The lowdown on the Sex.com case

I have gathered a lot more information on what has happened with the Sex.com case, with Stephen Cohen released, and the attempted assassination attempt on his Mexican lawyer.

The big question is whether Cohen will turn up to court in February, as he has been ordered to. There is absolutely no way in hell he will supply any details of his bank accounts – or, at least, any bank accounts with any money in. Maybe he will be super-smart and allow one account of his to be “found” with $1 million in and then walk away from the whole Sex.com mess. But having followed Cohen for a few years now, I would say that was so unlikely as to be barely worth mentioning.

I have tried to speak to Cohen’s new new lawyer, who is of course called “Steve” – old habits die hard for Steve Cohen – but he’s been out the office all day. I have spoken to Kremen’s lawyer though. He’s not sure whether Cohen will turn up in February either. Cohen is capable of almost anything that occurs to him.

I would say it was a certainty that he will turn up to court in February and try to talk his way out of it – that’s what he has always done in the past and he desperately wants to walk out the court a free man and smirk at Kremen on the way out. But I wonder if Cohen has learnt his lesson and if he’ll let it go – just fade away safe in the knowledge that he beat Kremen and never handed over any money.

The biggest wrench will be Tijuana. But is there anything keeping Cohen in Tijuana anymore? His ex-wife doesn’t like or trust him anymore, his friends have grassed him up, his lawyer has tried to steal his money, where does Stephen Michael Cohen go from here?

He has from now until 26 February to figure it out. I wonder what he’ll come up with.

Anyway, I’ve done a story for The Register about it. I’ll post it below because the story may not be up until Monday.

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Sex.com thief released from prison

And his Mexican lawyer shot the next day.

Kieren McCarthy

In yet another twist in the extraordinary tale of Sex.com, the con-man who stole the world’s most valuable domain has been released from jail – in order to locate the millions of dollars he owes the original owner.

Stephen Michael Cohen has been ordered to hand Gary Kremen $65 million by a US court but despite years of intense fighting has yet to hand over one cent. On Tuesday morning, after 14 months in jail for civil contempt, Cohen was released by Judge James Ware because Kremen’s lawyers had been unable to chase down his offshore bank accounts.

Cohen claims he is only able to get the details of his various accounts – held in Lithuania, Liechtenstein and the Isle of Man – in person and outside jail, and is due back in court in San Jose on 26 February to tell the judge how that search has gone.

But in a chilling turn of events, one of the few people with access to Cohen’s estimated countless millions, Mexican lawyer Gustavo Cortés Carvajal, known locally as El Sapo or “The Toad”, was the target of an assassination attempt in Tijuana at 5pm on the day of Cohen’s release.

Cortes was in a Mercedes van being driven by fellow lawyer Jose Luis Alamillo, when it was blocked in by two trucks in central Tijuana. Alamillo managed to break free and, chased by the trucks, get to the local police station but had been shot several times in his left flank during the attack. A four-year-old boy in a car at the scene when the shooting broke out was shot in the head and is an unknown state, while Cortes himself escaped unharmed.

There is nothing to link Cohen to Cortes’ attempted murder but suspicion is running high, especially since Cortes is widely rumoured to have taken nearly half of a $1 million ransom out of Cohen’s accounts when he was kidnapped earlier this year. Cortes may also have been the secret informer who offered to provide access to all Cohen’s accounts to Kremen’s legal team in return for a 10 percent cut.

The news is just the latest revelation in an extraordinary case that started on 17 October 1995 when Stephen Cohen managed to hack the computer system used to store all dotcom registrant details and change ownership of Sex.com into his name. Cohen later covered his tracks by forging a letter, purportedly from Kremen’s company, handing over the domain in recognition of non-existent trademark rights Cohen had in the name “sex.com”.

That theft was the start of an epic legal battle that finally ended in April 2001 with Kremen was handed back the domain and awarded $65 million: $40 million covering the money Cohen had made from the prestigious domain in the intervening six years, and $25 million as punitive damages.

But rather than pay, Cohen fled across the Mexican border and remained a fugitive from justice for four years until he was finally arrested on 27 October 2005 in Tijuana and transported the short distance across the border. Despite dozens of hours of subsequent interviews in jail, Cohen has failed to provide a single piece of information that has led to the discovery of any of his money.

Following a long series of court appearances, Judge Ware felt his hands were tied by the civil contempt laws and said he had no option but to release Cohen. “Cohen has been incarcerated for more than one year,” read Ware’s ruling, “during which time Kremen has failed to locate evidence of hidden bank accounts or other assets. Under these circumstances, the only purpose of Cohen’s continued incarceration would be punitive – an impermissible purpose for civil contempt sanctions.”

Kremen and his lawyers are uncertain whether Cohen will turn up at all on 26 February. If he doesn’t he will be held in contempt of court and another order for his arrest will be issued. But Cohen has adequately demonstrated he is more than capable of staying out of the law’s clutches. But it is very possible that Cohen will make the date because if he turns up and persuades Judge Ware he is unable to find any information on his bank accounts, Ware would have little choice but to free him from his contempt order, leaving Cohen free to do as he wishes.

That possibility is very likely to appeal to Cohen thanks to the extraordinarily personal battle between himself and Kremen (Kremen currently lives in Cohen’s old mansion in the exclusive San Diego neighbourhood of Rancho Santa Fe). If Cohen has the contempt lifted, he will have succeeded in thwarting Kremen and his army of lawyers and investigators.

But at the same time, Kremen remains absolutely determined to extract some form of concession out of his nemesis and his lawyers are already working on a range of tactics to have Cohen re-arrested in February if he doesn’t supply real details of existing bank accounts – something that is an absolute certainty. The extraordinary battle of wills and the the game of gambles that the two men have been playing for over a decade may well be on its final hand.

Kieren McCarthy has written a book about the brutal battle for Sex.com, to be published in May 2007. More information can be found at www.sexdotcom.info.

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