Into a Sex Tangle

Even as the passion for sex.com remains unrelenting among those who want to
own this highly lucrative domain name, a group of creditors of the domain is
said to be leaving no stones unturned in a bid to make sure they get the highest
price possible.

The scheduled auction of sex.com, which was necessitated when Escom, the
previous owner of the domain, went into foreclosure for unpaid debts, was
delayed as a group of creditors forced Escom into bankruptcy court last month.

Meanwhile, media reports suggest an intense tug of war between the creditors
for the management of Escom. Escom reportedly paid $14 mn for sex.com when it
bought the site in 2006. DOM Partners, one of its investors, helped finance the
deal and acquired the rights when Escom failed to make payments earlier this
year as the domain name had served as security for DOMs loan to Escom,
according to CNNMoney.com. And it was DOMs plan to sell the site to the highest
bidder in the equivalent of a foreclosure sale. Then it was reported that apart
from DOM, Escom also owes more than $10 mn to creditors including Washington
Technology Associates, iEntertainment and AccountingMatters.com, who opposed the
auction.

Mike Mann of WTA had estimated the value of sex.com to be at around $50 mn.
Meanwhile domain name experts have said that sex.com is worth between $14-18 mn.
Estimates also suggest that, had the domain name been sold in an auction, it
might have fetched only about $6 mn, writes Anita Ramasastry, a FindLaw
columnist. This huge gap between the estimated real worth of sex.com, and the
likely result of an auction is said to have prompted WTA and two other creditors
to thrash the auction plans of DOM and opt for bankruptcy. A filing by DOM
against the bankruptcy had said that Escom was required to be managed by its
three founding membersDOM, Washington Technology Associates, and Domain Name
Acquisition Group.

Amidst all these commotions, Mann agreed to donate his portion of the domain
name to the animal rights activist group PETA, according to Domain Name Wire.
But the price he asked for the donation was in the form of $50 mn tax deduction
by the authorities.

Now that the auction is delayed indefinitely, speculations are ripe that the
domain name could fetch a huge money when it goes on sale. Scott Matthews, a
lawyer for DOM said there had been significant interest in the domain name,
but he declined to say how many bidders were scheduled to take part in the
auction. Let us wait and see how much the name sex.com brings, even before its
sold.

CIOL Bureau

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