California Litigation
APRIL 2002
Don’t Tread on Me – Spammers Beware
On March 4, 2002, the Los Angeles Times reported
that a new study showed that the number of people
who go on-line as a part of their work rose to about
55 million from 43 million two years ago. The study
also showed that as on-line use increases, 44% of
users report that unwanted e-mail, or spam, is a
growing problem. In California, businesses and
individuals are doing more than purchasing
expensive filtering software to stop the onslaught of
spam. They are suing the spammers.
On February 6, 2002, a California law firm filed a
lawsuit in San Francisco against Etracks.Com, Inc.
(Case No. 404294) alleging that Etracks illegally used
the firm’s computer networks to bombard its users
with over 6,500 unsolicited e-mail advertisements
during a five-month period of time. Etracks’ conduct,
according to the law firm, constituted a violation of,
among other things, California’s statutory law (B&P
Code, Section 17538.4) that prohibits the sending of
unsolicited advertising over the Internet except
where specific disclosures have been made and
conditions have been met. Despite the law firm’s
demand that Etracks cease sending e-mails, it
nevertheless continued. Relief sought includes an
injunction, statutory damages of $50 for each
unsolicited e-mail advertisement, and attorneys’ fees.
The law firm’s action, exemplifying what appears to
be a growing trend among businesses to fight back
against spamers, should find support in a recently
decided California appellate case that rejected a
constitutional challenge to the advertising
prohibitions in the statute. In Ferguson v.
Friendfinders, Inc. 2002 DJDAR 67 ( 1st Dist., January
2. 2002), the plaintiff sued two businesses that
allegedly sent him and others unsolicited e-mail
advertisements that did not comply with the
requirements set forth in Section 17538.4. Plaintiff
included causes of action for negligence, trespass,
unfair business practices, and unlawful advertising
practices. The defendants responded by demurring
and arguing, among other things, that validating
plaintiff’s claims would constitute an unconstitutional
interference with interstate commerce in violation of the
U.S. Constitution. The trial court sustained defendants’
demurrer with prejudice, ruling that Section 17538.4
unconstitutionally subjects interstate use of the Internet
to inconsistent regulations and therefore, violates the
Commerce Clause of the U.S. Constitution.
On appeal, the appellate court reversed and
reinstated all but plaintiff’s negligence claim. It held
that Section 17538.4 does not regulate the Internet.
Instead, the court stated, it is a carefully drafted
statute that “regulates e-mail users who send UCE
[unsolicited commercial e-mail] to California residents
via equipment located in California.” Moreover, it
held that “California has a substantial legitimate
interest in protecting its citizens from the harmful
effects of deceptive UCE and section 17538.4 furthers
that important interest.” Thus, both statutory and
common law causes of action existed to address any
damages suffered.
Kirkpatrick & Lockhart LLP
California will, no doubt, be one of the most fertile
battlegrounds in the nation in years to come for the
continuing Internet wars, including the battles being
waged between computer users and advertisers.
While the California legislature has attempted to lay
down some ground rules for unsolicited e-mail
advertisements, advances in technology and the
creativity of spammers guarantee that those rules will
only slow down, but not stop, the proliferation of
unwanted Internet advertising and lawsuits
challenging spammers’ activities.
PAUL W. SWEENEY, JR.
psweeney@kl.com
310.552.5055
If you would like to discuss any of these issues in greater detail, please
contact any one of the following K&L California Litigation Group lawyers:
Los Angeles
Robert Feyder
Michael Mallow
Tom Petrides
David Schack
Ron Stevens
Paul Sweeney
Fred Ufkes
310.552.5023
310.552.5038
310.552.5077
310.552.5061
310.552.5000
310.552.5055
310.552.5079
San Francisco Jon Cohen
Ed Sangster
Charles Thompson
rfeyder@kl.com
mmallow@kl.com
tpetrides@kl.com
dschack@kl.com
rstevens@kl.com
psweeney@kl.com
fufkes@kl.com
415.249.1001 jcohen@kl.com
415.249.1028 esangster@kl.com
415.249.1017 cthompson@kl.com
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should not be used or relied upon in regard to any particular facts or circumstances without first consulting with a lawyer.
© 2002 KIRKPATRICK & LOCKHART LLP. ALL RIGHTS RESERVED.