.

That gives a nuclear-option threat of filing a DMCA takedown; telling a client that you can legally have their site turned off within 24 hours is a lovely piece of artillery to have in your back pocket, and since the actions are all taken by their hosting provider there's no possibility of "unauthorized access" charges coming back at you.

This is the most sensible method I've seen. The key point is that ownership does not pass over until payment is made in full.
do I need to pay you royalties when I incorporate those concepts into my own contracts from now on?
Even in the absence of a written contract, you absolutely have recourse.

The client essentially has two options at this point:

1. Admit that there was, in fact, a contract in oral form. In this case, they are required to pay.

2. Say that there was no contract of any kind. In this case, they cannot use your work, because you retain the rights to it. Copyright starts out with the creator, and in the absence of a contract that assigns copyright, it stays there. Mentioning that statutory damages for willful copyright infringement can be $150,000 will get people to rapidly change their mind about whether they really want to claim that there is no contract. And of course there's always the option of a DMCA takedown notice to their hosting provider, which is quick and easy.

They're only required to pay if the contract was fulfilled. Usually in cases like this there is a dispute over that.
If the contract was not fulfilled then they are in case #2 and have not obtained rights to the designer's work.
I'm with you but I think there are exceptions. To be clear, I don't think its ever okay to publicly shame a non-paying client like in this post but there are some things that are okay. A specific example is a situation I'm in right now.

Over six months ago I was asked to design and develop a Wordpress site for a slate of candidates running for local office. The guy who came to me for it was someone I had worked for before and had a very good experience with. He was fast, friendly, professional, and asked me to send him an invoice before I even planned to. So when he came to me this time asking me to put together a site that he needed up in less than a week I told him the price and got right to work. We had an agreement in writing only so far as emails went and I even spent my own money to let him use my hosting, get an SSL certificate so he could accept online donations and even gave him a few bucks just to test the donation functionality. He was happy with it and again asked for an invoice before I had one drawn up to send. They lost the election but I still did the work.

Fast forward over six months, 5 invoices, and a phone call later and I still haven't seen a single penny. To get his attention I changed the passwords to his other website (the one he actually cares about). That got him calling right away. I didn't let him know I changed the password and let him think it was a technical bug. He pretended not to know why I was never paid and promised to send payment immediately. One month and 3 emails later he promises to send the money "this week" and that he's in a "cah crunch".

Will I publicly shame him? No. I plan to ask for payment once more and give him a $250 discount if he uses the online payment form I set up for him. If he doesn't do it within a week I'll let him know he was one more week to pay me in full before I lock him out of his business email and suspend his web hosting both of which I provide.

You can always try to make the argument that designers need to be more careful in their dealings but you can't forget that there's always a human element, at least on some level, in all business transactions. Sometimes you trust a guy because you've built a good relationship with him and he fucks you over. I've never been stuffed once in three years though some have tried because I always used solid contracts and other safeguards against being ripped off. But sometimes, just sometimes, someone slips through the cracks and in those cases you have to have some recourse available to you.

I'm assuming the designer doesn't own the website domain. This is like breaking into someone's property, and saying that you won't leave until a demand is met. He should really consult a lawyer before he gets criminally prosecuted.
Agreed on the ransom, moreover - they gave the site to the owner on good faith that they would get paid, now they are complaining that they were fooled.
(comment deleted)
I don't believe that the Law works by analogy like that. There are relevant statute would likely be the Computer Fraud and Abuse Act, which talk about unauthorized access to a computer system. It has its own pitfalls, depending on who owns the computer and who is authorized to do what with said computer, but the "sit-in" analogy won't get you too far in a court of law.

The domain is registered with hostek.com, which is a web hosting company too, so I assume it's hosted there. WHOIS says the domain registration is owned by Onemine. You'd have to ask them and the court system who's actually legally responsible for the computers involved, but it's not looking very NYCFreshMarket-y to me.

Uuuugh.

