The world's most expensive domain goes to…
Yes, it is SEX.com! SEX.COM is set to fetch a record $13m for a domain name on Wednesday October 27th when a Californian bankruptcy court meets to decide on the deal. The domain name last changed hands in 2006 for a reported $14m in cash and shares, but it was put up for auction in July after its owner went bust. Not a surprise that it’s able to fetch such a high score though, as you can imagine the hits it’s able to get.
This 2006 transaction does not appear on our chart, which compares the highest prices paid for domain names in cash only, and those that can be verified. It does not, for instance, include the purchase of Insure.com for $16m in 2009 because the related website was part of the deal. And the priciest domains may never be known. Many big sales are not made public, and these may account for the largest share of the domain-name market.
And… a little history of the sex.com domain name.
On May 9, 1994, entrepreneur Gary Kremen (who also founded Match.com) registered sex.com with Network Solutions.
In October 1995, Network Solutions transferred the domain to Stephen M. Cohen, who 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 Network Solutions to change the ownership details by submitting a fake fax. After gaining control of the domain, Cohen produced an advertising-heavy site that received up to 25 million hits a day. From payments for click-throughs and other advertising, Cohen was reportedly making $50,000 to $500,000 per month. Kremen undertook steps to recover the domain, while Cohen claimed he obtained the domain legally from Online Classifieds (OCI). 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 the plaintiff. According to the record of Kremen v. Cohen, Cohen was ordered to pay $25 million into court; in April 2001, the California District Court awarded Kremen an additional $40 million for lost earnings, for a total judgment of $65 million.
Cohen appealed the judgment and refused to allow assessment of his business: He provided false information and declared most of his companies bankrupt while illegally moving assets out of US jurisdiction. When an arrest warrant was issued, Cohen fled to Mexico. Kremen offered a $50,000 reward for information, but Cohen remained at large while continuing to file appeals that were rejected. In October 2005, Cohen was arrested in Tijuana, Mexico for immigration violations, and was handed over to US authorities.
Cohen was released from custody on December 5, 2006, when Judge Ware determined that “the Court is satisfied that Cohen has provided an accounting of assets to the extent that he is able from jail.” Cohen currently is representing himself and provided the Court with an address in Mazatlan, Mexico.
As of December 21, 2007, 1,350 documents have been filed in the case.