Sex.com
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The Internet domain name sex.com is a web portal owned by Escom LLC. It was the focus of one of the most publicized legal actions about ownership of domain names.
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[edit] History
In 1994, entrepreneur Gary Kremen (now the CEO of Grant Media, LLC) registered the domain with Network Solutions (NSI). He did not develop a site.
In October 1995 NSI transferred the domain to Stephen M. Cohen. Cohen had been trying to gain control of the domain for some time by misrepresentation, using phone calls, e-mails and forged letters. He eventually persuaded an employee of NSI to change the ownership details, apparently through a fake fax, although this was not entirely clear during most of the legal proceedings that followed.
After gaining control of the domain, Cohen developed it, producing an advertising-heavy site which gained up to 25 million hits a day. From payments for click-throughs and other advertising it was reported that Cohen was making $50,000 to $500,000 every month.
Kremen undertook steps to recover the domain, but found it extremely difficult. Cohen claimed he obtained the domain legally from Online Classifieds (OCI), and a five-year legal battle ensued, led by cyberlawyer Charles Carreon. Kremen was victorious in November 2000, when Network Solutions was ordered to return the domain to Kremen and Cohen was ordered to pay $25 million into court.
In April 2001 the Californian District Court awarded Kremen an additional $40 million for lost earnings, for a total of $65 million. Cohen appealed the judgement and refused to allow assessment of his business – providing false information or none at all, declaring most of his companies bankrupt and illegally moving assets out of US jurisdiction. When an arrest warrant was issued, Cohen fled the country to Mexico. Kremen offered a $50,000 reward for information, but Cohen remained uncaught. Cohen continued to file appeals but they were rapidly rejected. In October 2005, Cohen was arrested in Tijuana, Mexico for immigration violations, and was handed over to US authorities.
[edit] VeriSign lawsuit
In 1998 Kremen began simultaneous legal proceedings against Network Solutions, later part of VeriSign, for breach of contract and conversion. The case was repeatedly delayed before his claim was dismissed by the trial court in May 2000, holding that since the registration was free, Kremen had no contract with Network Solutions, and that the doctrine of conversion (dealing improperly with another's property) did not apply because domain names are not tangible property. Kremen appealed. The 9th US Circuit Court of Appeals held in July 2003 that domains were property protected by the doctrine of conversion, and that VeriSign could be liable to Kremen for improperly transferring the domain. The case was remanded to the trial court on this basis. In March 2004 VeriSign ended the legal action and paid Kremen an undisclosed sum, believed to be around $20 million.
[edit] References
- "Saga of stolen sex.com website exposed". (Nov. 8, 2005). New Straits Times, p. 14.