Link straight from Reddit, and probably an illegal act from the designer. (Sorry but that's probably the law, like it or not)

Much as we all love to string people up, the reality is it's not professional, and probably not good for society.

Where is the proof the designer got stiffed???? The reason everyone loves this is cause we love to string someone up, proof not needed.

Not a healthy way to be.

Is this, like, really "illegal" in New York? Are you really sure about that? I'm not a lawyer but it seems to me that me that the grocery store has breached the contract and the designer has a number of options available to remedy the situation, including not delivering his part of the agreement. It would be interesting to hear the opinion of someone qualified in New York Contract Law.
If it is their server you are definitely committing a CFA to change the content. If it is your server, it's probably fine due to they haven't paid you so they broke whatever contract was in place.
>probably an illegal act from the designer. (Sorry but that's probably the law, like it or not)

The client may well be gaming the law here as well. (exploiting the fact that it is often not economical to sue over small amounts of money)

>the reality is it's not professional,

Professionalism is such a crappy word. Nobody really knows what it means, and too many people think it means something they want _you_ to think it means, when it is convenient for them.

>and probably not good for society.

I don't know. It may be good that this isn't the norm, but I think it is okay for this to happen to someone every now and then pour encourager les autres.

>Where is the proof the designer got stiffed?

A designer would have to really be off their rocker to do that without cause.

Is this really different from what hosting companies do? Most of them, if you have a bit more traffic than usual and pass the agreed limit, will replace your site with a message and only remove it if you upgrade your plan. Never saw anyone go apeshit on those cases like people are on this one.
This is also why you do not let your web designer own and operate your website hosting.
You don't let your designer host so you can stiff them?

No, this is why you pay your web designer for their work.

One has nothing to do with the other.

If they haven't paid you and you happen to own and operate it, just turn it off completely, there is no professional middle ground.

If a mechanic fixes your car and you don't pay them, in many places have have the right to seize your car until you pay. But they do not have the right to tamper with your brakes or spray paint "pay me" on your windshield.

They're free to park it by the road with a big sign on it.
Instead of being "stiffed", it is far more likely there is some degree of nuance. I'm sure if you called the market they would give their side of the story, and it would be something different than "we just took his services and didn't pay".

The problem here is the dispute that's occurring is being settled through taking the client's website hostage. That's ridiculously unprofessional.

And why--if you're a web designer--you should own and handle all design & hosting until you get paid. If it's purely design, and no backend (databases, PHP/Ruby/Python, etc.), you should probably get paid half what you expect up front, and also be sure to maintain any intellectual property rights you can.
That's a two part issue:

1 - Cloud services are for experts. It's too hard to use one and not have it backfire, lay-people have no chance here - most of the times, it will backfire and you won't even know it.

2 - Don't stiff the people whom your survival depends.

Now, of course, #2 is only an issue for people that stiff people. And for those, good luck trying to determine who should fit under this rule.

What the designer did is fine except I would have just put up a "Coming Soon..." instead of directly calling out the owner. It would have the same reaction from the owner because they don't know how to do any of it. And it wouldn't give anyone who visits the immediate knowledge that the designer can and will use their technical powers to embarrass you or your business.
This is actually a really sensible middle ground to the (very valid) views around here that this is a terrible career move to make.

There's still the legality aspect which concerns me.

I think it probably depends whose server the files are hosted on, if they're on the designer's, they could easily just turn off service and be justified, logging in to a client's server to do it without permission is probably crossing a line though.

However hijacking the domain with a message like this is legally risky IMHO, wherever it is hosted, as it could be seen as slander. Good luck to the designer getting paid now - I'd be very surprised if the client did pay up after this.

In the US, truth is an absolute defense to the claim of libel, so venue is pretty important.
I'm going to start using this as a remedy in contracts, if for no other reason than to put a stopper in all these "unprofessional response" replies.
Every contractor should secretly applaud this person. Although wrong, events like these, when witnessed, make others who might otherwise not pay reach for the checkbook. "I remember what happened to xyz site when they stiffed their consultant"
“But let us raise a toast to all our bombers, all our bastards, most unlovely and most unforgivable,

let's drink their health…

…then meet with them no more.”

