They say that sex sells, and that saying could definitely be applied to the domain name of Sex.com, which was just purchased by Clover Holdings from Escom LLC for $13 million. Besides the domain name itself, Clover Holdings also gets two related trademark registrations in the deal.
The Sex.com domain name has been considered to be the most valuable on the market. Sedo (Search Engine for Domain Offers), a domain broker which aided in this week's sale, put the highly sought-after domain on the market in July of this year. Escom's CEO, Del Anthony, reportedly solicited Sedo's help due to the service's large network of worldwide clients and its experience in brokering valuable domain names in the past.
Since sex is one of the most widely used search terms on the web, owning a domain such as Sex.com offers plenty of prospects for profitability. The domain's short and descriptive nature that helps to define an entire category also adds to its overall value.
The latest chapter concluding with the Clover Holdings purchase of Sex.com is just one part of the domain's storied past. Its history began in May of 1994, when it was registered by Gary Kremen. Kremen is also credited as being the founder of the popular dating site, Match.com. Kremen's ownership of the domain was quickly interrupted in 1995, when it was fraudulently acquired by Stephen Cohen.
Cohen, a fraudster with a checkered past, had just been released from federal prison after serving a 46-month sentence for participating in a bankruptcy fraud scheme. Cohen submitted a forged letter to the domain registrar, Network Solutions. The letter stated that Kremen had been released from his company, Online Classified, and that the Sex.com domain could be released to Cohen. Network Solutions followed the demands listed in Cohen's letter, and he became the domain's new owner.
Cohen owned Sex.com for a handful of years, collecting upwards of $40 million from its ownership during that time. Kremen fought back against Cohen and Network Solutions by filing lawsuits. In 2001, he won a $65 million judgment against Cohen. Unfortunately for Kremen, Cohen fled the country to Tijuana, Mexico.
In 2003, Kremen regained rights to the domain name after an appeals court ruling. The 2003 ruling also found Network Solutions guilty of transferring the domain to another party without verification. This ruling was significant, as it paved the way for current laws that hold registrars responsible for the domains they manage.
Cohen was finally arrested years later in 2005, and released from custody in the following year. Kremen sold the rights to Sex.com to Escom in 2006 for $14 million. Escom's decision to sell the domain this year came after declaring bankruptcy under pressure from creditors.
The history of Sex.com has been chronicled in two books: Charles Carreon's The Sex.com Chronicles and Kieren McCarthy's Sex.com: One Domain, Two Men, Twelve Years and the Brutal Battle for the Jewel in the Internet's Crown.
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