Gary Kremen The Life Of Term Paper

Length: 15 pages Sources: 4 Subject: Business Type: Term Paper Paper: #20453031 Related Topics: Online Dating, Perseverance, Aerospace Engineering, Pornography
Excerpt from Term Paper :

The online classifieds advertising technology outsourcing company went on to become one of the most popular communities and networking sites on the Internet. "Gary founded the firm after identifying opportunities for online personals service, now branded Match.Com. He wrote the company business plan, then raised $1.3 million from venture capitalists and private investors, and later assisted in raising $7.5 million from leading corporate partners..." Kremen was also a founder of Los Altos Technologies, Inc. (LAT), a leader in UNIX security.

He has also become a leading and sought-after speaker on Internet marketing and development. More importantly and in terms of the history of, he is considered to be a leading authority on issues pertaining to intellectual property law and the Internet. Furthermore, he has invested in more than 50 companies.

4. The saga

The legal battle surrounding began on May 19, 1994, when Kremen registered the domain name with Network Solutions. One year later he discovered that his extremely valuable domain name had been fraudulently transferred to a known felon, Stephen Michael Cohen. Against legal and financial odds, Kremen sued to regain the domain and was eventually successful on 11/27/00.

The legal battle to regain was lengthy and intense and involved Kremen having to use various lawyers. He was eventually successful through the expertise of attorney Charles Carreon. (Kremen v. Cohen,2003).

In brief, Stephen Cohen fraudulently obtained the domain name by submitting fake transfer letters to the domain registrar Network Solutions, now owned by VeriSign.

He also forged of a signature to do this. Cohen in effect took advantage domain name registration process which was not as formal and controlled as it is today.

Cohen pretended to be authorized by Kremen to order Network Solutions to transfer the name of the registrant of the domain name over to his company. Cohen used a phony letter from a non-existent executive at Kremen's company, Online Classifieds, authorizing transfer of to Cohen. The letter was written and signed by a "Sharon Dimmick," identified as the president of Online Classifieds.

Cohen saw the potential for this domain name and using forged documents persuaded Network Solutions to transfer the name to him. "Network Solutions took the letter at face value and transferred the name to Cohen who proceeded to turn '' into a lucrative online porn empire."

Kremen therefore undertook legal steps to recover the domain name. However, this way to be an extremely difficult and time consuming task. At first Cohen claimed that he had obtained the domain legally from Online Classifieds. This was to result in a five-year legal battle, which was to place extreme strain, especially financially, on Kremen.

In 2000 Kremen was successful and "...Network Solutions was ordered to return the domain to Kremen and Cohen was ordered to pay $25 million into court."

Kremen also was to receive a further 40 million for lost earnings. The court ordered Cohen to hand over profits from his use of; invoking the constructive trust doctrine and California's "unfair competition." (Unfair competition statute TA Kremen v. Cohen, 45 Fed. Appx. 746, 2002 WL 2017073 (9th Cir. 2002).

This was by no mean the end of the ordeal for Kremen. Cohen found numerous ways of not paying the amount owing to Kremen. Among the methods that he used were the following. They included "....refusing to allow assessment of his business - providing false information or none at all, declaring most of his companies bankrupt and illegally moving assets out of U.S. jurisdiction." Cohen fled to Mexico but was eventually arrested by the authorities.

These events did not solve the issue of Kremen's outstanding payments and financial problems, as well as the loss of earnings. Consequently, Kremen began legal proceedings against Network Solutions for breach of contract and conversion.

However this claim was dismissed by the court in May 2000. The court's rejection was guided by the decision of the district court which held that rejection was based on the view that domain names were not subject to conversion because domain names were intangibles and were not merged into a document as required the Restatement (Second) of Torts. The court ruled that."..since the registration was free, Kremen had no contract with Network Solutions, and that the doctrine of conversion (dealing improperly with another's property) did not apply because domain names are not tangible property."

The district court granted summary judgment in favor of Network Solutions on all theory of conversion for transferring a domain name without authorization." (Kremen v. Cohen, 337 F.)

This was an extremely important decision for a number of reasons and set a precedent for later legal issues relating to online property and copyright infringements. In terms of Kremer's claim this meant that VeriSign could now be held liable to Kremen for improperly transferring the domain. The case was remanded to the trial court on this basis and in March 2004, "... VeriSign ended the legal action and paid Kremen an undisclosed sum, believed to be around $20 million."

It should be noted that the case was eventually won and decided on the grounds of conversion and the right of property. The other aspects that Kremen had presented as part of his claim against Network Solutions were thrown out by the court. These comprised the following arguments.

A that the transfer violated Network Solution's cooperative agreement with the National Science Foundation - the government contract that made Network Solutions the '.com' registrar; that he had a property right in the doman name and that Network Solutions was guilty of conversion and... that Network Solutions was a 'bailee' of his domain name and liable for 'conversion by bailee'.

The Appellate court had agreed with the district court that the contract claims made by Kremen against Network Solutions were without merit. " Kremen had argued that although NSI had no written contract with him, his registration of the domain nonetheless created an implied contract. The 9th Circuit rejected this theory, because NSI received no consideration in exchange for registering Kremen's domain name."

