One point for email marketing. And another against litigation factories. In a ruling by a Ninth Circuit federal appellate three-judge panel last week, the court dismissed a suit filed against an email marketing company for sending an alleged 13,000+ unsolicited emails to the plaintiff-- who himself happened to be a 'professional plaintiff' who profited from filing anti-spam lawsuits against online marketers.
The Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM) of 2003 sets forth requirements regarding who can send commercial email and establishes penalties for spammers and companies whose products are advertised if they violate the law, and gives individuals the right to opt out of email spam lists. The recent ruling took a little bite out of CAN-SPAM's ability to regulate internet marketing and opened the door for companies to sidestep the act's strict provisions. The court held that CAN-SPAM does not enable individuals to file lawsuits against internet marketers, but instead reserves the right to sue specifically for private parties. It also prevented the claims from being tried under Washington state law, holding that the federal law preempted the state version.
The panel was not amused by the fact that plaintiff James Gordon signed up for 100-150 email lists in 2003 and then proceeded to threaten and sue the companies for violating state and federal anti-spam laws for sending him email. "Gordan has created a cottage industry where he and his 'clients' set themselves up to profit from litigation. The CAN-SPAM Act was enacted to protect individuals and legimitate businesses..not to support a litigation mill for entrepreneurs like Gordon," the court stated in its released opinion.
Perhaps the Court did a lesser-of-two-evils accounting and litigation factories came up with the short straw. Though the ruling sends a clear message to would-be career plaintiffs to dissuade them from pursuing litigation-for-profit schemes; it also open the door open--or the can--for protecting email marketers from CAN-SPAM regulations.
- Email Marketer Wins Spam Lawsuit (Online Media Daily)
- An End to Spam Litigation Factories? (Gordon v. Virtumundo) (CircleID)
- Gordon v. Virtumundo, Inc. (FindLaw)
- The CAN-SPAM Act: Requirements for Commercial Emailers (Federal Trade Commission)
- Internet Class Actions (provided by Erik S Syverson Attorney at Law)