Sex Sells, But Not Enough to Keep Pricey Sex.com Off the Auction Block
by Kathee Brewer
YNOT – Sex.com, the most notorious URL in the history of the web, will hit the auction block March 18 after owner Escom LLC defaulted on a debt to the website’s financial backers. New Jersey-based DOM Partners LLC, a financial services firm that specializes in web-based property, has ordered a foreclosure sale in hopes of recouping at least some of its investment.
Calabasas, Calif.-based Escom acquired Sex.com for somewhere between $10 million and $14 million in January 2006 when the domain’s original owner, Gary Kremen, decided to sell his adult entertainment interests and move on. Kremen’s five-year, multimillion-dollar legal battle to reclaim “the jewel in the internet’s crown” from hijacker and convicted fraudster Stephen Cohen has been documented in at least two books.
Match.com founder Kremen registered Sex.com in 1994. Less than a year later, Cohen forged a transfer letter and convinced registrar Network Solutions he was the rightful owner of the domain. Kremen regained control of the domain in 2000, and subsequently won a $65 million judgment against Cohen after a running battle that on various occasions involved courts at several levels, cloak-and-dagger international pursuit and semi-automatic weapons. Kremen has yet to collect a penny of the judgment, but he did obtain the deed to a San Diego, Calif., mansion that once belonged to Cohen.
The riveting, Tom Clancy-esque saga came to an end, finally, in 2005 when Mexican authorities handed off Cohen to U.S. authorities at the border.
During the five years he owned Sex.com, Cohen reportedly pushed as many as five million hits through the site daily and raked in as much as $100 million a year, according to journalist Kieran McCarthy’s 2007 book, Sex.com: One Domain, Two Men, Twelve Years and the Brutal Battle for the Jewel in the Internet’s Crown (Quercus).
In recent years, the site’s traffic has slowed to a comparatively paltry 250,000-or-so hits daily, according to published reports.
The domain will be the subject of a live auction handled by David R. Maltz and Co. at the New York law offices of Windels Marx Lane & Mittendorf LLP. Bids will be accepted only from those who provide a certified bank check in the amount of $1 million. The winning bidder will receive the domain name and all cash proceeds, accounts receivables, licensing rights and intellectual property rights associated with the URL, according to the notice announcing the sale.
The notice also states the domain will be sold “as-is,” with no warranties as to whether Sex.com is subject to any further liens or other encumbrances.
Michael Mann, a former investor in Sex.com and founder of buyDomains.com, told Domain Name Wire he expects the site to sell for as much as $25 million, although other analysts are not so confident. The New Zealand Herald quoted an unnamed source close to the sale saying the domain is “unlikely to bring in what it did in 2006, although it really depends on how much someone wants it.”
Kathee Brewer is an award-winning news, feature and opinion writer, editor and photojournalist. She has participated in and covered the development of the Web since 1995.
