I recorded a show for National Public Radio’s (NPR) On the Media show earlier this week talking about Sex.com, my book about it and the domain’s upcoming auction next month.

The show played this morning. You can see the NPR page (with transcript) at http://www.onthemedia.org/transcripts/2010/02/26/06. And listen to the show below:

Here’s what NPR has to say of the show:

Sex.com

On March 18th, a public auction will be held in Midtown Manhattan. On the block? Sex.com, one of the most coveted pieces of internet real estate, ever. But be warned. Sex dot com comes with a long and troubled past. It’s all chronicled by Kieren McCarthy in SEX.COM: One Domain, Two Men, Twelve Years and the Brutal Battle for the Jewel in the Internet’s Crown.

I think Amazon is fantastic. It is on the cutting edge of Internet commerce and it constantly pushes at the barriers… I’m a big fan of the Kindle – the first proper e-book; I admire Amazon’s affiliate program which is inventive and generous; but most of all, I love the way it has allowed booksellers across the world to tap into its enormous online presence, enabling independents to name their price and make books easily available that previously would have required a visit to the world’s main book repositories (in the UK that’s the Bodleian Library and the British Library at Paddington).

But I have to say I am foxed when it comes to what Amazon has to say with respect to my own book – Sex.com. While pondering getting a US publishing deal today, I had a look at Amazon.co.uk to see how my book was doing, whether it had any good reviews and so on.

Sex.com is out of print at the moment. So I was pleased to see it has been picked up by second-hand booksellers. The price wasn’t very encouraging though. No author likes to see their book offered for less than the paper it costs to print it on, so seeing Sex.com offered for £0.08 – or 8p – was not exactly exhilarating. But then what’s this – it is also on sale for £71.76. £71.76? What’s going on?

Yes, apparently someone thinks my book is worth £71.76. In fact several people. I can only assume this is one of the books I have signed. So does that mean my signature is worth £71.68? I’d love to think so. But I suspect not.

Amazon is offering the cheapest “new” versions of my book for £9.99. Then there’s a new one for £10.99 and from there the price leaps to £29.99. Well I have 10 copies in my flat that I would happily sell for $40 to anyone that asks. But then on the flipside, there a range of eight sellers ready to put my book in your hands for under £1.00.

Clearly some very strange economics going on. I’d love to find to a way of deluding myself into believing that this is a clear sign of restricted supply to growing demand for a work of brilliance causing price fluctuations but I suspect it’s just the Internet being funny again.

So get your copy now in case it becomes so expensive you can’t afford it, or so cheap you don’t want it. One of the two.

I’m quite excited about the fact that Amazon has brought out a new ebook reader that it calls the Kindle. I haven’t seen one in the real world but I am assuming with the effort they’ve put behind it that the screen technology is what it claims to be – easy to read without straining your eyes.

I believe ebooks are the inevitable future. It’s just another step along the digital revolution. But – and what a but – have you seen the state of the “Kindle”? It looks like a prototype. A prototype designed by 18-year-old students back in the 1980s. Here is good technology and big demand with crappy design – i.e. the perfect opportunity for Apple.

The problem is that if Apple gets to it fast then the control-freak company will insist in tying in content providers into its new format, will do deals with big bookshops and newspapers and will screw up the huge leap that a quality ebook reader will provide society.

Amazon’s Kindle downloads content over wireless – which is terrific – another example of why wireless networks are changing the way we function as a society, It is too pricey at the moment – $399 – and the content is too expensive. But all that will change if this takes off. And that’s the big question – are people ready for an ebook reader? I would say yes. With better design. Mobile phones are too fiddly; laptops too over-spec’d and slow.

I also like Amazon’s system for people to upload books into its system. It looks easy and appears to work. I have the ebook rights to my Sex.com book so when I get back from a Thanksgiving lunch I am going to in five minutes, I will try to upload my book and see what happens. I also have US rights to my book by the way. My publishers have let me down with that one. As soon as my workload lifts I will spend some time getting the book into the States and pushing it.

It will be a great day when I see my book being read on a well-designed non-Apple ebook reader. I just wonder how long that will be.

Kevin Murphy, a British IT journo based in the US, has done a review of my Sex.com book on his blog.

