Seattle Vice

By the turn of the twenty-first century, Frank Colacurcio’s downsized nudie dancing empire faced stiff opposition from a growing phenom called the Internet—and in particular from someone who grew up in Microsoft’s neighborhood, near Frank’s old “ghost farm.” Young computer geek Seth Warshavsky came out of suburban Bellevue and quickly levitated to multimillion-dollar success as Seattle’s and one of America’s foremost online pornographers. Depending on who was characterizing him, he was either a genius, a misogynist, a respected global businessman, an exploiter of children, the Bill Gates of porn, or the Larry Flynt of cyberspace. He was one of the few Web entrepreneurs of any kind to turn a profit. Or so it seemed.

In his early twenties, he had already been sued by the Pope and Pamela Anderson Lee, caused a riled-up competitor to spit in his face, and was arrested for choking his former girlfriend during a limo ride in Las Vegas (he claimed he was trying to keep her from jumping out). He was promising to take his fast-rising adult-entertainment company public and had even appeared before Congress to discuss online sex (he was for it). His eclectic mix of Web sites offered casino betting, psychic advice, housing loans, and sex-change operations—such as turning a male Florida government worker into a woman named Julie by removing his/her penis.

Warshavsky was gearing up to sell art and music over the Net and awaiting the arrival of higher-speed, TV-quality video on the home computer to transmit picture-perfect sex live from Seattle. His intent was to surpass the lower-quality sex acts he was already transmitting from his Pioneer Square studio—“free” to paid members—supposedly a hundred thousand of them paying $25 a month or $175 a year. Amid a jumble of beds, stages, showers, and video cameras, men and women earned all of $20 an hour in the converted warehouse performing what began as strip dancing in 1996 and evolved into live sex: alone, with objects, or with each other. On the loft’s stages, thirty-five technicians, directors, and young performers would become locked in dramatic productions of masturbation and intercourse—simulated in the sense that there was no apparent ejaculation or penetration. Many of the performers—some of them onetime local nude club dancers and their boyfriends—undressed and rolled about, semi-banging away for hours on end as directors in a booth guided the joysticks of remote cameras, part of what Warshavsky claimed was $3 million worth of push-video and state-of-the-art graphics systems.

Warshavsky claimed his revenues topped $50 million a year, and he was planning to take his company, Internet Entertainment Group, public with a forthcoming stock offering. He tried to dress things up a bit, calling himself an “adult content provider” rather than “porn king” or “smut merchant.” That was also why he, for the moment, was keeping his live sex mostly soft-core. “We’re pretty conservative when it comes to explicitness,” he said.

Masturbation, on the other hand, along with another byproduct, publicity, were his specialties. Warshavsky said he personally didn’t spank the monkey, what with all these women available to him, but he certainly hoped his customers did. He instead relentlessly pounded the publicity-mongering machinery, scoring PR points while occasionally sounding like a tin-horn Hugh Hefner. He delighted in picking on Hollywood targets sure to gain him some ink, such as Pamela Anderson Lee and then-estranged hubby, Tommy Lee. He staved off all their court attempts to stop his site from showing and selling their infamous honeymoon sex video. He similarly battled Poison singer Bret Michaels, whose video of him and Anderson having sex was on Warshavsky’s future playlist. Radio shrink Dr. Laura Schlessinger likewise failed in her attempt to force the removal of a dozen embarrassing naked still photos taken two decades earlier (and sold for $50,000 to Warshavsky) by her ex-lover. Actor Kelsey Grammer filed a lawsuit when he thought Warshavsky had possession of a homemade video of the onetime Frasier star making love, but four days later dropped the suit “like a red-hot crack pipe,” said a gleeful Warshavsky, in reference to Grammer’s admitted drug use.

Warshavsky also offered any member of Congress a discount at a whorehouse in Nevada. It was done so in gratitude, he said, after being called before a congressional hearing in 1999 to testify on proposed Internet adult-content regulations. He suggested creation of a secure zone in cyberspace with “dot.adult” addresses, figuring it could be blocked from children’s access by a V-chip. Legislators seemed impressed, but it was also a sly business move by Warshavsky intended to keep critics at bay.