It was however on the grounds of conversion alone that Kremer's actions against Network Solutions were successful. " the Court of Appeals overruled the decision of the District Court, but only in relation to the claim based on conversion."

In the process Kremen has incurred "...$5 million in legal fees, a mountain of money that included not only his last dollar at one point, but the last dollars of investors who had agreed to help bankroll the litigation in return for a share of if and when it was ever recovered. "

The importance of the decision by the Court of Appeals in overruling the previous decision was that it established the status of intangible property in the law. There was also the clarification of the U.S. Restatement (Second) of Torts; which stated that tangible property should be represented or "merged" in a document. This was adjusted in the case of Kemen's appeal.

The Court indicated that had it been necessary to do so, it would have found that conversion applies to every species of personal property, without any 'merger' requirement. However, in this case, there was a relevant document: the Domain Name System, or DNS - the distributed electronic database that associates domain names like with particular computers connected to the Internet.

Consequently, an outcome of the court decision was that,."..the regulation of domain names might be more appropriately done by statute."

In summary the entire case turned around the issue of what determined property in legal sense and whether "...a domain name is a species of "property" susceptible to conversion."

Judge Kozinski, of the 9th Circuit agreed "...that domain names are such a species." He also stated that "...intangible property could be subject to conversion and that no association with a tangible document was necessary.

Kremen v. Cohen, 9th Cir., Kremen v. Cohen, 9th Cir., No. 01-15899).

5. Conclusion

The significance of the case is evident from the above discussion. It not only clarified the issue of intangible property but also showed another possibly even more important aspect. This aspect is related to the character and life of Gary Kremen. The determination and persistence with which Kremen pursued his legal and just right to the domain name has served as an inspiration to many online entrepreneurs.

On the other hand the saga of…

Sources Used in Documents:


About Gary Kremen. 8 February, 2007.

Be Careful what You Wish for: The Continuing Saga of Gary Kremen and 7 February, 2007.

Dixon R. To Fight Domain Name Theft: Gives Birth to a New Property Right. 2004. 8 February, 2007.

Gary Kremen. 8 February, 2007.

Cite this Document:

"Gary Kremen The Life Of" (2007, February 11) Retrieved July 28, 2021, from

"Gary Kremen The Life Of" 11 February 2007. Web.28 July. 2021. <>

"Gary Kremen The Life Of", 11 February 2007, Accessed.28 July. 2021,

Related Documents
Eminent Domain According to the
Words: 721 Length: 2 Pages Topic: Urban Studies Paper #: 31832130

In this case, "the government must prove that it tried to negotiate the sale and that the takeover is for public use. If the government wins, an appraiser establishes fair market value and the property owner is paid and evicted," (Bryant n.d.). In cases like KELO et al. v. CITY of NEW LONDON et al., the property owner refused to sell and the matter went to court. In most

Eminent Domain Rulings Are Frequently
Words: 1368 Length: 4 Pages Topic: Urban Studies Paper #: 12584344

.." Bright 83) The utilization of eminent domain has been used to evict individuals to build malls, concentrated housing projects for both the poor and the affluent, and business parks, all of which presumably have higher property tax bases and therefore better serve the community where they are built than the homes that were there previously. Having recently received a grant award, in the amount of 500,000 from the ACLU, Homeowners' Freedom, a

Eminent Domain Is One of
Words: 2083 Length: 7 Pages Topic: Business - Law Paper #: 92556333

(4) Bell and Parchomovsky 871) This having been said the demand should rest on the public entity to not only prove the public purpose of the eminent domain ruling but also to fairly compensate the owner(s) with regard not only to market value but based on other interests as well. A takings law permits undercompensation whenever the reserve value of the property owner exceeds market price. Second, many important compensation doctrines require

Eminent Domain
Words: 3670 Length: 10 Pages Topic: Business - Law Paper #: 32667984

Kelo v. New London and Eminent Domain When the United States Supreme Court heard oral arguments in the case of Kelo v. City of New London, Connecticut in February of 2005, the issue legally speaking was a seemingly straightforward matter of Fifth Amendment jurisprudence. What was at stake as a point of Constitutional law was the last clause of the Fifth Amendment, generally referred to as the "takings clause." The actual

Kelo Eminent Domain: Was the
Words: 2707 Length: 10 Pages Topic: Business - Law Paper #: 25638610

" The public outcry against the Kelo decision confirms that citizens simply do not trust the government when it comes to their personal property. Definitions and Meanings Justice Sandra Day O'Connor strongly opposed the majority decision (Urbigkit, 2006). She wrote, "Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with

Land Use and Eminent Domain
Words: 681 Length: 2 Pages Topic: Family and Marriage Paper #: 16479886

land use and economic development. There is a hypothetical land parcel near freeway on- and off-ramps, several acres in size, owned by the Smith family, on which developers plan to build a casino. Citizen Opposition There will be significant opposition to building a casino by a small group of vocal and highly visible opponents. Many of the opponents will be affiliated with churches, and possibly environmentalist and social activist organizations as