He likes it. Which is nice since he is one of roughly three journalists in the world who understand the domain name system and its history. You can read it all here.

I like the opening line: “This is easily the funnest tech industry book I’ve read in a long time.”

I’m still don’t know where things are at with the US publisher, or this bloke in New York was interested in making a screenplay out of the book, or if I’m ever going to make any money from the book. Still, what does it matter in the wider scheme of things? I managed to write a book and people seem to enjoy it.

This has to be good – I note that Amazon.com is now selling my book – Sex.com.

Unfortunately there is still a four to six-week delivery date on it, which leads me to conclude that my publishers have yet to strike a deal with a US publisher. I also note on a quick perusal of the Net that the Sydney Morning Herald and ran a whole extract in its edition today – Chapter 3, I believe. And I’m pleased to see that Techworld – where I was news ed – ran an extract last week. Alot has happened since I’ve been away.

I’ve also got a lovely review on Amazon.com. Although this doesn’t appeared to have helped my ranking much – it’s still way down at book no 186,461. Anyway, the review:

Review

Don’t enter the world of Intellectual Property without this book, June 6, 2007

By Jonglier

Forget the lubricious or lascivious, there’s little if any of that in Kieren McCarthy’s business-thriller/page-turner. Its essential subject matter is on the face of it dry as a bone: trademarks, internet domain names or URLs, intellectual property rights, and the civil legal system that arbitrates on all of the above.

Yet McCarthy makes the topic alive, fraught, fascinating and above all important: to you and me as media users, to would-bet net entrepreneurs, to anyone to whom ideas – and their protection and promotion – is important… But oh how close, in the dying days of the saga, victory looked like turning to the sourest possible defeat!

Rush to your credit card wallet and buy this book now. Buy two: you’re sure to know a net fiend who’ll find it instructive and enthralling.”

Now ain’t that nice. I wonder if I’ll get any money for all this.

I had my book launch on Tuesday at Bar Detroit in Covent Garden. Terrific stuff. Lots of old friends, my publishers (several of the Quercus team pictured above), and my family. Gary Kremen was there and signed various books and generally entertained people. I did that weird thing where you speak to nearly everyone but only for a very sorry time each. I also didn’t eat anything, so I have lost the last half-hour or so of the evening and felt pretty rough the next day, but there you go – if you can’t do that at your book launch, when can you?

Anyway, there are a series of reviews out. And I’ve done a number of interviews so I thought I should quickly stick up links to them while I have a minute. Guy Kewney wrote one for his NewsWireless site, which The Register has decided to buy off him. Which is good news for me because Guy really enjoyed it. My favourite part: “You think you’re going to read a racy description of the high life of a few wealthy California dotcom millionaires, playing at pornography – but what you end up soaking into your soul, is a deep understanding of the pioneering days of the Internet.” Which was exactly what my intention was. He ends it: “It’s a brilliant bit of writing. Read it if you dare.” God bless him.

Me old boss Max have given me a more critical review on Techworld. As ever, Max has a keen eye for detail. He reckons I went on too much about the US legal system and didn’t make it clear what what quotes and what was my interpretation. Max may well be right on both counts. Max also reckoned I should have covered IANA and ICANN in greater detail. I don’t know. Maybe. I had to not put in alot of stuff to make the book readable because I wanted to make it readily accessible to everyone not just IT folk. I have whole chapters covering the early DNS, and many more covering the US legal system, and I also have a whole lot of stuff on other con-men that also, sadly, never made it into the final book. Nevertheless, Max said it was a “gripping story, well told”, adding, “there can’t be many books about the computer industry that can be described as page-turners but this is”. Which coming from Max is praise indeed.

Other reviews

There is a long feature in the Silicon Valley Metro – which I had nearly forgotten about because I did the interview over the phone while doing 100 other things in Geneva. That covers the story well, covering the story with quotes from me and Kremen’s lawyer Richard Idell. And I’ve just seen another review in The First Post. They’re not so keen, saying that the author “doesn’t always make the most of his entertaining cast of geeks and porn barons”.

