JupiterSunsation
03-09-2010, 04:43 PM
NEW YORK (CNNMoney.com) -- Sex.com, one of the most valuable Internet domain names, will go up for auction next week after the previous owner defaulted on its debts.
Escom LLC paid a reported $14 million for the Web site in 2006. But the company failed to repay debt owed to DOM Partners LLC, the New Jersey-based lender that helped finance the deal.
As a result, sex.com will be sold "as is" in the equivalent of a foreclosure sale, according to a letter from DOM Partners' lawyers that was made public Tuesday. The auction is set for March 18 in New York, and bidders are required to appear with a certified check for $1 million to participate.
Richard Maltz, an auctioneer at Maltz Auctions who is overseeing the sale, said there has been a "good amount of interest" in sex.com. But he did not say how much the Web site could sell for.
"It is a very unique property," he said. "It will be an incredible opportunity for someone."
Indeed, sex.com generated $15,000 a day in revenue at one point, according to Charles Carreon, an attorney who wrote about the Web site's legal travails in his book "The Sex.com Chronicles."
By way of comparison, the domain name www.pizza.com reportedly sold for more than $2.5 million at an auction in 2008.
The sex.com saga
The auction is only the latest chapter in the turbulent history of sex.com, which includes allegations of theft and countless court cases.
Gary Kremen, the founder of Match.com, registered the domain name in 1994, according to a timeline of the events on the Web site of journalist Kieren McCarthy, who wrote a book about sex.com.
According to McCarthy's account, Kremen spent several years in court battling with "porn baron" Stephen Cohen, who was accused of stealing sex.com from him in 1995 by sending forged letters and e-mails.
In 2000, a court handed control of the domain name back to Kremen and ordered Cohen to pay $65 million to Kremen. Cohen subsequently appealed and the case was rejected by the Supreme Court in 2003.
Two years later, Cohen was arrested in Tijuana for failing to appear in court. He was released in 2007, according to published reports.
Kremen was the principal in the 2006 sale of the domain to Escom, although a news release at the time said he would remain as an adviser
Escom LLC paid a reported $14 million for the Web site in 2006. But the company failed to repay debt owed to DOM Partners LLC, the New Jersey-based lender that helped finance the deal.
As a result, sex.com will be sold "as is" in the equivalent of a foreclosure sale, according to a letter from DOM Partners' lawyers that was made public Tuesday. The auction is set for March 18 in New York, and bidders are required to appear with a certified check for $1 million to participate.
Richard Maltz, an auctioneer at Maltz Auctions who is overseeing the sale, said there has been a "good amount of interest" in sex.com. But he did not say how much the Web site could sell for.
"It is a very unique property," he said. "It will be an incredible opportunity for someone."
Indeed, sex.com generated $15,000 a day in revenue at one point, according to Charles Carreon, an attorney who wrote about the Web site's legal travails in his book "The Sex.com Chronicles."
By way of comparison, the domain name www.pizza.com reportedly sold for more than $2.5 million at an auction in 2008.
The sex.com saga
The auction is only the latest chapter in the turbulent history of sex.com, which includes allegations of theft and countless court cases.
Gary Kremen, the founder of Match.com, registered the domain name in 1994, according to a timeline of the events on the Web site of journalist Kieren McCarthy, who wrote a book about sex.com.
According to McCarthy's account, Kremen spent several years in court battling with "porn baron" Stephen Cohen, who was accused of stealing sex.com from him in 1995 by sending forged letters and e-mails.
In 2000, a court handed control of the domain name back to Kremen and ordered Cohen to pay $65 million to Kremen. Cohen subsequently appealed and the case was rejected by the Supreme Court in 2003.
Two years later, Cohen was arrested in Tijuana for failing to appear in court. He was released in 2007, according to published reports.
Kremen was the principal in the 2006 sale of the domain to Escom, although a news release at the time said he would remain as an adviser