Sexy Sum: $65 Million for Sex.com

ByMichael S. James

April 4, 2001 — -- A man accused of hijacking the domain name sex.com must pay $65 million to the site's rightful owner, a federal judge has ruled.

U.S. District Judge James Ware, in San Jose, Calif., found Stephen M. Cohen must pay Gary Kremen $40 million in compensatory damages and $25 million in punitive damages for operating the adult entertainment site sex.com for 4 ½ years from 1996 to November 2000.

In his written ruling, Ware found that "Cohen devised and executed a fraudulent plan to steal the domain name 'sex.com'" by creating false documentation, including a fraudulent letter to a registry that keeps track of who owns domain names.

Ware found Kremen registered himself as the owner of sex.com in May 1994. Kremen currently operates the site.

Pamela Urueta, an attorney representing Kremen, said her client was "thrilled" late Tuesday at news of his court victory, but that he's "realistic that he's not likely to see $65 million in his lifetime from Cohen."

Cohen did not appear in court during the case, according to Ware's opinion. A Portland, Ore., attorney who represented Cohen in court has not returned a phone message seeking comment on the decision.

According to Urueta and media accounts, Cohen has claimed to be detained by authorities in Mexico on an unrelated matter, and is subject of an arrest warrant for not posting a $25 million court-ordered bond in the sex.com case.

"The warrant of arrest issued on March 2, 2001, shall remain outstanding until defendant Stephen M. Cohen surrenders the property of each defendant to this court," Ware wrote in his judgement.

The award is close to the amount Kremen had sought — $43.3 million in compensatory damages and $25 million in punitive damages.

"I think that Cohen certainly made $40 million on [sex.com] over the last four years," Urueta said. "Most of that money has been pushed so far offshore that it's unlikely that we're going to be able to get it."

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