I think this last comment actually hits on something very interesting about the book – and something I struggled with for a while when trying to write it: the book isn’t just about one thing. It actually about a multitude of things: two men fighting one another; the history of the Internet; the US legal system; a con-man and his scams; the online porn industry; the impact of technology in the digital era.

Everyone it seems had an idea what the story was about and is either amazed or irritated that that doesn’t make the main focus. Guy Kewney saw the book as about NSI and the dangerous monopoly at the top of the Net. Max Cooter wished it was more about the history of the Net. A couple of the reviews have been disappointed it isn’t more about the porn industry. I did a Radio Five Live interview where the woman – Anita Anand – went off on a tangent about being the first person to recognise the value of domain names, and also liked the porn angle more than the others. Some reviews have complained there is too much US legal system; others that there is too little.

Interview

I have to say though my favourite interview so far was last night with BBC Radio Wales with Adam Walton. You can see him online here and listen again to the show here (at least for a week). The reason I liked this interview was because for the first time it didn’t feel like I was selling something. I wasn’t effectively in the position of having two minutes to tell people why they should buy my product. Instead it felt as if we were having a chat about something that I had decided to spend a few years of my life researching and writing because it was so fascinating. I much, much prefer that. Even if the sales were smaller as a result, give me conversation over sales pitches any day.

Anyway, I have a number of other interviews lined up this week – nearly all phone interviews, so we shall see if I can reconcile the two. I am looking forward to seeing how many books have actually been sold next week. Most bookstores in the UK have copies – but some only have two or three copies. I dread to think that people that would buy the book don’t bother because the store has sold out or they can’t find it in the store. Who knows?

Right, I have a lot of ICANN work to be getting on with…

This is the article that appeared in The Sunday Times on Sex.com today. As I mentioned earlier, the article appears under my byline but was entirely written by a writer the Times brought in. I’m interested to see what people think of the two versions I wrote and the one that’s appeared. I’ll do a poll, but feel free to stick comments on any of my posts.

I think the broad difference is that I was trying to tell the story, and the final piece has taken the tack about the Internet and domains. Perhaps my versions tried to do too much in a short space and so were too complex for easy comprehension. Anyway, the piece is in, there are a few minor mistakes in it, but then I have just been told it is linked to on the Drudge Report, so that has to be good. I only hope all this translates into people actually reading the book.

Oh, and I should say, Gary Kremen is over from the States for the book launch on Tuesday in Covent Garden. If people want to come along, please do, there’s still space for 30 or so people.

Sex.com and a web of intrigue

Two men’s battle over a domain name shows how far the net has come

In a few weeks’ time a thickset middle-aged man with a ready smile and the gift of the gab will walk into a courtroom in San Jose, capital of California’s “silicon valley” and try to plead poverty before the judge.

The lawyers he will be facing will not believe him, and with good reason: over the past decade Stephen Michael Cohen has made hundreds of millions of dollars as the self-styled king of internet porn, a business worth globally some $57 billion.

It is not the pornography that has landed Cohen in court, but the theft of something with no physical existence. That something was a website, more precisely a domain name that a geeky 31-year-old called Gary Kremen registered back in 1994 simply because he could: sex.com. It turned out to be worth a fortune. Except that it was Cohen who made the fortune, and for more than 10 years Kremen has been fighting to get it back.

The case has cost millions of dollars, involved a trashed mansion, a phantom gunfight between bounty hunters, forgery and disappearing bank accounts and forever altered the development of the internet. Kremen vs Cohen finally established that property in cyberspace can be at least as valuable as in the real world.

It seems like ancient history but it is barely a dozen years since the beginning of “the net” – when it was, in fact, scarcely a net at all, more a series of links between communications companies and university laboratories with computers.

The US military encouraged and developed these multiple links to ensure that in a nuclear strike, communications could be routed through one of many interlinked networks of computers.

This early net was an arid place of computer code with only a few bulletin boards and user groups featuring text, mostly in jargon. The idea that it would one day become a global mar-ketplace for music, movies and above all pornography was unimaginable.

Until, that is, a hyperintelligent nerd with a goatee beard, a degree in computer science and not much of a social life thought he might just have an idea.

Gary Kremen had mixed at Chi-cago and Stanford universities with the men who would go on to run Microsoft. He had built a career reselling software packages but he realised that one day people would advertise on the internet.

