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The strange saga of the jinxed Sex.com domain name continued Thursday as its sale in a foreclosure auction was postponed just hours before the sale was to start due to drastic, last minute legal filing by the domain owner's creditors.
Sex.com has a tawdry but telling history. Its current owner spent $14 million dollars on the property in 2006 -- the most ever for a domain name at the time -- and is now selling it off after the property failed to appreciate in value. The bidding starts at $1 million. And to be sure, the domain name retains some value and, even as people use search engines and search-enabled browser address bars to find what they want without typing in keyword.com, an old habit that spawned a billion-dollar industry of crappy, content-less web pages like windshield-wipers.com.
Sex.com was originally bought by entrepreneur Gary Kremen, founder of match.com, in 1994. He did nothing with it. But a year later Stephen M. Cohen tricked Network Solutions into transferring ownership to him. After a five-year legal battle, ownership was restored to Kremen, who then sold it to Escom LLC for what is thought to be the most ever paid for a domain. Escom was backed by DOM Partners LLC, which acquired it by default and is now peddling it to the highest bidder.
On Thursday, creditors of Escom lodged an "involuntary Chapter 11 bankruptcy petition" against Escom in the United States Bankruptcy Court for the Central District of California in San Fernando Valley.
"Petitioners took this action to protect their interests and to maximize value for all other creditors and equity holders," the creditor's lawyers said via e-mail. "The filing will stay the public auction foreclosure proceedings ... which petitioners believe would have diminished the value of Escom's assets."
The auction page simply says that the sale is postponed, with no further details.
The history of the domain is so twisted, complete with forged documents, shell companies and a bounty -- that there is already an entire book devoted to it.
It's not clear at this point why anyone would want to get involved, but when or if the auction comes around again, you'll need a certified check for $1 million to get in on this once-in-a-lifetime business opportunity.
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