Judge Denies Motion to Dismiss Sex.com Bankruptcy Filing

WOODLAND HILLS, Calif. — A bankruptcy judge has denied DOM’s motion to dismiss an involuntary bankruptcy petition against Sex.com

DOM Partners LLC is a New Jersey lender that says it loaned more than $4 million dollars to fund operations for Sex.com. DOM wanted to dismiss the bankruptcy petition so it could resume a foreclosure auction and recover its debt.

A Sex.com auction was put on hold in March after three other creditors, Washington Technology Associates (WTA), iEntertainment Inc and AccountingMatters.com filed the bankruptcy petition.

According to court papers, “it does not appear that the petitioning creditors are seeking to take disproportionate advantage of DOM or any other creditors. In fact, WTA and DOM would have been paid the same percentage of the auction proceeds. It does not appear that the petitioning creditors filed the petition in bad faith."

The judge also set a hearing for next week to determine whether to appoint a chapter 11 trustee who will decide on how to sell the asset and if this company is able to operate and make business decisions.

The documents say, “this may be a preferable course of action in light of the impending gridlock that has prevented Escom from meeting its obligations and resolving the issue on how to best liquidate the domain name.”