With remarkable prescience, in 1994 he set up a company to sell this new commodity: the online ad. Back then there were very few websites, and they were basically handed out free to anyone who asked. Nobody had yet figured out a way to make money from the internet. The answer, Kremen realised, was obvious. What would get people to look at online ads? In the same way old newspaper ads would read “SEX: now that I’ve got your attention . . .”

Kremen contacted Network Solutions and registered sex.com. It may have been free to set up, but he was about to make a very expensive mistake. He failed to set up the website.

So it was pure chance that on browsing the lists of domain names – as people like him did – one morning in September 1995 he discovered the registry for sex.com also included someone called Stephen Cohen.

Over the next four weeks – just as Network Solutions began charging for domains for the first time – all trace of his own connection to the domain name was disappearing. As Network Solutions started selling 10,000 dotcoms a month for $50 each, then 30,000 a month, then 100,000: overnight a billion-dollar industry was born.

Kremen was laughing, until he wondered why he wasn’t making more money from sex.com. His former colleagues had sold match.com for $8m. Slowly it dawned on Kremen that he no longer legally owned it. But the man who did was making a killing.

Cohen was 15 years older than Kremen, and no internet whiz-kid but a genius of a different kind. The child of a broken marriage in a wealthy Los Angeles Jewish family, Cohen flunked out of school and drifted into cheque-book fraud targeting shopkeepers.

On the side he took classes to learn the trades of private investigator and lawyer, not because he wanted to practise them but because he wanted to know the skills of the people he expected would soon be after him.

Obsessed with sex – he married five times while serially sleeping around – he set up a “swingers’ club” in conservative Orange County making $100,000 a year charging for membership. He had also set up a bulletin board called French Connection on this new internet, used by wife-swappers to arrange parties and exchange pornographic pictures.

When the web came along, Cohen too realised sex.com would be a good

thing. These were still the years BG – before Google – when people often typed whatever they were looking for into the address bar and followed it with the best-known suffix: .com.

When Kremen looked into what had happened to his domain he found it had become a membership site charging $25 a month. Banner adverts for other porn sites paid Cohen up to $45,000 a month. It was a licence to print money, on the back of which Cohen had acquired a San Diego mansion and a luxury lifestyle.

Cohen claimed to have had the sex.com “trademark” since 1979, even though the concept of .com was then unknown. In fact he had stolen it by forging a letter of renunciation from Online Classifieds, a separate company Kremen had used to register sex.com.

Kremen launched the most expensive battle in dotcom history: Cohen fought doggedly, obfuscating and prevaricating, forcing Kremen repeatedly to amend the charges against him.

Kremen had become rich through shares in booming dot.com startups. He sold out to pursue his case. The courts meanwhile argued whether a domain was really a property or just a “telephone number”, though they were now routinely changing hands for more than $3m. Cohen and Kremen had realised before the law that domains were the shopfronts for the biggest market the world had ever known.

In 2001, with virtually all his cash used up in the legal battle, Kremen finally won a judgment that awarded him $65m in damages. Cohen refused to pay, and fled to Mexico. He left Kremen with his mansion – an exclusive six-bedroom, eight-bath-room villa with a swimming pool – which he had trashed in spite, then spread the untrue story that Kremen had sent bounty hunters to bring him back. He finally turned himself in by accident in 2005 when he was arrested and handed over to US marshals when he attempted to renew his Mexican visa.

Kremen has sold sex.com for $12m but still owns sex.net and another 4,000 domain names. He still lives in Cohen’s house. With interest Cohen now owes Kremen $82m, but says he has nothing, and cannot explain where it has gone. “Follow the money,” may have been good advice in the 1970s; but in the tangled web of cyberspace, it’s no longer that easy.

Sex.com by Kieren McCarthy is published by Quercus, £12.99

The Times has done a review of Sex.com. Short and sweet:

“Sex.com
By Kieren McCarthy
Reviewed by Iain Finlayson

Civil law, not unreasonably regarded as a dry subject, is often rendered relevant by colourful cases. There is no more dramatic cause of dispute than money, unless it is sex — so the battle for the domain name sex.com had it all. The registered owner, Gary Kremen, alleged that Stephen Cohen, a conman and pornographer, had stolen this prime piece of internet real estate from him. McCarthy gives a fast-footed account of the trial and its upshot. “

You should read this blog post before you delve into this piece.