— V

This is unwise. The main idea is that, as someone suggested in a comment:

  it has a nonzero probability that it will shame somebody 
  into paying.
This is in fact quite unlikely. If you believe this, you are not considering why someone isn't paying. In the majority of cases, the reason is disagreement. Nothing is going to materially change about a disagreement by taking a website hostage. You are only exacerbating the issue.

The main thing you achieve by something like this is satisfying your personal sense of justice and being judge, jury and executioner to accomplish it. However, that's vigilantism and as in most other examples of that, it is probably illegal.

As a webhoster, you may suspend hosting. As a designer, you may withdraw someone's license to your design. As a hoster and designer, assuming a single contract covering both, suspending hosting is by far the easiest, as the other path requires legal action. However, you should never replace agreed upon content with something that would be defamation if your claim were denied. Just suspend hosting.

First: "Nonzero" doesn't mean "likely".

Second: Defamation? What do you think this is, Europe? Go read New York Times vs Sullivan and get back to me talking about whether this website's claim was published with "reckless disregard of whether it was false or not." You're going to get approximately zero mileage with defamation in the US court system.

> In the majority of cases, the reason is...

You are the third person making the same kind of claim. It's not that I disagree, in the majority of the cases, something like that isn't a nice thing to do...

But this is one case, not the majority, we know nothing about it, except that it's in an extreme minority. If for no other reason, because the designer decided to retaliate this way. We are looking at extreme selection bias here, don't shove it under a carpet.

You always discuss an issue based on the specific case that raises the issue, but that doesn't mean there is automatically extreme selection bias going on. The relevant facts of a case are rarely unique. I've seen a dozen or so of such cases in the past ten years and I've never heard of a case where this kind of retaliation worked.

If I report that my green car was stolen and claim that a gang stealing green cars is active, then people respond with "That's unlikely, they're probably just stealing every car they can get their hands on". In line with your argument, they should instead say "Wow, a gang stealing green cars, how unlikely. How wonderous I would stumble upon this case of extreme selection bias here on the web".

That is even ignoring the fact that it is probably illegal. You are allowed to end the delivery of a service if the other party effectively cancels a contract, but you are not allowed to keep delivering the service in a way that breaches the contract. You cannot just serve any content you want on their domain (unless this situation was specifically foreseen in the contract).

I've had people not pay before. The reason was never "disagreement". It was always either insane internal bureaucracy or just plain stinginess. In both cases, you can get paid if you convince them that they stand to lose more by not paying.
This is indeed a bad career move. Not because it's unprofessional, but because that pin sitting on top of the sheet of paper rather than indented into it shows a lack of attention to detail and poor design.
An alternative is - from the commencement of the project - to have a watermark or other visual design element present which makes the site unusable to the client but still allows them to evaluate the work.
I appreciate the designer's frustration, but I've found that in most cases, simply taking the site offline (assuming you host it) is enough to get a call back from the customer. If the customer decides that they'd rather not have a website at all than have the website you built for them, then I think perhaps both parties should cut their losses and move on.
Yep, I have had a few clients for minor hosting things not pay, and the most simple way is to revoke access to the content. While putting some snarky comments on the page is funny, just taking it down would generally elicit the same response from a small minded shop keeper. Having dealt with the same stuff, shaming them or poking at their pride instead of having a very basic and honest discussion about consequences when they decide to not pay can lead them to become twice as bullheaded.

I still feel for the dev in this case, because this shit happens way too often in the industry.

The response is unprofessional juvenile in that it publicly calls out and shames the customer. He should just take the site down until payment is received.
Also the page contains the cloaked text (in yellow on a yellow background) : "This store owner is dishonest. Please Read."

Defamation lawsuit waiting to happen.