The Pope was his best score, however. Warshavsky linked his sex site to another that was covering Pope John Paul II’s 2000 visit to St. Louis. To make sure Catholics were properly horrified, Warshavsky padded his site with accounts of papal sex scandals and dirty religious jokes. In a suit by the church that delighted Warshavsky no end, a federal judge in St. Louis ordered that he sever his link to the Pope coverage. “The Pope and I share many of the same interests,” Warshavsky snickered in a publicity release. “Sex is what drives our business and sex is a main concern of the Pope.”

What drove Warshavsky to appoint himself as America’s dirty-sex laureate? He was a Bellevue High dropout who later got his GED off campus, he recalled in his nasally monotone, offering a vaguely toothy smile. Short and spare, he looked the mischievous kid sitting behind his oversize desk in a skyscraper near Pike Place Market—except that this kid turned his first million before he turned twenty-one. By nineteen—the same age as Bill Gates when he began to assemble Microsoft—Warshavsky discovered the easy money available from phone sex. Borrowing $7,000, he and a partner launched 1-800-GET SOME. He hired frothy-voiced, but not necessarily attractive, women to talk men into a lather and, finally, a climax. The venture grew from crude beginnings to a worldwide operation that, Warshavsky said, grossed $60 million in just a few years. By age twenty-two, he saw the future and it was still phone sex, but with pictures. Pirating a streaming-video sex site idea from a Canadian online pioneer, he launched Candyland.com, his original online porn site, in January 1996, changing the name to Clublove.com after toy maker Hasbro sued for name infringement on its Candy Land board game. By 2000 his expanded operations netted $15 million annually, he claimed, earning him mostly bemused admiration. Wired magazine called him “the Bob Guccione of the 1990s,” comparing him with the sometimes unctuous Penthouse publisher. The Wall Street Journal said he was a “scrubbed and apple-cheeked ... seasoned Web publisher.” Adweek found him to be a “freckle-faced, clean-cut Gen-Xer who recently bought a boat and likes water-skiing, but says he is bored when not working.” ABCNews.com quoted him as saying, “My mother’s proud of me.”

Missing from most Warshavsky profiles was any mention of what helped make Mrs. W’s son rich—jerking off. Without that vast market of self-abuse, Warshavsky might have remained the clothing salesman he once was. His aggressive business tactics also ticked off competitors, among them Joseph Kahwaty of iBroadcast, a Seattle pornographic video-feed supplier. Warshavsky obtained a restraining order against Kahwaty after he allegedly spit in Warshavsky’s face and challenged him to fight outside a Pioneer Square bar (Kahwaty posted details of the near-fisticuffs battle on the Internet, writing: “I spit in the little pussy’s face ...”). Warshavsky later sued Kahwaty for $1 million, claiming assault and defamation, then dropped the suit.

But lawsuits, it turned out, were perhaps the greatest byproduct of Warshavsky’s rise and fall in a short decade. He continued to get good national press. But in the courtrooms, another story was being told: a parade of creditors were after him to pay his bills; he wasn’t making anything like the money he claimed to be earning; and his half-a-million-dollar First Avenue condo suddenly went up for a forced sale. There were more than a dozen lawsuits involving creditors, suppliers, and ex-employees, debts and bounced checks. Unico Properties of Seattle, for one, said his monthly office rent check for $5,000 not only bounced, but that Warshavsky would not respond to a demand to make it good, and Unico was awarded a default judgment. He paid it only after a bench warrant was issued for his arrest.

By 2002 he had bailed from Seattle, for almost-as-far-away-as-you-can-get Thailand. His luxury condo was publicly auctioned off after he defaulted on an $845,000 promissory note, and he had transferred what was left of his debt-ridden sex business to a California corporation that continued to operate the Web sites. Then it got bad. According to a court deposition, an Internet Entertainment Group official was unable to come up with company financial statements in a recent collection case “because all the documents had been subpoenaed by the federal grand jury.” The official said that “Mr. Warshavsky was personally under criminal investigation.”

It turned out that, rather than building a sex empire, Warshavsky was building debt, stiffing customers, and hiding from process servers. From tits out to tits up, he had assembled a debt estimated at half a million dollars. He battled creditors for years thereafter with the help of his attorney, Gil Levy—who, coincidentally, happened to be the longtime attorney for Frank Colacurcio.