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23 Jun 2007
I recently came across a copy of a ruling in the bizarre case of MySpace vs. theglobe.com. Theglobe.com was the ultimate dot.com bubble company. It started up here in Ithaca, and went public at the peak of dot.com hysteria with one of the the greatest one-day price runups ever. Since then they bought and sold a variety of busineses, none of which ever made any money, including the Voiceglo VoIP service which appears to be what the spam was promoting.
In January 2006, theglobe.com set up over 95 dummy MySpace accounts, using throw-away e-mail addresses from free webmail providers, and then sent out about 400,000 automated spams to other MySpace members. After a month, MySpace sent them a cease and desist letter, so they stopped for a while, but then resumed spamming through May. I cannot begin to fathom how they thought that sending internal MySpace spam was a good idea, or how they thought they could get away with it. As I noted in another blog entry, theglobe has since shut down Voiceglo, and settled the case by paying MySpace all the money they had, about $2.5 million. At this point theglobe's only remaing line of business is the .TRAVEL domain, and only infusions of cash from the company president are keeping it afloat.
Due to the unusual facts of this case, it raises some interesting issues. Theglobe argued that MySpace isn't an ISP as required to apply CAN SPAM, and internal MySpace messages aren't the e-mail that CAN SPAM regulates. The judge disposed of those arguments in a few paragraphs, noting that the law's definition of "internet access provider" is quite broad, and that since MySpace lets you send messages from one named user to another, that's e-mail and CAN SPAM applies.
Another part of the decision related to MySpace's terms of service, which include a $50 charge per spam. The court found that enforcable, too, over strenuous objections from theglobe. This isn't particularly relevant to normal e-mail, which doesn't have any prior agreement between the parties, but should be good news for instant messaging systems. (The ruling is likely only to be persuasive in the Central District of California, but since that happens to be where Yahoo and Hotmail are, it could be pretty persuasive.) Even though the court agreed that there were open issues relating to how deceptive some of the subject lines were, fifty bucks per spam adds up rather quickly, and it's no wonder that theglobe settled.
After a couple of recent losses in the weak Mumma and Gordon CAN SPAM cases, it's somewhat reassuring to see that in a case with strong facts, the court had no problem finding that CAN SPAM applied and that a spammer had violated it.
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