“The Internet? The Internet is for porn!” exclaimed one of the speakers last week [18 May 2007] as the Oxford Union debated the question “This House believes that the Internet is the greatest force for Democratisation in the World”.

Professor John Palfrey of Harvard University was speaking against the motion. And although his point was tongue-in-cheek he accurately reflected an enduring situation with real-world use of the Internet. The Internet is for many things, but one of the biggest is, undoubtedly, porn.

A quarter of all search-engine requests are for pornography, at least a fifth of adults online have accessed a porn site, and there are an estimated 400 million Web pages out there catering for the demand. The adult industry is worth $57 billion worldwide, and the United States –the world centre for pornography – claims $12 billion of it.

It is with some irony then that one of the men most associated with Internet pornography is due in court next month to explain where the millions of dollars he has made from the industry has gone. But as with most things in Stephen Michael Cohen’s life, nothing is as it first seems.

Most of the US porn industry is centered around Los Angeles and it was in the City of Angels that Stephen Cohen, a lifelong con-man who was to battle his way to the top of the online “adult industry” before being dragged unceremoniously from his throne, was raised and spent most of his life.

The man who was to be responsible for ruining him also lived in California – 300 miles north in San Francisco – but could not be more dissimilar. While Cohen left high school and a broken family with no qualifications and only his cunning to survive on, Kremen was a star pupil, the son of two teachers, who gained two degrees before taking an MBA course at Stanford and made a living in the emerging computer market, being one of the first few thousand people to use the precursor to the Internet, ARPAnet.

Cohen was 15 years old in 1963 when Kremen was born. By the time Kremen was 15, he was already on a determined life of crime, specialising in “paperhanging” or passing bad cheques, and charming his way in houses, bed and bank accounts with ready abandon. By the time Kremen was at college and playing around with computers, Cohen had become an expert in company law, was on his third wife, had been in court for running a sex club and was being sued for being one of the world’s first software pirates.

Cohen was intricately tied in with the Californian swinging scene and dreamed of making it big in the blossoming pornography market. Meanwhile, Gary Kremen was the least likely porn baron the world has ever seen, a shy computer engineer with a management degree who struggled to get a date. Even so it was Kremen and not Cohen that actually owned the Internet address that was making Cohen one million dollars a month.

Kremen had registered it when 99.9 percent of people had even heard of the Internet, in May 1994. Cohen had stolen it, ingenuously, in September 1995. It was the most valuable real estate that existed and still exists on the Internet today. It was sex.com.

As difficult as it may be to believe, it was only 12 years ago that those outside a small circle of academics, computer engineers and US generals first heard about the Internet.

The network had been built over 20 years by engineers working for the US Department of Defense’s advanced research department looking for a communication system able to survive nuclear attack. It then spread rapidly through universities, who marveled at how they were able to send papers to colleagues halfway across the world in seconds.

But it was, inevitably, money that brought the Internet to the rest of the world’s attention. On 14 September 1995, the company that had control of all “dotcoms” – Network Solutions – started selling domain names for $50 a year (previously they had been free). It had been registering around 10,000 a month for a few months, but suddenly it was selling 30,000 a month, and then a few months later, 100,000. From nowhere a billion-dollar industry had appeared – and all for addresses on an invisible computer network.

Just as inevitably it was the pornography industry that was the first to recognise the potential of this new network and start spending huge sums of money making sure that people were able to get hold of their wares from the comfort of their own homes. But since these were the days before Google, most people looking for pornography on the Internet simply typed in s.. e.. x.. .com and hit Return.

Stephen Cohen saw this immediately and just three days after Network Solutions started selling the domains, he had managed to manipulate the computer system used to register domain names, and then over the phone convince someone at the company that the change was correct. He walked away with the Internet’s Holy Grail, the most valuable real estate on the computer network – sex.com.

