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2 August 2000
Sex.com ownership ruling expected
Jon Swartz, USA Today

A decision is expected as early as this week in one of the Internet's most intriguing disputes, involving the ownership of the name Sex.com.

"This case has it all: bankruptcy fraud, pornography, forgery, offshore holdings, deep pockets, dirty tricks, depositions in foreign cities and a bitter dispute over rights to a multimillion-dollar domain name," says Ellen Rony, co-author of The Domain Name Handbook.

The coveted Sex.com name has helped Stephen Michael Cohen, 52, build an adult entertainment network that some porn executives say is worth at least $250 million.

But Silicon Valley businessman Gary Kremen, 36, who made a small fortune founding online dating service Match.com, says he owns the name -- and that Cohen cheated him out of millions.

He secured Sex.com in May 1994 and had it until October 1995, when domain name registrar Network Solutions Inc. turned it over to Cohen. The group did so on the basis of a letter in which Kremen's one-time roommate supposedly ceded the name to Cohen.

Kremen says the letter was a fraud. In 1998, he sued Cohen and NSI for unspecified millions in damages.

"Is this an open invitation to stealing Web addresses and legalized forgery?" Kremen says. "This is insane."

Cohen countersued Kremen and his lawyer, and filed a $50 million libel lawsuit against Luke Ford, an online gossip columnist who focuses on the sex industry and has written about the case.

The ruling from U.S. District Court in San Jose, Calif., could decide if Sex.com is stolen property. But it will probably be appealed. Kremen is already appealing a federal court decision exonerating NSI.

Cohen -- who served two years in federal prison in the early 1990s for fraud -- scoffs at the accusation that he forged the letter to NSI. He calls Kremen a litigation-happy "nut" trying to cash in on his successful business.

Cohen says he staked a claim to Sex.com in 1979 in connection with his electronic bulletin board for "swingers" and "nudist camps," The French Connection, which he ran before establishing operations in Tijuana, Mexico.

What's more, he accuses Kremen, whom he has met once, of falsifying paperwork in an effort to land the Sex.com moniker. Kremen denies the charge.

Meanwhile, Cohen last year began filing copyright infringement lawsuits against smaller companies with Web addresses containing Sex.com.

"We're certainly not going to cave in to this," says Lewis Payne, co-owner of Meow Media, whose properties include Sexbytes.com. "He has strong-armed other Web sites with threatening e-mails, and they simply handed over their domain names."

Cohen, though, says Web users can easily be confused.

"A lot of people believe this is the Wild West," he says. "But we think companies should protect their assets. You can believe Disney and Nike will go after the likes of Web sites with names like Steve's Disneyland and John's Nike."

No one expects Cohen to back down.

"He intimidates a lot of people in an industry filled with outlaws," Ford says.

 

 

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