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Appeals Court Upholds $65-Million Jury Award in Sex.com Domain Case

September 04, 2002|From Bloomberg News

SAN FRANCISCO — A federal appeals court dismissed the appeal of a fugitive who lost a $65-million verdict last year over his theft of the lucrative Internet domain name www.sex.com.

The U.S. 9th Circuit Court of Appeals action Friday affirms an April 2001 federal jury verdict ordering Stephen Cohen to pay the site's original and current owner, Gary Kremen, for acquiring the domain name through fraud.

Kremen hasn't been able to collect the money from Cohen. He also is trying to sue VeriSign Inc.'s Network Solutions, the company that registers Web site addresses. The court is reviewing Kremen's appeal that Network Solutions should be responsible for letting Cohen take the domain name.

Kremen registered the domain name in 1994, but adult-entertainment executive Cohen took it in 1995.

Cohen's attorney, Michael Mayock, who claimed that his client wasn't able to pay the jury award because he is under house arrest in Mexico, couldn't be reached for comment.

Donna Patt, Mayock's secretary, said Mayock went home sick Tuesday and the court's opinion arrived in Tuesday's mail.

In a three-paragraph opinion released Friday, the panel rejected Cohen's arguments, saying, "in light of Cohen's status as a fugitive from justice and his egregious abuse of the litigation process, we exercise our discretion to dismiss his appeal pursuant to the fugitive disentitlement doctrine."

The three-judge panel also ruled Kremen is entitled to Cohen's Rancho Santa Fe, Calif., home. Kremen took possession of Cohen's home last year and estimates the house is worth $6 million.

Until 1998, Network Solutions was the only place users could register domain names. How the panel rules on Network Solutions' status in the case could affect Internet law, said James Wagstaffe, Kremen's attorney.

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