He then covered the website with ads for other porn sites and sat back as millions and millions flooded in. It provided him with the life he’d always dreamed of: rich, powerful, with a beautiful mansion in the hills outside San Diego, and a coterie of young, pneumatic women for his pleasure (although his fourth and fifth wives were not so keen on the last aspect).

For Gary Kremen, the theft of the domain gave him the fire for a fight. A fight that was to take him six years and millions of dollars to win but which remains unfinished even now as Stephen Cohen has failed to hand over one cent of the $65 million judgment against him. With so much at stake, the case took over both men’s lives and also sucked in those of their friends, families and employees.

For a while it also made the US legal system and the Internet itself sit up and take notice. Twice referred to the US Supreme Court and considered by the Court of Appeals no less than four times, the case ended with a ruling that will forever alter development of the Internet. It decided that the addresses on the Internet could be considered “convertible” property and that they could be stolen. Amazingly, before Kremen’s epic five-year court battle, the law considered “amazon.com” or “google.com” and even “sex.com” as little more than a telephone number, despite the fact that Kremen personally brokered the sale of “altavista.com” for $3.35 million. No one had ever paid $3 million for a telephone number.

It that fight wasn’t enough, it all happened in the period of temporary madness that we now call the “dotcom boom” where fortunes were made and lost faster than at any other time in history. Where a website that sold cheap flights was at one point valued at more than the entire US airline industry; where people would wake up to find they were billionaires and then discover a few months later they were bankrupt.

But even among all the extraordinary tales of the Internet, the fight for sex.com stands out. Like a modern-day retelling of the Trojan War with Gary Kremen’s Menelaus chasing the most beautiful woman (or, rather, website) in the world and laying siege to Cohen’s Paris, it was a long and bitter fight.

In June 2001, reports started to appear that Stephen Cohen was in fear of his life after two bounty hunters had come looking for him at his Tijuana home. A gunfight with the Mexican police had ensued. The bounty hunters were in pursuit of a $50,000 reward posted by Gary Kremen and which had featured in news media across the world.

What is all the more incredible is that the gunfight never happened. It was instead an extraordinary lie invented by Stephen Cohen to put Kremen on the backfoot and make the judge angry with him. The lie took months to unravel. Another of his lies, this time over how he actually stole the domain, took years and an entire court case centered on it to be revealed. Stephen Cohen, you see, is a con-man. A very, very good con-man.

When you hear him speak, it is easy to see how he has made a career from ripping people off. The lawyer that would finally win the case, a star attorney called James Wagstaffe, explained that one method he used during the case was to listen only to Cohen’s words and not to him. “If you listen to him, you believe what he has to say.” Such is the confidence of his delivery that even Gary Kremen confessed that the first time they actually met – over dinner in the middle of the case – “I almost believed it was me that had stolen sex.com from him.”

But despite Cohen’s extraordinary talents, Kremen’s ceaseless determination to beat him won out, but not before Kremen had stared ruin in the face, spending the very last chunk of money he had from cashing in shares that he hadn’t even paid the tax on. He also overcame a crippling drug addiction to crystal meth that had both helped him party and to lift free of the pressure of the battle over sex.com.

US court actions are extremely expensive, and Kremen couldn’t afford to start one. But civil war in the adult industry thanks to Cohen’s action provided Kremen with some early funds from Cohen’s rivals. That challenge fell apart, and was only saved at the last minute by Kremen’s canny investments in Internet start-ups that paid off handsomely during the dotcom boom.

The second challenge nearly collapsed as well, as Cohen had hired the best lawyers money could buy to destroy the case. But finally, the third charge saw Kremen handed Sex.com and then awarded $65 million. Except he never saw a cent of it. Instead, Cohen fled the country and moved all his money to offshore accounts, which Kremen is still chasing to this day.

What Kremen did get however was Cohen’s house: a mansion in the exclusive Rancho Santa Fe district of San Diego. Cohen couldn’t wire a six-bedroom, eight-bathroom mansion to a Swiss bank account and so, after months of vicious fighting, Kremen eventually won control of it. When Kremen turned up, he found a multi-million-dollar calling card: Cohen’s henchmen had completed destroyed his old home, including pulling out all the toilets and plumbing, wiring, carpets, even trees in the garden.

