From: "Kathee Brewer" <[EMAIL PROTECTED]> To: "Gaylor Matthew" <[EMAIL PROTECTED]> Subject: The plot sickens Date: Tue, 12 Feb 2002 20:50:05 -0800
Continuing strife in the Sex.tv Ltd./.tv Corp. feud, including allegations of fraud, deceptive business practices and cybersquatting. Sex.tv is seeking other .tv domain owners to join the suit, and says it already has several others waiting to do so; a Website has been established for information and contact. As I'm sure you know, The .tv Corporation was bought by Verisign in January. It'll be interesting to see how Verisign responds to this, as another of its subsidiaries, Network Solutions, has been sued by sex.com. Sex.com also alleges fraud, as well as negligence, in the affair that transferred sex.com to an imposter several years ago. The domain was returned to the real owner, San Francisco businessman Gary Kremen, last year in a decision that also ordered the usurper to pay several million dollars in damages. The usurper now claims poverty and an inability to pay the judgment, and he's asked the court to release him from the obligation (no one's sure where the estimated $40 million he made from the Website while he had it went). <http://www.avnonline.com/issues/200202/newsarchive/021202_lead.shtml> Sex.tv Sues .tv Corporation By Kathee Brewer Feb. 12, 2002 LOS ANGELES - <http://www.sex.tv/>Sex.tv disappeared from the Web on Monday, hours after its parent company, Sex.tv Ltd., filed suit against registrar <http://www.tv/>The .tv Corporation in U.S. District Court. The lawsuit alleges fraud, cybersquatting, and deceptive business practices under California and federal statutes. It also seeks to have the court place the domain Sex.tv and the $688,000 paid by Sex.tv Ltd. to The .tv Corporation for domain registration fees in a "constructive trust" pending further action. "Basically, we're saying The .tv Corporation made false statements in order to sell things," said Charles Carreon, attorney for Sex.tv Ltd., a British corporation. "They sold domain names with an implied warranty of merchantability; they represented them as functional when they had no functional IP addresses. They swindled my client and hundreds of thousands of .tv domain name registrants by selling them overpriced domain names that did not work. We are asking the court to order � The .tv Corporation to cough up what it obtained through fraud, deception, and unfair business practices in violation of California law." According to a prepared statement released by Sex.tv Ltd., the company "is suing on behalf of all domain name purchasers, and includes in its complaints claims for cybersquatting, alleging that The .tv Corporation engaged in a 'protection racket' to register trademarks and 'ransom them back' to trademark owners for inflated prices." The .tv Corporation prices domain names according to "desirability." According to a statement at the registrar's Website, "Most .tv Web addresses can be registered for $50/year. 'Premium' .tv Web addresses are common words and phrases and 1-, 2- and 3-character names. They can be registered at variable prices above $50/year." Recent registrations include drugstore.tv at $500,000, casino.tv at $250,000, and gay.tv and free.tv at $100,000 apiece. Business.tv, movies.tv, news.tv, and sports.tv are available for $1 million each. Sex.tv Ltd. and The .tv Corporation have been at odds over implied and written contractual obligations at least since mid-December, when Sex.tv Ltd. President Fintan O'Rourke received an email message from The .tv Corporation Senior Director of Sales David J. Rosenbaum. In the email, dated 10 days before payment of the domain's second-year registration fee of $325,000 was due, Rosenbaum queried O'Rourke about his plans for the domain name, asking, "Are you planning to make full payment in time? Are you planning to breach the contract? I have someone else that wants the name, who can send money to arrive next week." At the time, Sex.tv Ltd. principals called the email extortive and surprising, as they had not given The .tv Corporation any reason to doubt payment for the domain registration would be forthcoming. Carreon said he has been corresponding with officials of and attorneys for The .tv Corporation since then in an effort to resolve disputes over cooperative advertising, registration fees, and what he and O'Rourke said were fraudulent promises of traffic volume. Amid the negotiations, The .tv Corporation served notice of its intention to revoke the contract with Sex.tv Ltd. to O'Rourke via fax. That was on Jan. 11. Thirty days later, as allowed in the contract, it pulled the DNS registration of the Sex.tv Website on the same day the lawsuit was filed, after Carreon and O'Rourke decided negotiations had reached an impasse and withheld payment of the registration fee. On the same day, a notice appeared on a Web page to which the Sex.tv domain was redirected, stating the domain was for sale at a price of $1 million per year. "I told [The .tv Corporation's attorney] on Thursday that the suit would be filed on Monday," Carreon said. "I received confirmation of the filing around noon on Monday, and at about 2:30 Fintan called me to tell me that the domain had been turned off." O'Rourke said, "We refused to make payment because of [The .tv Corporation's] misrepresentations. We would have no problems making a payment for a domain name and a contract that was everything it should be, but this one hasn't been, and we're not prepared to pay for this domain until they perform the things they promised us." Chief among the breached promises, according to O'Rourke, was that Sex.tv garnered 25 percent of all traffic entering domains within The .tv Corporation's realm, or 625,000 hits per month. "That kind of traffic would have represented about $1 million a year in revenues for us," O'Rourke said, but in actuality, "we have achieved no more than two or three hundred hits per day." Another complaint involves the functionality of the domain, especially in Europe. Carreon said technical difficulties within The .tv Corporation prevented Sex.tv from being reached via the World Wide Web at least until April 2001, even though Sex.tv Ltd. purchased the domain in December 2000 and did everything in its power to make it live immediately. O'Rourke and Carreon said they are convinced that Sex.tv Ltd. is not the only company to suffer at the hands of The .tv Corporation. They expect other parties to join Sex.tv Ltd.'s lawsuit within weeks. A Website has been established at <http://www.suingdottv.com/> to provide information about the suit and facilitate contact for those who might wish to join. "[The .tv Corporation has] clearly defrauded may hundreds of thousands of people throughout the world," O'Rourke said, noting that he has spoken with other .tv domain owners who are as disgruntled as he is with The .tv Corporation. "No matter how much [a registrant] has spent, .tv has an obligation to perform, and we want this suit to convince them of that." Carreon and O'Rourke said Sex.tv Ltd. views the domain shutdown as retaliation for the lawsuit. "The .tv Corporation has been in bad faith since the beginning, and this latest turn is their usual M.O.," Carreon said. ".tv should do the right thing now that they have Verisign behind them and pay some bills." Verisign bought The .tv Corporation in January for $35 million. Lynn Thai, marketing director for The .tv Corporation, said the company had "no comment" about Sex.tv or the lawsuit. Kathee Brewer Technology Editor AVN Online/TCI 9414 Eton Ave. Chatsworth, CA 91311 Voice: (409) 765-0172 Fax: (818) 718-5799 E-mail: <mailto:[EMAIL PROTECTED]> URL: <http://www.avnonline.com/> ______________________________________________________ AVNOnline.com: Daily news and resources are just a click away. ************************************************************************** Subscribe to Freematt's Alerts: Pro-Individual Rights Issues Send a blank message to: [EMAIL PROTECTED] with the words subscribe FA on the subject line. List is private and moderated (7-30 messages per week) Matthew Gaylor, (614) 313-5722 ICQ: 106212065 Archived at http://groups.yahoo.com/group/fa/ **************************************************************************
