ISPs get upset when someone causes an e-mail traffic jam, and they've been known to close down accounts or even sue.
Spam was born in the early '90s, when the internet was the province of a small, polite community that took great pains to protect their lines of communication. Sanford Wallace and his company, CyberPromotions, broke the taboo. He signed on a bunch of clients with products to sell, dredged up a slew of addresses and blasted out marketing e-mail.
Ultimately, the company was hit with 13 lawsuits from ISPs angered by the traffic problems Wallace caused and the ill will he inspired in their customers. The company spent 1995 through 1998 in litigation, with at least three cases pending at any one time. Eight of the lawsuits resulted in expensive judgments against CyberPromotions, including one for $2 million; the combined damages were so costly that the company was effectively forced out of business.
Wallace claims the lawsuits were the best thing that ever happened to him, or the Internet. By acting as the fall guy, he says, he helped the nation figure out what constitutes ethical e-mail marketing and enact laws that prohibit unethical practices. "There were a lot of precedent-setting cases," he says. "With CyberPromotions, I thought, 'If it works in the real world, why not e-mail?' But it failed. I learned that on the Internet the rules change. You can't do things that people don't want."
America Online, the first to sue Wallace, has since filed over 40 suits against spammers, with 12 cases currently pending. While it might be less costly simply to close their accounts, AOL sues spammers in the hope that a hefty judgment will put them out of business. Causes of action can include copyright and trademark violations; trespassing; torts; violations of contracts; and violations of the Federal Computer Fraud and Abuse Act, which makes it illegal to use someone else's computer or network without their authorization. "Our aim is to impose the real costs of spamming on the spammer," says Randall Boe, associate general counsel at AOL.
The AOL suit against Sanford Wallace started, in fact, with a Sanford Wallace suit against AOL. After getting stuck with a batch of undeliverable mail, one day AOL sent it all back to him. "It freaked him out," says Boe. "So he sued us, claiming that we sent him an e-mail bomb that was undeliverable. We countersued, and then we were off to the races."
AOL claimed that Wallace was clogging its pipelines with undeliverable mail and annoying customers with unwanted messages. Wallace, like the spammer-defendants who followed, claimed he had a First Amendment right to send spam, and that it was a violation of antitrust laws for AOL to block him from sending spam.
After pursuing direct e-mailers for a while, AOL tried a different tack. While still targeting people with something to sell, AOL started going after the makers of spamware, the software used to extract e-mail addresses and gush out messages in bulk. The company is currently searching for the makers of Stealth E-mailer and Floodgate, software designed to evade an ISP's attempts to block out spam.
AOL successfully chased down Neil Bala, who sold two spamware products, FloodGate and GoldRush, using a pyramid scheme. Bala sold to people who in turn sold to others, and so on. "Now we're going after them all," says Boe. "We home in on a couple of candidates by monitoring e-mail traffic. And then we have a team of investigators to locate them physically. After that, we file the lawsuit and then serve them the legal complaint in person."
But finding spammers isn't always easy. A case in point: Vernon Hale operated Prime Data World Systems out of a mobile home in Kentucky. When he heard that AOL's legal department was after him, Boe says Hale simply drove off. But he kept calling AOL lawyers from the road, explaining that he was out of the