It took another four years from that point but eventually Kremen got him. Stephen Cohen was arrested just over the Mexican border in Tijuana while trying to renew his visa. He had been made a fugitive from justice four years earlier for failing to turn up in court, in direct violation of the judge orders. Kremen had only met Cohen once before, but a few weeks after Cohen’s arrest, he was in a small room facing him. Cohen made it clear he was unbowed: “In all the years you’ve been chasing me, you have never got a single asset in my name. And you never will.”

And despite another year in jail, during which time Kremen and his lawyers tore into every bank account and property trying to find where Cohen’s estimated hundreds of millions are kept, Cohen was right: they couldn’t find the money.

They’re still trying. And Stephen Cohen is still delaying, hoping that at some point they will give up. He is no longer in jail but he is due in courtroom eight at the end of June in the District Court of San Jose to explain where the money has gone. Kremen won’t be there. But his lawyers will.

Kieren McCarthy’s Sex.com details for the first time the extraordinary battle for sex.com. It is out on 21 May 2007. A supplementary website to the book can be found at http://www.sexdotcom.info.

To find out what on earth this is all about, please read this blog post.

“In all the years you’ve been chasing me, you have never got a single asset in my name. And you never will.”

That was how Stephen Michael Cohen made it plain to the man sitting opposite him – a man who had been on his trail for over a decade – that he would never admit defeat. The statement was all the more poignant given the fact that Cohen was wearing an orange jumpsuit, standard-issue to inmates at the Santa Clara correction facility. Even though he was in jail, with no date set for release, and the man he was addressing was his best route out of there, Cohen remained defiant.

Gary Kremen had been after Stephen Cohen since 18 October 1995 – the day Cohen stole his most valuable possession. He had fought him through the law courts, against the odds, and won a ground-breaking $65 million court judgment in April 2001. And then he had traced and chased him as he fled across the US border rather than pay up. Through Europe, across Asia and around the Middle East, Kremen pursued both the man and his money before Cohen was finally arrested in Mexican border town Tijuana on 27 October 2005. Ten years. Nearly a quarter of his life spent trying to capture a thief.

But it was no ordinary possession that Cohen had stolen. It was the most valuable piece of real estate that exists on the Internet – sex.com.

The value of those three letters, even in the age of Google, is enough for it to have fetched $12 million in January 2006. But back when Cohen stole the domain name in 1995, most people hadn’t even heard of the Internet. And when Kremen first registered it in May 1994, he didn’t even have to pay for it. So long as the name hadn’t already gone, it was yours for free. By 1999, it was a different story, and just being able to put up a webpage at sex.com was sufficient to bring in $1 million a month. Which is what Gary Kremen would have done had it not been stolen from under his nose by Cohen who used it to build an international business empire.

How do you steal a domain name worth millions? Well, the story has always been that Cohen forged a letter purportedly from Kremen’s company that stated it had fired Kremen and was handing over sex.com to one Stephen Cohen because he had prior trademark rights in the name.

That forged letter exists, but after years of investigative work it has been discovered that Cohen had already stolen the domain when he forged and then backdated the letter to cover his tracks (and make sure the real method by which he had stolen it wasn’t discovered). Stephen Michael Cohen, if you hadn’t already figured it out, is a con-man. A very, very good con-man.

In as far as you can draw up the characteristics of a man who is willing to lie and cheat for a living, to lead a life outside society, and deceive for personal gain at any opportunity, Stephen Cohen fits the bill exactly. Highly intelligent, but with poor schooling and no father figure, he tried to enter the establishment, failed, and then rejected it absolutely. The result was a tendency to slip into fantasy and a pathological desire to break society’s rules.

Horatio Bottomley, the flamboyant MP for Hackney South in the early 1900s, who started up the patriotic newspaper John Bull and then proceeded to cheat, swindle and con his way around the UK, lost both his parents at five, and created a fake and glorious ancestry for himself. The inspiration for Conan Doyle’s “Moriarty”, a man called Adam Worth, who stole the world’s most valuable painting (Gainsborough’s Duchess of Devonshire) in 1876, left home at 14, joined the army and posed as a member of the upper classes. Frank Abagnale, the con-man later immortalised by Leonardo di Caprio in Catch Me If You Can, came from a broken home, left it at 16 and spent the 1960s posing as everyone from airline pilots to doctors to sociology professors.

