Last week, US District Court Judge James Ware dismissed a claim against an individual accused of hijacking sex.com. Steven Cohen obtained the name by allegedly forging a letter to domain registrar Network Solutions in 1996 authorising the transfer from its original owner, Gary Kremen. The judge ruled that, even if this happened, it could not amount to “conversion” under US legislation, or in effect, theft.
Judge Ware wrote: “There is simply no evidence establishing that a domain name including sex.com [meets the definition of property] as required by the law of conversion.” He followed his own earlier decision in a case by Kremen against Network Solutions, taking the view that a domain name is more akin to a designation for a service, like a telephone number, than property in its own right. He observed that it was for the legislature, not the courts, to clarify the ambiguities of US property law and its relevance to domain names.
However, Judge Ware went on to grant a request by Gary Kremen to file an amended claim charging Cohen with a breach of California’s unfair competition code. This provides that if someone steals a product and sells it, the person is unfairly competing with another who has to buy the product and sell it. If successful with such an amended claim, Kremen could recover the profits enjoyed by Cohen from the porn site at sex.com, estimated in the hundreds of millions of dollars.
It is also thought that Kremen will use Californian fraud law to get a court ruling that Network Solutions should transfer back the domain name. If successful, Kremen would also be entitled to compensation.