Stephen Cohen saw his family break apart when his father left their home in the Los Angeles suburb of Van Nuys to live with his secretary in exclusive Beverley Hills. Cohen left High School with poor grades, tried to become a lawyer and failed, but decided thereafter to pretend to be one. Over the subsequent course of his criminal career and five marriages, Cohen became a registered private investigator, a locksmith, a repossessor, a software pirate, strip-club owner, shrimp farmer, sex club operator and, eventually, the owner of the Internet’s Holy Grail – sex.com.

He started out ripping off stoned hippies during the Summer of Love, 1967, before moving onto cheque fraud, and then counterfeiting. But his particular genius rests in his understanding of US corporate law. When he discovered the ability to register companies and then declare bankruptcy, wiping out debts, he was unstoppable. The first company he registered was in mocking tribute to his mother’s frequent refrain when he was a teenager. It was called Ynata and stood for “You’ll Never Amount to Anything”.

There were two Ynatas, one in California and one in the British Virgin Islands – where he hid the tens of millions of dollars he made from running sex.com. There were also two companies called Omnitec. And three Sporting Houses. At some point, one of each of these companies was listed as the owner of sex.com. It is impossible to know which because Cohen simply jumbled around ownership of each company as it suited him – making one the subsidiary of another, “selling shares” in one to another, or drawing and redrawing the names of the directors of each.

It was into this world that Gary Kremen – a geek entrepreneur, a man with a computer science degree and an MBA from Stanford – walked, completely unawares.

Kremen noticed his name and email address had changed on the electronic ownership records for sex.com but initially dismissed it a glitch. When, a few weeks later, his address also disappeared, he contacted the company that ran all dotcoms, Network Solutions (NSI), and complained. It said it would investigate. The company then called Cohen, and Cohen called Kremen. Except Cohen claimed to be NSI’s head of investigations and told Kremen they had reviewed his case and found Cohen had legitimate rights in the name “sex.com” so they would not hand it back.

Kremen bought the story, at least for a few months. But it wasn’t until he got his hands on the forged letter that he realised the whole thing had been a clever, calculated con. NSI and Cohen left him with no choice but to sue, except he didn’t have any money, so he accepted a deal to hand over 51 percent of Sex.com to two big names in the adult industry in return for which they secretly funded his legal campaign.

That campaign floundered but was refreshed when the dotcom boom left Kremen personally with millions of dollars’ worth of shares which he cashed in and used to fund a series of new lawyers. It took years but he would eventually win in court. Although not before the case had nearly collapsed three times, and been up to Supreme Court and back twice.

The judge awarded him $65m. But despite hiring a slew of specialist investigators and lawyers, Cohen’s skills at hiding money were too good. Cohen then decided to skip the country, sparking a chase that would eventually result in a gunfight in Tijuana.

What Kremen did get however was Cohen’s house: a mansion in the exclusive Rancho Santa Fe district of San Diego. Cohen couldn’t wire a six-bedroom, eight-bathroom mansion to a Swiss bank account and so, after months of vicious fighting, Kremen eventually won control of it. When Kremen turned up, he found a multi-million-dollar calling card: Cohen’s henchmen had completed destroyed his old home, including pulling out all the toilets and plumbing, wiring, carpets, even trees in the garden.

It took another four years but eventually Kremen got him. Stephen Cohen was arrested while trying to renew his visa and transported over the border. Kremen had only met Cohen once before, but a few weeks after Cohen’s arrest, he was in a small room facing him. That was when Cohen told him he would never get a cent of the money.

And despite another year in jail, during which time Kremen and his lawyers tore into every bank account and property trying to find where Cohen’s estimated hundreds of millions are kept, Cohen was right: they couldn’t find the money. They’re still trying. Stephen Michael Cohen is no longer in jail but he is due in courtroom eight at the end of June in the District Court of San Jose to explain where it has gone. Kremen won’t be there. But his lawyers will.

Kieren McCarthy’s Sex.com details for the first time the extraordinary battle for sex.com. It is out on 21 May 2007. A supplementary website to the book can be found at http://www.sexdotcom.info.